Q4 Interim and Year-end
Report 2016
Lennart Evrell
President & CEO
Håkan Gabrielsson
CFO
High production, improved market terms & a strong cash flow
2017-02-10 Boliden Group Q4 2016
* PIR=Process Inventory Revaluation
• Revenues 12,137 (9,699) MSEK
• EBIT ex PIR* 2,106 (596) MSEK
‒ EBIT 2,353 (416) MSEK
• Free Cash Flow 1,692 (36) MSEK
• Strong result Smelters
• High production Mines
‒ Production record at several units
• Higher costs
‒ Mainly volume driven
• Improved metal prices
• Capital gain Odda 47 MSEK
2
0
500
1 000
1 500
2 000
2 500
3 000
3 500
4 000
4 500
5 000
5 500
6 000
0
200
400
600
800
1 000
1 200
1 400
1 600
1 800
2 000
2 200
2 400
1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4
2011 2012 2013 2014 2015 2016
R4Q,MSEK
MSEK
Quarterly EBIT excl PIR* Rolling 4Q EBIT Rolling Q EBIT excl PIR*
FY 2016
2017-02-10 Boliden Group Q4 2016
* PIR=Process Inventory Revaluation
• Revenues 40,316 (40,242) MSEK
• EBIT ex PIR* 5,094 (4,010) MSEK
‒ EBIT 5,682 (3,590) MSEK
• Free Cash Flow -2,801 (2,565) MSEK
‒ Excluding Kevitsa 3,124 MSEK
• Profitable Smelter strategy
• Higher production, mainly Mines
• Production record at several units
• Improved market terms
• Proposed dividend 5.25 (3.25) SEK
per share
3
0
1 000
2 000
3 000
4 000
5 000
6 000
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
MSEK
EBIT EBIT excl PIR*
Market Q4 2016 – Supply driven market
Macro
• Improved industrial production growth
Base metals markets
• Cu, Zn demand growth 3 %
• Strong growth in Ni demand
• Disruptions to Cu mine production
• Zn concentrate deficit
• Cu, Zn inventories down
• Ni supply flat, inventories still large
• Easing of Ni ore export ban in Indonesia,
while Philippine confirms closures
2017-02-10 Boliden Group Q4 2016 4
Zinc, copper and nickel prices
Normal C1 – Zinc Normal C1 – Copper
USD/ton USD/ton
Source: Wood Mackenzie January 2017, Thomson Reuters Datastream January 30 2017
Normal C1 – Nickel
USD/ton
2017-02-10 Boliden Group Q4 2016 5
0
500
1 000
1 500
2 000
2 500
3 000
3 500
4 000
4 500
5 000
0
500
1 000
1 500
2 000
2 500
3 000
3 500
4 000
4 500
5 000
Zn average price Zn max price
Zn min price 50th perc
75th perc 90th perc
0
1 000
2 000
3 000
4 000
5 000
6 000
7 000
8 000
9 000
10 000
11 000
0
1 000
2 000
3 000
4 000
5 000
6 000
7 000
8 000
9 000
10 000
11 000
Cu average price Cu max price
Cu min price 50th perc
75th perc 90th perc
0
5 000
10 000
15 000
20 000
25 000
30 000
35 000
0
5 000
10 000
15 000
20 000
25 000
30 000
35 000
Ni average price Ni max price
Ni min price 90th perc
75th perc 50th perc
Boliden market term index
2017-02-10 Boliden Group Q4 2016 6
Mines
2017-02-10 Boliden Group Q4 2016 7
Mines – high production, higher metal prices
• EBIT 1,136 (31) MSEK
‒ 804 MSEK in Q3 2016
• Capex 923* (688) MSEK
• High production in all mines
‒ Garpenberg strong performance
• Higher metal prices and USD
• Higher costs
‒ Mainly volume driven
2017-02-10 Boliden Group Q4 2016 8
* - excluding the acquisition of Kevitsa (-18 MSEK)
0
800
1 600
2 400
3 200
4 000
4 800
0
200
400
600
800
1 000
1 200
1 400
1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4
2011 2012 2013 2014 2015 2016
R4Q, MSEKMSEK
