Interim report January December 212 Lennart Evrell President & CEO Mikael Staffas CFO
Summary Full year Revenues 4 1 (4 323) MSEK EBIT ex PIR* 3 941 (5 8) MSEK Msek 2 5 Quarterly EBIT Quarterly EBIT excl PIR* Rolling Q EBIT excl PIR* 6 EBIT 4 71 (4 748) MSEK Free Cash Flow 1 389 (-3) MSEK One-off tax effect 415 MSEK, non-cash 2 5 Proposed dividend 4 (4) SEK per share 4 Positive mineral resource development Q4 Revenues 1 194 (9 716) MSEK EBIT ex PIR* 818 (991) MSEK EBIT 656 (1 75) MSEK Free Cash Flow 11 (-482) MSEK Weak mine production 1 5 1 5 3 2 1 Lower margins in smelters Projects on plan Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 21 211 212 * PIR=Process Inventory Revaluation Boliden Group Q4 212 2
The Market Boliden Group Q4 212 3
Industrial production Year on year % 25 2 15 1 5-5 -1-15 -2-25 World estimated by Boliden 27 28 29 21 211 212 China BRIC World USA Euro Area Boliden calculation world IP and BRIC IP Boliden Group Q4 212 4
Construction Year on year % 4 3 2 China 1 USA -1 EU27-2 -3 USA: construction spending value EU27: Index construction production China: fixed asset investments - cumulative value 26 27 28 29 21 211 212 Boliden Group Q4 212 5
Car production Year on year % China Germany US auto IP light vehicles China Germany US auto IP light vehicles 35 5 3 25 2 4 3 15 2 1 5 1-5 -1-1 -15 Q1 212 Q2 212 Q3 212 Q4 212-2 21 211 212 Boliden Group Q4 212 6
Zinc price and inventories USD/t 5 4 5 4 3 5 3 2 5 2 1 5 LME Inventory Shanghai Inventory Price Price Q avg 1,8 1,6 1,4 1,2 1,,8,6 Millions Zinc price (LME average) USD/t Q4-12 vs period Q4 11 1,897 +3% Q1 12 2,25-4% Q2 12 1,928 +1% Q3 12 1,885 +3% Q4 12 1,947-1,4 5,2, 23 24 25 26 27 28 29 21 211 212 213 2 4 2 2 2 USD/t Q3 Q4 1 8 Global zinc demand YoY up % End Q3 to end Q4: Price down 3% Inventories up 19% 1 6 1 4 1 2 1 Boliden Group Q4 212 7
Zinc TC and premiums USD/t concentrate Zinc treatment charge (TC) USD/t metal Zinc metal price premium 35 2 3 18 16 25 14 2 15 12 1 8 1 6 5 4 2 29 21 211 212 29 21 211 212 Realised TC (including price participation) Spot TC - outturn Europe ex-works Far East (Western) US Midwest Delivered Source: CRU (www.crugroup.com) Spot TC improved Low smelter production, high mine production in China Source: CRU (www.crugroup.com) Zinc premium stable in Europe Boliden Group Q4 212 8
Copper price and inventories USD/t LME Inventory Shanghai Inventory COMEX Inventory Price Price Q avg 11 1 9 8 7 6 5 4 1,6 1,4 1,2 1,,8,6 Millions Copper price (LME average) USD/t Q4-12 vs period Q4 11 7,489 +6% Q1 11 8,31-5% Q2 12 7,869 +1% Q3 12 7,76 +3% Q4 12 7,99-3,4 2,2 1, 23 24 25 26 27 28 29 21 211 212 213 9 8 5 8 USD/t Q3 Q4 Global copper demand YoY up % End Q3 to end Q4: Price down by 4% Inventories up 37% 7 5 7 6 5 6 Boliden Group Q4 212 9
Copper TC and premiums USD/t concentrate Copper treatment charge (TC) USD/t metal Copper metal price premium 12 12 1 TC annual and mid-year benchmark contract Standard grade spot TC US$/dmt 1 8 8 6 6 4 4 2 2 Spot Copper premium CIF W. Europe Benchmark CIF Europe 29 21 211 212 29 21 211 212 Source: CRU (www.crugroup.com) Spot TC improved Low volumes, single trades influenced in Q4 Source: CRU Sep 212 (www.crugroup.com) Copper premium stable in Q4 Boliden Group Q4 212 1
Gold, Silver and Lead prices USD/oz 2 1 8 1 6 1 4 1 2 1 8 6 4 2 USD/oz 6 5 4 3 2 1 Gold 23 24 25 26 27 28 29 21 211 212 213 Silver USD/t 5 4 5 4 Lead Inventory Price Price Q avg 3 5 3 3 25 2 5 2 2 15 1 5 1 1 5 5 23 24 25 26 27 28 29 21 211 212 213 Average prices Q4 212 vs period Q4-11 Q3-12 Gold +2% +4% Silver +3% +1% Lead +11% +11% 45 4 35 Thousands 23 24 25 26 27 28 29 21 211 212 213 Boliden Group Q4 212 11
Market situation summary Q4 Metal demand European demand weaker Zinc demand in China up Metal supply Copper concentrate output up Zinc concentrate output stable Zinc metal production down YoY % Q1-12 Q2-12 Q3-12 Q4-12 Zinc Concentrate supply 4.9 4.1 3.8 -.6 Metal production -1.4-3.1-5.2-3.5 Metals demand -1.4 -.5 1.8 4.3 Copper Concentrate supply -1.8 2.6 5. 2.9 Metal production 2.8 1.4 2.1.9 Metals demand 8.8.9.9-2.2 Lead Concentrate supply 12.3 5.5 3.9 3.3 Metal production 2.8 2.7.6 1.6 Metals demand 2.5 4. 3.8 4.5 Source: CRU January 213 (www.crugroup.com) Boliden Group Q4 212 12
