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INVESTOR PRESENTATION
September 2017
2
DISCLAIMER
INVESTOR PRESENTATION – SEPTEMBER 2017
This presentation does not constitute an offer to sell or the solicitation of an offer to buy any
securities, nor shall there be any offer or sale of these securities in any jurisdiction in which such
offer, solicitation or sale would be unlawful under the securities laws of any such jurisdiction.
The securities to be offered have not been registered under the U.S. Securities Act of 1933, as
amended (the “Securities Act”) and may not be offered or sold in the United States absent
registration or unless pursuant to an applicable exemption from the registration requirements of the
Securities Act and any other applicable securities laws. The securities will be offered outside the
United States pursuant to Regulation S under the Securities Act pursuant to an exemption from
registration. There is no assurance that the offering will be completed or, if completed, as to the
terms on which it is completed.
3
SUMMARY
ERAMET IN A NUTSHELL
FINANCIALS
PRIORITIES AHEAD
KEY INVESTMENT POINTS & TERM SHEET
1
3
5
4
INVESTOR PRESENTATION – SEPTEMBER 2017
FOCUS ON DIVISIONS 2
4
ERAMET IN A NUTSHELL
INVESTOR PRESENTATION – SEPTEMBER 2017
ERAMET AT A GLANCE
5
€2,984 m
€1,797 m sales
13%
22% EBITDA margin
€84 m
€256 m current operating income
13,000
employees in 2016
€217 m
€107 m of capital expenditure
47%
36% gearing
€1,493 m
market cap. at 04.09.2017
A diversified mining and metallurgical Group with world-class positions
o 3 business divisions with leading positions
Turnover since 2010 (in €m) Manganese Ore and Nickel metal prices evolution since 2010
Integrated NICKEL producer
Integrated MANGANESE producer
ALLOYS Producer of highly technological advanced steel
products for the most demanding industries
In 2016 / in H1 2017
INVESTOR PRESENTATION – SEPTEMBER 2017
3 576 3 603 3 447
3 162 3 144 3 109 2 984
1,373
1,797
2010 2011 2012 2013 2014 2015 2016 H1 2016 H1 2017
In 2016
2
4
6
8
10
12
2010 2011 2012 2013 2014 2015 2016 2017
US
D/lb
or
US
D/d
mtu
Ni price LME (USD/lb) Mn ore 44% (CRU CIF Chine)
6
ERAMET A LONG TERM PLAYER
Nickel Manganese Alloys Group
INVESTOR PRESENTATION – SEPTEMBER 2017
Incorporation Nickel
(operations of nickel
mines in New Caledonia)
Le Nickel becomes SLN, with Elf
Aquitaine (French State) holding
50% of the company
Acquisition by ERAP
(French State) of 70% of
SLN
Set up of ERAMET-
SLN
Listing of
ERAMET
Acquisition of Erasteel (High speed steel producer)
Acquisition of 51% of Eurotungstène (cobalt and
tungstene powder producer)
Diversification into manganese, with the
acquisition of 61% of COMILOG in Gabon
The Duval family becomes
shareholder of ERAMET, through the
contribution of Aubert & Duval
Transfer of ERAP stake to Cogema,
subsequently absorbed into AREVA
Acquisition of Weda Bay Nickel
(nickel project) in Indonesia
Diversification into closed-died forging
and specials steels, following contribution
by the Duval family and Aubert & Duval
(now ERAMET Alloys) to ERAMET
Acquisition of a 59% stake in Tinfos
(manganese alloys, titanium dioxyde)
Agreement with the Gabonese Republic for a phased increase of its
shareholding in COMILOG (up to 35%)
Set-up of TiZir in Senegal
(ilmenite and zircon project)
Transfer of
AREVA
26% to FSI
Inauguration of Moanda Metallurgical Complex.
Establishment of MKAD closed-die forged parts for aircraft parts manufacturers
Sha
reho
ldin
g st
ruct
ure
Div
ersi
ficat
ion
activ
ities
1880 1974 1983 1985 1989-91 1994 1995-97 1999 2006 2008 2010 2011 2012 2015 2016-17
Partnership
Weda Bay
Nickel
Inauguration of EcoTitanium, to establish the first
European facility for recycling aviation grade titanium
ERAMET IS PRESENT ON EVERY STAGE IN THE METALS
VALUE CHAIN…
7
R&D and engineering at each stage
Exploration
Extractive
Metallurgy
Elaboration
Metallurgy
EXPLORATION & MINING METAL VALORIZATION TRANSFORMATION
Mine
Products
INVESTOR PRESENTATION – SEPTEMBER 2017
Nickel – New Caledonia
Weda Bay
50+ years ressources / #7 largest
producer of nickel
Manganese - Gabon
40+ years resources / #2 high-grade Mn
ore worldwide
Zircon and Ilménite – Senegal
25+ years ressources
#1 High grade FeNi producer worldwide
#2 Manganese alloys producer worldwide
#1 refined manganese alloys
producer worldwide
#1 nickel chloride producer worldwide
#3 high grade nickel producer worldwide
#2 closed-die forging parts producer
worldwide & #1 gas-atomized powders
producer worldwide
RAW
MATERIAL
VALUE
CHAIN
5 world-class deposits
Lithium project
Titanium / producer
…WITH AN INTERNATIONAL FOOTPRINT
8
Senegal
Ilmenite and zircon mine
Gabon
Manganese mine
Manganese alloys and metal
plants
New-Caledonia
Nickel mines and
ferronickel plant
France / Europe
High speed steels and metals
powders
France / Europe/USA
Manganese alloys
Main operations:
France / Europe
Closed-die forging
Production of alloys & superalloys
INVESTOR PRESENTATION – SEPTEMBER 2017
11%
32%
21%
31%
5%
Sales FY 2016 (breakdown by geographic area)
France
Europe
North America
Asia
Other
Duval family: SORAME +
CEIR 37.00%
French State: APE1
25.62%
STCPI2
4.03%
BRGM3
1.34%
Others 32.01%
A COMMITTED EXECUTIVE MANAGEMENT AND A
SHAREHOLDING STRUCTURE ENSURING A LONG TERM
STRATEGY
1 APE (Agence des Participations de l’Etat)
2 STCPI (Société Territoriale Calédonienne de Participation Industrielle) : entity owned by the New Caledonian
provinces 3 BRGM (Bureau de Recherches Géologiques et Minières – the French Geological Survey Office)
Shareholding structure as of 30/06/2017
Outstanding shares: 26,585,360
Executive committee
Christel BORIES
Chairman and CEO
To be noted
Acquisition by Intesa, Unicredit and Ubi of Carlo Tassara’s participation (c. 12%)
in December 2016
Thomas DEVEDJIAN
Chief Financial Officer
Philippe VECTEN
CEO Mining Division
Denis HUGELMANN
CEO Alloys divisions
Philippe GUNDERMANN
Strategy and Financial
Communication
Jean de L’HERMITE
Chief Legal Officer
Michel CARNEC
HR, Health, Safety and
Security
Catherine TISSOT-COLLE
Communication and Sustainable
Development
INVESTOR PRESENTATION – SEPTEMBER 2017 9
10
Sustainable development is at the
heart of ERAMET strategy
• Protecting women and men by placing health and safety at the heart of
our issues.
• Designing processes that respect regulations and the environment.
• Developing ways of reducing environmental impacts, engaging in
biodiversity.
• Implement a "license to market" responsibility.
• Increase resource efficiency and promote recycling.
