Nyrstar: 2018 Full Year Results
Regulated Information
2018 Full Year Results
26 May 2019 at 23:45 CEST
HIGHLIGHTS:
- Capital structure review initiated in October 2018 in response
to extremely challenging financial and operating conditions being
faced by the Company due to materially reduced Underlying EBITDA
performance in H2 2018 and the maturity of certain liabilities
during 2019
- Group underlying EBITDA1 of EUR 99 million for 2018, a decrease
of 52% on 2017, primarily driven by substantial reductions in zinc
and lead treatment charges, a weakening of the US dollar against
the Euro (1.13 to 1.18), increased energy prices in Metals
Processing and higher direct operating costs at the mining
operations, partially offset by increased zinc metal and zinc in
concentrate production (up 4% and 14% respectively)
- Metals Processing underlying EBITDA of EUR 135 million, down
EUR 71 million year-on-year, driven by lower zinc treatment
charges, higher energy prices in Europe and Australia during H2
2018, the suspension of operations at Port Pirie in December 2018,
partially offset by higher production of zinc, copper, silver and
minor metals; and
- Mining underlying EBITDA of EUR 19 million, down EUR 28 million
year-on-year, driven by the negative EBITDA performance from the
restart and subsequent suspension of the Myra Falls mine and weak
production and operating cost performance at the Langlois and
Middle Tennessee mines, partially offset by lower zinc treatment
charges and continued operating improvements at the East Tennessee
mines
- Balance sheet and liquidity
- Following the Q3 2018 results announcement on 30 October 2018,
substantial working capital outflows were experienced during Q4
2018 and liquidity was substantially reduced
- Net debt excluding zinc metal prepay of EUR 1,643 million at
the end of December 2018, an increase of EUR 541 million on 31
December 2017 which included the Perpetual Securities which are now
accounted for as financial liabilities. Net debt inclusive of zinc
metal prepay and perpetual securities of EUR 1,771 million at the
end of December 2018, an increase of EUR 408 million on 31 December
2017
- New USD 650 million committed working capital facility from
Trafigura implemented in December 2018, replacing the USD 250
million working capital facility with Trafigura, originally entered
into in May 2016
- Net loss of EUR 618 million for 2018, primarily driven by a
large income tax expense with the partial de-recognition of
deferred tax assets, impairment of the carrying value of the
Langlois and Myra Falls mines, costs associated with the capital
restructuring process and operating loss incurred in 2018
- Port Pirie Redevelopment continues to ramp-up in-line with
management expectations
- Maintenance shutdown of the sinter plant, TSL furnace and blast
furnace during December 2018 to comply with the prescribed
lead-in-air limits at the end of Q4 2018 also allowed Nyrstar to
address a TSL furnace cooling issue and bring forward maintenance
previously scheduled for the blast furnace in January 2019
KEY FIGURES
EUR
million (unless otherwise
indicated) |
FY |
FY |
% |
|
H1 |
H2 |
% |
|
|
2017 |
2018 |
Change |
|
2018 |
2018 |
Change |
|
Income
Statement Summary |
|
|
|
|
|
|
|
|
Revenue |
3,530 |
3,812 |
8% |
|
1,930 |
1,883 |
(2%) |
|
Gross Profit |
1,074 |
1,118 |
4% |
|
600 |
517 |
(14%) |
|
Direct operating costs |
(875) |
(1,014) |
16% |
|
(485) |
(529) |
9% |
|
Non-operating and other |
6 |
(5) |
(181%) |
|
6 |
(11) |
(289%) |
|
|
|
|
|
|
|
|
|
|
Metal Processing U. EBITDA |
206 |
135 |
(34%) |
|
118 |
16 |
(86%) |
|
Mining U. EBITDA |
47 |
19 |
(59%) |
|
28 |
(9) |
(132%) |
|
Other
and Eliminations U. EBITDA |
(48) |
(56) |
17% |
|
(26) |
(29) |
11% |
|
Group Underlying EBITDA |
205 |
99 |
(52%) |
|
120 |
(22) |
(118%) |
|
Underlying EBITDA margin |
6% |
3% |
(56%) |
|
6% |
(1%) |
(119%) |
|
Embedded derivatives |
(3) |
2 |
(169%) |
|
(3) |
5 |
(257%) |
|
Restructuring expense |
(4) |
(22) |
432% |
|
(13) |
(9) |
(30%) |
|
M&A related transaction
expense |
(0) |
(1) |
493% |
|
(2) |
0 |
(111%) |
|
Other income |
9 |
3 |
(68%) |
|
2 |
1 |
(69%) |
|
Profit / (Loss) on disposal of
investments |
3 |
0 |
(102%) |
|
0 |
0 |
- |
|
Other
expenditure |
0 |
(30) |
- |
|
0 |
(30) |
- |
|
Underlying adjustments |
4 |
(49) |
- |
|
(16) |
(33) |
113% |
|
Depreciation, depletion,
amortisation |
(156) |
(162) |
4% |
|
(75) |
(88) |
17% |
|
Impairment gain / (loss) |
126 |
(99) |
- |
|
0 |
(99) |
- |
Result from operating activities |
180 |
(212) |
- |
|
30 |
(242) |
- |
|
|
|
|
|
|
|
|
Net finance expense (including fx) |
(207) |
(151) |
(27%) |
|
(76) |
(75) |
- |
Income tax (expense) / benefit |
37 |
(250) |
- |
|
1 |
(252) |
- |
|
|
|
|
|
|
|
|
Profit / (Loss) from continuing operations |
10 |
(614) |
- |
|
(45) |
(569) |
- |
Profit / (Loss) from discontinued operations |
37 |
(4) |
- |
|
(4) |
0 |
(100%) |
Profit / (Loss) for the period |
47 |
(618) |
- |
|
(49) |
(569) |
- |
|
|
|
|
|
|
|
|
Basic Profit / (Loss) per share from continuing
ops |
0.10 |
(5.60) |
- |
|
(0.22) |
(5.60) |
- |
|
|
|
|
|
|
|
|
Capex (continuing and discontinuing
ops) |
|
|
|
|
|
|
|
Metals Processing |
303 |
126 |
(59%) |
|
70 |
56 |
(23%) |
Mining |
56 |
101 |
80% |
|
63 |
38 |
(40%) |
Other |
3 |
1 |
(50%) |
|
1 |
1 |
37% |
Group Capex |
362 |
229 |
(37%) |
|
134 |
95 |
(30%) |
Cash
Flow |
|
|
|
|
|
|
|
Funds From Operations (FFO)2 |
(358) |
(90) |
(75%) |
|
18 |
(109) |
- |
|
Free Cash Flow (FCF)3 |
(472) |
(236) |
(50%) |
|
(53) |
(183) |
(241%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EUR
million (unless otherwise
indicated) |
31 Dec 2017 |
31 Dec 2018 |
% Change |
|
30 Jun 2018 |
31 Dec 2018 |
% Change |
|
Debt and
cash |
|
|
|
|
|
|
|
|
Loans and borrowings, end
of the period |
1,170 |
1,882 |
61% |
|
1,276 |
1,882 |
48% |
|
Cash and cash equivalents,
