To: The
Manager
Announcements
Company Announcements Office
Australian Stock Exchange
Public Announcement 2009 39AWC
Attached is a presentation by Alumina Limited's CEO, John Bevan, in Hong Kong and Singapore
during the Morgan Stanley Asia Pacific Summit
Some statements in this public announcement are forward-looking statements within the meaning of the US Private Securities Litigation
Reform Act of 1995. Forward-looking statements also include those containing such words as `anticipate', `estimates', `should', `will',
`expects', `plans' or similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual outcomes to be
different from the forward-looking statements. Important factors that could cause actual results to differ from the forward-looking statements
include: (a) material adverse changes in global economic, alumina or aluminium industry conditions and the markets served by AWAC;
(b) changes in production and development costs and production levels or to sales agreements; (c) changes in laws or regulations or
policies; (d) changes in alumina and aluminium prices and currency exchange rates; and (e) the other risk factors summarised in Alumina's
Form 20-F for the year ended 31 December 2008.
Stephen Foster
Company Secretary
17 November 2009
Alumina Limited
ABN 85 004 820 419
GPO Box 5411
Melbourne Vic 3001
Australia
Level 12 IBM Centre
60 City Road
Southbank Vic 3006
Australia
Tel +61 (0)3 8699 2600
Fax +61 (0)3 8699 2699
Email info@aluminalimited.com
Alumina Limited
Positioned for Growth
Asia Pacific Summit
John Bevan
Chief Executive Officer
2
Alumina Limited
who are we?
Current aluminium market conditions
Alumina demand and pricing
The unique position of Alumina Limited
3
Disclaimer
This presentation is not a prospectus or an offer of securities for subscription or sale in any jurisdiction.
Some statements in this presentation are forward-looking statements within the meaning of the US Private
Securities Litigation Reform Act of 1995. Forward-looking statements also include those containing such
words as "anticipate", "estimates", "should", "will", "expects", plans" or similar expressions. Forward-looking
statements involve risks and uncertainties that may cause actual outcomes to be different from the forward-
looking statements. Important factors that could cause actual results to differ from the forward-looking
statements include: (a) material adverse changes in global economic, alumina or aluminium industry
conditions and the markets served by AWAC; (b) changes in production and development costs and
production levels or to sales agreements; (c) changes in laws or regulations or policies; (d) changes in
alumina and aluminium prices and currency exchange rates; (e) constraints on the availability of bauxite;
and (f) the risk factors and other factors summarised in Alumina's June 2009 Half-Yearly ASX Report filed
on Form 6-K and Alumina's Form 20-F for the year ended 31 December 2008.
Forward-looking statements that reference past trends or activities should not be taken as a representation
that such trends or activities will necessarily continue in the future. Alumina Limited does not undertake any
obligations to update or revise any forward-looking statements, whether as a result of new information,
future events or otherwise. You should not place undue reliance on forward-looking statements which
speak only as of the date of the relevant document.
4
Current Share Price (11/11/09)
A$1.69
Shares on Issue
2.44bn
Market CAP
A$4.12bn
175
237
316
331
569
406
202
100
200
300
400
500
600
2002
2003
2004
2005
2006
2007
2008
Underlying Earnings (AUD)
Who is Alumina Limited
Alumina Limited (AWC) is listed on the Australian Stock Exchange
and the New
York Stock Exchange
Alumina's primary asset is its 40% joint venture interest in Alcoa World
Alumina
& Chemicals (AWAC)
Alcoa holds 60%
AWAC mainly produces smelter grade alumina feedstock and aluminium from
2 smelters in Australia
5
Joint Venture Structure
Alumina
Limited
Alcoa Inc
40%
60%
What is AWAC?
