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FULL YEAR 2011 IFRS RESULTS – Oao Tmk

Oao Tmk · Mar 16, 2012 · 34 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 1
    PROPRIETARY & CONFIDENTIAL TMK Investor Presentation FY 2011 IFRS Results
  2. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 2
    Presentation Outline Company Overview 4 Financial Review 8 Russia 17 North America 22 Investments 28 Appendix Summary Financial Accounts 30 Appendix TMK Global Assets 34 Contacts 37 3
  3. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 3
    Company Overview 4
  4. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 4
    Investment Highlights One of the largest tubular capacity Global High exposure to the oil & gas industry: approximately 74% of 2011 shipments went to the oil & gas sector Market Leader Leading producer of value-added steel pipes for…
  5. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 5
    Global Operational and Sales Footprint Steel Tubular Industry Leader TMKs strategic positioning made it the steel tubular industry leader, with over 4 million tonnes sold in 2011. Truboplast Pipe Maintenance Department Seversky…
  6. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 6
    Russian and North American Synergies Both Russia and North America have benefitted during the past three years since the acquisition of IPSCO Benefits for Russia Benefits for North America Best business practices Russia is implementing…
  7. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 7
    Financial Review 8
  8. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 8
    FY 2011 Sales Volumes by Segment and Group of Product Russia Americas Europe Total Thousand Change, Change, Change, Change, FY 2011 FY 2010 FY 2011 FY 2010 FY 2011 FY 2010 FY 2011 FY 2010 Tonnes % % % % Seamless Pipe 1,883 1,698 11%…
  9. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 9
    FY 2011 Key Consolidated Financial Highlights Summary FY 2011 Financial Highlights 4Q 2011 Revenue +0% Q-o-Q -3% Y-o-Y U.S. mln(1) Change, FY 2011 FY 2010 1,800 (unless stated otherwise) % Net Sales 6,754 5,579 21% 1,500 U.S. mln…
  10. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 10
    FY 2011 Key Financial Highlights by Division (1) Russia Americas Europe U.S. mln Change, Change, Change, FY 2011 FY 2010 FY 2011 FY 2010 FY 2011 FY 2010 (unless stated otherwise) % % % Volumes- Pipes, kt 3,115 2,989 4% 892 804 11%…
  11. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 11
    Revenue Growth by Segments and Groups of Products Revenue growth in the Russian division was driven by better pricing and product mix and higher sales volumes in seamless business, while in the American division revenue growth was…
  12. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 12
    FY 2011 Key Financial Highlights by Group of Product U.S. mln FY 2011 FY 2010 Change, % (unless stated otherwise) Volumes- Pipes, kt 2,342 2,120 10% Core Business Seamless Net Sales 3,911 2,952 32% Sales of seamless pipes generated…
  13. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 13
    Working Capital Position Accounts Receivable (days) Accounts Payable (days) 100 94 120 107 80 100 80 75 60 56 56 50 64 60 50 40 40 20 20 0 0 2008 2009 2010 2011 2008 2009 2010 2011 Inventories (days) Cash Conversion…
  14. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 14
    Debt Profile TMK Continues to Optimize its Capital Structure and Develop a Flexible, Cost-effective Debt Portfolio Maturity Profile as of 31 December 2011 As of 31 December, 2011, Total Debt accounted for U.S.3,787 mln 800 84% of…
  15. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 15
    Russia 17
  16. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 16
    Oil Production and Capex Needs in Russia Deteriorating oil production conditions at mature The average productivity of oil wells in Russia fields, particularly in the Urals and Western Siberia, remains below most of other major oil…
  17. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 17
    Russian Drilling - Moving East for Growth The Increasing complexity of oil and gas production in Russia is expected to increase demand for higher value-added products CAGR 2007-2012F 5.6% Drilling Activity, km 24 000…