end of period |
(68) |
(239) |
249% |
|
(78) |
(239) |
205% |
|
Net Debt Exclusive
of Zinc Prepay4 |
1,102 |
1,643 |
49% |
|
1,198 |
1,643 |
37% |
|
|
|
|
|
|
|
|
|
|
Zinc Prepay |
75 |
128 |
71% |
|
104 |
128 |
23% |
|
Perpetual Securities |
186 |
175 |
(6%) |
|
186 |
175 |
(6%) |
|
Net Debt
Inclusive of Zinc Prepay and Perpetual
Securities |
1,363 |
1,771 |
30% |
|
1,487 |
1,771 |
(56%) |
|
|
|
|
|
|
|
|
|
|
FY 2017 |
FY 2018 |
|
|
H1 2018 |
H2 2018 |
|
Metals Processing
Production |
|
|
|
|
|
|
|
Zinc metal (‘000 tonnes) |
1,019 |
1,064 |
4% |
|
528 |
536 |
2% |
Lead metal (‘000 tonnes) |
171 |
160 |
(7%) |
|
69 |
90 |
30% |
|
|
|
|
|
|
|
|
Mining
Production |
|
|
|
|
|
|
|
Zinc in concentrate (‘000 tonnes) |
123 |
139 |
14% |
|
70 |
70 |
- |
Copper in concentrate (‘000
tonnes) |
2.1 |
1.6 |
(21%) |
|
0.8 |
0.9 |
7% |
Silver (‘000 troy ounces) |
553 |
439 |
(21%) |
|
214 |
225 |
5% |
Gold (‘000 troy ounces) |
1.9 |
2.1 |
8% |
|
0.7 |
1.3 |
82% |
|
|
|
|
|
|
|
|
Market5 |
|
|
|
|
|
|
|
Zinc price (USD/t) |
2,896 |
2,922 |
1% |
|
3,268 |
2,656 |
(19%) |
Lead price (USD/t) |
2,318 |
2,242 |
(3%) |
|
2,456 |
2,091 |
(15%) |
Silver price (USD/t.oz) |
17.05 |
15.71 |
(8%) |
|
16.65 |
15.02 |
(10%) |
Gold price (USD/t.oz) |
1,258 |
1,269 |
1% |
|
1,319 |
1,229 |
(7%) |
EUR/USD average exchange rate |
1.13 |
1.18 |
4% |
|
1.21 |
1.15 |
5% |
EUR/AUD average exchange rate |
1.47 |
1.58 |
7% |
|
1.57 |
1.59 |
1% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Nyrstar NV ("Nyrstar" or the “Company” and,
together with its subsidiaries, the “Group”) has previously
announced that its consolidated financial statements for the twelve
months ended 31 December 2018 (“Full Year Results 2018”), were
rescheduled to 24 May 2019 due to the need to complete the
comprehensive capital structure review of the Group. As was
announced by the Company on 15 April 2019, Nyrstar initiated a
review of its capital structure (the “Capital Structure Review”) in
October 2018 in response to the challenging financial and operating
conditions being faced by the Group. As previously announced, these
conditions included substantial working capital and liquidity
outflows experienced during the fourth quarter of 2018 and first
quarter of 2019 necessitating the raising of urgent short term
funding. Combined with the Group’s materially reduced Underlying
EBITDA performance in 2018 and the maturity of certain liabilities
during 2019, these factors resulted in the need to reconsider the
Group’s capital structure.
The Capital Structure Review identified a very
substantial additional funding requirement that the Group is unable
to meet without a material reduction of the Group’s indebtedness.
As a consequence, the Capital Structure Review has necessitated
negotiations between the Group’s financial creditors in order to
develop a deleveraging and funding plan as part of a comprehensive
balance sheet recapitalisation. Alternatives to such a
recapitalisation would place the future of the Group and its
stakeholders at severe risk. As at the date of this announcement,
the Company is in the process of implementing the
recapitalision.
The Company has received from its auditor,
and is publishing today, an opinion issued in accordance with
article 143, §2 of the Belgian Company Code (“non-compliance
opinion”) on the basis that certain information requested from the
Company was not timely delivered. The Company is working hard
to deliver such information to its auditor with the intention that
the auditor will issue its audit opinion once it has audited such
information. The full-year results that are published today
will then again be published to the market, together with the audit
opinion that the auditor will then issue.
GROUP FINANCIAL OVERVIEW
Group gross profit for 2018 of EUR 1,118
million was up 4% on 2017, driven by higher zinc production volumes
in Mining and Metals Processing and marginally higher zinc and gold
prices which were both up 1%, partially offset by deteriorating
benchmark zinc treatment charge terms and a weaker US dollar
against the Euro.
Direct operating costs for 2018 of EUR
1,014 million increased 16% on 2017, due to higher zinc production
volumes in Mining and Metals Processing, higher electricity prices
at the smelters, increased mining costs as a result of the restart
of operations at Myra Falls and the ramp-up of mining operations at
Middle Tennessee.
Group underlying EBITDA of EUR 99 million
in 2018, a decrease of 52% on 2017, due to a weakening of the US
dollar against the Euro, lower lead and silver prices, a 15%
reduction in the benchmark zinc treatment charge, higher direct
operating costs per tonne of zinc in both Mining and Metals
Processing.
Underlying adjustments in 2018 were a
total of EUR 49 million, comprising EUR 2 million of embedded
derivatives, EUR (22) million of restructuring expense, EUR 1
million of M&A related transaction expense and EUR (30) million
of other expenditure relating primarily to the write-off of
payments that were connected with the divestment of the El Toqui
mine in Chile.
Depreciation, depletion and amortisation
expense for 2018 of EUR 162 million was up 4% year-on year.
In 2018, the Company recognised a non-cash,
pre-tax impairment loss of EUR 99 million (2017: impairment
gain of EUR 126 million). This impairment loss (2017: impairment
gain) relates fully to pre-tax impairment losses on Nyrstar’s
Mining assets (EUR 85.9 million) at Langlois and Myra Falls and
specific asset write-offs in Metals Processing (EUR 11.4
million).
Net finance expense (including foreign
exchange) for 2018 of EUR 151 million (EUR 207 million in 2017)
primarily due to a net foreign exchange gain of EUR 6.5 million in
2018 compared to a loss of EUR 59.9 million in 2017. The interest
expense in 2018 of EUR 128.3 million was higher than in 2017 (EUR
104.4 million).
