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Q2 2019 RESULTS PRESENTATION 26 JULY 2019 Q2 2019 RESULTS PRESENTATION DISCLAIMER This document may contain forward-looking information and statements about ACERINOX, S.A., its subsidiaries and/or its management. These forward-looking


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Q2 2019 RESULTS PRESENTATION

26 JULY 2019

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2

DISCLAIMER

This document may contain forward-looking information and statements about ACERINOX, S.A., its subsidiaries and/or its management. These forward-looking statements include financial projections and estimates and their underlying assumptions, and statements regarding the intent, belief or current expectations or forecasts of ACERINOX, S.A. and/or its management, as well as statements regarding future performance, plans, objectives,

  • perations, business, strategy, capital expenditures, results of operations, markets and products. These forward-looking statements or forecasts may also

include assumptions regarding future economic and other conditions, such as future nickel or chrome prices and, in general, are subject to risks, uncertainties and variables beyond ACERINOX’s control that can adversely affect them. These forward-looking statements and information do not constitute historical facts and can generally be identified by the use of terms such as “expects”, “anticipates”, “believes”, “plans”, “estimates” and similar expressions. ACERINOX, S.A. believes they all are reasonable but are not a guarantee of future performance, prices, results of operations, benefits or dividend payout policies. ACERINOX, S.A. future financial condition, financial ratios, business, results of

  • perations and dividends could differ materially from those expressed or implied in or projected by such forward-looking statements, information and forecasts.

All forward-looking statements included herein are based on information available on the date hereof. Except as required by applicable law, ACERINOX, S.A. does not undertake any obligation to publicly update or revise any forward-looking statements and information, even in the event of new information being published or new events occurring. Investors, holders of ACERINOX, S.A. securities and shareholders in ACERINOX, S.A. are cautioned not to place undue reliance on the forward-looking statements and information, which speak only as of the date they were made. All subsequent oral or written forward-looking statements or information attributable to ACERINOX, S.A. or any of its members, directors, officers, employees or any persons acting on its behalf are expressly qualified in their entirety by this cautionary statement. No representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or opinions contained herein. None of the Company or any of its affiliates, advisors or representatives shall have any liability whatsoever for any loss arising from any use of this document, or its contents, or otherwise arising in connection with this document. Moreover, this document nor any part of it constitutes a contract, nor may it be used for incorporation into or interpretation of any contract or other type or agreement. The points contained in this disclaimer must be taken fully into account by all persons or entities obliged to take decisions or to draw up or to publish opinions

  • n securities issued by ACERINOX, S.A., in particular, by the analysts and investors reading this document. All the aforesaid persons are invited to consult the

public documentation and information that ACERINOX, S.A. reports to or files with the bodies responsible for supervising the main securities market and, in particular, with the Spanish National Securities Market Commission (CNMV in its Spanish initials). Q2 2019 RESULTS PRESENTATION

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3

SECOND QUARTER PERFORMANCE

Q2 MARKET HIGHLIGHTS Stabilization of market activity Raw material prices remain volatile Macro uncertainties prevail Europe Imports remain low YoY Inventories mixed Base prices remain low USA Volume and prices stable Imports remain at low levels Inventories low Asia Ongoing oversupply Prices remain weak

Slight improvement vs Q1: +7% EBITDA QoQ

  • 36% EBITDA YoY

Downward inventory adjustment of 13 million NAS strong performance continues Other plants facing a challenging environment Q2 Production:

  • 9% melting production QoQ
  • 11% melting production YoY

Working Capital lower in Q2 vs Q1 Positive free cash flow pre dividends Debt remains controlled despite returns to shareholders

Q2 ACERINOX HIGHLIGHTS

X X

 

X

X

  

X X

  

X X X X

Q2 2019 RESULTS PRESENTATION

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SLIDE 4

5,000 10,000 15,000 20,000

J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J

4

MARKET PERFORMANCE

A v e r a g e p r i c e : c a s h / t h r e e m o n t h s U S D / m t A v e r a g e q u a r t e r l y p r i c e U S ¢ / L b . C r