• Maintain a trusting relationship with stakeholders.
ERAMET implements this sustainable development policy in all Group activities with:
• An environmental charter.
• A biodiversity policy adopted in 2015.
• An ethical charter updated in 2015.
• A responsible purchasing charter.
• An energy policy.
CAPITALIZE ON THE SOLID FRAMEWORK SET UP IN
TERMS OF CSR
• Strengthening the Group’s ethics compliance
and CSR programs
• Ensuring Group compliance with new
French legislation (Sapin II law, Due
diligence)
• Implement the Responsible Procurement
and Purchasing Charter through new CSR
evaluation process with suppliers
2017 main focus
INVESTOR PRESENTATION – SEPTEMBER 2017
11
FOCUS ON DIVISIONS
INVESTOR PRESENTATION – SEPTEMBER 2017
12
OVERVIEW OF ERAMET DIVISIONS
ERAMET
ERAMET Manganese ERAMET Alloys
Act
ivit
y
Fully-integrated
producer: extraction,
transformation and
commercialisation
Products: Manganese ore
and Manganese alloys
Producer of highly
technological advanced
steel products
Products: Alloys,
Atomised powder
Extraction, transformation
and commercialisation
Products: Zircon and
Titanium (Ilmenite,
Rutile, leucoxene)
Sales: €1,439m
EBITDA: €358m
Employees: 4,962
Sales: €949m
EBITDA: €74m
Employees: 4,840
INVESTOR PRESENTATION – SEPTEMBER 2017
New metal project
Ongoing development of
the process of direct
extraction of lithium from
lithium deposits in
Argentina
Products: Lithium
carbonate
Key
Fig
ure
s
In 2016
Mineral sands* ERAMET Nickel
Fully-integrated
producer: extraction,
transformation and
commercialisation
Products: Ferronickel and
nickel salts and metal (as
of H1 2017)
Sales: €595m
EBITDA: (€24m)
Employees: 2,534
Sales: -
EBITDA: -
Employees: 41
*included in ERAMET Manganese
… AND ITS 5 WORLD CLASS DEPOSITS M
ang
anes
e
Leading high-grade
manganese producers
Gabon
New
Met
al
Pro
ject
RESSOURCES
• 40+ y resources
• In operation for more than 50 y
KEY ELEMENTS
Senegal
In house innovative process
(10 patents)
Resources available estimated at > 25 y
In operation since 2014
Argentina
Resources available estimated at > 50 y Lithium
Project
INVESTOR PRESENTATION – SEPTEMBER 2017
Min
eral
sa
nd
s
Mix geological deposit
(Titanium / Zircon)
positioned on growth end
use market
Nic
kel
New-Caledonia
World class mines in
terms of quality and size
of their resources
~ 50 y resources
In operation since the end of the 19th century
Indonesia
~ 50 y resources
Partnership with Tsingshan
Weda Bay
project
13
World #2 producer of high-grade manganese ore
World #2 producer of manganese alloys
World #1 producer of refined manganese alloys
INVESTOR PRESENTATION – SEPTEMBER 2017
Changer photos
ERAMET MANGANESE
14
15
ERAMET MANGANESE AT GLANCE
A mining and industrial facility in Gabon A manganese mine in Gabon, operated by COMILOG
Two local transformation units in Gabon, CIM for fines agglomeration and CMM for the production of high-
purity manganese and manganese alloys
Manganese main use: carbon steel 90% of world manganese is used for the production of carbon steel in the form of alloys, 10% in the chemical
industry (cells and batteries, agriculture, pigments, etc.)
48% of ERAMET turnover In 2016
4,803 employees In H1 2017
Production of manganese alloys 3 industrial sites in Norway, 1 in France and 1 in the USA for the production of high carbon and refined
manganese alloys
INVESTOR PRESENTATION – SEPTEMBER 2017
WHAT IS THE USE OF MANGANESE?
EXTRACTION
OF ORE IN
ORDER TO…
…TRANSFORM IN
ALLOYS OF
MANGANESE…
…TO SATISFY THE CARBON
STEEL DEMAND
1
3
2
Carbon steel
90%
Chemistry and other
application
10%
o In the production of steel, manganese occurs mainly as alloys: on average 6 to
7 kg of manganese are used to make one tonne of steel.
o Utilization as an alloying element improve properties of the steel: hardness,
abrasion resistance, elasticity and surface condition for rolling
o Key component in large range of industries (construction and automobile)
o Manganese is found in minerals and
needs to be transformed for exploitation
(metallurgical valorization)
o Mining operations are carried on open pits
o Manganese has no satisfactory
substitute in its major application in
metallurgy
o If not transformed as manganese alloys, the ore can be used in the form of chemical
derivatives targeting various customers in the chemical industry
Construction Automobile Machine Ship White goods
Agriculture (fertilizers) Ferrites (electronic circuits) Batteries Other varied applications (pigments, fine chemistry)
INVESTOR PRESENTATION – SEPTEMBER 2017 16
17
MARKET TRENDS
INVESTOR PRESENTATION – SEPTEMBER 2017
1 MANGANESE ORE
2
Main market for Manganese: CARBON STEEL
After a record low level in H1 2016, sharp rise in
prices seen in H2 2016 thanks to the recovery in
carbon steel production in China and the
tightening of production by manganese ore
producers.
Prices stable at high levels since early 2017.
Regarding Manganese alloys prices, from their
low point early in the year 2016, prices grew very
strongly and remain currently firm.
Demand for manganese largely depends on
changes in the global production of carbon steel.
Global carbon steel production in H1 2017 grew
by 4.5% compared with H1 2016 and 0.4%
compared with H2 2016.
Momentum continued to be very strong in China.
Worldwide
production
An
alys
is
Evolution of
Manganese ore
and alloys prices
Source: CRU Western Europe spot prices Exane BNP Paribas
In Mt
DECREASE OF CARBON STEEL INVENTORIES DUE TO
SUPPORTIVE DEMAND
0
2
4
6
8
10
400
600
800
1 000
1 200
1 400
1 600
1 800
2 000
High-carbon ferromanganese Silico-manganeseMedium-carbon ferromanganese Mn CRU CIF Chine 44%
US
D/d
mtu
EU
R/t
E
UR
/t
EU
R/t
18
PERSPECTIVES ON END USE MARKETS
INVESTOR PRESENTATION – SEPTEMBER 2017
1 EXPECTED DEMAND OF CRUDE STEEL: MODERATE GROWTH WITH A STEADY DEMAND
SUPPORTIVE DEMAND IN CHINA: IN TERMS OF END USE
Source: World Steel Association, ArcelorMittal
Forecast crude
steel demand in
China (in tonnes)
+2.1 % -0.8 %
+4.7 % +4.5 %
+1.2 %
+2.5 % +3.7 %
+2.0 %
+0.8 %
+0.4 %
+2.4 %
+0.0 %
Growth rate CAGR %
’10-17 ’17-27
Apparent demand for crude steel
In million metric ton
612 668 688 766 740 700 709 706 668 655
69 73 77 81 86 89 92 95 134 148
302 330 350
366 371 375 382 390 470 499 168 180 161
163 170 176 181 183 196 198
108 117 126
123 139 123 119 124 155 158
152 158 155
155 163 155 157 157 157 157
1 411 1 526 1 557
1 654 1 669 1 618 1 640 1 655 1 780 1 815
2010 2011 2012 2013 2014 2015 2016 2017 2025 2027
Other developed
North America
Europe
Emerging countries
India
China
// //
2
Total +2.3 % +0.9 %
19
ERAMET EXPERTISE ON MANGANESE: EXTRACTION AND
PREPARATION
INVESTOR PRESENTATION – SEPTEMBER 2017
The ore is mixed with coke in an electric
furnace. Ferromanganese or
silicomanganese is obtained, which is
used in ERAMET customers’ steel
production processes.