Nyrstar recognised an income tax
expense for the year ended 31 December 2018 of
EUR 250 million (2017: income tax benefit of EUR 37
million) representing an effective income tax rate of -68.9% (for
the year ended 31 December 2017: -481.3%). The tax rate is impacted
by non-recognition of current year losses, and by the
de-recognition of previous losses relating mainly to Nyrstar Sales
& Marketing AG, the US Group, and the Canadian Group given it
is not probable that these tax losses will be used in the future
considering forecast profit projections.
Loss after tax of EUR 618
million in 2018, compared to a net profit of EUR 47 million in
2017, mainly as a result of the impairment charges related to the
write down of the carrying value of the Langlois and Myra Falls
mines, the partial de-recognition of Nyrstar Sales & Marketing
AG and Nyrstar US deferred tax assets due to reduced expected
recoverability and the operational losses incurred in 2018 and
change of control impacts.
Capital expenditure was EUR 229 million
in 2018, representing a decrease of 37% year-on-year driven by a
substantial reduction in Metals Processing from EUR 303 million in
2017 to EUR 126 million in 2018 with the completion of the Port
Pirie Redevelopment and a EUR 45 million increase in Mining with
the restart of the Myra Falls mine.
Net debt at the end of 2018 at EUR
1,643 million, excluding the zinc metal prepay, was 49% higher
compared to the end of 2017 (EUR 1,102 million at the end of 2017),
predominantly due to substantial working capital outflow during Q4
2018 due to higher commodity prices, no new silver prepays in H2
2018, reduction in non-committed letter of credit lines from
banking counterparties, tightened credit terms with a number of
suppliers, the reclassification of EUR 82.5 million and EUR 50.7
million of prepayments for deliveries of silver metal and zinc
metal respectively from deferred income to loans and borrowing at
31 December 2018 as the Group had no ability to settle by physical
delivery of silver metal and zinc metal respectively from its own
production and the reclassification of perpetual securities (EUR
174.9 million at 31 December 2018) from equity to loans and
borrowings6. The net debt inclusive of the zinc metal prepay and
perpetual securities at the end of 2018 was EUR 1,771 million, up
30% compared to the end of 2017. Cash balance at the end of 2018
was EUR 239 million compared to EUR 68 million at the end of 2017.
SAFETY, HEALTH AND ENVIRONMENT
“Prevent Harm” is a core value of Nyrstar. The
Company is committed to maintaining safe operations and to
proactively managing risks including with respect to people and the
environment. At Nyrstar, we work together to create a workplace
where all risks are effectively identified and controlled and
everyone goes home safe and healthy each day of their working
life.
In 2018, we placed particular emphasis on the
prevention of hand injuries which account for a large portion of
our total injuries. A dedicated hand injury prevention program
entitled Because some tools cannot be replaced was introduced at
all operations with the purpose of eliminating unsafe conditions
contributing to hand injuries, improving tools and personal
protective equipment, and changing at-risk behaviours relevant to
hand injuries. We also continued the implementation of the Process
Safety Management System launched in 2017 and strengthened controls
related to hydrogen explosion risks at our smelters.
The Group continued to make significant progress
in safety performance. No severe irreversible injuries occurred.
The frequency rate of cases with time lost or under restricted
duties (DART) for the Company achieved a new record low of 3.7, an
improvement of 7% compared to a rate of 3.9 in 2017. The frequency
rate of cases requiring at least a medical treatment (RIR) was 6.7,
this is a 4% increase compared to 6.4 in 2017. More important, the
number of days lost due to LTIs and RW injuries reached a new
record low of 202. This is 20% lower than the previous best of 255
days lost by million working hours in 2017.
No environmental events with material business
consequences or long-term environmental impacts occurred during the
period.
OPERATIONS REVIEW: METALS PROCESSING
EUR million |
FY |
FY |
% |
|
H1 |
H2 |
% |
(unless otherwise indicated) |
2017 |
2018 |
Change |
|
2018 |
2018 |
Change |
|
|
|
|
|
|
|
|
Treatment charges |
286 |
232 |
(19%) |
|
123 |
109 |
(11%) |
Free metal contribution |
351 |
378 |
8% |
|
193 |
185 |
(4%) |
Premiums |
152 |
150 |
(2%) |
|
76 |
74 |
(3%) |
By-Products |
166 |
216 |
30% |
|
106 |
109 |
3% |
Other |
(99) |
(111) |
14% |
|
(47) |
(64) |
37% |
Gross Profit |
855 |
863 |
1% |
|
451 |
413 |
(8%) |
|
|
|
|
|
|
|
|
Employee expenses |
(221) |
(218) |
(1%) |
|
(109) |
(108) |
(1%) |
Energy expenses |
(227) |
(259) |
14% |
|
(117) |
(142) |
21% |
Other expenses /income |
(202) |
(250) |
24% |
|
(120) |
(130) |
9% |
Direct Operating
Costs |
(649) |
(727) |
12% |
|
(346) |
(380) |
10% |
|
|
|
|
|
|
|
|
Non-operating and other |
(1) |
(2) |
155% |
|
14 |
(16) |
(-213%) |
Underlying EBITDA |
206 |
135 |
(34%) |
|
118 |
16 |
(86%) |
|
|
|
|
|
|
|
|
Sustaining and growth |
199 |
125 |
(38%) |
|
68 |
57 |
(18%) |
Port
Pirie Redevelopment |
104 |
1 |
(99%) |
|
2 |
(1) |
(167%) |
Metal Processing
Capex |
303 |
126 |
(59%) |
|
70 |
56 |
(23%) |
Metals Processing delivered an underlying EBITDA
result of EUR 135 million in 2018, a decrease of 34% over 2017 due
to lower treatment charges, higher energy prices in Europe and
Australia during H2 2018 and the suspension of operations at Port
Pirie in December 2018, partially offset by higher production of
zinc, copper, silver and minor metals.
Marginally stronger year-over-year gross profit
(up 1%) at EUR 863 million in 2018 was mainly driven by higher zinc
prices (up 1%) compared to 2017 which were constrained by the zinc
price collar hedging in place at that time and higher production
volumes of zinc metal and by-products, largely offset by a 19%
decrease in zinc and lead treatment charge income. Annual 2018 zinc
benchmark treatment charge terms were settled during Q2 2018 at
approximately 15% below the 2017 terms at USD 147 per tonne of
concentrate.
The total Premium gross profit contributions
were relatively flat compared to 2017 (down 2%), driven by
marginally higher volumes and relatively flat average realised
premia rates.
