Annual Report 2012/13 IN MOTION Annual Report 2012/13 Annual Report IN MOTION IN THE GROUP IN FIGURES AURUBIS GROUP (IFRS) 2012/131) 2011/121)2) Change in % INCOME STATEMENT Revenues € million 12,346 13,789 – 10.5 EBITDA € million (56) 717 – 107.8 Operating EBITDA € million 268 481 – 44.2 EBIT € million (195) 586 – 133.3 Operating EBIT € million 149 366 – 59.5 EBT € million (230) 516 – 144.6 Operating EBT € million 114 296 – 61.6 Consolidated net income € million (153) 363 – 142.2 Operating consolidated net income € million 94 207 – 55.1 Net cash flow € million (86) 383 – 122.4 BALANCE SHEET Total assets € million 4,058 4,889 – 17.0 Fixed assets € million 1,434 1,375 4.3 Capital expenditure € million 185 155 19.4 Depreciation and amortization € million 139 131 5.8 Equity € million 2,000 2,197 – 9.0 AURUBIS SHARES Market capitalization € million 2.014 2,039 – 1.2 Earnings per share € (3.42) 8.03 – 143 Earnings per share (operating) € 2.05 4.58 – 55.2 Dividend per share 2) € 1.10 1.35 – 18.5 HUMAN RESOURCES Number of employees 6,563 6,372 + 3.0 Personnel expenses € million 435 421 + 3.3 1) values “operationally” adjusted by valuation results from the use of the LIFO method instead of the average cost method in accordance with IAS 2, by copper price-related valuation effects on inventories and by effects from the purchase price allocation, mainly property, plant and equipment, from fiscal year 2010/11 onwards 2) 2012/13 figure is the proposed dividend AURUBIS – We are the leading integrated copper group and the largest copper recycler world- wide. We produce about 1 million t of copper cathodes each year and use them to fabricate various copper products at our production sites in Europe and the US. In addition, we have an extensive service and sales system for copper products in Europe, Asia and North America. Buffalo Pori Finspång Hamburg Zutphen Smethwick Emmerich Fehrbellin Lünen Olen Stolberg Röthenbach Dolný Kubín Mortara Pirdop Production Avellino Processing Production/processing SEGMENTS PRIMARY COPPER RECYCLING/ COPPER PRODUCTS PRECIOUS METALS This Business Unit primarily unites This Business Unit produces copper This Business Unit processes cathodes the activities concerned with the cathodes from a wide variety of into copper products and markets production of quality copper in the recycling raw materials. It also produ- them. End users include the electrical form of marketable copper cathodes ces precious metals and other by- engineering, automotive, mechanical from the primary raw material, copper metals. engineering, telecommunications and concentrates. It also produces construction industries. sulfuric acid. Main sites Main sites Main sites Hamburg (D) Hamburg (D) Avellino (I), Buffalo (USA), Emmerich (D), Olen (B) Lünen (D) Finspång (S), Hamburg (D), Olen (B), Pirdop (BG) Pori (FIN), Stolberg (D), Zutphen (NL) Main activities Main activities Main products Processing copper concentrates; Recycling; producing cathodes, Continuous cast wire rod, continuous producing cathodes, sulfuric acid, precious metals, other specialty cast shapes, strip/foil, shaped wire, iron silicate and other specialty products specialty profiles products Revenues € million 7,661 Revenues € million 4,256 Revenues € million 9,045 EBIT (operating) € million 136 EBIT (operating) € million 29 EBIT (operating) € million 7 Employees (avg.) 2,100 Employees (avg.) 1,454 Employees (avg.) 2,800 COPPER PRODUCTION COPPER PROCESSING PRODUCTION 2011/12 2012/13 Change in % LME settlement copper price (avg.) U S |S / t 7,84 4 7,513 – 4.2 Cathodes 1,000 t 1,147 1,148 + 0.1 Continuous cast wire rod 1,000 t 646 608 – 5.9 Continuous cast shapes 1,000 t 164 149 – 9.1 Pre-rolled strip 1) 1,000 t 188 192 + 2.1 Strip 1,000 t 207 215 + 3.9 Shaped wire 1,000 t 10 10 – Specialty profiles t 8,100 6,800 – 16.0 Gold t 37 39 + 5.4 Silver t 1,222 1,038 – 15.1 1) Sales KETS IN MOTION MAR The more quickly and strongly our Core metal Sustainability environment changes, the more copper important it is for us to stay in motion. PRODUCTION Multi-metal As a result, our strategy formulates the Internationalization CAPABILITY AND supply and INNOVATION recovery C answers to future market developments U S T O today. This allows us to face challenges S Full synergy Solutions for M U E potential of the customers and R P P value chain suppliers S L in good time and to seize opportunities IE R S early on. Our goal is to expand our leading market position as an integrated copper producer. Our production expertise is the driving force behind our success and is therefore a central component of our strategy, which we will continue improving while promoting innovation. THE FRAMEWORK OF OUR PATH TO THE FUTURE: » Copper is and will remain our key expertise. However, » It is important to us to use the elements in complex other metals will become more important for us in input materials completely for fabricating products. the future. » We will continue growing internationally. In a » Our strengths lie in our sophisticated, innovative globalized world, we think globally and orient our- methods for processing copper and metallic raw selves accordingly. materials and producing high-quality products. We offer our cus tomers and suppliers individual solutions » Sustainability – The balance of the economy, social and services. aspects and environmental protection is important to us. We want to continue developing in this direction. » We link experience and knowledge with new ideas, utilizing all of the opportunities that our position along the value chain provides. 