Mines Boliden Group Q4 212 13
Mines Summary EBIT 517 (646) MSEK 842 MSEK in Q3 212 Garpenberg in lower grade areas Low production in Tara High unit costs Msek 1 4 1 2 1 Quarterly EBIT Rolling 4Q EBIT 5 4 5 4 3 5 Negotiations ongoing Aitik production disturbances Boliden area ore mix change Less copper, more zinc 8 6 3 2 5 2 4 1 5 Projects on plan Capex 1,87 (82) MSEK 2 1 5 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 21 211 212 Boliden Group Q4 212 14
Mines Full Year EBIT by Unit MSEK 4 5 Aitik Boliden area Garpenberg Tara Mines total 4 3 913 3 5 3 2 98 2 5 2 1 5 1 5 2 46 1 692 1 314 1 33 53 369 268 73 211 212 211 212 211 212 211 212 211 212 Boliden Group Q4 212 15
Mines Production 1 Milled ore, mtonnes Copper Metal content, ktonnes 24 Milled ore, mtonnes 1,5 Zinc Metal content, ktonnes 1 8 2 1,2 8 6 16 12,9 6 4 8,6 4 2 4,3 2 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 21 211 212 Milled ore (Aitik) Metal content, Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 21 211 212 Milled ore Zinc metal content Milled ore lower, disturbances in Aitik Copper production in Boliden Area down, ore mix change Garpenberg mining in low zinc grade areas Lower grade, production disturbances in Tara Higher zink production in Boliden Area Boliden Group Q4 212 16
Mineral Reserves & Resources Boliden Group Q4 212 17
Mineral Reserves & Mineral Resources Resources increased in all mines Continued reserve increase in Garpenberg and Boliden Area Resources increase Aitik, low grades New additions to mineral resources Laver, 69 Mt low grade Cu, Au, Mo Rockliden, 4,5 Mt Cu, Zn, Ag, Pb Exploration in 212 35 (282) MSEK 228 m drilled (19 ) Boliden Group Q4 212 18
Aitik and Boliden Area Aitik Boliden Area Thousands 2 5 2 18 16 14 1 5 12 1 1 8 6 5 4 2 23 24 25 26 27 28 29 21 211 212 23 24 25 26 27 28 29 21 211 212 Inferred Measured/Indicated Inferred Measured/Indicated Proven/Probable Production*1 Proven/Probable Production*1 Mineral reserves unchanged Mineral resources large increase but low grades Both reserves & resources increased Boliden Group Q4 212 19
Garpenberg and Tara Garpenberg Tara 3 3 25 25 2 2 15 15 1 1 5 5 23 24 25 26 27 28 29 21 211 212 23 24 25 26 27 28 29 21 211 212 Inferred Measured/Indicated Inferred Measured/Indicated Proven/Probable Production*1 Proven/Probable Production*1 Both reserves & resources increased Mineral reserves down, slight increase in resources Boliden Group Q4 212 2
Smelters Boliden Group Q4 212 21
Smelters Summary EBIT ex PIR* 191 (326) MSEK 292 MSEK in Q3 212 Rönnskär production instability Odda direct leaching disruption EBIT -4 MSEK Costs Seasonally higher vs Q3 In line with Q4 211 Capex 277 (514) MSEK Msek 1 4 1 2 1 8 6 Quarterly EBIT Quarterly EBIT excl PIR* Rolling 4Q EBIT excl PIR* Kokkola silver recovery project on plan 4 2 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 21 211 212 Boliden Group Q4 212 22
Smelters Full Year EBIT excl PIR by Unit MSEK 1 2 Bergsöe Odda Kokkola Harjavalta Rönnskär Smelters total 1 72 1 1 51 8 6 47 535 4 2 75 34-25 8 246 261 222 324-2 211 212 211 212 211 212 211 212 211 212 211 212 Boliden Group Q4 212 23
Smelters Production Total feed, ktonnes 4 Copper Cathode production, ktonnes 1 Total feed, ktonnes 25 Zinc Metal production, ktonnes 14 35 3 25 2 15 8 6 4 2 15 1 12 1 8 6 1 5 2 5 4 2 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 21 211 212 Copper feed, total Cathode production 21 211 212 Zinc feed, total Zinc metal production Feed and production up Improved production in Harjavalta Stable production in Kokkola Production disturbances in Odda Boliden Group Q4 212 24
Financials Boliden Group Q4 212 25
Financial development Summary MSEK Q4 212 Q4 211 Q3 212 Revenues 1,194 9,716 9,123 EBITDA 1,171 1,552 1,76 EBIT 656 1,75 1,146 EBIT ex PIR 818 991 974 Investments 1,366 1,321 874 Free cashflow 11-482 31 Earnings per share, SEK 3.11 2.88 2.99 Net debt / equity ratio, % 25 29 26 Includes non-cash one-off tax effect of 1.52 per share (415 MSEK) Boliden Group Q4 212 26