By-product gross profit contributions were
positively impacted by higher gold and sulphuric acid prices and
higher production volumes of copper, silver, gold, indium and
sulphuric acid compared to 2017. After a fire in Q4 2015, the
indium plant was re-built in 2016 and resumed production by the end
of Q1 2017 with 29.8 tonnes of indium metal produced in 2017 and a
further ramped-up production volume of 42.6 tonnes in 2018.
Direct Operating Costs increased in 2018 (up 12%
compared to 2017) at EUR 727 million due to increased energy prices
in Europe and Australia and higher production volumes of zinc metal
and by-products.
Capital expenditure spend in 2018 decreased by
59% on 2017, in-line with the revised lower capital expenditure
guidance provided for 2018 (EUR 130 million to EUR 140 million)
compared to 2017 (EUR 303 million). The lower capital expenditure
has been driven by the completion of the Port Pirie Redevelopment
capex at the end of 2017 and a planned reduction in sustaining
capital spend in 2018 to historically normal levels.
EUR |
FY |
FY |
% |
|
H1 |
H2 |
% |
DOC/tonne |
2017 |
2018 |
Change |
|
2018 |
2018 |
Change |
|
|
|
|
|
|
|
|
Auby |
448 |
471 |
5% |
|
477 |
466 |
(2%) |
Balen |
501 |
482 |
(4%) |
|
483 |
481 |
0% |
Budel |
407 |
467 |
15% |
|
411 |
522 |
27% |
Clarksville |
481 |
562 |
17% |
|
536 |
590 |
10% |
Hobart |
467 |
432 |
(8%) |
|
453 |
413 |
(9%) |
Port Pirie7 |
810 |
997 |
23% |
|
1,117 |
905 |
(19%) |
DOC/tonne8 |
546 |
594 |
9% |
|
580 |
607 |
5% |
|
FY |
FY |
% |
|
H1 |
H2 |
% |
|
2017 |
2018 |
Change |
|
2018 |
2018 |
Change |
|
|
|
|
|
|
|
|
Zinc metal ('000
tonnes) |
|
|
|
|
|
|
|
Auby |
166 |
155 |
(6%) |
|
78 |
78 |
0% |
Balen/Overpelt |
249 |
275 |
10% |
|
137 |
138 |
1% |
Budel |
248 |
268 |
8% |
|
133 |
136 |
2% |
Clarksville |
117 |
101 |
(14%) |
|
52 |
49 |
(5%) |
Hobart |
238 |
264 |
11% |
|
129 |
136 |
5% |
Total |
1,019 |
1,064 |
4% |
|
528 |
536 |
2% |
|
|
|
|
|
|
|
|
Lead metal ('000
tonnes) |
|
|
|
|
|
|
|
Port Pirie |
171 |
160 |
(7%) |
|
69 |
90 |
30% |
|
|
|
|
|
|
|
|
Other products |
|
|
|
|
|
|
|
Copper cathode ('000 tonnes) |
4.2 |
4.3 |
1% |
|
1.6 |
2.7 |
65% |
Silver (million troy ounces) |
13.6 |
13.8 |
1% |
|
4.9 |
8.9 |
8% |
Gold (‘000 troy ounces) |
72.6 |
73.0 |
1% |
|
25.7 |
47.3 |
84% |
Indium metal (tonnes) |
29.8 |
42.6 |
43% |
|
21.4 |
21.2 |
(1%) |
Sulphuric acid ('000 tonnes) |
1,266 |
1,364 |
8% |
|
653 |
712 |
9% |
Metals Processing produced approximately 1.06
million tonnes of zinc metal in 2018, representing a 4% increase on
2017. The increase in zinc metal production year-over-year was
despite the planned maintenance shuts at Auby, Balen, Clarksville
and Hobart; and was assisted by a lack of material unplanned
outages which had impacted production volumes in 2016 and 2017.
However, zinc and lead metal production was impacted during Q4 2018
by lower raw material inventory as a consequence of the Company’s
liquidity constraints.
Lead metal production at Port Pirie of 160kt was
down 7% year-over-year due to a 38 day planned blast furnace
maintenance outage in Q2 2018 and a shut of the blast furnace for
December 2018. During December 2018, the Company chose not to
operate the old sinter plant at Port Pirie in order to further
support reducing lead in air emissions which ended the year below
the defined limit. In addition, Nyrstar also performed maintenance
on the TSL furnace and blast furnace during December 2018. These
maintenance shuts were to address a TSL furnace cooling issue; and
to bring forward maintenance previously scheduled for the blast
furnace in January 2019. The TSL furnace resumed operation on 15
December 2018.
OPERATIONS REVIEW: MINING
EUR million |
FY |
FY |
% |
|
H1 |
H2 |
% |
(unless otherwise indicated) |
2017 |
2018 |
Change |
|
2018 |
2018 |
Change |
|
|
|
|
|
|
|
|
Treatment charges |
(23) |
(28) |
20% |
|
(14) |
(14) |
1% |
Payable metal contribution |
230 |
282 |
22% |
|
160 |
122 |
(23%) |
By-Products |
18 |
16 |
(13%) |
|
9 |
7 |
(22%) |
Other |
(8) |
(15) |
94% |
|
(7) |
(8) |
15% |
Gross Profit |
218 |
256 |
17% |
|
148 |
108 |
(27%) |
|
|
|
|
|
|
|
|
Employee expenses |
(77) |
(92) |
19% |
|
(42) |
(49) |
15% |
Energy expenses |
(20) |
(23) |
13% |
|
(11) |
(11) |
0% |
Other expenses |
(80) |
(121) |
52% |
|
(57) |
(64) |
13% |
Direct Operating
Costs |
(177) |
(236) |
33% |
|
(111) |
(125) |
13% |
|
|
|
|
|
|
|
|
Non-operating and other |
6 |
0 |
(105%) |
|
(9) |
9 |
(197%) |
Underlying EBITDA |
47 |
19 |
(59%) |
|
28 |
(9) |
(132%) |
|
|
|
|
|
|
|
|
Mining Capex |
56 |
101 |
80% |
|
63 |
38 |
(40%) |
Mining underlying EBITDA of EUR 19 million in
2018 was EUR 28 million lower than in 2017 due to the negative
EBITDA performance from the restart and subsequent suspension of
the Myra Falls mine and weak production and operating cost
performance at the Langlois and Middle Tennessee mines, partially
offset by lower treatment charges and continued operating
improvements at the East Tennessee mines.