F E R R O C H R O M E N I C K E L

S o u r c e : L M E S o u r c e : M e t a l B u l l e t i n

Q2 2019 RESULTS PRESENTATION

165 154 110 139 118 142 138 124 112 120 104

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2017 2018 2019

2,703 2,440 1,785

1,500 1,700 1,900 2,100 2,300 2,500 2,700 2,900 3,100 3,300 J F M A M J JL A S O N D J F M A M J JL A S O N D J F M A M J 2017 2018 2019

S T A I N L E S S S T E E L C O L D R O L L E D S H E E T P R I C E S A I S I 3 0 4 2 . 0 m m

U S D / m t , f i n a l p r i c e , a l l o y s u r c h a r g e i n c l u d e d S o u r c e : C R U

2017 2018 2019

  • N. Europe

USA Taiwan

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5

STAINLESS STEEL INVENTORIES

2 3 4

100 200 300 400 500 600

J F M A M J JL A S O N D J F M A M J JL A S O N D J F M A M J JL A S O N D J F M A M J JL A S O N D J F M A M J JL A S O N D

20 40 60 80 100

J F M A M J JL A S O N D J F M A M J JL A S O N D J F M A M J JL A S O N D J F M A M J JL A S O N D J F M A M J JL A S O N D

40 50 60 70 80 90 2 0 1 5 D a y s

  • f s t o c k

100 200 300 400 500

J F M A M J JL A S O N D J F M A M J JL A S O N D J F M A M J JL A S O N D J F M A M J JL A S O N D J F M A M J JL A S O N D

M o n t h s

  • f s t o c k
T h o u s a n d m t A v e r a g e 2 0 1 5 - J u n 2 0 1 9 4 6 5 , 0 0 0 m t A v e r a g e 2 0 1 5 - J u n 2 0 1 9 3 1 9 , 0 0 0 m t T h o u s a n d m t T h o u s a n d m t A v e r a g e 2 0 1 5 - J u n 2 0 1 9 : 7 7 , 1 9 6 m t

I N V E N T O R I E S O F C O L D - R O L L E D I N V E N T O R I E S A T D I S T R I B U T O R S I N V E N T O R I E S A T W U X I & F O S H A N

S o u r c e : E H V G e r m a n y S o u r c e : M S C I S o u r c e : 5 1 b x g

2 0 1 6 2 0 1 7 2 0 1 8 2 0 1 9 2 0 1 6 2 0 1 7 2 0 1 8 2 0 1 9 2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 8 2 0 1 9 2 0 1 5

Q2 2019 RESULTS PRESENTATION

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Q2 2019: MAIN FINANCIAL FIGURES

Q1 2019 Q2 2019 Variation H1 2018 H1 2019 Variation

Net Sales 1,202 1,240 3% 2,588 2,442

  • 6%

EBITDA 90 97 7% 268 186

  • 30%

EBIT 45 54 19% 184 100

  • 46%

Results before Taxes and Minorities

45 53 17% 182 98

  • 46%

Results after Taxes and Minorities

33 37 13% 138 69

  • 50%

Free Cash Flow (before dividends)

17 22 29% 68 39

  • 43%

Net Financial Debt

573 642 12% 537 642 20%

No of employees

6,768 6,836 1% 6,818 6,836 0%

Deliveries stable vs Q1 Q2 EBITDA impacted by €-13 million inventory adjustment

Robust performance in a challenging environment

Figures in million €

Q2 2019 RESULTS PRESENTATION

FCF remains positive

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118 151 154 58 90 97 2 0 4 0 6 0 8 0 1 0 0 1 2 0 1 4 0 1 6 0 1 8 0

Q118 Q218 Q318 Q418 Q119 Q219

7

QUARTERLY PERFORMANCE

668 639 617 516 628 570 Q118 Q218 Q318 Q418 Q119 Q219

  • 46

114

  • 11

114 17 22

Q118 Q218 Q318 Q418 Q119 Q219 667 537 666 552 573 642 Q118 Q218 Q318 Q418 Q119 Q219

MELTING PRODUCTION FREE CASH FLOW NET FINANCIAL DEBT EBITDA

Thousand tons Million € Million € Million €

(Before dividends) Q2 2019 RESULTS PRESENTATION

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8

Q2 CASH FLOW

Q2 2019 RESULTS PRESENTATION

Million €

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9

CASH FLOW

Q2 2019 RESULTS PRESENTATION

Millones EUR

Jan - Mar 2019 Apr - Jun 2019 Jan - Jun 2019 Jan - Dec 2018 Jan - Jun 2018 EBITDA 90 97 186 480 268 Changes in working capital 4 8 11

