#1IFGL Refractories Limited An Indian Multinational Investor Presentation May 2015 DEDICATED TO CLEAN METAL#2Safe Harbor IFGL This presentation and the accompanying slides (the "Presentation"), has been prepared by IFGL Refractories Limited (the "Company"), solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securities, and shall not form the basis or be relied on in connection with any contract or binding commitment whatsoever. This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Company makes no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth, accuracy, completeness, fairness and reasonableness of the contents of this Presentation. This Presentation may not be all inclusive and may not contain all of the information that you may consider material. Any liability in respect of the contents of, or any omission from, this Presentation is expressly excluded. Certain matters discussed in this Presentation may contain statements regarding the Company's market opportunity and business prospects that are individually and collectively forward-looking statements. Such forward-looking statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and assumptions that are difficult to predict. These risks and uncertainties include, but are not limited to, the performance of the Indian economy and of the economies of various international markets, the performance of the refractories industry in India and world-wide, competition, the company's ability to successfully implement its strategy, the Company's future levels of growth and expansion, technological implementation, changes and advancements, changes in revenue, income or cash flows, the Company's market preferences and its exposure to market risks, as well as other risks. The Company's actual results, levels of activity, performance or achievements could differ materially and adversely from results expressed in or implied by this Presentation. The Company assumes no obligation to update any forward-looking information contained in this Presentation. 2#3An Overview#4IFGL Group - An Introduction XXXXX IFGL 3 decades of experience A global producer of Specialised Refractories for Iron and Steel Industry Presence in over half of the Global Steel markets 50+ Countries: Distribution and Services Network Consistent Track record for Growth & Profitability 4#5IFGL Experienced Management Mr. S.K. Bajoria Chairman Mr. P. Bajoria Managing Director Mr. Gian Carlo Cozzani Director, Monocon Mr. Giorgio Cappelli Director, Monocon Promoter of S K Bajoria Group based at Kolkata engaged in diversified business activities Has been President of the Indian Chamber of Commerce, Director of West Bengal Industrial Development Corporation Ltd and Industrial Promotion & Investment Corporation of Orissa Ltd Associated with IFGL from the very early days of Indo Flogates, even before the start of production in 1984. Has been Director & Chief Executive of erstwhile Indo Flogates Ltd. More than 30 years of experience of Refractory Industry and has been involved in various capacities in Indian Refractories Makers Association Associated with IFGL since Oct, 2009 Former President and CEO of Vesuvius (now Vesuvius plc). Instrumental in steering Vesuvius from US$ 100 million to over US$ 1 billion Based in Europe, he is a member of IFGL's Core Group and a Director of