Quarterly EBIT Rolling 4Q EBIT
2016 – higher volumes & improved market terms
Boliden Group Q4 2016 9
Aitik
• Volatile production
• Cu grade 0.22 (0.21)%
• Low Cu price
Boliden Area
• Stronger production – improved processes
Garpenberg
• Successful expansion – 2.6 (2.4) Mton milled
• High Zn price
Kevitsa
• Solid production
• Low Ni and Cu prices
Kylylahti
• Higher milled volume – improved processes
• Low Cu price
Tara
• Higher production – action plan delivers
• High Zn price
2017-02-10
* - Kevitsa consolidated per 1 June 2016
** - Including items affecting comparability: changed pension terms Tara (248 MSEK),
acquisition costs Kevitsa (–39 MSEK) in 2016; energy tax Aitik (–212 MSEK), changed
pension terms Tara (227 MSEK) in 2015
183**108
1452
-74 95**
1429
222
548
2063
166*
-28
476**
2804
-500
0
500
1000
1500
2000
2500
3000
Aitik Boliden Garpenberg Kevitsa Kylylahti Tara Total
MSEK EBIT
2015 2016
Kevitsa update June-December 2016
2017-02-10 Boliden Group Q4 2016 10
• EBIT 166 MSEK and EBITDA 500 MSEK
(June-Dec 2016)
• Record milled volume pace 7.7 Mton
• Integration according to plan
• Actions so far:
‒ Process tuning for AG milling
‒ Optimization of concentrate quality
Kevitsa plan
2017-02-10 Boliden Group Q4 2016 11
• Plan 9 Mton milled volume 2020
‒ Continued tuning
‒ Improvements in milling efficiency
• Grades 2017-18 on June-Dec 2016 level
• Shifting feed to Boliden’s smelters
‒ Ni concentrate going to Harjavalta
‒ External long-term contracts expired 1 Jan 2017
‒ Before closing ~1/3 of volume
‒ ~60% of Cu concentrate going to Boliden
smelters
‒ External contracts expires end 2018
Mineral Reserves &
Resources
2017-02-10 Boliden Group Q4 2016 12
2017-02-10
Mineral Reserves & Mineral Resources
Boliden Group Q4 2016 13
• Mined volume replaced by new additions
• Significant increase in mineral reserve at
Garpenberg
‒ +36 Mton
‒ Lower reserve grades have not impacted mine
plan for next 5 years
‒ Reserve life almost doubled
• Extension of Tara following exploration
• Disappointing near mine exploration at
Kylylahti
• Exploration 380 (370) MSEK
‒ 201 400 (182 000) m drilled
Aitik and Boliden Area
• Limited exploration
• Stable reserves
• Cu grade 0.23 (0.23)%
• 27 years reserve life
• 40% of Rävliden resource upgraded from
inferred to indicated
• Maurliden East excluded, Te price lower
• 7 years reserve life
2017-02-10 Boliden Group Q4 2016 14
Boliden Area Aitik Mton kton
0
500
1 000
1 500
2 000
2 500
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Proven/Probable Measured/IndicatedInferred Production*10
0
5 000
10 000
15 000
20 000
25 000
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016Proven/Probable Measured/IndicatedInferred Production*10
Garpenberg and Kevitsa
• Reserves +36 Mton
‒ Resources converted to reserves
• Lower average reserve grade
‒ Zn: 3.2 (3.9) %
‒ Ag: 97 (113) g/t
• 29 years reserve life
• Acquired 2016, limited exploration
• Boliden’s calculation gives slightly lower
average reserve grade
• 16 years reserve life
2017-02-10 Boliden Group Q4 2016 15
Garpenberg Kevitsa kton kton
0
10 000
20 000
30 000
40 000
50 000
60 000
70 000
80 000
90 000
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Proven/Probable Measured/Indicated