  • 87
  • 86

Changes in operating working capital

  • 47

8

  • 39
  • 74
  • 97
  • Inventories
  • 32

8

  • 24
  • 28
  • 59
  • Trade debtors
  • 51
  • 42
  • 93

27

  • 116
  • Trade creditors

36 42 78

  • 73

79 Others 51

  • 1

50

  • 14

11 Income tax

  • 26
  • 50
  • 76
  • 81
  • 49

Financial expenses

  • 5
  • 5
  • 15
  • 7

Others

  • 21

8

  • 13

30 5 OPERATING CASH FLOW 47 57 104 326 131 Payments for investments on fixed assets

  • 30
  • 35
  • 65
  • 155
  • 63

FREE CASH FLOW 17 22 39 171 68 Dividends and treasury shares

  • 49
  • 81
  • 130
  • 128
  • 1

CASH FLOW AFTER DIVIDENDS

  • 32
  • 59
  • 91

43 67 Conversion differences 11

  • 10

1 14 6 Variation in net financial debt

  • 21
  • 69
  • 90

57 72

Million €

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10

EXCELLENCE 360º: ROADMAP

2019 2020 2021 2022

112 MM€

89%

Excellence 360º target = EUR125 million in 2023 (recurrent)

24 MM€

19%

2023

125 MM€

100%

59 MM€

47%

86 MM€

69%

360º

Q2 2019 RESULTS PRESENTATION

Target achieved until June: EUR24 million

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11

OUTLOOK

Q3 EBITDA IS EXPECTED TO BE SIMILAR TO Q2 19

  • Seasonal

slowdown in Europe

  • US market conditions remain

robust

  • Prices remain low in Europe

and Asia

Despite a challenging global market and the weaker summer period Q3 EBITDA should be similar to Q2

Q2 2019 RESULTS PRESENTATION

  • Macro uncertainties and weak

visibility

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THANK YOU

Q&A

Q2 2019 RESULTS PRESENTATION

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13

A c e r i n o x E u r o p a A P L i n e N A S B A L i n e

APPENDIX

Q2 2019 RESULTS PRESENTATION

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14

ACERINOX: GLOBAL PLAYER

  • Sp an ish m u l t i n a t i o n a l c o m p a n y
  • F u l l y d e d i c a t e d t o s t a i n l e s s s t e e l
  • Net sales: EUR 5 , 0 1 1 m illio n ( 2 0 1 8 )
  • Am o n g larg est p ro d u cers i n t h e w o rld w ith 3 . 5

m illion t o n s o f m eltin g c a p a c i t y

  • 6 facto ries in 4 c o n t i n e n t s
  • 6 , 7 0 9 p ro fessio n als in 5 c o n t i n e n t s
  • Presen ce in 40 co u n tries w o rld w id e w ith s a l e s

in 80 co u n tries

Q2 2019 RESULTS PRESENTATION

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15

HISTORY

1 9 7 0 , i n c o r p o r a t i o n o f A C E R I N O X , S . A . ( S p a i n ) 1 9 9 0 , i n c o r p o r a t i o n o f N O R T H A M E R I C A N S T A I N L E S S ( U S A ) 2 0 0 2 , i n c o r p o r a t i o n o f C O L U M B U S S T A I N L E S S ( S o u t h A f r i c a ) 2 0 0 9 , i n c o r p o r a t i o n o f B A H R U S T A I N L E S S ( M a l a y s i a )

A c e r i n o x , S . A . 9 8 % H a n w a ( M e t a l O n e C o r p ) 2 %

M A I N A C E R I N O X S H A R E H O L D E R S

C o r p o r a c i ó n F i n a n c i e r a A l b a , S . A . 1 8 . 9 6 % N i p p o n S t e e l S t a i n l e s s S t e e l C o r p . 1 5 . 4 9 % F e y n m a n C a p i t a l S . L . ( O M E G A ) 9 . 8 8 % D i m e n s i o n a l F u n d A d v i s o r s 3 . 0 5 % I n d u s t r i a l D e v e l o p m e n t C o r p . ( I . D . C . ) 3 . 0 4 %