Mining capital expenditure in 2018 was EUR 101
million, up EUR 45 million on 2017, due primarily to the ramp-up of
the Middle Tennessee mines and the restart of the Myra Falls
mine.
|
FY |
FY |
% |
|
H1 |
H2 |
% |
DOC USD/tonne ore milled |
2017 |
2018 |
Change |
|
2018 |
2018 |
Change |
|
|
|
|
|
|
|
|
Langlois |
111 |
133 |
19% |
|
139 |
126 |
(9%) |
East Tennessee |
40 |
38 |
(4%) |
|
38 |
39 |
1% |
Middle Tennessee |
60 |
65 |
9% |
|
64 |
67 |
4% |
Myra Falls |
- |
- |
- |
|
- |
- |
- |
Average DOC/tonne ore
milled |
55 |
57 |
4% |
|
58 |
57 |
(1%) |
'000 tonnes |
FY |
FY |
% |
|
H1 |
H2 |
% |
unless otherwise indicated |
2017 |
2018 |
Change |
|
2018 |
2018 |
Change |
|
|
|
|
|
|
|
|
Total ore milled |
3,238 |
4,080 |
26% |
|
2,075 |
2,006 |
(3%) |
|
|
|
|
|
|
|
|
Zinc in
Concentrate |
|
|
|
|
|
|
|
Langlois |
34 |
24 |
(31%) |
|
12 |
12 |
5% |
Myra Falls |
- |
0.6 |
- |
|
- |
0.6 |
- |
East Tennessee |
66 |
76 |
15% |
|
36 |
40 |
12% |
Middle
Tennessee |
22 |
39 |
75% |
|
22 |
17 |
(26%) |
Total |
123 |
139 |
14% |
|
70 |
70 |
- |
|
|
|
|
|
|
|
|
Other metals |
|
|
|
|
|
|
|
Copper in concentrate |
2.1 |
1.6 |
(21%) |
|
0.8 |
0.9 |
7% |
Silver (‘000 troy oz) |
553 |
439 |
(21%) |
|
214 |
225 |
5% |
Gold (‘000 troy oz) |
1.9 |
2.1 |
8% |
|
0.7 |
1.3 |
82% |
Nyrstar's Mining operations produced
approximately 139kt of zinc in concentrate in 2018, an increase of
14% compared to 2017. The total mine production of zinc in
concentrate in 2018 was marginally below the revised full year
guidance range of 140kt to 150kt. This lower level of zinc in
concentrate production has been largely due to disappointing
production performance of the Langlois and the Middle Tennessee
mines and commercial production at the Myra Falls mine commencing
slightly later than had been originally anticipated at the start of
the year and the impact of the suspension of ore extraction at year
end to address deficiencies identified in compliance orders from
the Ministry for Energy, Mines & Petroleum Resources in British
Columbia.
OTHER DEVELOPMENTS
Port Pirie Redevelopment
On 1 February 2019, Nyrstar published an
operational and financial update which included, amongst other
items, a financial update with regards to the Port Pirie
Redevelopment. The Company provides the following additional
clarification with regards to the latest Port Pirie Redevelopment
guidance.
The historic and normalised forecast pro-forma
Underlying EBITDA for Port Pirie, Hobart and Australian Metals
Processing is summarised in the table below.
Pro-forma Underlying EBITDA EURm |
|
2016A |
2017A |
2018A |
2019F |
2020F |
Port Pirie |
|
8 |
18 |
(11) |
38 |
56 |
Hobart |
|
51 |
40 |
31 |
57 |
69 |
Australian Metals Processing |
|
59 |
58 |
20 |
95 |
125 |
The total pro-forma Underlying EBITDA guidance
of EUR 95 million and EUR 125 million for Australian Metals
Processing in FY 2019 and FY 2020 respectively is the aggregate of
the total pro-forma Underlying EBITDA contribution from both the
Port Pirie and the Hobart smelters under normalised liquidity and
operating conditions. This guidance is not incremental (or uplift)
as was the case for the Port Pirie Redevelopment guidance provided
before 1 February 2019 and will be materially negatively impacted
by the liquidity constraints that have been experienced by the
Group in Q4 2018 and H1 2019. The normalised Underlying EBITDA
guidance is the total pro-forma EBITDA contribution from the two
Australian smelters.
The main factors driving the negative pro-forma
Underlying EBITDA result for Port Pirie in 2018 were a combination
of increased costs due to the continued ramp-up of the TSL furnace
with the parallel operation of the sinter plant and higher energy
prices, production outage in December 2018 and technical process
bottlenecks which reduced the recovery of metal from the feed.
Other macro factors, such as lower lead treatment charges and metal
prices also negatively impacted the pro-forma Underlying EBITDA at
Port Pirie.
The allocation of additional costs to residues
between 2016 and 2018 has had an impact on the guided pro-forma
Underlying EBITDA contribution from the Port Pirie Redevelopment in
FY 2019 and to a lesser extent in FY 2020. As was disclosed in
Nyrstar’s press release on 1 February 2019, the processing of
historical inventory will provide a cash flow benefit of
approximately EUR 70 million in FY 2019. If there had not been
costs allocated to these residues in 2016 to 2018, the Underlying
EBITDA contribution from Port Pirie in FY 2019 would be
approximately EUR 70 million higher.
The other main reasons for the current lower
(but still material) pro-forma Underlying EBITDA contribution
guidance from the Port Pirie Redevelopment as compared to previous
guidance, are:
- lower metal recovery assumptions as a result of technical
process bottlenecks at Port Pirie, which results in a reduction in
free metal extracted from all feed processed by Port Pirie. These
bottlenecks (primarily the slag fumer and copper plant at Port
Pirie) were identified in the preparation of the 5-year Business
Plan for the capital structure review process and were incorporated
in the pro-forma Underlying EBITDA modelling for Australian Metals
Processing; and
- the application of one year of actual operating data instead of
the projected data which Nyrstar previously needed to rely on.
As was indicated in the operational and
financial update published on 1 February 2019, the Metals
Processing segment profitability of both the Australian sites are
intrinsically linked by the raw material flows between the two
sites and are only possible due to the Port Pirie Redevelopment. In
the absence of the Port Pirie Redevelopment, the Hobart and Port
Pirie sites would both be non-operational and would not contribute
EBITDA to the Metals Processing segment. Furthermore, the pro-forma
Underlying EBITDA of the two sites individually, but not of
Australian Metal Processing overall, depends on the internal
re-charge arrangements between the two sites for internal residues
that are used as feedstock at the sites. For this reason, to
provide more clarity, the Company has decided to show the proforma
Underlying EBITDA for Australian Metal Processing with a breakdown
of this figure to Port Pirie and Hobart.
The total project cost for the Port Pirie
Redevelopment was approximately AUD 714 million. This is inclusive
of the feasibility study costs and project management labour
costs.