Monocon International Refractories Limited, UK Joins as Director Monocon International Refractories Ltd from May, 2015, he will be fully involved in Overseas Operations of Group. Is a Doctorate in Industrial Chemistry from Milano University Was the Board member & COO of Steel Division of RHI AG Vienna, being one of the leading manufacturers of specialized refractories for Iron & Steel Industry 5#6Our Journey 1980's 1990 IFGL Refractories - founded as a JV with Harima Corp., Japan • 1999 - Indo Flogates merged with IFGL Refractories • 1979 Indoflogates 1990's founded • 1980 Collaboration with Flogates, UK . • 2005-06 • Hoffman Germany 2008 Acquisition of Group, • 2008 2010 IFGL • 2012 - Set up of IFGL Exports at Kandla SEZ, Gujarat 2015 Capacity expansions completed in USA 2005 Acquisition of Monocon Group, UK 2006 Acquisition of - Goricon Group, UK 2010 Acquisition of El Ceramics, USA 2012-15 6#7IFGL Successful International Acquisitions Company Acquired Manufacturing Facilities Acquisition Cost Revenue in Acquisition Year 2015 Revenue Monocon Group, UK - 2005 Hoffman Group, UK - 2008 UK + USA + China GBP 9.5mn GBP 21mn GBP 28mn Germany, Europe Euro 7.0mn Euro 9mn Euro 11mn Ei Ceramics USA - 2010 Cincinnati, USA USD 13mn USD 11mn USD 17mn All Acquisitions are profitable & generate sufficient cash flow to manage Debt servicing and fund capacity expansions 7#8Holding Structure 51% IFGL Exports Ltd Kandla SEZ, Gujarat, India Technical and Financial IFGL Refractories Limited 100% IFGL HO - Kolkata, India Works - Kalunga, Orissa, India IFGL Worldwide Holding Limited Collaboration of Monocon Group Hofmann Ceramic El Ceramics Krosaki Harima Corporation, Japan, (Subsidiary of Nippon Steel Corporation, Japan) UK / USA / China Germany USA 8#9Specialized Refractory for Steel making with Wide Product Range 89 IFGL Isostatic & Tube Changer Refractories & System Slide Gate & Purging Refractories & System Cast Products, Zirconia Nozzles, Foundry Ceramics 9#10Key Strengths & Strategy#11Our Manufacturing Plants Mono Ceramics Inc Michigan, US Monocon, UK Hofmann Ceramic, Germany IFGL Tianjin Monocon Tianjin, China E I Ceramics, Cincinnati, US IFGL Exports, Kandla SEZ, Gujarat, India IFGL Rourkela, Orissa, India 11#12Ukraine Russia IFGL Our Global Network France UK Ital ARCTIC OCEAN Germany Romania & Slovakia Poland Sweden ICELAND USA, Canada, NORWAY U.K. Copenhagen Hamburg Berlin LARD FINLAND Stockholm Archangel Arkhangelsk Riga Yakutsk R CANADA Winnipeg Toronto, Omana 「ロー Dallas Monterrey 回 Halifax New York Washington, D.C. St John's ㅁ Mexico Citc City Havana Mexico Guatemala Managua Panama City Domingo 回 Castries Caracas VENEZUELA Paramaribo OCEAN COLOMBIA C Turkey Egypt To Lisbon SPAIN Marrakesh Algiers MAURITANIA NIGER Praia IMALI Khartoum Akhartim YEMEN ◉ Niamey Dakar ATLANTIC CHAD SUDAN 미 UKRAINE KAZAKHSTAN BOMAN 回 charest Sof Yerevand TURKEY Tunis 回 Ager © Tehran Triport Папа SYRIA Kabul. 