S o u r c e : C N M V

1 0 0 % A c e r i n o x S . A . A c e r i n o x , S . A . 7 6 % I . D . C . 2 4 % Q2 2019 RESULTS PRESENTATION

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16

ACERINOX PRINCIPLES AND VALUES

Q2 2019 RESULTS PRESENTATION

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17

ACERINOX PRODUCTION CAPACITY

M e l t i n g 1 . 4 H o t R o l l i n g 1 . 2 C o l d R o l l i n g 0 . 8 L o n g P r o d . 0 . 2 M e l t i n g 1 . 1 H o t R o l l i n g 0 . 9 C o l d R o l l i n g 0 . 7 L o n g P r o d . 0 . 2 M e l t i n g 1 . 0 H o t R o l l i n g 1 . 0 C o l d R o l l i n g 0 . 5 M e l t i n g ( * ) 1 . 0 H o t R o l l i n g ( * ) 1 . 0 C o l d R o l l i n g ( * ) 0 . 6

( * ) O n c e i t ’ s c o m p l e t e d

N O R T H A M E R I C A N S T A I N L E S S

F U L L Y I N T E G R A T E D P L A N T

A C E R I N O X E U R O P A

F U L L Y I N T E G R A T E D P L A N T

C O L U M B U S S T A I N L E S S

F U L L Y I N T E G R A T E D P L A N T

B A H R U S T A I N L E S S

Q2 2019 RESULTS PRESENTATION

M i l l i o n m t

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18

STAINLESS STEEL WORLD PRODUCTION

5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000 55,000 1950 1960 1970 1980 1990 2000 2010 2018

W o r l d p r o d u c t i o n o f S t a i n l e s s S t e e l i n 2 0 1 8 :

50.7 million mt

( + 5 . 5 % o v e r 2 0 1 7 )

C o m p o u n d a n n u a l g r o w t h r a t e 1 9 5 0 – 2 0 1 8 :

+ 5.9%

Q2 2019 RESULTS PRESENTATION

T h o u s a n d m t

S o u r c e : I S S F a n d A c e r i n o x
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19

S o u r c e : I S S F

STAINLESS STEEL USE PER SECTOR, 2018

Metal products 38% Mechanical engineering 29% Construction 12% Motor vehicles 9% Electrical Machinery 8% Other transport 5%

Q2 2019 RESULTS PRESENTATION

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20

STAINLESS STEEL WORLD PRODUCTION

C h i n a a c c o u n t s f o r 5 5 % o f w o r l d p r o d u c t i o n i n 2 0 1 8

10 20 30 40 50

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Others Japan India China USA Europe

Q2 2019 RESULTS PRESENTATION

Others: Brazil, Russia, S. Africa, S. Korea, Indonesia

T h o u s a n d m t

S o u r c e : I S S F
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524 536 498 481 526 563 572 547 593 535 542 560 577 561 524 458 531 514

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2015 2016 2017 2018 2019

ACERINOX PRODUCTION

  • 9 % o v e r Q 1 2 0 1 9
  • 1 1 % o v e r Q 2 2 0 1 8

MELT ING SHO P HO T RO LLING CO L D RO L L ING

T h o u s a n d m t 601 611 562 546 575 652 637 611 668 605 615 631 668 639 617 516 628 570

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2015 2016 2017 2018 2019

395 430 393 390 418 428 429 441 438 436 427 437 462 471 443 377 422 441

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2015 2016 2017 2018 2019 Q2 2019 RESULTS PRESENTATION

  • 3 % o v e r Q 1 2 0 1 9
  • 8 % o v e r Q 2 2 0 1 8

+ 4 % o v e r Q 1 2 0 1 9

  • 6 % o v e r Q 2 2 0 1 8

21

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22

BALANCE SHEET

Q2 2019 RESULTS PRESENTATION

ASSETS LIABILITIES Million € Jun-19 2018 Jun 18 Variation Million € Jun-19 2018 Jun 18 Variation Non-current assets 2,144.25 2,133.77 2,131.28 0.5% Equity 2,019.70 2,119.30 2,014.62