Manganese ore extraction 1
Transport by rail and sea 2
Processing (Alloys) 3
Shipment to chemistry players
3a
End-Application
The raw manganese ore comes from Moanda in Gabon.
After milling and washing, it is partially enriched and
agglomerated
The ore is transported by rail (the Transgabon railway), administered
by SETRAG, a subsidiary of COMILOG, to the port of Owendo near
Libreville, from where it is exported
End-Application
4a
Shipment to steelworkers
4
5
20
ERAMET MANGANESE KEY ELEMENTS
INVESTOR PRESENTATION – SEPTEMBER 2017
ERAMET PRODUCTION OF MANGANESE ALLOYS KEY FIGURES*
M€ H1 17 H1 16 2016 2015 2014
Sales 920 620 1,439 1,430 1,429
EBITDA 403 65 358 196 266
Current operating
Income 346 0 219 58 137
Industrial investment 36 44 104 164 199
MANGANESE ORE: POSITIONING AND CASH COST TOP TIER CUSTOMERS
(In thousands of tonnes)
ERAMET objective: 4 million tonnes manganese ore produced for 2017
ERAMET Manganese accounted for 10% of world production of Manganese in
2016
2016
cas
h-c
ost
po
siti
on
(o
re)
•2nd quartile
•3rd quartile
•1st quartile
•4th quartile
P
Australia
South-Africa
Source: ERAMET estimates
*Including TiZir
ERAMET has one of
the lowest cash
cost of the industry
33% 29% 20% 16% 10% 9% 11% 11% 9%
25% 25% 32% 36%
34% 31% 38%
38% 36%
42% 46% 48% 49%
56% 59% 51%
51% 55%
779 784 730 746
696 710 702
349 362
2010 2011 2012 2013 2014 2015 2016 H1 2016 H1 2017
High-carbonferromanganese
Standardsilicomanganese
Refined alloys
MINERAL SANDS
INVESTOR PRESENTATION – SEPTEMBER 2017
TiZir is included in ERAMET Manganese
21
AT A GLANCE
22
TiZir 50% ERAMET a 50/50 joint venture with the Australian Group, Mineral Deposits Limited, bringing together this leading downstream
metallurgical asset and an upstream source of ore.
Integrated operations maximising margin and minimising risk.
TiZir aims to become one of the world’s leading players in zircon and titaniferous raw materials.
Two main products: Zircon and Ilmenite Extraction of mineral sands (mineral raw materials which contain heavy minerals concentrated over time in an
alluvial or windy environment)
TiZir Senegal Production of heavy mineral concentrates of 614,000 tonnes in 2016
TiZir Norway Transformation of the extracted Ilmenite (metallurgical valorization) into Titanium slag which are
bought by pigments producers
INVESTOR PRESENTATION – SEPTEMBER 2017
894 employees In H1 2017
WHAT IS THE USE OF ZIRCON?
42%
15%
13%
18%
12% Ceramics
Foundry sands
Refactory
Chemistry
Other
1,1 Mt
in 2015 57%
12%
31% China
Western Europe
Rest of the World
1,1 Mt
in 2015
MINERALURGICAL
EXTRACTION AND
SEPARATION
DOWNSTREAM :
MICRONIZATION
OR CHEMISTRY
FINISHED PRODUCTS
1
3
2
Zirconia Zircon « flour grade »
Refractory and foundry Ceramic Zirconium metal and salts of
zirconium
Key figures
World production of zircon in 2015: 1.3 Mt
World consumption of zircon in 2015: 1.1 Mt.
Applications by final markets Consumption of zircon by regions
Main applications of zircon
• Ceramics, refractory products, foundry and chemistry (necessary in the composition of nuclear reactors)
• The zircon can also be converted to zirconia or reduced to zirconium. Zirconia can be used in microelectronics or jewelery.
INVESTOR PRESENTATION – SEPTEMBER 2017 23
WHAT IS THE USE OF TITANIUM DIOXIDE (TiO2)
UPSTREAM:
titanium ore
(Ilmenite,
leucoxene,
rutile)
MIDSTREAM:
Titanium slag
DOWNSTREAM: pigments and titanium metal
1
3
2
Key figures
World production of TiO2 in 2015: 6.99 Mt
Global consumption of TiO2 in 2015: 6.82 Mt
Applications by final markets Consumption of TiO2 by regions
Main applications of TiO2
• More than 90% of TiO2
feedstocks (in the form of titanium slag, ilmenite, leucoxene and rutile) are used for the manufacture of pigments for paints, paper and plastics
• About 5% of the production is used for the manufacture of titanium metal (aeronautics, ...)
Mineralurgical
extraction and
separation
Production of
slag and
synthetic rutile
(high purity
TiO2)
Pigment Titanium metal
34%
22%
20%
10%
14% China
North America
Western Europe
Asia - Pacific
Rest of the World
7 Mt
in 2015
91%
5% 4% Pigment
Ti metal
Other
7 Mt
in 2015
INVESTOR PRESENTATION – SEPTEMBER 2017 24
TRENDS FOR TiO2 FEEDSTOCK AND ZIRCON
25 INVESTOR PRESENTATION – SEPTEMBER 2017
1
2 ZIRCON
Particularly used for the ceramics market.
The low stock levels and higher demand in China allowed for
price increases which will be effective in H2 2017.
TiO2-Feedstocks (Ilmenite, Rutile, Leucoxene and Titanium
dioxide slag) is mainly used for pigments production.
Price recovery in the market (ilmenite notably), driven by high
demand for pigments.
Future supply will be influenced by the timing of investment
decisions for mine expansions or new supply to provide feed
for beneficiation facilities such as synthetic rutile.
Regional demand in 2020
Ti02-Feedstocks
Demand by feedstock product: 2011 –2021
Demand by end-use: 2011 –2021
INDUSTRY CHARACTERISTICS IMPROVING MARKET CONDITIONS INDUSTRY OUTLOOK
TRENDS ON ILMENITE AND ZIRCON: INDUSTRY
MARKET DYNAMICS
26 INVESTOR PRESENTATION – SEPTEMBER 2017
Demand and global GDP/urbanisation
strongly correlated
Opaque product pricing
Emergence of China in 2010
Influence of major producers’ strategies
Demand growth driven by improving
economic fundamentals
Limited inventories throughout supply
chain
Investment deferrals
Environmental pressure driving
rationalisation in China
Declining resource base
Pigment
• higher plant utilisation rates
• contract prices continue to increase
High-grade titanium feedstock
• restart of idled operations removing
excess capacity
• higher spot prices for rutile
Zircon
• supply limitations point to further
price recovery
World #1 Producer of High Grade Ferronickel
World #1 Producer of Nickel Chloride
One of the only three global producers of high purity Nickel
ERAMET NICKEL
INVESTOR PRESENTATION – SEPTEMBER 2017 27
ERAMET NICKEL AT A GLANCE
28
5 Mines and one pyrometallurgical plant in New Caledonia Exploitation of 5 of its own mines + 4 subcontracted mines, two ore-processing plants (washing plants) and
a pyrometallurgical plant in Doniambo, Noumea
SLN is certified ISO 14 001 and ISO 9 001 for the industrial site
Nickel main use: stainless steel Is mainly used to produce stainless steel (2/3 of the world production) with a strong development expected in the
medium term on the battery market (high purity nickel, nickel salts)
Weda Bay nickel project One of the world's largest undeveloped nickel deposits
Project to be developed in partnership with Tsingshan
20% of ERAMET turnover In 2016
Nickel refinery in France A refinery plant to produce nickel salts and high-purity nickel
2,353 employees In H1 2017
INVESTOR PRESENTATION – SEPTEMBER 2017
WHAT IS THE USE OF NICKEL?