Inferred Production*10
0
20 000
40 000
60 000
80 000
100 000
120 000
140 000
160 000
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016Proven/Probable Measured/IndicatedInferred Production*10
Garpenberg’s mineral reserves and resources
2017-02-10 Boliden Group Q4 2016 16
Lappberget
+15 Mt Reserves
+6 Mt Resources
Huvudmalmen
+9.5 Mt Reserves Dammsjön
+13 Mt Reserves
Kyrkan, Tyskgården, Finnhyttan
+4.2 Mt Resources
Note: Gross mineral reserves and resources shown in illustration
Kylylahti and Tara
• Disappointing near mine exploration
• Exploration continues
• Slightly more than 2 years reserve life
2017-02-10 Boliden Group Q4 2016 17
Kylylahti kton
• Stable reserves
• New inferred resource Tara Deep 10 Mton
‒ Grade: Zn 8,5%, Pb 1,8%
• 6 years of reserve life
Tara kton
0
1 000
2 000
3 000
4 000
5 000
6 000
7 000
8 000
9 000
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Proven/Probable Measured/IndicatedInferred Production*10
0
5 000
10 000
15 000
20 000
25 000
30 000
2007 2008 200920102011 2012 20132014 2015 2016
Proven/Probable Measured/Indicated
Inferred Production*10Tara Deep
Smelters
2017-02-10 Boliden Group Q4 2016 18
2017-02-10 Boliden Group Q4 2016
* PIR=Process Inventory Revaluation
19
• EBIT ex PIR* 1,094 (583) MSEK
‒ 613 MSEK in Q3 2016
• Capex 420 (496) MSEK
• Higher metal prices and USD
• Stable Cu and Zn production
• Higher volume free metals vs Q3
• Capital gain Odda 47 MSEK
Smelters – improved terms, stable Cu & Zn production
-100
400
900
1 400
1 900
2 400
2 900
3 400
-100
100
300
500
700
900
1 100
1 300
1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4
2011 2012 2013 2014 2015 2016
R4Q, MSEKMSEK
Quarterly EBIT excl PIR* Rolling 4Q EBIT Rolling 4Q EBIT excl PIR*
727 736 739
390
18
2692
852704
572
314
109
2759
0
500
1000
1500
2000
2500
3000
Rönnskär Harjavalta Kokkola Odda Bergsöe Total
MSEK EBIT ex PIR
2015 2016
2016 – solid earnings
2017-02-10 Boliden Group Q4 2016 20
• Rönnskär’s and Bergsöe’s actions
compensate for lower market terms
Rönnskär
• Action plan completed
• Improved prices and terms
Harjavalta
• New Ni model improved position
• Lower market terms
Kokkola
• Production disturbances H2 2016
• Lower market terms
Odda
• Expansion to 200 kton/year on plan
• Lower market terms
Bergsöe
• Record high production
• Improved process stability
• Higher Pb price
* PIR=Process Inventory Revaluation
*
Financials
2017-02-10 Boliden Group Q4 2016 21
Strong earnings
2017-02-10 Boliden Group Q4 2016 22
MSEK Q4 2016 Q4 2015 Q3 2016
Revenues 12,137 9,699 9,733
EBITDA 3,500 1,339 2,653
EBIT 2,353 416 1,529
Process inventory revaluation (PIR) 247 -181 211
EBIT ex PIR 2,106 596 1,318
EBIT ex PIR pro forma 537
Investments 1,343 1,187 1,028
Acquisitions* -18 - -
Free cash flow 1,692 36 91
Earnings per share, SEK 6.68 1.05 4.15
Net debt / equity ratio 32 23 40
Financial development
* - Final adjustment to the Kevitsa acquisition in Q4 2016
Q4 vs. Q4 – Higher volumes & metal prices
2017-02-10 Boliden Group Q4 2016 23
Higher metal prices
MSEK
Q4 2016 2,106
Q4 2015 - pro forma 537
Deviation 1,570
Specification of deviation
Volumes 508
Prices and Terms (incl. hedges) 1,369