  18. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 18
    Increasing Complexity of Russian Drilling The Share of Greenfield Production is Projected to Reach 17% Horizontal Drilling is Expected to Double in the Next 5 Years in 2015 Compared to Just 6% in 2010 21 20% 560 18 480 mln…
  19. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 19
    Russian LDP Demand Drivers Large-diameter pipe demand to remain robust as regions of production continue to move further away from consumption centers Shtokman Bovanenkovo Murmansk Bovanenkovo- Novy Ukhta Urengoy Murmansk-…
  20. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 20
    North America 22
  21. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 21
    Shift to Unconventional Drilling Conventional (Vertical) Drilling Unconventional (Horizontal) Drilling (Hydraulic Fracturing) Seamless / Premium Welded Tubing Connections Vertical Horizontal Shale Shale Length, km Up to 5 Up to…
  22. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 22
    Increasing Drilling Complexity Increasing Service Intensity Average Average Service intensity in 2008 multiplied by 3-5 Lateral Number of Field Period Hydraulic Length (ft) Stages AFE(1) times compared to 2006, and by more than 7…
  23. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 23
    U.S. 0 1 2 3 4 5 6 Marcellus Wet (core) 2,8 Pinedale 2,9 Marcellus Dry (core) 3,0 major shales. Fayetteville (3.4 Bcf) 3,0 Granite Wash (Horizontal) 3,1 Huron Shale 3,2 Gas above U.S.4/Mcf Deep Bossier (E.Texas)…
  24. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 24
    US Drilling Stronger than Ever Drilling Activity Brought Months of OCTG Supply Back to Normal Major U.S. Shale Oil & Gas Plays 16 2,500 Months of Supply 14 US Rig Count 2,000 Bakken 12 Months of Supply U.S. Rig Count 10…
  25. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 25
    Canadian Oil Sands Three Major Oil Sands Deposits Canadian Oil Sands Fast Facts Around 170 billion of Oil Sands reserves Potential for over 100 years of production Mining less than 200 feet deep: 20% of reserves Peace River Deposit…
  26. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 26
    Investments 28
  27. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 27
    Investment Projects Russia USA Construction of EAF at Tagmet R&D Center in Houston Total Investment: U.S. 270 mln Investment: U.S.26 mln Remaining Investment: U.S. 154 mln Timing: Building Completed in 2011 The in-house R&D Center…
  28. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 28
    Appendix Summary Financial Accounts 30
  29. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 29
    TMK Income Statement U.S. mln 2011 2010 2009 2008 2007 Revenue 6,754 5,579 3,461 5,690 4,179 Cost of Sales (5,307) (4,285) (2,905) (4,252) (2,891) Gross Profit 1,446 1,293 556 1,438 1,288 Selling and Distribution Expenses (411) (403)…
  30. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 30
    TMK Cash Flow U.S. mln 2011 2010 2009 2008 2007 Profit / (Loss) before Income Tax 544 185 (427) 308 699 Adjustments for: Depreciation and Amortisation 336 301 313 248 140 Net Interest Expense 271 412 406 263 90 Others (101) 44 36…
  31. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 31
    Appendix TMK Global Assets 34
  32. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 32
    Russia - CIS - Europe Production Seversky (incld. TMK-CPW) Capacity Volzhsky Product (tonns) Capacity Seamless OCTG 220,000 Product (tonnes) S.Line Pipe & Industrial 120,000 Seamless OCTG 270,000 Heat Treating 175,000 S.Line Pipe…
  33. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 33
    TMK IPSCO US Market Penetration Camanche, IA Brookfield, OH Koppel, PA Product Capacity (tonnes) Product Capacity (tons) Product Capacity (tonnes) ERW OCTG line pipe, 249,000 ULTRA Premium 86,500 Heat Treating 73,000 standard pipe…
  34. FULL YEAR 2011 IFRS RESULTS – Oao Tmk – slide 34
    Thank You TMK Investor Relations 40/2a, Pokrovka Street, Moscow, 105062, Russia +7 (495) 775-7600 IRtmk-group.com 37

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