BlueScope Butler China

Transcription

1 China Shanghai Analyst Briefing - Shanghai 12th November, 2004 Presented by: Mike Alossi President BlueScope Steel China Tianjin

2 Presentation Outline 1. Overview 2. Facilities and Processes 3. Products and Markets 4. Financials 5. Strategy 6. Reference Projects 7. Summary 2

3 Presentation Outline 1. Overview 2. Facilities and Processes 3. Products and Markets 4. Financials 5. Strategy 6. Reference Projects 7. Summary 3

4 Development of 1992 Opened representative office in China Registered a wholly owned venture Built our plant in Shanghai 2001 Expanded Shanghai facilities to include beam manufacture 2002 Built our second plant in Tianjin 2004 Commenced construction of beam facility at Tianjin Finished over 1,100 projects million square meters 4

5 Safety LDI No Lose Time Days Days Of LDI Structural Line Maintanance Stations Rolling Lines 2,701 0 Shipping Days Lost Time Days Efficient work but where is safety? Decrease shipping costs? Teamwork 5

6 Safety Regular safety meetings & reviews Clear safety regulations Implementing BlueScope Steel Safety management System Company sponsored annual medical checkup for employees aged 30 years and over Butler was awarded Safety Model Unit of 2002 and

7 Process Owner s Concept Customer Tour Manufacturing Design team develops fully engineered solution Final Contract Negotiation Detailed discussions to finalise project design Deliver a high quality, complete building solution 100% Customer Satisfaction 7

8 Complete Building Solutions Local Support Value Engineering Construction Services Design On-Site Consultation Building Solution Project Management Transportation Manufacturing 8

9 Key Success Factors to Date Right Timing BlueScope Butler s Name Customer Oriented Strategy Management Personal Involvement Our Core Strength Performance Service Quality 9

10 Factors of Success Perfect timing to enter the market Massive industrial developments Foreign Investors rushed into China The market s appetite for quick Construction, economical solutions and quality solutions Positioning ourselves in the Market Right Setup and solutions for the market need Quality solutions, Customer focus, Competitive price. 10

11 Factors of Success Right Approach to the Market - Total construction solution Promote our strengths and the Difference whole system solution that has stood the test of time Value Local Engineering Support Design Constructi on Single Source Capability Services On- Site Transport ation Proje ct Cons Ma ultati Single Source nag on eme 11 nt Manu factu ring

12 Factors of Success Right Approach to the Market - Total construction solution Select the right products / solutions Hire the right people Build state of the art facilities Set up effective processes Transferred the best our culture from Butler USA Adopted the best of the local culture 12

13 Number 1 in PEB and 3 rd Overall in Metal Construction in China PEB Ranking Sales Ranking for Metal Structure Industry ( ) Value in '000 RMB Company Names Ranking Sales Jiangnan Heavy Industry Co., Ltd ,040, , , , ,894 Hangzhou Hangxiao Steel Structure Co., Ltd , ,550 Butler (Shanghai) Inc , , , , ,458 Zhejiang Dongnan Frame Group , ,864 Jiangsu Changsheng Group Co., Ltd , ,081 Shanghai ABC Steel Structure Co., Ltd , , , ,333 Baoding Mancheng Shuangfeng Non-ferrous Metal Products Co., Ltd ,168 Shanghai Sanhang-Yaxin Steel Pine Co., Ltd ,386 Zhejiang Huadong Light Steel Construction Materials Co., Ltd ,678 Caohu Fuhuang Light Construction Material Co., Ltd ,501 Chian Railway Turnout Bridge Inc ,067 China Jingye Construction Engineering Contractor Company ,684 China Shengli Group ,210 Gaoyao Jinli United Hardware Factory ,110 Hangzhou Dongnan Net Frame Factory ,146 Hangzhou Hangxiao Machinery Structures Development Co., Ltd ,591 Hebei Xingtai Longhai Steel Products Co., Ltd ,513 Heilongjiang Shengli Real Estates Development Group Co., Ltd ,383 Hubei Xingxin Group ,700 Hubei Zhenshen Group Co.,Ltd ,426 Jiangyin Changjiang Industrial General Corp ,720 Lixin County Zhanggou Xingxin Group , ,623 Shanghai Dingfeng Metal Products Co., Ltd ,824 Shanghai Grand Tower Steel Structure Co., Ltd ,469 Shanghai Jialiang Iron & Steel Co., Ltd ,355 Sihui Aluminum Alloy Shape Factory , ,472 Siping Hongzui Metallurgical Equipment Co., Ltd ,755 Tangshan Iron & Steel Group Co., Ltd. Enterprises General Corp , ,864 Zhejiang Dongnan Net Frame Group Company , ,453 Zhejiang Huilun Industrial Co., Ltd , ,350 Zhejiang Qianghuang Building Material Co., Ltd ,023 Data Source: Dun & Bradstreet Report, PEB market paricipants