Whereof currency effects 227
Costs -227
Depreciation -154
Items affecting comparability 92
Other -17
Deviation 1,570
Higher volume in all mines
EBIT excl. PIR pro forma*
Volume impact
Kevitsa
Higher volumes
*The comparison period includes Kevitsa that was acquired 1 June 2016
2016: Capital gain Odda 47 MSEK
2015: -45 MSEK
Q4 vs. Q3 – Higher production & market terms
2017-02-10 Boliden Group Q4 2016 24
Volume impact
Maintenance, tech & exploration Mines
Seasonal increase
Higher variable remunerations
Mainly FX
MSEK
Q4 2016 2,106
Q3 2016 1,318
Deviation 788
Specification of deviation
Volumes 730
Prices and Terms (incl. hedges) 390
Whereof currency effects 293
Costs -435
Depreciation -10
Items affecting comparability 47
Other 67
Deviation 788
Higher production Mines
Higher volume free metals Cu smelters
EBIT excl. PIR
Capital gain Odda 47 MSEK
Higher free cash flow
2017-02-10 Boliden Group Q4 2016 25
MSEK Q4 2016 Q4 2015 Q3 2016
EBITDA excluding PIR 3,253 1,520 2,442
Changes in working capital -194 -143 -1,117
Inventories -651 462 -807
Payables 866 -873 -152
Receivables -424 265 -151
Other 14 3 -7
Cash flow from investments -1,147 -1,211 -981
Cash flow from acquisitions* 18 - -
Financial items -86 -62 -75
Tax paid -123 -72 -125
Other -30 4 -54
Free cash flow 1,692 36 91
Free cash flow excl. Kevitsa acquisition 1,674 36 91
Free cash flow
* - Final adjustment to the Kevitsa acquisition in Q4 2016
Stronger balance sheet
2017-02-10 26 Boliden Group Q4 2016
SEK bn (Unless otherwise stated)
31 Dec
2016
30 Sep
2016
Total Assets 53.9 51.7
Capital employed 42.5 42.1
Shareholders' equity 29.4 27.6
Net debt 9.3 11.1
Gearing, % 32 40
Loan duration, years 3.3 3.4
Average interest rate, % 1.2 1.2
Interest duration, years 0.2 0.2
Net payment capacity 7.0 5.5
0
5
10
15
20
25
30
35
40
45
0
2 000
4 000
6 000
8 000
10 000
12 000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2013 2014 2015 2016
%MSEK
Net debt Gearing
Full-year financial development – Summary
2017-02-10 Boliden Group Q4 2016 27
MSEK (Unless otherwise stated) FY 2016 FY 2015
Revenues 40,316 40,242
EBITDA 9,881 7,112
EBIT 5,682 3,590
EBIT ex PIR 5,094 4,010
Investments 4,127 3,650
Acquisitions 5,961 -
Free cash flow -2,801 2,565
Earnings per share, SEK 15.49 9.65
Net debt /equity ratio 32 23
2016 vs 2015 – Higher production & improved terms
2017-02-10 Boliden Group Q4 2016 28
MSEK
FY 2015 pro forma 3,961
FY 2016 pro forma 4,946
Deviation 985
Specification of deviation
Volume 1,207
Prices and Terms (incl. hedges) 579
Whereof currency effects 257
Costs -658
Depreciation -393
Items affecting comparability 301**
Other -50
Deviation 985
Volume impact
Higher personnel costs
Improved metal prices & FX
Lower smelter terms
Higher production, mainly Mines
Higher volume Mines
Aitik capital intensive areas
Kevitsa
* The comparison periods include Kevitsa that was acquired 1 June 2016
** 2016: 256 MSEK; changed pension terms Tara (248 MSEK), acquisition costs Kevitsa (–39 MSEK),
capital gain divestment aluminium fluoride operation at Odda (47 MSEK).
2015: -45 MSEK; energy tax Aitik (–212 MSEK), changed pension terms Tara (227 MSEK), internal
profit elimination Smelters (–60 MSEK).
