Amg amg titanium alloys & coatings presentation may 2013


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Amg amg titanium alloys & coatings presentation may 2013

  1. 1. AMG Titanium Alloys &CoatingsMay 2013
  2. 2. 2AMG Business Units, Products and Markets Niche metals & alloys Coating materials Capital equipment & servicefor high purity materials Critical raw materialsAMG Processing AMG EngineeringInfrastructureAerospaceEnergyAMG MiningSpecialty Metals &Chemicals AMG’s conversion andrecycling businesses AMG’s vacuum systemsand services business Integrated AMG’s minebased businessesServing the Technology Trends in Energy, Aerospace, Infrastructure,and Specialty Metals & Chemicals
  3. 3. 3Overview■ Founded inNürnberg,Germany1911 1998■ Acquired bySafeguardInternational■ Became amemberof AMG2006 2011■ Celebrated100thAnniversaryCoating Materials Master Alloys Chemicals PowdersEnergy –SolarSpecialtyChemicals■ Facilities in Nuremberg and Freiberg, DE■ 2012 Revenue: $126 million■ 2012 Gross Margin: $28 million■ 2012 ROCE: 26%■ 426 FTEsAerospace AerospaceSpecialtyChemicalsSpecialty Metals &ChemicalsA leading manufacturer of high performance metals and materials■ Acquired FNEForschungsinstitutfür Nichteisen-Metalle FreibergGmbH2007 Future Growth
  4. 4. 4OverviewOperational Highlights2012 Revenue by End Market■ Successful startup of ALD Skull Melter toimprove TiAl business■ Cold Crucible Induction Melting■ Ramp up of EcoVox plant for moreindependence from third party suppliers■ Increase of capacities and productionefficiency■ Major steps in cost savings due to productdevelopment■ Strong growth of master alloys■ Successful renegotiations of V residuecontractsEnergy6.7%Aerospace71.1%Infrastructure3.9%SpecialtyMetals &Chem18.8%
  5. 5. 5Nürnberg, GermanyProduction of high performance metals and materials Chemicals Master Alloys Coating Materials PowdersAdministration, Sales & Marketing, Human Resources,Accounting & ITFreiberg / Saxony, GermanyBrand-Erbisdorf near FreibergProduction, research and development in materials andsurface technologies Coating Materials Research & DevelopmentOverviewOther LocationsSales & Marketing Wayne, PA USA Shanghai, China Worldwide network of sales partnersMünchenNürnbergFrankfurt am MainBerlinFreibergHamburg
  6. 6. 6Critical Raw Materials The EU identified 14 critical raw materials* to the European economy – focusing on twodeterminants – economic importance and supply riskNote: *European Commission Annex V to the Report of the Ad-hoc Working Group on defining critical raw materialsMaterials mined or processed by AMGHighlighted materialsprocessed by AMG TitaniumAlloys & CoatingsREELiAlVSbCrNiCTaNbTiSiMo
  7. 7. 7Coating MaterialsInputs andMaterial ScienceEverydayApplicationsEndMarketsKeyProductsValuePropositionEnergy –Solar Sputtering targets forTCO layers for PVthin film cells Alumina-dopedZinc Oxide(ZnO:Al) Increase efficiencyunder subdued daylight Reduce productioncostsSurfaceCoatingAll thin filmproducers applyTCO with thesputtering processand ~90% of thinfilm TCO layers aremade with ZnO:Al Increase visibilitycontrast and colorimpression Rotatable targets forsurface coating onsmart phones and PCs SiO2 Nb2O5SpecialtyMetals &ChemicalsCoating layer isapplied to increasecontrast and colorimpression oniPhonesSurfaceCoatingSurfaceCoating Sputtering targets forvarious industries suchas tooling, automotive,and aerospace TiAl CrAl Improve wearresistance Provide protectivehard coatingsSurface coatingsapplied to cars toimprove wearresistance and UVprotection Sputtering targets androtatable targets forthe flat glass industry AZOY®(ZnO/Al2O3) CROMA®SurfaceCoating Reduce heat loss Increase transparencyunder visible light Reduce infrared lightCoating layerapplied on buildingglass to improvethermal insulationand reducereflection
  8. 8. 8Thin Film–Rotatable Targets for Capacitive Touch ScreensCoating Materials – Niobium TargetsStrategicRationaleTechnologyandIllustrationEndMarkets ■ Market expected to increase 4x by 2016e■ Market growth directly depends on implementation of new coating equipmentToday Investment GoalDevelopment■ Increase visibility contrast and color impression on smart phones and tablet PCs■ Niobium oxide rotatable targets■ Rapidly growing market■ 2010: Developed the 1st layer-stacks by DC- and MF- high-rate sputter deposition withleading coating equipment manufacturer■ $ 0.3 million investment in thermal spray technology for NbO2 and Si■ 2011: Commercial production■ 2012: Market leader 40% market shareAirNb2O5SiO2Nb2O5SiO2A layer stack with Nb2O5polycarbonate/glass