Management changes
In connection with the capital structure review
process, Nyrstar announced on 18 January 2019 that Mr. Martyn Konig
had taken up the role of Executive Chairman and that Mr. Roman
Matej had been appointed to serve as Interim Chief Financial
Officer. Mr. Michel Abaza, the former Chief Financial
Officer, left the Nyrstar Group with immediate effect.
Strategic foreign exchange hedges
Since 2016, Nyrstar has entered into a series of
12 month rolling foreign exchange options to hedge the Company’s
monthly exposure related to the direct operating costs denominated
in Australian dollars (AUD), Canadian Dollars (CAD) and in Euro
(EUR) utilising put and call collar structures. During the course
of 2018, EUR/USD exposure was unhedged in H1 2018 and hedged on a
fixed forward basis at 1.18 in H2 2018. For the AUD/USD
transactional exposure, various collars were executed resulting in
a weighted average collar of 0.70 to 0.80 for approximately 100% of
2018. For the CAD/USD transactional exposure on Langlois, various
collars were executed resulting in a weighted average collar of
1.32 to 1.36 for approximately 100% of 2018. Transactional CAD/USD
currency exposure for the Mining segment was hedged with a fixed
forward of 1.32 in 2019. In January and February 2019,
Nyrstar unwound all of its strategic forward foreign exchange
hedges due to the loss of credit lines from the hedge
counterparties.
Strategic metal price hedges
In H1 2018, Nyrstar had in place zinc price
collar hedges to protect 70% of total free metal produced at the
zinc smelters and North American mines within a price range of USD
2,300/t and USD 3,094/t. Above and below these prices, Nyrstar’s
exposure was limited to 30% of the total free metal produced.
In H2 2018, Nyrstar had in place zinc price collar hedges to
protect 50% of total free metal produced at the zinc smelters and
North American mines within a price range of USD 2,600/t and USD
3,842/t. Above and below these prices, Nyrstar’s exposure was
limited to 50% of the total free metal produced.
During 2018, Nyrstar continued with its 12 month
rolling hedging programme and had hedged the majority of its zinc
free metal exposure (150kt) for the Mining segment at c. USD
3,000/t. Zinc in concentrate production in 2020 was also partly
hedged with approximately 16kt hedged at a zinc price of c. USD
2,900/t. In December 2018, Nyrstar terminated all of its strategic
metal hedges to provide additional liquidity to the business.
Metal at Risk Hedging
At any given time Nyrstar holds metal, either as
work-in-progress or finished good inventory, that has been
“priced-in” but not “priced-out”. As this metal remains exposed to
fluctuations in the underlying metal price until it is “priced
out”, it is called “Metal at Risk”. The actual Metal at Risk at any
given point in time fluctuates with deliveries of raw materials and
production levels.
As a risk mitigation process, Nyrstar has always
consistently monitored its Metal at Risk on an ongoing basis and
undertaken hedging to mitigate the metal price exposure in what
Nyrstar refers to as “transactional hedging”. The price of placing
these transactional hedges is dependent on whether future or
“forward” prices are higher or lower than current or “spot” prices,
as indicated by the shape of the forward underlying metal price
curve. Future prices can be either higher or lower than current
prices, depending on a range of factors and can change quite
rapidly at times. The hedges required to hedge Nyrstar’s Metal at
Risk position are determined by whether the net position is
positive, meaning Nyrstar has more metal “priced-in” than is
“priced-out”, or alternatively is negative, meaning Nyrstar has
more metal “priced-out” than is “priced-in”.
As announced by Nyrstar on 1 February 2019, it
has been continuing to manage tightly its cash and inventory levels
and has been evaluating additional measures to improve its
liquidity position. During the course of March 2019, Nyrstar closed
out all of its Metal at Risk hedge positions to release cash
collateralized against the credit lines. As a consequence of
closing out these Metal at Risk hedges, Nyrstar realised a one-off
cash benefit of approximately USD 40 million and is now fully
exposed to fluctuations in metal prices for its Metal at Risk.
Cyber attack
In January 2019, Nyrstar was subject to a
cyber-attack. Certain IT systems, including email, were impacted.
The cyber-attack issue was subsequently contained and resolved. The
operational and financial impact of the cyber-attack on Nyrstar’s
Metals Processing and Mining operations was not significant.
Perpetual Securities Distribution
AmountOn 29 April 2019, Nyrstar Port Pirie Pty Ltd
notified the holder of the Perpetual Securities that it elected to
cash pay all of the Distribution Amount (interest/fees) on the
Perpetual Securities for the period 27 November 2018 to 27 May 2019
(being AUD 13.2 million) and also that it would redeem 29,125
Perpetual Securities with a value of AUD 29.1 million. This is the
targeted number of Perpetual Securities for the relevant period
under the financing arrangement involving the State of South
Australia. Nyrstar will pay the aggregate of both amounts, AUD 42.3
million (EUR 26.1 million) on 27 May 2019.
SENSITIVITIES
Nyrstar’s results continue to be significantly
affected during the course of 2018 by changes in metal prices,
exchange rates and treatment charges. Sensitivities to variations
in these parameters are depicted in the below table, which sets out
the estimated impact of a change in each of the parameters on
Nyrstar’s 2018 underlying EBITDA based on the actual results and
production profile for the year ending 31 December 2018.
|
|
|
Estimated annual 2018 underlying EBITDA impact, excluding
hedge impact (EURm) |
Parameter |
2018 Annual Average price/rate |
Variable |
Metals Processing |
Mining |
Group |
|
|
|
|
|
|
Zinc price |
$2,907/t |
-/+ 10% |
(35)/+35 |
(29)/+29 |
(64)/+64 |
Lead price |
$2,242/t |
-/+ 10% |
(1)/+1 |
- |
(1)/+1 |
Copper price |
$6,523/t |
-/+ 10% |
(2)/+2 |
(1)/+1 |
(3)+3 |
Silver Price |
$15.71/oz |
-/+ 10% |
(3)/+3 |
- |
(4)+4 |
Gold Price |
$1,268/oz |
-/+ 10% |
(1)/+1 |
- |
(1)+1 |
EUR:USD |
1.18 |
-/+ 10% |
+95/(78) |
+11/(9) |
+106/(86) |
EUR:AUD |
1.58 |
-/+ 10% |
(34)/+28 |
- |
(34)/+28 |
EUR:CHF |
1.15 |
-/+ 10% |
- |
- |
(3)/+2 |
Zinc B/M TC |
$147/dmt |
-/+ 10% |
(20)/+20 |
+3/(3) |
(17)/+17 |
Lead TC |
$83/dmt |
-/+ 10% |
(2)/+2 |
- |
(2)/+2 |
The above sensitivities were calculated by
modelling Nyrstar’s 2018 underlying operating performance. Each
parameter is based on an average value observed during that period
and is varied in isolation to determine the full-year underlying
EBITDA impact.