  • 4.7%

Current assets 2,572.42 2,473.82 2,603.53 4.0% Non-current liabilities 1,320.08 1,226.22 1,301.54 7.7%

  • Inventories

1,042.64 1,018.74 1,049.70 2.3%

  • Interest-bearing loans and borrowings

1,122.74 1,026.29 1,093.53 9.4%

  • Debtors

678.27 589.78 742.06 15.0%

  • Other non-current liabilities

197.34 199.93 208.01

  • 1.3%

Trade debtors 617.68 524.69 668.44 17.7% Other debtors 60.59 65.09 73.62

  • 6.9%

Current liabilities 1,376.91 1,262.07 1,418.65 9.1%

  • Cash

826.56 850.11 788.62

  • 2.8%
  • Interest-bearing loans and borrowings

345.62 375.89 231.82

  • 8.1%
  • Other current assets

24.96 15.18 23.15 64.4%

  • Trade creditors

861.92 783.86 935.31 10.0%

  • Other current liabilities

169.36 102.32 251.52 65.5% TOTAL ASSETS 4,716.68 4,607.59 4,734.81 2.4% TOTAL EQUITY AND LIABILITIES 4,716.68 4,607.59 4,734.81 2.4% Net Financial Debt 641.80 552.07 536.74 Operating Working Capital 798.39 759.57 782.83

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23

WORKING CAPITAL

  • 1,000
  • 500

500 1,000 1,500 2,000

Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17 Dec-18 Jun-19

I n v e n t o r i e s T r a d e D e b t o r s T r a d e C r e d i t o r s W o r k i n g C a p i t a l

Million €

Q2 2019 RESULTS PRESENTATION

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24

NET FINANCIAL DEBT

1,075 1,084 887 582 529 616 711 620 609 552 642

200 400 600 800 1,000 1,200

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Jun 2019

61.3% 56.3% 47.1% 33.9% 34.1% 33.2% 35.1% 28.6% 30.9% 26.0% 31.8%

  • 5.63

2.84 2.60 2.94 2.32 1.36 2.48 1.88 1.25 1.15 1.61 Gearing NFD / LTM EBITDA

Q2 2019 RESULTS PRESENTATION

Million €

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25

H1 CASH FLOW

Q2 2019 RESULTS PRESENTATION

Million €

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SLIDE 26

0.44 0.45 0.45 0.50

2016 (*) 2017 2018 2019

26

CAPITAL ALLOCATION

94 173 173 144

2015 2016 2017 2018

  • Coil build up line - NAS
  • Ladle furnace - Acerinox
  • Ladle furnace - Columbus
  • Slitter line - Columbus

( * ) S c r i p d i v i d e n d

DIVIDEND INCREASE 11% SHARE BUYBACK PROGRAMME: CAPEX RETURN TO SHAREHOLDERS PHASE I: 2% CAPEX IN PROGRESS:

€ / share

Q2 2019 RESULTS PRESENTATION

Million €

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27

EXCELLENCE PLAN V

  • Focused on operational excellence
  • Best practices in each business unit
  • Management and control tool

97 52 53 50 27

PE I 2009 - 2010 PE II 2011 – 2012 PE III 2013 – 2014 PE IV 2015 – 2016 PE V 2017 – 2018 PE VI 2019 – 2020

58% 73% 88% 74% 55% 133 90 60 67 50

45MM€

Achieved 2 0 1 7 - 2 0 1 8 E X C E L L E N C E P L A N V

T a r g e t : 5 0 m i l l i o n E U R A c h i e v e d : 5 5 % , 2 7 m i l l i o n E U R

5 c h a p t e r s : O p e r a t i o n s , W o r k i n g C a p i t a l , P e r s o n n e l , C o m m e r c i a l a n d S u p p l y C h a i n

Q2 2019 RESULTS PRESENTATION

Million €

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28

THE NEXT STEP: EXCELLENCE 360º

Q2 2019 RESULTS PRESENTATION

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29

EXCELLENCE 360º

Q2 2019 RESULTS PRESENTATION

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THANK YOU

Q2 2019 RESULTS PRESENTATION