29 INVESTOR PRESENTATION – SEPTEMBER 2017
EXTRACTION
OF ORE IN
ORDER TO…
…BE
TRANSFORMED IN
NICKEL ALLOYS…
…TO SATISFY MAINLY THE STAINLESS
MARKET DEMAND
1
3
2 o Allied to other elements, it can be used for different applications in growing
industry. Its rich and varied properties are chiefly in alloys, electroplating and
catalyst in organic synthesis
o Stainless market (main market): nickel combined with chromium makes it
corrosion-resistant and more ductile and malleable
o Nickel-based alloys: conception of superalloys for its mechanical
performances and to meet the most stringent requirements (for aerospace
and nuclear power for example)
o Strong development expected on the battery market
o Nickel belongs to the transition metals and is hard
and ductile
o They are two main types of nickel ore: sulphide ores
(nickel combined with several other metals ie cobalt,
silver etc.) or oxide ores (as in New Caledonia, to be
transformed as ferronickel)
Tran
spo
rt
Co
nst
ruct
ion
Hyg
ien
e an
d h
ealt
h
220 000
260 000
300 000
340 000
380 000
420 000
460 000
500 000
540 000
6 000
8 000
10 000
12 000
14 000
16 000
18 000
20 000
22 000
Jan-
14F
eb-1
4M
ar-1
4A
pr-1
4M
ay-1
4Ju
n-14
July
-14
Aug
-14
Sep
-14
Oct
-14
Nov
-14
Dec
-14
Jan-
15F
eb-1
5M
ar-1
5A
pr-1
5M
ay-1
5Ju
n-15
Jul-1
5A
ug-1
5S
ep-1
5O
ct-1
5N
ov-1
5D
ec-1
5Ja
n-16
Feb
-16
Mar
-16
Apr
-16
May
-16
Jun-
16Ju
l-16
Aug
-16
Sep
-16
Oct
-16
Nov
-16
Dec
-16
Jan-
17F
eb-1
7M
ar-1
7A
pr-1
7M
ay-1
7Ju
n-17
Jul-1
7A
ug-1
7S
ep-1
7
YTD 2017: (-16 kt)
59% 44% 50% 48% 48% 46%
41% 46% 50% 52% 52%
54%
33 207 35 336
37 786 41 372 41 209
44,925
0,00
5 000,00
10 000,00
15 000,00
20 000,00
25 000,00
30 000,00
35 000,00
40 000,00
45 000,00
2011 2012 2013 2014 2015 2016
MARKET TRENDS
30 INVESTOR PRESENTATION – SEPTEMBER 2017
1 NICKEL PRICES REMAINING AT LOW LEVEL
2017 total primary Ni demand expected to face a
robust growth, after a 8% increase in 2016, driven
by all segments: stainless steel, plating and
booming perspectives for batteries
2017 primary Ni supply expected to increase
the growth being fueled by Indonesian NPI ramp-up
(including Tsingshan operations)
Partially constrained by ore supply from Philippines
: -4% in H1 2017 (Government sanctions or bad
weather) and Indonesian allowed shipments
resuming only very slowly
All in all, the balance should result in a greater
deficit than 2016 (-54KT)
Visible stocks (LME and SHFE warehouses) still
stand at a high level. However producers and
distributors inventories are low and there is good
outlook in China, fueling the recent price increase.
44% 49% 48%
56% 51% 52%
Rest of
World
China
2 STRONG SUPPLY FOR STAINLESS STEEL DRIVEN BY CHINA
Worldwide
production (2/3 of the Nickel market) A
nal
ysis
Evolution of
nickel prices
Main market for Nickel: STAINLESS STEEL
kt +9.0%
USD
/lb /t
10.0
9.1
8.2
7.3
6.4
5.5
4.5
3.6
2.7
tonnes
+34%
Source: ISSF and ERAMET
0
30,000
60,000
90,000
120,000
150,000
180,000
210,000
240,000
270,000
300,000
330,000
360,000
390,000
420,000
450,000
480,000
510,000
540,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
20,000
22,000
Ja
n-1
4
Fe
b-1
4
Ma
r-1
4
Ap
r-1
4
Ma
y-1
4
Ju
n-1
4
Ju
ly-1
4
Au
g-1
4
Se
p-1
4
Oc
t-1
4
No
v-1
4
De
c-1
4
Ja
n-1
5
Fe
b-1
5
Ma
r-1
5
Ap
r-1
5
Ma
y-1
5
Ju
n-1
5
Ju
l-1
5
Au
g-1
5
Se
p-1
5
Oc
t-1
5
No
v-1
5
De
c-1
5
Ja
n-1
6
Fe
b-1
6
Ma
r-1
6
Ap
r-1
6
Ma
y-1
6
Ju
n-1
6
Ju
l-1
6
Au
g-1
6
Se
p-1
6
Oc
t-1
6
No
v-1
6
De
c-1
6
Ja
n-1
7
Fe
b-1
7
Ma
r-1
7
Ap
r-1
7
Ma
y-1
7
Ju
n-1
7
Ju
l-1
7
LME stocks SHFE stocks LME Nickel spot price (USD/t)Nickel inventories
(in tonnes)LME nickel stocks (in tonnes) SHFE nickel stocks (in tonnes) LME nickel settlement (USD/tonne)
PERSPECTIVES ON END USE MARKETS
31 INVESTOR PRESENTATION – SEPTEMBER 2017
1 OUTLOOK FOR PRIMARY NICKEL DEMAND
2 STAINLESS DEMAND INDEX
Stainless will remain the largest
application while automotive batteries
will be a major growth driver.
Roskill forecasts a primary nickel
demand CAGR of 4% to 2030, up from
3.1% if automotive batteries were not
included
In kt Ni
The good news for stainless is that
usage should continue to rise and
especially for steel the outlook is even
more robust
Source: Roskill, OEF, MBR’s Stainless Steels Market Tracker & MBR’s Steel Forecaster
ERAMET NICKEL EXPERTISE: A FULLY-INTEGRATED
PRODUCER
32 INVESTOR PRESENTATION – SEPTEMBER 2017
SLN25® ferronickel shots are
manufactured at the Doniambo smelter
in New Caledonia and considered as
products perfectly tailored to the
needs of our customers who produce
stainless steels.
Nickel ore extraction 1
Nickel ore transformation 2
Ferronickel 3
Nickel Matte 4
End-Application 6
9 mining centers in New Caledonia (of which 4 where
the extraction is partially subcontracted )
Important tonnages
High nickel content (2.45%-2.5%)
Important reserves
Ore storage and loading
At Doniambo (New Caledonia), the ore is unloaded
from three ships chartered all year by SLN to provide
the link to the mining centers
Variety of Applications
AOD converter
Electric Arc Furnace EAF
Oxygen converter
VOD equipment
Induction furnace
It then produce
Very high purity nickel metal
(99.99% Ni)
Very high purity nickel chloride
(NiCI2)
Very high purity nickel carbonate
(NiCO3)
The Sandouville plant (France)
applies a hydrometallurgy process to
transform the matte received from its
Finnish supplier and recovers the
nickel and cobalt it contains.