回 Cairo, 回 RAC New Delhi ALGERIA LIBYA EGYPT SAUDI ARABIA OMAN INDIA 回 Joshkent ürümar IRA EGHANISTAN 回 PAKISTAN O' © ilaanbaatar Ferlaby MONGOLIA CHINA papca ☐ Beijing 回 Harbin 回 Kimch'agl Pyongyang Xi'an Chengdu ANMA Hanoi gu 回 hanghai ...ohsiung Bhaka ☐ Mu Bombay THAILAND 回 Moscow Ufa Omsk ☐ Astana Krasnoyars Ouagadougou Monrovia s THIOPIA Abidjan NIGERI Lomé Libreville Yaoundé Kampala KENYA Mogadishu Iran Avtale Manaus Quito 回 Chiclayo Iquitos PERU> ABOLIVIA PACIFIC OCEAN Chile Santiago BRAZIL Brasília Campo Grande Asunción Rio de Fortaleza Recife ☐ 回 回 IDEM. REP Mombasa wir LOF CONGO Luanda TANZANIA Antsiranana Chennai Bangkok Sri Jayawardenepura Kuala Medan Manila 回 PHILIPPINES 0 PALAL Lumpur Kota 回回 Kuchi 回 Malayasia Jakarta Kinabalu DONESIA Surabaya Davao 1 Darwin ㅁ Salvador Longwe ANGOLS Lusaka O Oshakati 回 Harare Antananarivo NAMIB Fretoria Janeiro ARGENTINA 回 S.Africa- SOUTH Maputo AFRICA Town Montevideo Aus, INDIAN OCEAN AUSTRALIA Perth 0 Comodoro Rivadavia 0 2002 Microsoft Corp. All rights reserved. Works & Marketing offices Distributors/Agents 12#13Strong Customer Relationships KSC MARINL VIZAG STEEL شرکت فولاد خوزستان NUCOR GO GERDAU Pride of Steel A Navratna Company D A ArcelorMittal ThyssenKrupp सेल SAIL TATA Bhushan onesteel gp Bhushan OUTO KUMPU NIPPON STEEL & SUMITOMO METAL حديد @ ESSAR STEEL saarstahl BSRM the ultimate steel RAUTARUUKKI hadood IFGL SIDENOR CELSA CHINASTEEL H HYUNDAI GROUP İSDEMİR STEEL SeverStat EVAL قطر ستيل SW حديد الإمارات Emirates Steel OVAKO QATAR STEEL Tenaris ERDEMİR السويس الصلب شركة الـ Gruppe BLUESCOPE STEEL SUEZ EL CO. JINDAL STEEL & POWER NLMK COLUMBUS STAINLESS MEGASTEEL SDN BHD 南達 Southem Steel 13#14IFGL • • Future Strategy Capacity Expansion Completed expansion in El Ceramics, USA in Q4FY15 Tripling capacity in Kandla Phase 1 completion by 2016 Future Strategy Foray in New Markets IFGL is currently present in 50% of the steel producing nations of the world leaving enough room for geographical expansion of our products New Products & Technologies Focus on investing in developing new products thereby increase product penetration and offering to Steel companies Inorganic Acquisitions Successfully integrated all acquisitions between 2005-2010 across geographies creating stakeholder value and increasing global market share 14#15Capacity Expansion E I Ceramics, Cincinnati, US Doubled Capacities in Isostatically Pressed Refractories. Installed new 10,000 pieces p.a. capacity of Clay Graphite Foundry stoppers IFGL Exports, Kandla SEZ Doubling capacity from current 80,000 pieces p.a. to 160,000 pieces p.a. by FY16 post which another we will add another line of 80,000 pieces p.a. by FY18 IFGL Capacity expansions to increase volume offering in Global markets leading to potential increase in Market share 15#16Financial Overview#17Financial Overview 473 Consolidated Turnover [Rs. Crs.] 606 676 FY15 Sales by Region 793 781 Europe [exc UK] 35% UK 12% IFGL Americas 23% India Asia [exc 22% India] 8% India UK FY11 FY12 FY13 FY14 FY15 Asia [exc India] Europe [exc UK] Americas 17#18Consolidated Profit & Loss Particulars [Rs. Crs.] Q4FY15 Q4FY 14 FY 15 FY 14 Total Income 195.4 202.0 793.5 781.0 Raw Material 105.8 98.0 406.1 378.0 Employee 30.0 28.0 117.9 110.0 Expenses Other Expenses 40.7 46.0 170.6 181.0 EBITDA 19.0 29.0 98.9 113.0 EBITDA % 9.7% 14.6% 12.5% 14.5% Finance Cost 1.3 2.0 5.9 7.0 Depreciation 3.1 4.0 14.3 15.0 Profit Before Tax 14.5 24.0 78.7 91.0 Tax 6.7 7.0 25.4 25.0 Minority Interest (MI) -0.5 1.0 0.2 2.0 Profit after Tax & MI 8.4 16.0 53.1 64.0 PAT % 4.3% 7.8% 6.7% 8.2% IFGL 18#19Consolidated Balance Sheet IFGL Particulars [Rs. Crs.] Mar-15 Mar-14 Particulars [Rs. Crs.] Mar-15 Mar-14 Shareholder's Fund 344.8 329.0 Non-Current Assets 