EBIT excl. PIR pro forma*
Going forward
• Mines
‒ Aitik: volatile production, 2017-19: Cu 0.25%
‒ Garpenberg: 2017: Zn 4.5%, Ag 120 g/ton,
lower reserve grades have not impacted mine
plan for next 5 years
‒ Kevitsa: Grades 2017-18 on June-Dec 2016 level
‒ Winter conditions in Q1 in open pits
• Smelters
‒ Planned maintenance 2017: -390 (-260) MSEK*
‒ Q2: -260 (-210) MSEK
‒ Q3: -50 (-50) MSEK
‒ Q4: -80 (0) MSEK
‒ Odda P200: ahead of plan, ramp-up continues Q1
• Capex
‒ FY 2017: slightly below 6 BSEK
• Capital gain Odda 47 MSEK in Q4 2016
2017-02-10 Boliden Group Q4 2016 29
* EBIT impact
Strong FY 2016
• Well positioned in the metal market
‒ Mines and smelters
‒ Base metals and precious metals
‒ High productivity
• Garpenberg expansion exceeding
expectations
• Kevitsa acquisition strengthens Boliden
• Production records at several units
2017-02-10 Boliden Group Q4 2016 30
Disclaimer
• This presentation has been prepared by Boliden for information purposes only and as per the indicated date. Boliden does not undertake any obligation to correct or update the information or any statements made therein. Certain statements in this presentation are forward-looking and are subject to risks and uncertainties.
• Nothing contained herein shall constitute any representation or warranty as to accuracy or completeness. Boliden has not made any independent verification of the information obtained from third parties.
• Nothing in this material shall be construed as an offer or solicitation to buy or sell any security or product, or to engage in or refrain from engaging in any transaction.
• Boliden does not accept any liability whatsoever arising from or in connection with the use of this information.
• Save as by prior approval in writing, this material may not be copied, transmitted or disclosed, whether in print, electronic or any other format. All rights to the material are reserved.
2017-02-10 Boliden Group Q4 2016 31
2017-02-10 32 Boliden Group Q4 2016
Appendix
2017-02-10 Boliden Group Q4 2016 33
2017-02-10 Boliden Group Q4 2016 34
Mines – Production
• Aitik – higher production
• Boliden Area – improved ore mix vs Q3
• Garpenberg – stable and high production
• Kevitsa – high milled volume, higher grades vs Q3
• Kylylahti – record milled volume
• Tara – high milled volume, low Zn grade
(*) Milled ore incl Kevitsa (**) Metal content incl Kevitsa
0,0
0,5
1,0
1,5
2,0
2,5
3,0
3,5
0
400
800
1 200
1 600
2 000
2 400
2 800
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2013 2014 2015 2016
Metal content, kt
Milled ore, kt
Nickel
Milled ore pro forma* Milled ore Metal content pro forma** Metal content
0
5
10
15
20
25
30
0
2
4
6
8
10
12
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2013 2014 2015 2016
Metal content, kt
Milled ore, mt Copper
Milled ore Metal content pro forma** Metal content
0
20
40
60
80
100
0,0
0,4
0,8
1,2
1,6
2,0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2013 2014 2015 2016
Metal content, kt
Milled ore, mt
Zinc
Milled ore Metal content
Smelters – Production
• Harjavalta: High feed and Cu production
• Rönnskär: Process rather than volume
focus
• Kokkola: Disturbances
• Odda: High feed and Zn production
• Odda P200 on plan
2017-02-10 Boliden Group Q4 2016 35
0
15
30
45
60
75
90
105
120
0
50
100
150
200
250
300
350
400
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2013 2014 2015 2016
Metalproduction,
kt
Total feed, kt
Copper