ERAMET NICKEL KEY ELEMENTS
33 INVESTOR PRESENTATION – SEPTEMBER 2017
ERAMET PRODUCTION OF NICKEL* (IN TONNES) KEY FIGURES
M€ H1 17 H1 16 2016 2015 2014
Sales 312 255 595 686 781
EBITDA (59) (36) (24) (156) 42
Current operating
Income (104) (89) (119) (261) (52)
Industrial investment 42 21 56 56 97
SLN CASH COST (USD/LB) TOP TIER CUSTOMERS
55,227
53,369
55,012
53,015
56,447
54,360 53,719
2016201520142013201220112010
*Ferronickel and matte
*Annual rate, based on economic conditions at the start of 2016
2015
6.0
-25%
end-2020 end-2017
4.5
mid-2017 2016
5.06
4.0
2018-2020 5.17
SLN PERFORMANCE AND PRODUCTIVITY PLAN – CASH-COST
TARGET: USD 4/lb END 2020*
INVESTOR PRESENTATION – SEPTEMBER 2017
Grade optimization
Lean in mining operations
Export of low-grade ore
Stoppage of Bessemer melting shop
Technical productivity through measures to increase
work time and overhaul organizations
Maintenance / reliability
Slag valorization
Productivity in support functions
Purchasing gains
Others
USD 4/lb end-2020*
USD 6/lb in 2015
*Annual rate, based on economic conditions at the start of 2016
USD 4.5/lb in end-2017
Raise the company’s productivity through measures to
increase work time and overhaul organizations.
Reduce SLN’s energy bill through measures on energy
efficiency and the revision of electricity prices
To be noted that on top of those measures, a new power
plant will be built in New Caledonia, benefitting from the
French State guarantee on the banking financing (up to
€320m)
Lean Supports
Plant projects
Mining projects
Strenghtening
plan
MINING PROJECTS
PLANT PROJECTS
LEAN SUPPORTS
STRENGHTENING PLAN
34
FOCUS ON ERAMET NICKEL PRODUCTION: TOWARDS A
DIVERSIFIED NICKEL PORTFOLIO
35 INVESTOR PRESENTATION – SEPTEMBER 2017
1 Weda Bay
2 Sandouville
o VERY COMPETITIVE INDUSTRIAL NEW SET
UP
o 43% HELD BY ERAMET
o 30,000kt OF NICKEL (of which 13,000kt for
ERAMET)
o First commercial transactions in 2020
55,000
tonnes
2016
2020
88,000
tonnes
Nickel Pig Iron
Nickel Haute pureté
Ferronickel
2
1
o Main markets: electronic markets and batteries
o LONG TERM AGREEMENT CONCLUDED for the
supply of Sandouville with external nickel matte as
of H2 2017
o Start of the new process in 2017. Ramping-up over
the next months
o 15,000kt OF HIGH PURITY NICKEL
The group is
adapting its mix
production to
meet the final
demand
TSINGSHAN: A PRIVATE UNLISTED COMPANY, BASED IN CHINA AND INDONESIA
Leading global producer of stainless steel since 2014
Stainless steel production capacity of approximately 6.5 million tonnes, including 1
million tonnes in Sulawesi, Indonesia
USD 13 billion in sales in 2015
o THE WORLD LARGEST DEPOSIT NOT YET IN OPERATION accounting for
more than 9mt of Ni content
o AGREEMENT (integrated partnership) WITH TSIGNSHAN IN JUNE 2017
World #2 producer of high-power closed-die forged parts for aeronautics and energy generation
World #1 player in gas-atomised powder metallurgy
A leading producer of high-performance special steels
ERAMET ALLOYS
INVESTOR PRESENTATION – SEPTEMBER 2017 36
37
ERAMET ALLOYS AT A GLANCE
A primarly European presence Stamped parts and long products: 7 Aubert & Duval plants in France
High-speed steels and recycling: 2 Erasteel plants in France, 3 in Sweden, 1 in China, 1 in the USA, 1 in the UK
Forging and forging: a partnership in India SQUAD
Unique know-hows Recognized skills in R&D and development of complex processes or products (in the field of alloys, super alloys
and titanium alloys...) for strategic industries (specifically aerospace)
A Titanium industry developed in partnership Titanium Recycling: EcoTitanium partnership
Titanium transformation: UKAD partnership
Machining of titanium parts: MKAD partnership
32% of ERAMET turnover In 2016
4,823 employees In H1 2017
INVESTOR PRESENTATION – SEPTEMBER 2017
Main market: aerospace
In house design & production
USE AND PRODUCTION ROUTES OF ERAMET ALLOYS
PRODUCTS
ALLOYS
PRODUCTION…
…TRANSFORMATION…
…FOR STRATEGIC INDUSTRIES SPECIALLY
AERONAUTICS
1
3
2
o Metallic alloys made by combining metallic elements, in order to generate special usage properties such as strength,
heat resistance, resistance to corrosion, fatigue, hardness…
o ERAMET Alloys is covering the all spectrum of metallurgical solutions:
o ERAMET has strong know how in alloys transformation to meet the most demanding challenges:
INVESTOR PRESENTATION – SEPTEMBER 2017
Superalloys High performance
special steels High speed steel
Recycling
aerospace
titanium
Closed die forging Forging Rolling
Titanium,
aluminium alloys
outsourced
Machining
Aeronautical structure: bringing resistance to
crucial points Energy: a recognized performance
38
39
MARKET TRENDS
INVESTOR PRESENTATION – SEPTEMBER 2017
Main market for alloys: AEROSPACE SECTOR
The aerospace sector continues to enjoy steady
growth and is the leading contributor to ERAMET
Alloys.
Products rates for single aisle, both at Boeing and
Airbus are very high (high production output), and
globally order book is full at least for the 5 coming
years at OEMs.
The demand in aircraft is driven by world traffic
growth, aircraft deliveris growth, demand from
emerging countries and fleet renewal.
Demand in the
sector
An
alys
is
Perspectives in
the sector
Design
40
ERAMET ALLOYS EXPERTISE: DESIGN AND DEVELOPMENT
OF HIGH-PERFORMANCE STEELS
1 Raw material sourcing
Melting Transformation
Heat treatment Finishing, machining
Non-destructive testing
End-Application
2
3 4
5 6
7
8
Based on the customers’ order,
the production range will be
designed in collaboration with the
various production departments
The raw materials consist of iron,
scraps and off-cuts which are
carefully selected and analyzed
chemically as well as ferro-alloys
Two stages can be distinguished:
primary metallurgy, which consists in
melting the material and secondary
metallurgy, during which the metal is
refined. The metal is then poured into
ingots.
The ingots or capsules produced are
then heated and processed to obtain
semi-finished products, forged parts,
closed-die parts, bars or wires.
The product’s metallurgical structure
is changed by combined heating and
cooling, which makes it possible to
modify its mechanical properties.
Samples are taken for mechanical
testing to ensure that the customer’s
requirements in terms of elasticity,
hardness and tensile strength are met.
The final peeling or milling stages
produce different finishes.
These controls (ultrasonic, magnetic, etc.) ensure the quality of products by revealing
the existence of any type defect that might occur within the material or on its surface.