World's largest alumina producer, accounting for 18% of
world production
Exclusive joint venture with
Alcoa for bauxite and alumina
Alcoa manages "day to day
operations"
Includes 2 smelters in Australia
AWAC Entities
6
AWAC The Global Bauxite & Alumina Business
Point Comfort
San Ciprian
Kwinana
Pinjarra
Wagerup
Huntly
Willowdale
Guinea
Juruti
Jamalco
Suralco
Sao Luis
Portland
Point Henry
MRN
Bauxite Mines
Refineries
Smelters
All assets 100% owned by AWAC except
Portland Smelter 55%
Guinea 23%
Sao Luis -
39% MRN
9.6%
Jamalco 45%
Eight refineries
Seven bauxite mines
Two smelters
7
Aluminium Demand is Rebounding
2009 Projected Primary Aluminum Consumption by Region (mmt)
Source: Alcoa Q3 2009
2H'09 vs. 1H'09
Growth Rate: 11%
2H'09 vs. 1H'09
+6%
+18%
+1%
+22%
+11%
+16%
+7%
6.6
7.1
3.0
3.4
2.4
2.6
2.0
2.4
0.4
0.4
0.3
0.4
1.9
2.0
1H'09
2H'09
Other*
Brazil
Russia
Asia w/o China
North America
Europe
China
8
Source: Alcoa Q3 2009
Alcoa End Markets: Assessment of 2nd Half 2009 VS 1st Half 2009 Conditions
Improving Aluminium Market Conditions in 2H 2009
9
$1,250
$1,500
$1,750
$2,000
$2,250
$2,500
$2,750
$3,000
$3,250
$3,500
0
10
20
30
40
50
60
70
1/05
7/05
1/06
7/06
1/07
7/07
1/08
7/08
1/09
7/09
Producer
Japan Port
Shanghai
LME
LME 3 Mon
Rise In LME Stocks Slows As Non-LME Stocks
Decline
$/MT
Producer levels
at all time lows
Japan Port
stocks at 15-
year lows
Inventory
Source: Bloomberg, IAI
67 days of
consumption
LME at 49
days
Non-LME at
18 days
10
J
u
l
0
8
A
u
g
0
8
S
e
p
0
8
O
c
t
0
8
N
o
v
0
8
D
e
c
0
8
J
a
n
0
9
F
e
b
0
9
M
a
r
0
9
A
p
r
0
9
M
a
y
0
9
J
u
n
0
9
J
u
l
0
9
K
t
1 Week of Inventory
Minimal Lead-time
3 months of Inventory
3 Month Lead-time
2 months of Inventory
3 Month Lead-time
Distributor
Rolling Mill
Smelter
OEM
The Impact of Destocking on the Supply Chain
Continuous Flow
New
Order
In
Process
On
Floor
Order to
Rolling Mill
-7%
New
Order
In
Process
On
Floor
Order to
Smelter
-17%
Excess
New
Order
Production
Volume
-42%
Old
Order
Order
Reduction
New
Order
Order to
Service
Center
On
Floor
-5%
Time Line
3 Months
6 Months
9 Months
Source: Davenport & Company; Alcoa analysis
Refrigerator
Rolled Sheet
Rolled Sheet
Primary Aluminum
De-stocking Has Left Supply Chain Depleted
11
Source: Bloomberg as at 9 November 2009
Aluminium Forward Prices
Short term prices are below reinvestment requirements
1,200
1,400
1,600
1,800
2,000
2,200
2,400
Dec-08
Dec-09
Dec-10
Dec-11
Dec-12
Dec-13
US$/t
November
January
March
12
Non
Integrated
18mt
Integrated
39mt
Alumina
Production
79.1mt
Rest of World 57mt
Generally 1,3,5 year contracts,
or longer
Generally linked to aluminium
price
Developing spot market
China 22mt
Generally short term contracts
Generally not linked to
aluminium price
Integrated
9mt
Non
Integrated
13mt
Alumina Supply Dynamics
Source: CRU 2008 Actuals
Contract Form*
* Alumina
13
China's Alumina Supply Integrated vs
Non-Integrated
Source: Clark & Marron October 2009
Integrated
Chalco
Integrated
Non Chalco
Imports
Long term
Other
Traded