  9. 9. 9A Boeing 787 Dreamliner contains ~250,000 lbtitanium, 17% increased fuel efficiency compared toBoeing 737Master AlloysInputs andMaterial ScienceAerospaceEverydayApplicationsEndMarketsKeyProducts Titanium masteralloys for aircraftengine components VanadiumAluminum (VAl)PropertyModificationValueProposition Reduce aircraftweight, improvingfuel efficiency andreducing CO2emissionsTitanium-aluminides are applied to blades for thelast two stages of the low pressure turbine (LPT) ofaircraft engines which is installed on Boeing 787Dreamliner Titanium masteralloys for aircraftengines TitaniumAluminides(γ -TiAl)PropertyModification Provide aproprietary materialand process Reduce aircraftweight, improvingfuel efficiency andreducing CO2emissions
  10. 10. 10Master Alloys – Titanium AlumnidesTi-64 Ti-6246 Ti-834Ni-basedSuperalloysTitaniumAluminidesExampleOperatingtemperature [ C] up to 430up to730 1,230 - 730 up to 730up to 230Ti Aluminides for Aircraft Engines
  11. 11. 11Master Alloys – Titanium AluminidesTi Aluminides for Aircraft EnginesStrategicRationale■ Reducing aircraft weight to improve fuel efficiency and reduce CO2 emissions■ Titanium aluminides reduce weight and meet technical specifications■ 10 year development■ Technology: $1.2 million on VAR skull furnace developed by ALD■ Improve availability of TiAl semi-finished goods through the skull furnaceproduction method – both for the casting and the forging route■ 2010 first long term contract for low pressure turbine application■ Rapidly growing market due to increase fuel efficiency demandsTechnologyandIllustrationEndMarkets ■ Demand for aircraft engines, is growing >5% per annum for foreseeable future■ Market expected to grow by 3x by 2016e due to increase in applicationsγ-TiAl ingot Low Pressure Turbine (LPT) Blade
  12. 12. 12A B787 Dreamliner contains ~250,000 lbtitanium, resulting lighter weight and 17%increased fuel efficiency compared to B737ChemicalsInputs andMaterial ScienceSpecialtyMetals &ChemicalsAerospaceEverydayApplicationsEndMarketsKeyProducts Vanadium oxidesand compoundsfor variousindustries SAV V2O5 AMV KMVValueProposition Act as catalyst forchemical reactions Protect fromcorrosion Absorb UV and IR-lightGfE designschemicals andpowders accordingto customerrequirementsPropertyModification Vanadium oxidesfor Titaniummaster alloys (foraircraft engines andcomponents) V2O5 VO2PropertyModification Reduce aircraftweight, improvingfuel efficiency andreducing CO2emissions
  13. 13. 13In-sourcing Vanadium Recycling for Chemicals■ Reduce cost of vanadium and increase secure supply■ Long-term producer of V2O5 through recycling ~ 4,500 MT per year of European wastes■ Goal: Reduce costs up to $1/lb V2O5■ Technology: EcoVox® for capability to reduce costs of in-house recycling■ VO2-furnace, filter-press, a fluid-bed-dryer and a PMV facility,V2O5 furnace, a newsteam generation and a waste water treatment line■ Meet or exceed all environmental specifications■ Exceed 20% of global market shareStrategicRationaleTechnologyandIllustrationEndMarketsV2O5 Powders & Chemicals Titanium Master Alloy (VAl)A certified aerospace supplier for engine applications to major customersChemicals – V2O5
  14. 14. 14PowdersInputs andMaterial ScienceSpecialtyMetals &ChemicalsEverydayApplicationsEndMarketsKeyProducts Industrial powdersfor variousindustries A-Cr powderhp CoAl 78/22powder Ti-powder CoAlTi-powderValueProposition Improveconductivity ImprovebiocompatibilityPropertyModificationHip Implants coatedwith titanium powdersMagnets containspowdersTitanium powder Pigments
  15. 15. 15Short-termMid-termLong-termStrategic Actions■ Improve safety and environment■ Reduce inventory and working capital■ Implement work-process optimizations■ CAPEX optimization versus budget control■ Improve cost control■ Focus on customer relations / demands■ Adapt capacities to meet new demand■ Re-negotiate supply contracts■ Focus on profitable product groups■ Focus R&D projects towardfuture growth markets■ Develop competence centers2013 Reduce SG&A expenses Improve Working Capital Levels Optimize CAPEX to increase ROCE