Feed, total Metal production
0
30
60
90
120
150
0
50
100
150
200
250
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2013 2014 2015 2016
Metal production,
kt
Total feed, kt
Zinc
Feed, total Metal production
0
400
800
1 200
1 600
2 000
0
1 000
2 000
3 000
4 000
5 000
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
LME inventory Shanghai inventory Price Price Q avg
Zinc price, USD/t KTonnes
1 400
1 600
1 800
2 000
2 200
2 400
2 600
2 800
3 000
okt-15 jan-16 apr-16 jul-16 okt-16 jan-17
USD/t
Zinc price
2017-02-10 Boliden Group Q4 2016
Average price in Q4 vs. period
Q3-16 Q2-16 Q1-16 Q4-15
12% 31% 50% 56%
36
Q4 Q1 Q2 Q3 Q4
Note: Prices until 6 February 2017
Copper price
2017-02-10 Boliden Group Q4 2016 37
0
400
800
1 200
1 600
2 000
2 400
0
2 000
4 000
6 000
8 000
10 000
12 000
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
LME inventory COMEX inventory Shanghai inventory Price Price Q avg
Copper price, USD/t KTonnes
4 000
4 500
5 000
5 500
6 000
6 500
7 000
okt-15 jan-16 apr-16 jul-16 okt-16 jan-17
USD/t
Average price in Q4 vs. period
Q3-16 Q2-16 Q1-16 Q4-15
11% 12% 13% 8%
Q4 Q1 Q2 Q3 Q4
Note: Prices until 6 February 2017
Nickel price
2017-02-10 Boliden Group Q4 2016 38
Average price in Q4 vs. period
Q3-16 Q2-16 Q1-16 Q4-15
5% 23% 27% 15%
6 000
7 000
8 000
9 000
10 000
11 000
12 000
13 000
okt-15 jan-16 apr-16 jul-16 okt-16 jan-17
USD/t
0
100
200
300
400
500
600
0
10 000
20 000
30 000
40 000
50 000
60 000
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
LME inventory Price Price Q avg
Nickel price, USD/t KTonnes
Q4 Q1 Q2 Q3 Q4
Note: Prices until 6 February 2017
0
200
400
600
800
1 000
1 200
1 400
1 600
1 800
2 000
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Gold price, USD/troy oz.
Gold, silver and lead prices
2017-02-10 Boliden Group Q4 2016
Lead Gold
Silver
Average price in Q4 vs. period
Q3-16 Q2-16 Q1-16 Q4-15
Gold -8% -3% 4% 11%
Silver -12% 2% 16% 16%
Lead 15% 25% 23% 28%
39
0
500
1 000
1 500
2 000
2 500
3 000
3 500
4 000
4 500
5 000
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Lead price, USD/t
0
10
20
30
40
50
60
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Silver price, USD/troy oz.
Note: Prices until 6 February 2017
Market balance – zinc and copper
2017-02-10 Boliden Group Q4 2016 40
Zinc – global market Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416
Metals demand, kt 3324 3344 3307 3339 3356 3419 3403 3442
Year on year change -1% -1% -1% 1% 1% 2% 3% 3%
Smelter production, kt 3365 3484 3408 3440 3275 3323 3334 3468
Year on year change 8% 7% 2% -2% -3% -5% -2% 1%
Mine production, kt 2 878 3 324 3 254 3 015 2 647 2 920 2 940 3 017
Year on year change 4% 4% 2% -10% -8% -12% -10% 0%
Metal balance, kt 41 140 101 101 -81 -96 -69 26
Concentrate balance, kt -279 59 84 -128 -345 -79 -86 -207
Copper – global market Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416
Metals demand, kt 4968 5522 5555 5684 5013 5671 5680 5844
Year on year change -1% 1% 1% 3% 1% 3% 2% 3%
Smelter production, kt 5423 5525 5564 5626 5536 5624 5671 5739
Year on year change 5% 3% 0% 1% 2% 2% 2% 2%
Mine production, kt 3555 3805 3778 3934 3838 4038 4051 4005
Year on year change 2% 6% 4% 7% 8% 6% 7% 2%
Metal balance, kt 365 -77 -93 -161 373 -97 -9 -105
Concentrate balance, kt -162 54 -66 -21 -156 21 46 -56
Source: CRU December 2016 and January 2017, Boliden
calculations
Market balance – nickel and lead
2017-02-10 Boliden Group Q4 2016 41