EBIT analysis Q4 vs Q3 MSEK Q4 212 Q3 212 EBIT 656 1,146 Process inventory revaluation (PIR) -163 172 EBIT excl. PIR 818 974 Deviation -155 Specification of deviation Volume -28 Prices and Terms (incl. hedges) -48 Currency effects -31 Costs -194 Depreciation 14 Internal profit elimination 278 Others 15 Deviation -155 Result for respective period Realized Metal- and Currency hedge 7 93 Lower production in Mines Lower prices and terms for by-products and lower metal prices in beginning of quarter Production disturbances and season variation More underground mining Correction in Tara, -79 MSEK in Q3 Boliden Group Q4 212 27
EBIT analysis Q4 vs Q4 MSEK Q4 212 Q4 211 EBIT 656 1,75 Process inventory revaluation (PIR) -163 84 EBIT excl. PIR 818 991 Deviation -173 Specification of deviation Volume -135 Prices and Terms (incl. hedges) -123 Currency effects -3 Costs -9 Depreciation -44 Internal profit elimination 143 Others 15 Deviation -173 Result for respective period Realized Metal- and Currency hedge 7 19 Lower production Mines Modest increase from BoRe Lower prices and terms Smelters 125 MSEK in reclamation provisions 211 Boliden Group Q4 212 28
Financial development 212 vs 211 MSEK 212 211 Revenues 4,1 9,716 EBITDA 6,287 6,674 EBIT 4,71 4,748 EBIT ex PIR 3,941 5,8 Investments 4,185 3,998 Free cashflow 1,389-3 Earnings per share, SEK 11.96 12.39 Net debt / equity ratio, % 25 29 Boliden Group Q4 212 29
Cash flow MSEK 212 211 EBITDA* (Operating profit before depr.) 6,288 6,674 PIR -129 261 Change inventories -45-79 Change payables 615-372 Change receivables 234-827 Other 5 Change in working capital 32-1,17 Cash flow from investments -4,129-4,24 Financial items -179-188 Tax paid -1 145-1,54 Other -235 92 Free cash flow 1,389-3 * Includes PIR=Process Inventory Revaluation Boliden Group Q4 212 3
Capital structure SEK billion 31 Dec 212 31 Dec 211 MSEK 1 Net debt & Gearing % 5 Total assets 4, 37.6 45 Capital employed 31,4 3.5 Shareholders equity 22,9 21. 8 6 4 35 3 Net debt 5,7 6.1 25 Net debt /equity ratio, % 25 29 4 2 15 Equity/assets ratio, % 57 56 2 1 Loan duration, years 3,5 3,3 Average loan interest, % 3,1 3,29 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 21 211 212 5 Interest duration, years,9 1, Net payment capacity 9,2 8,7 Net debt Gearing Boliden Group Q4 212 31
Accounting specifics in Q4 and after Q4 (212) Lower corporate tax rate in Sweden From 26,3 to 22 % Non-cash effect 212: 415 MSEK Positive impact on net profit and EPS Future reclamation costs Reclamation provision increased by 538 MSEK No effect on profits and C/F 212 Annual effect from 213: Depreciations +3 MESEK Financial costs +1 MSEK Post Q4 (January 213) Diesel with wrong tax-rate used in Aitik Mistake with no financial benefit Taxes paid as if correct diesel was used Authorities intend to impose tax liability of 212 MSEK plus interest If final ruling is negative, Boliden will appeal No provision Boliden Group Q4 212 32
Project update Aitik on plan to 36 Mt 214 Rönnskär E-recycling at full capacity Kankberg Mine production started early Gold leaching started Tellurium leaching trimming-in phase Silver recovery Kokkola on plan Garpenberg on plan Underground infrastructure, shafts, concentrator Start-up first half 214, full production end 215 Aitik45 feasibility under way Laver conceptual study started Boliden Group Q4 212 33
Summary General Macro somewhat better but uncertainty remains Metal prices stable By-products lower Operations Aitik on low grades for two years Garpenberg in low grade areas Mix change in Boliden area Kankberg start Depletion of Maurliden Östra (Cu) and gold in Kristineberg Shift from open pit to underground Cost programs in Tara and Odda Projects on plan Improved mineral reserves and resources Maintenance stops 213 EBIT -325 MSEK Whereof approx. -3 in Q2 Boliden Group Q4 212 34
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Metals for modern life Boliden Group Q4 212 36