254.7 260.7 Share capital 34.6 49.1 Fixed assets 128.1 124.6 Reserves & Surplus 310.2 279.9 Goodwill on consolidation 124.0 134.2 Minority Interest 9.6 9.5 Long-term loans and advances 2.0 1.8 Non-current liabilities 40.0 48.1 Other non-current assets 0.6 0.2 Long term borrowings 29.0 40.5 Current assets 340.6 313.0 Other Long Term Assets 11.0 7.6 Inventories 100.2 103.4 Current liabilities 200.9 187.1 Trade receivables 180.3 165.8 Short term borrowings 66.8 57.7 Cash and bank balances 47.9 30.7 Trade Payables 100.0 96.2 Short-term loans and advances 8.9 9.5 Other current liabilities 34.1 33.2 Other current assets 3.4 3.6 Total Liabilities 595.3 573.7 Total Assets 595.3 573.7 19#20Consolidated Financial Highlights -FY15 Consolidated Turnover [Rs. Crs] EBITDA [Rs. Crs] 781.0 FY14 793.5 FY15 India Market Sales V/s International Market Sales [%] India Market Sales International Market Sales 78% 22% 120 100 80 60 60 40 40 20 20 113.0 98.9 IFGL 0 FY14 FY15 PAT [Rs. Crs] 50 265 70 64.0 60 40 30 20 10 0 53.1 FY14 FY15 20 20#21IFGL Standalone Financial Highlights - FY15 Standalone Turnover [Rs. Crs] 328.9 338.2 50 EBITDA [Rs. Crs] 46.6 48.9 FY14 FY15 Domestic V/s Export Sales [%] 40 40 30 20 20 10 0 30 30 FY14 FY15 PAT [Rs. Crs] 25 24.4 25 20 20 10 50 Domestic 48% 15 52% Exports 10 26.9 FY14 FY15 21#22IFGL Subsidiary Performance Highlights – FY15* Overseas Subsidiary Turnover [Mn GBP] 27.5 - Overseas Subsidiary PAT 8.8% 10.3 7.9 Germany UK *Notes •UK refers to Monocon Companies •USA refers to El Ceramics •Germany refers to Hoffman Ceramics •Gujarat refers to IFGL Exports Ltd where IFGL Refractories Ltd owns 51% USA 6.2% 5.9% Germany UK USA Gujarat Subsidiary Turnover & PAT [Rs. Crs] 44 0.37 Revenue PAT 22 22#23IFGL 5 Year Performance Particulars [Rs. Crs] FY11 FY 12 FY 13 FY 14 FY 15 Total Income 473.3 607.1 676.8 781.0 793.5 Raw Material 247.0 303.8 352.3 378.0 406.1 Employee 66.1 84.3 98.7 110.0 117.9 Expenses Other Expenses 113.3 141.8 163.2 181.0 170.6 EBITDA 47.0 77.2 62.7 113.0 98.9 EBITDA % 9.9% 12.7% 9.3% 14.5% 12.5% Finance Cost 5.6 6.75 8.0 7.0 5.9 Depreciation 8.7 12.91 13.4 15.0 14.3 Profit Before Tax 32.7 57.5 41.3 91.0 78.7 Tax 8.4 18.3 15.9 25.0 25.4 Minority Interest (MI) 0.0 0.0 -2.8 2.0 0.2 Profit after Tax & MI 24.3 39.2 28.2 64.0 53.1 PAT % 5.1% 6.5% 4.2% 8.2% 6.7% IFGL 23#24Key Ratios* Return on Capital Employed [%] 18% 13% 13% 22% 18% 0.7 IFGL Net Debt: Equity Ratio [x] Net Debt: EBITDA Ratio [x] 0.5 0.5 0.3 0.2 2.5 1.4 1.9 0.8 0.7 FY11 FY12 FY13 FY14 FY15 FY11 FY12 FY13 FY14 FY15 FY11 FY12 FY13 FY14 FY15 *Consolidated ROCE=EBIT/(Total Debt + Networth) Net Debt:Equity Ratio = ( Total Debt - Cash & bank balance) / Networth 24#25Dividend Record 5.0% FY11 15.0% 15.0% FY12 FY13 17.5% 20.0% FY14 FY15 IFGL Particulars (Rs.) FY11 FY12 FY13 FY14 FY15 Consolidated Book Value per Share 50.8 64.1 70.9 95.1 99.7 Consolidated Earning Per Share 6.9 11.3 7.9 18.3 15.1 Dividend Per Share 0.5 1.5 1.5 1.75 2.00 25#26Contact For further information, please contact: Company: Investor Relations Advisors : IFGL Refractories Ltd. CIN L27202OR1989 PLC002971 Mr. Rajesh Agrawal [email protected] www.ifglref.com Strategic Growth Advisors Pvt. Ltd. CIN U74140MH2010PTC204285 - Mr. Shogun Jain / Ms. Sanjita Ghosh [email protected]/[email protected] +91 7738377756 / +91 7738359389 www.sgapl.net IFGL