Source: CRU December 2016 and January 2017, Boliden
calculations
Nickel - global market Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416
Metals demand, kt 476 475 460 466 485 518 495 510
Year on year change 0% -4% -2% 3% 2% 9% 7,7% 9,4%
Smelter production, kt 473 500 483 490 462 499 490 493
Year on year change -5% 3% -6% -4% -2% 0% 2% 1%
Mine production, kt 446 535 550 482 444 514 559 492
Year on year change 6% 3% 3% 7% 0% -4% 2% 2%
Metal balance, kt -3 25 23 24 -22 -19 -5 -17
Lead - global market Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416
Metals demand, kt 2709 2738 2813 2929 2790 2822 2912 3009
Year on year change 0% 0% 2% 3% 3% 3% 4% 2,7%
Smelter production, kt 2705 2724 2832 2958 2803 2838 2910 2970
Year on year change -1% -1% 2% 3% 4% 4% 3% 0%
Mine production, kt 1042 1179 1261 1269 1037 1127 1223 1221
Year on year change -4% -2% 1% -4% 0% -4% -3% -4%
Metal balance, kt -4 -14 19 29 13 16 -2 -39
Concentrate balance, kt -131 18 133 139 -207 -75 39 56
Economic development
2017-02-10
Industrial production, year on year %
Boliden Group Q4 2016
Source: Thomson Reuters Datastream, Boliden calculations for world data
42
-6
-4
-2
0
2
4
6
8
10
12
14
J F MAM J J A S O N D J F MAM J J A S O N D J F MAM J J A S O N D J F MAM J J A S O N D J F MAM J J A S O N D
2012 2013 2014 2015 2016
EU28 USA China World
-15
-10
-5
0
5
10
15
20
25
30
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D
2012 2013 2014 2015 2016
EU USA China
Construction – largest segment for Cu and Zn
2017-02-10
Activity, year on year %
Source: Reuters Datastream
Boliden Group Q4 2016
China: year on year based on cumulative investments at each point
43
2017-02-10
Source: LMC Automotive
Boliden Group Q4 2016
Automotive
44
Production of light vehicles, year on year, quarterly data
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2012 2013 2014 2015 2016
Europe USA China World
China – metals demand and economic growth
Source: CRU Ltd, Thomson Reuters Datastream
2017-02-10 Boliden Group Q4 2016 45
Year on year growth %
0
2
4
6
8
10
12
14
16
18
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2011 2012 2013 2014 2015 2016
Zinc demand Copper demand GDP Industrial production
Zinc TC and premia
• Concentrate market tight
• Higher Zn price, realized contract TC up
• Spot TCs in China down
• Stable premia in Europe
• Metal market fairly balanced in Europe
2017-02-10 Boliden Group Q4 2016
Source: CRU January 2017
46
0
50
100
150
200
250
300
2012 2013 2014 2015 2016
US$/t concentrate
Treatment charges
Realized TC - European contract
Spot TC, China imports
0
50
100
150
200
250
2012 2013 2014 2015 2016
US$/t metal Metal premia
Ex-Works Premia Europe
Delivered Premia US Midwest
Premia Far East - WesternContract benchmark according to market sources including CRU
Copper TC and premia
• Disruptions to mine supply
• Contract TC 2017 down
• Spot TC down
• European spot premia stable
2017-02-10 Boliden Group Q4 2016
Source: CRU January 2017
47
Contract benchmark according to market sources including CRU Contract benchmark according to market sources including CRU
0
20
40
60
80
100
120
140
160
2012 2013 2014 2015 2016
US$/t metal Metal premia
CIF European benchmark premia
CIF Average European premia
0
20
40
60
80
100
120
140
2012 2013 2014 2015 2016
US$/t concentrate
Treatment charges
Contract TC - annual and mid-year benchmark
Standard grade spot TC
2017-02-10 48 Boliden Group Q4 2016