1 CONTENT IN MOTION MARKETS PROCESSES 06 12 MARKETS ARE IN MOTION KNOW-HOW We successfully transfer established KEEPS US IN MOTION concepts to new markets. We deal with increasing demands using sophisticated processes. » Internationalization » Full synergy potential of the value chain » Multi-metal supply and recovery » Production capability and innovation 30 MANAGEMENT 57 FINANCIAL REPORT 30 A discussion with the Executive Board 58 GROUP MANAGEMENT REPORT 34 Report of the Supervisory Board 58 Company and general framework 38 Supervisory and Executive Boards 71 Consolidated business performance 2012/13 41 Corporate governance 80 Fiscal situation 53 Aurubis shares 90 Non-financial performance indicators 100 Risk management 105 Subsequent events 105 Forecast report 113 Legal disclosure requirements 2 CONTENT PRODUCTS SUSTAIN - ABILITY 18 24 DIVERSITY REQUIRES US IN MOTION – AND IN HARMONY TO BE IN MOTION WITH OUR SURROUNDINGS Copper is our key expertise. We offer Our company is an active part of society. tailored copper solutions. » Sustainability » Core metal copper » Solutions for customers and suppliers 194 FURTHER INFORMATION 117 CONSOLIDATED FINANCIAL STATEMENTS 194 Glossary 118 Consolidated income statement 197 4-year overview 119 Consolidated statement of comprehensive income 198 Financial calendar 2014 120 Consolidated balance sheet Imprint 122 Consolidated cash flow statement 123 Consolidated statement of changes in equity 124 Notes to the financial statement 192 AUDITORS’ REPORT 193 RESPONSIBILITY STATEMENT 3 ININ PRINCIPIO MOTION CREAVIT DEUS CAELUM ET TERRAM IF YOU KEEP YOUR EYES ON THE TARGET, YOU CAN PURSUE IT WITH DETERMINATION. We are moving on a path to becoming the world’s leading integrated copper group: on the basis of our established business model, in which people make up Aurubis and are experts in their fields, and with our reworked strategy that provides us with orientation. 4 5 Off to new markets WE UNDERSTAND OUR BUSINESS. EVEN THOUGH THE ENVIRONMENT IS CHANGING, WE’RE IN A POSITION TO TRANSFER ESTABLISHED STRUCTURES AND MODELS TO NEW MARKETS 6 SUCCESSFULLY AND TO ADJUST THEM TO DIFFERENT CONDITIONS. IN MOTION MARKETS MARKETS ARE IN MOTION – AND WE KNOW HOW TO TAKE ADVANTAGE OF THIS Our raw material and product markets are surrounded by an environment that moves and changes more strongly all the time and at an increasingly fast pace. Political, macroeconomic and financial influences are Dependencies and interdependencies have increased – growing. Fluctuations in metal prices, exchange rates and and therefore also the risks. Resources are a key factor share prices occur at shorter notice and are more intense. used as a strategic pawn to shape economic policy. If Transparency is higher and along with it, the global effect economic momentum declines or if there are strong po- of local events. Demand and production centers are shift- litical changes, the capital and currency markets react ing on the world map. Our societies are also changing worldwide and influence commodity flows, stocks and radically – sustainability, demographic change and inter- metal prices. nationalization affect even the smallest aspects. The important sales and procurement markets of the We have to find answers and solutions for all of these is- future are located where there is potential for demand sues. New economic centers have sprung up all over the growth and where strategically important resources are globe. The market dominance of Western Europe and the available. United States has given way to a multipolar world. China in particular, but also Brazil, India and other Asian coun- tries have gained economic power. For instance, China’s GDP is ranked third worldwide. Infrastructure projects provide crucial momentum in growth regions, followed by private consumption: demand for home and air conditioning technology, con- sumer electronics, household appliances and cars is ris- WE ARE PREPARED FOR ing and causing an economic boom. The result: a growing CHANGES AND UTILIZE THE desire for raw materials. China alone accounts for about OPPORTUNITIES THAT RESULT 40 % of global copper demand today, 21 % more than 10 FROM THEM. years ago. But this trend also has drawbacks. 7 IN MOTION MARKETS On a global path: AURUBIS CONTINUES ITS INTERNATIONAL EXPANSION Market changes affect the business, so it is crucial Those who track the markets have to view internatio- to recognize them early on.