INVESTOR PRESENTATION – SEPTEMBER 2017
41
ERAMET ALLOYS KEY ELEMENTS
KEY FACTS KEY FIGURES
M€ H1 17 H1 16 2016 2015 2014
Sales 564 497 949 991 938
EBITDA 61 40 74 78 81
Current operating
Income 32 13 27 27 23
Industrial investment 27 19 55 44 48
INVESTOR PRESENTATION – SEPTEMBER 2017
POSITIONING TOP TIER CUSTOMERS
Aubert & Duval well positioned in high power close die forged parts.
Example: engine disks for the A350 and B777 models, landing gear
for the A350 model, wing structuring parts for Airbus…
Aubert & Duval’s teams were rewarded at the salon du Bourget (the
Paris air show), with the "Best Performer Supplier Award", handed
out by Airbus Helicopters (Paris, June 2017).
Opening of MKAD, a joint venture between Aubert &
Duval and Mecachrome, on 14 October 2014 o Aerospace grade titanium machining parts
Launch in early 2017 of spent catalysts and batteries
facilities at Commentry (France) o New commercial segment, which will gradually ramp up over
the coming months but which is expected to weight on
Erasteel’s results for the H2
Launch of EcoTitanium on 3 February o First European producer of aerospace grade titanium using
recycled material
Launch of Galaad on 11 May 2017 o New atomising tower in Ancizes (France) which will produce
powders from superalloys directed at the aerospace sector
and the additive manufacturing segment
NEW METAL PROJECT
INVESTOR PRESENTATION – SEPTEMBER 2017 42
PERSPECTIVES ON LITHIUM END USE MARKETS
Source: Avicenne Energy Report (December 2015); Deutsche Bank, BCG CMI lithium model
INVESTOR PRESENTATION – SEPTEMBER 2017
Demand across all lithium applications is
expected to remain strong, growing at a
CAGR between 8 to 12 % over the period
2015-25
Lithium-ion batteries, ERAMET key target
market, represent the key segment of
demand underpinned by the growing
importance of electric vehicles
Expected CAGR between 11-20% over 2015-
2025, vs. average 4% across other
applications.
0
150
300
450
600
BCG (2016)
57%
+12 % pa
Avicenne
(2015)
102
48%
183
52%
43%
Deutsche
Bank
(2016)
Others
Batteries
+8 to +12% pa
22%
78%
Kt LCE
60%
40%
69%
31%
2010 A 2015 A 2025 E
Lithium demand
43
NEW METAL PROJECT WHICH PREPARES ERAMET FUTURE
INVESTOR PRESENTATION – SEPTEMBER 2017
ERAMET LITHIUM PROJECT IN ARGENTINA ENTERS ITS LAST PHASE OF DEVELOPMENT BEFORE AN INVESTMENT DECISION
Extremely dynamic lithium
market in 2016. Bright
perspectives
Success in piloting the
innovative patented
extraction process : few
hundreds kg of lithium
carbonate battery grade
produced in 2016
Pre-feasibility study
performed
Investment of 350-380
MUSD
Environmental permitting
demand filed in December
2016
2017- 2018 : Detailed feasibility study and
economical valuation
Start of construction scheduled early 2019
subject to investment decision
Start of production end of 2021
Production capacity : 20 ktpy lithium carbonate.
Active continuation of CSR programs
Key Lithium Applications
Note: The chart above is not intended as an exhaustive list of lithium products and their applications, but depicts a select number of lithium applications. *Brines : lithium from salt flat deposits – Spodumene : lithium from hard rock deposits
Li-Ion Batteries –
Portable Devices Glass & Ceramics Grease Pharmaceuticals Aluminium-alloys
ERAMET Target Applications
Li-Ion Batteries –
Electric Vehicles
ERAMET secured mining rights over a very vast 500 km² domain with ressources >7MT LCE
(50 years+ of operations)
0
1 000
2 000
3 000
4 000
5 000
6 000
US$/t LCE
Cumulative Industry LCE Production (kt)
ERAMET process
competitiveness target
(LCE produced from brines*)
LCE produced from
spodumene*
Spodumene
producers
Spodumene
conversion
cost
(US$2800/t)
44
FINANCIALS
INVESTOR PRESENTATION – SEPTEMBER 2017 45
39%
54%
48% 52% 48% 45% 49% 45% 46% 48%
45% 51%
34%
21%
24%
27% 27% 26% 22% 25% 22% 20%
19% 17%
27%
25%
28%
21% 25% 29%
29% 30% 32% 32%
36%
31%
3 792
4 346
2 689
3 576 3 603 3 447 3 162 3 144 3 109 2 984
1 373
1,797
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 H12016
H12017Manganèse Nickel Alloys
FREE CASH FLOW EBITDA MARGIN
FINANCIAL PERFORMANCES
INVESTOR PRESENTATION – SEPTEMBER 2017
CURRENT OPERATING INCOME SALES
-200
-100
0
100
200
300
400
H1
2013
H2
2013
H1
2014
H2
2014
H1
2015
H2
2015
H1
2016
H2
2016
H1
2017
Nickel Alloys Manganese GroupIn €m
84 170
142
-240
-50
-292
226 172
H1 2015 H2 2015 H1 2016 H2 2016 H1 2017
Of which asset disposals
2
36% 35%
2%
27%
22%
12% 7%
12% 3%
13%
4%
22%
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 H12016
H12017
17% in average
since 2007
Breakdown by divisions excluding holding and eliminations
In €m
In €m
46
INVESTOR PRESENTATION – SEPTEMBER 2017
ACTION PLAN PERFORMED IN THE LAST 3 YEARS TO
GENERATE FCF AND REINFORCE THE BALANCE SHEET
Industrial action plan to increase productivity and performances:
€306m on aggregate savings since 2014 on annual basis
Disposal of assets for a total impact of €144m
Maturity extension of the c.€1bn revolving credit facility in January 2017
€200m French State loan agreement in July 2016 with a final maturity in June 2024 (bullet)
Issue of €100m perpetual convertible bond in September 2016 (net share setteled undated bonds convertible into new shares ie ODIRNAN)
REINFORCE THE
EQUITY
INCREASE
PRODUCTIVITY
PERFORMANCES
ASSET
DISPOSALS INCREASE
LIQUIDITY
Generate Free
Cash Flow
Reinforce the
balance sheet
47
411 716 675
988 501
136
162 161
175
163
2 754
1 779 1 776 1 669 1 837
547
878 836
1 163
664
2014 2015 2016 H1 2016 H1 2017
IFRS Net Debt Joint-venture contribution Equity
DEBT ANALYSIS (1/2)
INVESTOR PRESENTATION – SEPTEMBER 2017
CHANGE IN NET DEBT STRONG BALANCE SHEET
RECONCILIATION OF NET DEBT
0
500 500
230 30
30 1 698
1 416 1 186
1 698
1 946 1 946
2016 H1 2016 H1 2017
RCF not drawn Part of the RCF repaid on 25/07/2017Credit lines not drawn Available Cash
RCF repayment
for €500m at end-
June 2017
Additional
repayment for
€230m in July
2017
1
2
SIGNIFICANT FINANCIAL LIQUIDITY
In €m H1 2017 H1 2016 2016
Gross IFRS debt 1,910 2,265 2,366
Available IFRS cash (1,409) (1,277) (1,691)
IFRS Net debt 501 988 675
Joint Venture gross debt 170 179 168
Joint Venture available cash (7) (4) (7)
Net debt 664 1,163 836 Undrawn Undrawn
In €m
In €m
-664
-836
-10794 (107)
185
(836)
(664)
Net debt at
end of H1 2017
Industrial
investments
Change in
operating WCR
Cash gener.
from op.