14 Supply Sources External Coil Customers Majority locally Produced CRC Some Imported CRC Metal Coating Domestic Bar & Plate for beam manufacture Painting Building Solutions Lysaght & Butler Solutions Customers The BlueScope Steel Suzhou Coating line will become the core coated and painted steel supplier once commissioned. Currently most coated steel is sourced from high quality imports Imported Coated & Painted steel (specifications not produced at Suzhou) 14

15 Excellent People Make Difference Recruiting the right people Education / experience as well as attitude, stability, commitment, and fitness with Butler culture 60 % of Employees by Qualification Retaining the right People Pay for performance culture Share success Bonuses, Recent BlueScope Steel share award Grand Total Salary and Benefit Structure 162.0% 50 Base Salary 100.0% Master Bachelor Diploma Technical High School Primary School Benefit Total 62.0% Un-employment 2.0% Medical 14.5% Pensio 22.5% Housing 23.0% 0% 20% 40% 60% 80% 100% 120% 140% 160% 180% 15

16 Training, Development & Engagement - Internal training: Cross-department business training Technical training Cross BSL Training Business Acumen Training Culture training - External training: Language training Qualification training Managerial Skill training Senior Managers update all associates on our business 16

17 People Make Difference Localized Management Staff- many Sr. Managers with over 30 years experience combined with young tigers 17

18 Presentation Outline 1. Overview 2. Facilities and Processes 3. Products and Markets 4. Financials 5. Strategy 6. Reference Projects 7. Summary 18

19 China Facilities Shanghai Plant Vistawall Shanghai Tianjin Plant 19

20 State-of-the-Art Manufacturing Facilities 20

21 Part of our Strong Greater China Production and Sales Network BlueScope Steel 1 Metal Coating & Painting facility 7 Solutions manufacturing facilities Over 70 sales offices BUTLER Urumqi Chengdu Lysaght Chongqing Xian Tianjin Xiamen Guangzhou Shanghai Guangzhou Lysaght Langfang Lysaght Tianjin Butler Suzhou Coating and Painting Facility Shanghai Lysaght Butler Taiwan Lysaght 21

22 22 Xinjiang Qinghai Xizang Yunnan Sichuan Gansu Ningxia Shaanxi Shanxi Henan Hubei Guizhou Guangxi Guangdong Jiangxi Fujian Zhejiang Anhui Jiangsu Shandong Hebei Nei Mongol Liaoning Jilin Heilongjiang Hunan Hong Kong Taiwan Changchun Qinhuang Dao Shijiazhuang Yantai Qingdao Dalian Zhengzhou Wuxi Suzhou Ningbo Hangzhou Nanjing Hefei Changsha Nanchang Fuzhou Xiamen Shenzhen Jiangmen Zuhai Haikou Nanning Luzhou Taiyuan Karamay Kulja Kashgar Yumen Shiqunhe Lhasa Golmud Xining Chengdu Kunming Guiyang Hohhot Hailar Qiqihar Haerbin Anshan Jinan Nanjing Lanzhou Hainan Beijing Tianjin Shanghai Manufacturing Plants

23 Sub-fabrication Plants Hailar Qiqihar Heilongjiang Haerbin Karamay Kashgar Shiqunhe Kulja Xinjiang Xizang Lhasa Golmud Yumen Qinghai Xining Kunming Yunnan Sichuan Chengdu Lanzhou Ningxia Gansu Luzhou Shaanxi Guizhou Guiyang Guangxi Nanning Hohhot Shanxi Taiyuan Hubei Hunan Nei Mongol Hebei Shijiazhuang Jinan Shandong Jiangxi Guangdong Qinhuang Dao Jiangmen Shenzhen Zuhai Hong Kong Yantai Fuzhou Fujian Liaoning Anshan Dalian Qingdao Nanjing Zhengzhou Jiangsu Henan Anhui Wuxi Nanjing Changsha Beijing Suzhou Hefei Hangzhou Ningbo Nanchang Zhejiang Xiamen Changchun Jilin Taiwan In addition, we have a network of accredited Butler builders however, unlike in the US, these business partners do not generally sell but are contracted to erect buildings directly with customers Haikou Hainan 23

24 Presentation Outline 1. Overview 2. Facilities and Processes 3. Products and Markets 4. Financials 5. Strategy 6. Reference Projects 7. Summary 24

25 Manufacturing Make-up of Products Typical % Frames & Plant production Plant 41% Frames 59% % Plant Production Components 22% Truss 2% BR-II 21% Stylwall 0% Purlins 27% MR-24 28% 25

26 Solutions for Wide Range of Industries Manufacturing Pharmaceutical Infrastructure Commercial & Retail 26

27 Our Facilities are used as show case for customer s Visit Warmly Greeting Customers Showing the Capabilities Elaborating the Product Difference Project Focus Discussion 27

28 Trade Shows & Seminars 28

29 Advertisements Newspapers & Magazines Ads 29

30 Brochures & Technical material Butler Asia Pacific Blue Cover (En/Ch) Butler Building Systems ( English/ Chinese ) Butler Differences (English & Chinese) Butler Standard Building Project Profile (En & Ch) Landmark 2000 Structural System ( Ch/En) Widespan Structural System ( English/ Chinese ) Multi-Story Architectural Details (Ch/En) 30