Sensitivities are:
- Dependent on production volumes and the economic environment
observed during the reference period.
- Not reflective of simultaneously varying more than one
parameter; adding them together may not lead to an accurate
estimate of financial performance.
- Expressed as linear values within a relevant range. Outside the
range listed for each variable, the impact of changes may be
significantly different to the results outlined.
These sensitivities should not be applied to
Nyrstar’s results for any prior periods and may not be
representative of the underlying EBITDA sensitivity of any of the
variations going forward.
FORWARD-LOOKING STATEMENTS
This release includes forward-looking statements
that reflect Nyrstar's intentions, beliefs or current expectations
concerning, among other things: Nyrstar’s results of operations,
financial condition, liquidity, performance, prospects, growth,
strategies and the industry in which Nyrstar operates. These
forward-looking statements are subject to risks, uncertainties and
assumptions and other factors that could cause Nyrstar's actual
results of operations, financial condition, liquidity, performance,
prospects or opportunities, as well as those of the markets it
serves or intends to serve, to differ materially from those
expressed in, or suggested by, these forward-looking statements.
Nyrstar cautions you that forward-looking statements are not
guarantees of future performance and that its actual results of
operations, financial condition and liquidity and the development
of the industry in which Nyrstar operates may differ materially
from those made in or suggested by the forward-looking statements
contained in this news release. In addition, even if Nyrstar's
results of operations, financial condition, liquidity and growth
and the development of the industry in which Nyrstar operates are
consistent with the forward-looking statements contained in this
news release, those results or developments may not be indicative
of results or developments in future periods. Nyrstar and each of
its directors, officers and employees expressly disclaim any
obligation or undertaking to review, update or release any update
of or revisions to any forward-looking statements in this report or
any change in Nyrstar's expectations or any change in events,
conditions or circumstances on which these forward-looking
statements are based, except as required by applicable law or
regulation.
About NyrstarNyrstar is a global
multi-metals business, with a market leading position in zinc and
lead, and growing positions in other base and precious metals,
which are essential resources that are fuelling the rapid
urbanisation and industrialisation of our changing world. Nyrstar
has six smelters, one fumer and four mining operations, located in
Europe, Australia and North America, and employs approximately
4,100 people. Nyrstar is incorporated in Belgium and has its
corporate office in Switzerland. Nyrstar is listed on Euronext
Brussels under the symbol NYR. For further information please visit
the Nyrstar website: www.nyrstar.com.
For further information contact:
Anthony Simms - Head of
Investor Relations T: +41 44 745 8157 M:
+41 79 722 2152 anthony.simms@nyrstar.comFranziska
Morroni - Head of Communications T: +41 44 745
8295 M: +41 79 719 2342
franziska.morroni@nyrstar.com
MINING PRODUCTION ANNEX
PERIOD |
Production KPI by Site |
Ore milled ('000 tonnes) |
Mill head grade |
Recovery |
Concentrate |
Metal in concentrate |
Zinc (%) |
Lead (%) |
Copper (%) |
Gold (g/t) |
Silver (g/t) |
Zinc (%) |
Lead (%) |
Copper (%) |
Gold (%) |
Silver (%) |
Zinc(kt) |
Lead(kt) |
Copper(kt) |
Zinc(kt) |
Lead(kt) |
Copper(kt) |
Gold(k’toz) |
Silver(m‘toz) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONTINUING
OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FY 2017 |
Langlois |
467 |
7.77% |
- |
0.58% |
0.16 |
43.31 |
95.0% |
- |
77.5% |
78.9% |
85.0% |
65 |
- |
9.0 |
34.5 |
- |
2.1 |
1.9 |
553 |
East Tennessee |
2,003 |
3.48% |
- |
- |
- |
- |
95.1% |
- |
- |
- |
- |
107 |
- |
- |
66.3 |
- |
- |
- |
- |
Middle Tennessee |
769 |
3.11% |
- |
- |
- |
- |
92.8% |
- |
- |
- |
- |
34 |
- |
- |
22.2 |
- |
- |
- |
- |
Myra Falls |
0 |
0.00% |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
Mining Total |
3,238 |
4.01% |
- |
0.58% |
0.16 |
43.31 |
94.5% |
- |
77.5% |
78.9% |
85.0% |
206 |
- |
9.0 |
122.9 |
- |
2.1 |
1.9 |
553 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FY 2018 |
Langlois |
410 |
6.15% |
- |
0.50% |
0.15 |
36.41 |
94.3% |
- |
77.6% |
75.2% |
85.6% |
46 |
- |
6.9 |
23.8 |
- |
1.6 |
1.4 |
411 |
East Tennessee |
2,237 |
3.60% |
- |
- |
- |
- |
94.7% |
- |
- |
- |
- |
123 |
- |
- |
76.3 |
- |
- |
- |
- |
Middle Tennessee |
1,389 |
2.97% |
- |
- |
- |
- |
94.3% |
- |
- |
- |
- |
60 |
- |
- |
38.8 |
- |
- |
- |
- |
Myra Falls |
45 |
2.14% |
0.31% |
0.19% |
0.60 |
25.45 |
60.9% |
3.5% |
65.3% |
73.1% |
76.4% |
0.4 |
0.02 |
0.1 |
0.6 |
0.00 |
0.1 |
0.6 |
28 |
Mining Total |
4,081 |
3.63% |
0.31% |
0.47% |
0.19 |
35.33 |
94.1% |
3.5% |
76.4% |
75.1% |
84.7% |
230 |
0.02 |
7.0 |
139.5 |
0.0 |
1.6 |
2.1 |
439 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% Change |
Langlois |
(12%) |
(21%) |
- |
(13%) |
(10%) |
(16%) |
(1%) |
- |
0% |
(5%) |
1% |
(29%) |
- |
(23%) |
(31%) |
- |
(24%) |
(25%) |
(25%) |
East Tennessee |
12% |
4% |
- |
- |
- |
- |
(0%) |
- |
- |
- |
- |
15% |
- |
- |
15% |
- |
- |
- |
- |
Middle Tennessee |
81% |
(4%) |
- |
- |
- |
- |
2% |
- |
- |
- |
- |
75% |
- |
- |
75% |
- |
- |
- |
- |
Myra Falls |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
Mining Total |
26% |
(10%) |
- |
(18%) |
17% |
(18%) |
(0.45%) |
- |
(1%) |
(5%) |
