[Gen-AI Analysis] Nemak S.A. Business Report FY ended 2013 - MarkLines Automotive Information & Gen-AI Platform

Nemak S.A. Business Report FY ended Dec. 2013

Business Highlights

Financial Overview

(in million MXN)

	FY ended Dec. 31, 2013	FY ended Dec. 31, 2012	Rate of Change (%)	Factors
Net Sales	56,299	51,385	9.6	1)
Adjusted EBITDA	7,823	6,671	17.3	-

Factors
1)
-Sales for FY ended Dec. 31 increased by 9.6% year-on-year because of the solid performance of the U.S. automotive industry and the Company's focus on premium clients in Europe. Furthermore, aluminum auto parts are increasingly being used as replacements for cast iron parts. The increase in sales was based on a sales volume of 47.6 million of comparable cylinder heads in the year, 14% more than in 2012.

-Export ratio in the Sales is 88%.

R&D

R&D Expenditure

(in million MXN)

	FY ended Dec. 31, 2013	FY ended Dec. 31, 2012
Overall	3,221	3,693
% of Sales	5.7	7.2

R&D Structure

-The Company has seven Product Development Centers, strategically located in Austria, Canada, Germany, Mexico and Poland.
-The Company is capable of developing more than 100 new products yearly while operating at full capacity.

Technological Development

Alloy Systems
-High performance alloys for high powered engines
-Mechanical properties and microstructural predictions
-Body structural casting technologies
-Thin walls in cylinder heads

Complex Geometries
-3D printing for advanced powertrain prototypes
-Inorganic binders

Powertrain Component Integration
-Turbo housing integration to cylinder heads
-Range extender and aluminium electric motor components

Surface Treatment Technologies
-Bore coating
-Surface treatment for thermal efficiency
-Body structural casting technologies

-The LPPM (Low-Pressure Permanent Mold) and LPPS (Low-Pressure Precision Sand) processes for the manufacturing of aluminum cylinder heads and blocks, respectively, paved the way for a more efficient operation as well as higher quality products at the Company, and constitute two cutting-edge technologies in its industry.

Investment Activities

Capital Expenditure

(in million MXN)

	FY ended Dec. 31, 2013	FY ended Dec. 31, 2012	FY ended Dec. 31, 2011
Overall	4,336	4,171	4,126

-As capital expenditure for FY ended Dec. 31, 2013, they Company built a new factory in Chongqing, China. The Company expanded production capacity in North America, Europe and Asia.

-In 2013, the Company announced Its decision to build a plant in Russia. It will produce engine heads and blocks for a German car maker. This plant will have an annual capacity of 600,000 units and will start up at the end of 2015.