31 Certifications Factory Mutual Certificate Underwriter Laboratory ( UL) Certificate 31

32 The Way We Treat Our Customers 100% Customer Satisfaction Guaranteed Involvement in Sales Support by each department Project Management Progress Customers are our partners, we share their concerns, issues and success. 32

33 Strong Targeted Brands Consistent with the wider BlueScope Steel, Butler have always promoted and maintained strong brands 33

34 Customers & Competitors Customers Project Owners Government Key Accounts Repeat & referral business is a key success factor Competitors Local PEB producers (some with international affiliations) Importers Contractors / rollformers Concrete Local & international competitors continue to improve. In response we drive product development, customer satisfaction & cost effectiveness. BlueScope Steel has unparalleled geographic and capability breadth in China & the right solutions 34

35 Major strategic Accounts - Local Cris 25 Projects Midea 14 Projects Dascom 130 M2 Haier 43 Projects Orient Home 28 Stores GreatWall Computer 6 Plants 35

36 Major strategic Accounts Multi-National Customers Kodak -Xiamen GM -Shanghai Metro Xi an OBI - Shanghai Weatherford - Shanghai Dell Computer - Xiamen 36

37 Some of Our Customers In China Our Customers In China 37

38 Market Profile in China Market Profile: Average contract size is over US$ 1 million We can stay competitive in the local market Our customers will continue to be the end users All senior managers spending 50% of the time supporting sales Continue to develop our builder organization Expand our strategic relationship accounts Focus is 100% customer satisfaction after installation 38

39 Success in Management Localisation 39

40 Presentation Outline 1. Overview 2. Facilities and Processes 3. Products and Markets 4. Financials 5. Strategy 6. Reference Projects 7. Summary 40

41 Orders & Sales CY US$ Millions $250 $230 $210 $190 $170 $150 $130 $110 $90 $70 $50 $30 $10 Sales Orders 40% Average Sales Growth $138 $98 $105 $60 $61 $59 $62 $76 $62 $18 $29 $32 $ $200 41

42 Manufacturing History Total output in 000 metric tonnes

43 Cost Reduction Cost Reduction is a Continuous Process Main Elements of a Building by Cost Engineering 7% Service 4% BOI 15% Primary 30% Freight 4% Roof Panel 15% Wall Panel 10% Secondary 15% 43

44 Cost Reduction - Developed regional & local sourcing Raw Materials Cost - MR24 Reinforcing Clip Example MR24 US$/Clip Reinforcing Clip % Change % Savings 0% U.S. Price -59% Local Price 0% -20% -40% -60% -80% 44

45 Cost Reduction - Engineering Cost ($ / Hr.) Developed regional & local sourcing Engineering Cost $/Hr % Change 0% 0% -19% -28% -48% -69% 10% 0% -10% -20% -30% -40% -50% -60% -70% -76% -80% -90% 45

46 Presentation Outline 1. Overview 2. Facilities and Processes 3. Products and Markets 4. Financials 5. Strategy 6. Reference Projects 7. Summary 46

47 Growth Strategy Establish local Sales and Grow Regional Sales Support from Existing Centers Build in-market Manufacturing Marketing Group Pre-acquisition we focussed on growing existing markets and new geographies within China As part of BlueScope Steel, we are now also expanding our range of solutions and leveraging the wider businesses outside China 47

48 Expansion Market coverage, capacity & range Competitive In Price To Continue Our Success in China Offer High Quality Products Product development Introduce new solutions / Lysaght linkage To maintain Market leadership In China Local presence To get local support Excellent in Service 100% customer Satisfaction 48

49 Presentation Outline 1. Overview 2. Facilities and Processes 3. Products and Markets 4. Financials 5. Strategy 6. Reference Projects 7. Summary 49

50 Intel Shanghai: 27,842 sqm 50

51 Kodak Xiamen : 65,000 sqm 51

52 Greatwall Computer : 65,000 sqm 52

53 Motorola Tianjin: 75,514sqm 53

54 Chery Auto: 124,684 sqm 54

55 Dongsheng Pharmaceutical: 13,000 sqm 55

56 Markor Furniture Showroom : 5,154 sqm 56

57 Jiangxi Greencool: : 128,000 +5,000sqm 57

58 Haier Research Center:,26,503sqm 58

59 DMS Indoor Soccer Stadium : 47,880 sqm 59

60 General Motor 85,000 sqm 60

61 Presentation Outline 1. Overview 2. Facilities and Processes 3. Products and Markets 4. Financials 5. Strategy 6. Reference Projects 7. Summary 61

62 Summary Very strong, consistent growth achieved to date in China Significant further growth opportunities remain : Ongoing economic growth; Further geographic expansion within Greater China; Inter-material replacement and new products; Leverage BlueScope Steel solutions and network within Greater China and elsewhere 62

63 China Shanghai Analyst Briefing - Shanghai 12th November, 2004 Presented by: Mike Alossi President BlueScope Steel China Tianjin