(0%) |
12% |
- |
(22%) |
14% |
- |
(21%) |
8% |
(21%) |
MINING PRODUCTION ANNEX
PERIOD |
Production KPI by Site |
Ore milled ('000 tonnes) |
Mill head grade |
Recovery |
Concentrate |
Metal in concentrate |
Zinc (%) |
Lead (%) |
Copper (%) |
Gold (g/t) |
Silver (g/t) |
Zinc (%) |
Lead (%) |
Copper (%) |
Gold (%) |
Silver (%) |
Zinc(kt) |
Lead(kt) |
Copper(kt) |
Zinc(kt) |
Lead(kt) |
Copper(kt) |
Gold(k’toz) |
Silver(m‘toz) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONTINUING
OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
H1 2018 |
Langlois |
209 |
5.86% |
- |
0.49% |
0.15 |
37.32 |
94.2% |
- |
77.8% |
75.0% |
85.1% |
23 |
- |
3.6 |
11.6 |
- |
0.8 |
0.7 |
214 |
East Tennessee |
1,132 |
3.38% |
- |
- |
- |
- |
93.9% |
- |
- |
- |
- |
58 |
- |
- |
35.9 |
- |
- |
- |
- |
Middle Tennessee |
734 |
3.19% |
- |
- |
- |
- |
95.1% |
- |
- |
- |
- |
34 |
- |
- |
22.3 |
- |
- |
- |
- |
Myra Falls |
0 |
0.00% |
- |
- |
- |
- |
0.0% |
|
|
|
|
0 |
- |
- |
0.0 |
- |
- |
- |
- |
Mining Total |
2,075 |
3.57% |
- |
0.49% |
0.15 |
37.32 |
94.4% |
- |
77.8% |
75.0% |
85.1% |
115 |
- |
3.6 |
69.8 |
- |
0.8 |
0.7 |
214 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
H2 2018 |
Langlois |
200 |
6.45% |
- |
0.51% |
0.15 |
35.46 |
94.3% |
- |
77.5% |
75.5% |
86.2% |
24 |
- |
3.3 |
12.2 |
- |
0.8 |
0.7 |
197 |
East Tennessee |
1,105 |
3.83% |
- |
- |
- |
- |
95.4% |
- |
- |
- |
- |
66 |
- |
- |
40.4 |
- |
- |
- |
- |
Middle Tennessee |
655 |
2.71% |
- |
- |
- |
- |
93.1% |
- |
- |
- |
- |
26 |
- |
- |
16.6 |
- |
- |
- |
- |
Myra Falls |
45 |
2.14% |
0.31% |
0.19% |
0.60 |
25.45 |
60.9% |
3.5% |
65.3% |
73.7% |
76.4% |
0 |
0.02 |
0.14 |
0.6 |
0.00 |
0.05 |
0.64 |
28 |
Mining Total |
2,006 |
3.69% |
0.31% |
0.46% |
0.23 |
33.64 |
93.8% |
3.5% |
75.3% |
75.2% |
84.4% |
115 |
0.02 |
3.4 |
69.7 |
0.0 |
0.9 |
1.3 |
225 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% Change |
Langlois |
(4%) |
10% |
- |
5% |
(1%) |
(5%) |
0% |
- |
0% |
1% |
1% |
4% |
- |
(8%) |
5% |
- |
0% |
(4%) |
(8%) |
East Tennessee |
(2%) |
13% |
- |
- |
- |
- |
2% |
- |
- |
- |
- |
14% |
- |
- |
12% |
- |
- |
- |
- |
Middle Tennessee |
(11%) |
(15%) |
- |
- |
- |
- |
(2%) |
- |
- |
- |
- |
(26%) |
- |
- |
(26%) |
- |
- |
- |
- |
Myra Falls |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
Mining Total |
(3%) |
3% |
- |
(7%) |
57% |
(10%) |
(1%) |
- |
(3%) |
0% |
(1%) |
0% |
- |
(4%) |
(0%) |
- |
7% |
82% |
5% |
1 Underlying EBITDA is a non-IFRS measure of earnings, which is
used by management to assess the underlying performance of
Nyrstar’s operations and is reported by Nyrstar to provide
additional understanding of the underlying business performance of
its operations. Nyrstar defines “Underlying EBITDA” as profit or
loss for the period adjusted to exclude loss from discontinued
operations (net of income tax), income tax (expense)/benefit, share
of loss of equity-accounted investees, gain on the disposal of
equity-accounted investees, net finance expense, impairment losses
and reversals, restructuring expense, M&A related transaction
expenses, depreciation, depletion and amortization, income or
expenses arising from embedded derivatives recognised under IAS 39
“Financial Instruments: Recognition and Measurement” and other
items arising from events or transactions clearly distinct from the
ordinary activities of Nyrstar. For a definition of other terms
used in this press release, please see Nyrstar’s glossary of key
terms available at:
http://www.nyrstar.com/investors/en/Pages/investorsmaterials.aspx
2 Funds From Operations (FFO) is a measure used by management to
assess the performance of Nyrstar’s operations and is defined as
Group Underlying EBITDA less working capital movements, capital
expenditure, tax and other cash flow (excluding changes in silver,
copper and Zinc Metal prepays)
3 Free Cash Flow (FCF) is a measure used by management to assess
the performance of Nyrstar’s operations and is defined as FFO minus
interest and financing expenses
4 As at 31 December 2018, an aggregate total of EUR 174.9
million (2017: EUR 186.3 million) of Perpetual Securities had been
issued. The Perpetual Securities have been accounted for entirely
as financial liabilities at 31 December 2018 whilst in previous
periods, such as 30 June 2018 and 31 December 2017, the Perpetual
Securities were accounted for as equity and not included in loans
and borrowings. See note 26 (Perpetual Securities) in the
Consolidated Financial Statements.
5 Zinc, lead and copper prices are averages of LME daily cash
settlement prices. Silver/Gold price is average of LBMA daily
fixing / daily PM fixing, respectively
6 As per note 4 of the Consolidated Financial
Statements, in December 2018 Nyrstar entered into the Trade Finance
Framework Agreement (“TFFA”) with Trafigura. Under the terms of the
TFFA, Nyrstar agreed to grant securities over the shares of various
group entities including Nyrstar Port Pirie Pty Ltd (“NPP”). At 31
December 2018, Nyrstar Hobart Pty Ltd, the owner of NPP, granted
securities over 19.9% shares in NPP. While at 31 December 2018
Nyrstar NV owned legally and beneficially 100% of NPP, it was not
in Group’s sole control to avoid Nyrstar NV ceasing the legal and
beneficial ownership (directly or indirectly) of 100% of the issued
voting shares of NPP, which is one of the Early Redemption Event
(“ERE”) of the Securities. As such, the Securities have been
accounted for as financial liabilities at 31 December 2018.
7 Per tonne of lead metal and zinc contained in fume
8 DOC/tonne calculated based on segmental direct operating costs
and total production of Zinc and Lead Market Metal
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