Net debt at
end of 2016
In €m
H1 2017 H1 2017 proforma H2 2016
Equity* *including minority interests
48
Desintermediated debt 45%
Banking debt 38%
Bank overdrafts 3%
Finance leases 3%
Other borrowings 11%
-31%
-30% -27% -33% -28%
-12%
7%
20%
49%
47%
70%
36%
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 H1 2016 H1 2017
DEBT ANALYSIS (2/2)
INVESTOR PRESENTATION – SEPTEMBER 2017
KEY DEBT ELEMENTS
GEARING TYPE OF GROSS DEBT (AS OF 30/06/2017)
€730m RCF repayment out of €981m as of end
of June 2017 (pro forma)
In July 2017, TiZir (an ERAMET 50% owned
company) issued a new $300m bond (maturing
in July 2022) which will mainly refinance the
previous one scheduled to mature in
September 2017.
The reduction in debt is the result of (i) priority
given by the company to cash generation and
(ii) markets improvement.
ERAMET gearing is in line with the sector
average
GROSS DEBT SCHEDULE AS AT 30/06/2017 (IN €M)
199
2017 2018 2019 2020 2022 2021 2023 2024 >2025
260
118 160
147 125 163
13 40
835
29 22
Manganese
Nickel
RCF Alloys
Holding - Group
€1,861m
Pro forma maturity schedule as at 30/06/2017, including RCF repayment and TiZir’s Bond
refinancing
Gross debt pro forma (ie gross
IFRS debt and Joint Venture
gross debt)
Net cash position from 2007 to 2012
49
PRIORITIES AHEAD
INVESTOR PRESENTATION – SEPTEMBER 2017 50
STRATEGIC PRIORITIES - UNDER REVIEW
INVESTOR PRESENTATION – SEPTEMBER 2017
FIX UNDERPERFORMING
BUSINESSES
ERAMET AIMS FOR MANAGERIAL AND OPERATIONAL EXCELLENCE AT ALL LEVELS OF ITS ORGANIZATION
REINFORCE ASSETS WITH
GLOBAL LEADERSHIP
3
1
Lithium
Weda Bay
Manganese
Aubert & Duval downstream
DIVERSIFY THE PORTFOLIO
THROUGH GROWTH ON
SELECTED HIGH VALUE
PROJECTS
2
COMMITMENT TO COST
REDUCTION AND
IMPROVED
PRODUCTIVITY
ERAMET MEANS TRANSFORM ERAMET IN
A HIGH PERFORMING
ORGANIZATION
LEVERAGE ON ERAMET
STRONG KNOW HOW
SLN
Erasteel
Other projects
Aubert & Duval
upstream
51
o PRODUCTIVITY AND ENERGY EFFICIENCY o Raise the company’s productivity through measures to increase work time and overhaul organizations.
o Reduce SLN’s energy bill through measures on energy efficiency and the revision of electricity prices.
o RAMP-UP ON SANDOUVILLE NEW MODEL o Successful ramp-up due to the change in matte sourcing.
o Selling nickel metal in whole plates rather than in pieces (better margins).
o ACTIONS FOCUSED ON INDUSTRIAL SET UP AND CUSTOMER RELATIONSHIP o Reconfiguration of the steel melting shops: centralization of the 2 existing steel meltings’ activity on a single one located in Les Ancizes,
closure of the Firminy steel melting shop.
o Maximize capacity utilisation through better availability of the equipment and productivity improvement
o Reduce waste.
o Specialization and optimization of rolling mills: concentration of large diameter rolled products on one site and small diameter rolled products
on another one. Closure of the other rolling mills.
o Improve the customer experience: improve service and business performance.
o ACTION ON COMILOG o Increase of the availability and utilization rates of mining equipments (trucks, shovels) through improved maintenance.
o Increase in the operating rate of the ore processing plant by optimizing operating parameters.
o Renovation plan of the Transgabonese railway (SETRAG).
o OPTIMIZATION OF PRODUCTION PARAMETERS o These optimizations allow half year after half year to increase ERAMET production, as already demonstrated.
INVESTOR PRESENTATION – SEPTEMBER 2017
REDUCE COSTS AND INCREASE PRODUCTIVITY
o REACH FULL CAPACITY AND OPTIMIZE THE ASSET
52
LEVERAGE ERAMET STRONG KNOW-HOW
220 employees
30 M€ spent in 2016
150 products
o R&D activity across the entire metals value chain, from mining to products including recycling
o Specific know-how, often produced by the group R&D with solid social and environmental criteria
o Leverage network through open innovation
Adapting the Sandouville’s plant to a
new source of nickel matte Lithium project in Argentina
Development of the new Aubert & Duval ML340
superalloy. This new ultra high-performance steel
will form the turbine shaft for the LEAP and
Silvercrest aircraft engines.
Support a production increase
at the Mn alloys plants
AN EFFICIENT SET UP FOR A HIGH LEVEL APPLIED
RESEARCH
AP
PL
ICA
TIO
N E
XE
MP
LE
S
10 patents on a very
original and innovative
process.
Reduction by 15% of fuel
consumption thanks to this
alloy.
New business model for
the Sandouville refinery.
Best performance of
the Mn alloys plant
worldwide.