Total
Supply
5.4
20%
6.6
24%
3.0
11%
12.1
45%
27.1
(Figures represent millions of tonnes)
14
Alumina Price Comparison
Source: Chalco website, Bloomberg, ABARE, China CCM
0
100
200
300
400
500
600
700
800
Jun 2003
Jun 2004
Jun 2005
Jun 2006
Jun 2007
Jun 2008
Jun 2009
U
S
$
/
t
Chalco alumina
Alumina spot
ABARE alumina
Non-Chalco alumina
15
China's Alumina Cost Curve (3Q 2009)
Cost
US$/t
0%
25%
50%
75%
100%
Cumulative Production -
%
Alumina Cost Curve (US$/t)
Source: Clark & Marron October 2009
Cost
US$/t
0
50
100
150
200
250
300
350
400
450
0%
25%
50%
75%
100%
Cumulative Production -
%
16
Alumina Supply/Demand is Balanced
Source: Alcoa estimates, CRU, CNIA, IAI
2009E Alumina Supply / Demand Balance (in kmt)
Balanced
Jul-Dec 09 Alumina Production
10,700
Run Rate
Announced Restarts
400
Imports from Western World
2,300
Supply
13,400
Demand
(12,700)
Net Surplus
700
Jul-Dec 09 Alumina Production
24,600
Run Rate
Announced Restarts
450
Exports to China
(2,300)
Supply
22,750
Demand
(23,200)
Net Deficit
(450)
China
Western World
17
What Makes a Tier 1 Asset?
Close to bauxite reserves
Low caustic soda usage
Long term energy supply
Stable workforce
Close to deep water port
Port gives direct access to
main customers
Pinjarra - 4.2m mtpy
18
AWAC has tier 1 assets in Australia and Brazil
Production volumes dominate production
Nominal capacity of 17 million tonnes
Sao Luis will improve AWAC's position to 25
th
percentile of cost curve
Source: © Brook Hunt and Associates Ltd 2009
AWAC
0
10000
20000
30000
40000
50000
60000
70000
80000
Production (kt/ a)
AWAC is Well Positioned for the Long Term
19
J
u
l
0
8
A
u
g
0
8
S
e
p
0
8
O
c
t
0
8
N
o
v
0
8
D
e
c
0
8
J
a
n
0
9
F
e
b
0
9
M
a
r
0
9
A
p
r
0
9
M
a
y
0
9
J
u
n
0
9
J
u
l
0
9
U
S
c
/
l
b
K
t
Juruti Mine and Alumar Refinery Expansion Commissioned in 3Q 2009
Railroad
Washing Plant
Ship Loader
Juruti
Alumar
Benchmark in Sustainable Development
Strengthened Refining Position in Brazil
Alumina Silo
Cogeneration
Calciners
Source: Alcoa, Alumina Limited
New Tier 1 Assets are being Commissioned
Alumina share of capex US$0.8 billion
2.6 MMT of production; opportunities
to expand as demand grows
World competitive bauxite to serve
refineries in Brazil and beyond
Alumina share of capex US$0.6 billion
2.1 MMT expansion; 1.1 MMT AWAC
share
Expansion capacity in first quintile of
cost curve
20
Alumina Limited Balance Sheet is Strong
Gearing at 30 June 2009
8.6%
Net debt at 30 June 2009
A$328 million*
No net drawn debt due for repayment in 2009 or 2010
US$350m convertible bond matures 2013, can be
redeemed 2011
* Includes component of convertible bond in equity
21
Summary
Short term market outlook is stable
Supply imbalances provide pricing opportunities
AWAC positioned at 25% percentile of cost curve
Alumina Limited has a strong balance sheet
Positioned for market improvement and growth
Document Outline
- Alumina Limited - MS Nov 2009.pdf
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
- þÿ
|
Print Entire Page