INVESTOR PRESENTATION – SEPTEMBER 2017 53
TRANSFORMING ERAMET IN A HIGH PERFORMING
ORGANIZATION
o New industrial facilities will come on stream and be ramped up (ex: Ecotitanium, the last
link in the European aerospace-grade titanium sector)
o Reconfiguration of Sandouville to handle a new commodity
o Roll-out of the Transgabonais railway modernisation plan (SETRAG)
o Start of the detailed engineering design stage for the Lithium project (deposit in Argentina)
INVESTOR PRESENTATION – SEPTEMBER 2017
o Review the managerial model: build leaner organization
o Right people at the right places
o Leverage best practices
o Promote agility and accelerate decision making
o Reinforce discipline and execution
o Create a continuous improvement mindset
Focus on investments selected
on the criteria of value
creation
Managerial
transformation
54
KEY INVESTMENT
POINTS & TERM SHEET
INVESTOR PRESENTATION – SEPTEMBER 2017 55
KEY INVESTMENT POINTS
SOLID POSITIONS IN ITS BUSINESS
• Significant value in its assets with world class orebodies
(high grade ore and significant resources), having long term
expected lives
• World leading positions in almost all its business segments
• An experienced specialist with a high knowledge of all its
businesses
• High reputation with customers
A STABLE SHAREHOLDING STRUCTURE FOR A LONG TERM ACTOR
• A stable shareholder structure,
ensuring a long term strategy
• A committed management team
• Stable relationships with partners,
clients and countries where ERAMET
is operating
A BALANCE SHEET THAT SHOWED ITS ROBUSTNESS THOUGH THE CYCLES
• Action plan to reduce cost and improve productivity at the
level of each business unit
• Develop ERAMET agility through value added partnership
and/or investments
• Continue to benefit from R&D projects focused on a
practical use of innovations
• Capitalize on ERAMET historical CSR framework
• A successful de-risking strategy on the balance sheet
• Improved results in 2016 and H1 2017
• A resilient EBITDA margin (17% in average since 2007)
ONGOING ACTION PLAN TO GAIN COMPETITIVE EDGE
INVESTOR PRESENTATION – SEPTEMBER 2017 56
TERM SHEET
INVESTOR PRESENTATION – SEPTEMBER 2017
Issuer ERAMET
Rating Unrated
Notional Amount EUR 300m+
Issue Type Fixed
Status of the Notes Senior, Unsecured, Unsubordinated
Form of the Notes Bearer dematerialized
Maturity 6 – 7 years
Documentation Standalone / Change of Control / Make Whole Call / 3 month par call / Clean-Up Call (80%)
Governing Law French
Listing Euronext Paris
Denominations €100,000 + €100,000
Use of Proceeds General Corporate Purpose and refinancing of its existing debt
Targeted bonds EUR 525m 4.500% due November 2020
Tender price 106.125%
Offer period 11 September – 20 September 4pm CET (intermediaries may have earlier deadlines)
Prioritary allocation Tendering bondholders must contact the dealer managers to request an allocation code to
receive priority allocation in the new issue
57
APPENDIX
INVESTOR PRESENTATION – SEPTEMBER 2017 58
INCOME STATEMENT
59
In €m H1 2017 H1 2016 2016 2015 2014 2013 2012 2011
Sales 1,797 1,373 2,984 3,109 3,144 3,162 3,447 3,603
EBITDA 389 56 375 92 363 231 407 789
% of Sales 22% 4% 13% 3% 12% 7% 12% 22%
Amortisation and depreciation of fixed assets
and provisions for contingencies and losses (133) (147) (291) (299) (288) (276) (254) (235)
Current operating Income 256 (91) 84 (207) 75 (45) 153 554
% of Sales 14% (7%) 3% (7%) 2% (1%) 4% 15%
Other operating income and expenses (28) (55) (179) (606) (129) (503) (74) (63)
Operating Income 228 (146) (95) (813) (54) (548) 79 491
Financial income (52) (53) (79) (90) (68) (32) (7) 30
Pre-tax Income 68 (199) (174) (903) (122) (580) 72 521
Share of income of equity affiliates (1) - (2) (1) 0 1 0 1
Income tax (107) - (61) (8) (49) 72 (29) (219)
Net income 68 (199) (237) (912) (171) (507) 43 303
Minority interest (13) (58) (58) (198) 12 (137) 34 108
Net income – Group share 81 (141) (179) (714) (159) (370) 9 195
INVESTOR PRESENTATION – SEPTEMBER 2017
CASH FLOW STATEMENT
60
In €m H1 2017 H1 2016 2016 2015 2014 2013 2012 2011
Operating activities
EBITDA 389 56 375 92 363 231 407 789
Cash impact of items under EBITDA (204) (95) (228) (252) (238) (157) (149) (155)
Cash generated from operations 185 (39) 147 (160) 125 74 258 634
Change in WCR 94 (59) (26) 153 (82) 87 (41) (43)
Net cash generated by operating activities (1) 279 (98) 121 (7) 43 161 217 591
Investing activities
Industrial investments (107) (85) (217) (267) (346) (587) (641) (492)
Other investment flows - (109) 30 (16) 26 (7) 5 (33)
Net cash from investing activities (2) (107) (194) (187) (283) (320) (594) (636) (525)
Free Cash Flow (1) + (2) 172 (292) (66) (290) (277) (433) (419) 66
Cash linked to equity operations (3) - 100 - (25) (252) (285) (187)
Impact of changes on exchange rates 3 7 8 (41) (27) 19 (1) (21)
(Increase)/Reduction in net financial debt position 172 (285) 42 (331) (329) (666) (705) (142)
(Net financial debt) at beginning of period (836) (878) (878) (547) (218) 448 1153 1295
(Net financial debt) at closing of period (664) (1,163) (836) (878) (547) (218) 448 1153
INVESTOR PRESENTATION – SEPTEMBER 2017
GROUP BALANCE SHEET
61
Assets - €M Liabilities - €M
836 664
882858
261250
720 634
2.745
31/12/2016
2.818
3.538
1.515
30/06/2017
3.379
44
30/06/2017
3.379
20
1.587
31/12/2016
3.538
Fixed assets Provisions and net deferred tax Net debt
Minority interests
Equity
Financial instruments WCR
INVESTOR PRESENTATION – SEPTEMBER 2017
RECONCILIATION OF GROUP REPORTING AND PUBLISHED
ACCOUNTS
62
(1) Financial statements prepared under applicable IFRS, with joint ventures are accounted for using equity method
(2) Group reporting, in which joint ventures are accounted for using proportionate consolidation.
(€ million) 1st half year Joint-venture 1st half year 1st half year Joint-venture 1st half year FY Joint-venture FY
2017 contribution 2017 2016 contribution 2016 2016 contribution 2016
Published (1)
Reporting (2)
Published (1)
Reporting (2)
Published (1)
Reporting (2)
Sales 1 741 56 1 797 1 329 44 1 373 2 897 87 2 984
EBITDA 375 14 389 54 2 56 366 9 375
Current operating income 250 6 256 (85) (6) (91) 91 (7) 84
Operating income 222 6 228 (139) (7) (146) (47) (48) (95)
Net income for the period - Group share 81 - 81 (141) - (141) (179) - (179)
Net cash generated by operating activities 292 (13) 279 (96) (2) (98) 98 23 121
Industrial investments 105 2 107 79 6 85 206 11 217
(Net financial debt) (501) (163) (664) (988) (175) (1 163) (675) (161) (836)
Shareholders' equity 1 851 (14) 1 837 1 679 (10) 1 669 1 791 (15) 1 776
Shareholders' equity - Group share 1 587 - 1 587 1 408 - 1 408 1 515 - 1 515
INVESTOR PRESENTATION – SEPTEMBER 2017
ERAMET ORGANIZATION
63 INVESTOR PRESENTATION – SEPTEMBER 2017
MANGANÈSE
Mineral Deposits Ltd
SETRAG Transgabon railway (99.98%)
Mine (Maonda) &
Metallurgy complex
COMOLOG Dunkerque (France)
ERAMET
Manganese
10 sites
COMLOG COMILOG
Asia Ltd
ERAMET
Norway
ERAMET
Marietta TiZir
3 sites
Manganese Alloys
(Norway)
Manganese Alloys
(USA)
3 sites 1 site 2 sites
(100%) (100%) (50%)
(50%)
(80%)
(20%)
Gabonese
State (28.94%)
Others (7.35%)
(63.71%)
(100%)
NICKEL
(90%)
1 site
SLN
ERAMET
Nickel
PT Weda Bay Nickel
5 mines
1 metallurgical plant
(56%)
(100%) New-Caledonia
Nisshin Steel 10% STCPI 34% French State 1 share
Ferronickel
Sandouville Refinery
(100%)
Le Havre (France)
NICKEL SALTS &
METAL BUSINESS UNIT
Strand Minerals Pte Ltd
(Singapour)
Mine and
hydrometallurgical
plant (project)
Halmahera (Indonesia)
PT Antam
ERAMET
Alloys
Albert & Duval
7 sites Erasteel
8 sites
Interforge (France)
94%
UKAD (France)
(50%)
Titanium alloys
Aluminium alloys Special steels
Superalloys
Erasteel HEIML
(China) (49%)
Pre-alloyed powder metallurgy
(100%) (100%)
ALLOYS ERAMET
ERAMET
group
Eramet Engineering (100%)
Eramet Research (100%)
Eramet International(100%)
ERAMET
Alloys ERAMET
Manganese ERAMET
Nichel
Mineral sands (90%
TiZir) (Senegal)
TiZir Titan & Iron
(Norway)