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Harbor Aluminum Conference
Chicago, IL
June 9, 2016
2
Cautions about forward-looking statements and other notices
Cautionary Statement Regarding Forward-Looking Statements. This presentation contains forward-looking statements, which are based on our current expectations,
estimates and projections about Real Industry, Inc. and its subsidiaries' (the “Company”) businesses and prospects, as well as management’s beliefs and certain
assumptions made by management. Words such as “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “may,” “should,” “will” and variations of
these words are intended to identify forward-looking statements. Such statements speak only as of the date hereof and are subject to change. The Company
undertakes no obligation to revise or update publicly any forward-looking statements for any reason. These statements include, but are not limited to, statements
regarding estimated secondary aluminum demand in future periods; secondary aluminum outlook; scrap market outlook; automotive end use outlook as well as future
performance, growth, operating results, financial condition and prospects of the Company. Such statements are not guarantees of future performance and are subject
to certain risks, uncertainties, and assumptions that are difficult to predict. Accordingly, actual results could differ materially and adversely from those expressed in any
forward-looking statements as a result of various factors. Important factors that may cause such a difference include, but are not limited to the Company’s ability to
successfully identify, consummate and integrate acquisitions and/or other businesses; changes in business or other market conditions; the difficulty of keeping
expense growth at modest levels while increasing revenues; the difficulty of making operating and cost improvements; the Company and its subsidiaries' ability to
successfully defend against current and new litigation and indemnification matters, as well as demands by investment banks for defense, indemnity, and contribution
claims; the Company’s ability to access and realize value from its federal net operating loss tax carryforwards; the Company’s ability to identify and recruit
management; the Company’s ability to maintain the listing requirements of the NASDAQ; and other risks detailed from time to time in the Company’s SEC filings,
including but not limited to the most recently filed Annual Report on Form 10-K and subsequent reports filed on Forms 10-Q and 8-K.
3
Real Alloy at a Glance
Global leader in third-party aluminum recycling
Headquarters in Beachwood, OH
30+ year operating history
Convert aluminum scrap and by-products into recycled
metal and specification alloys
24 facilities in North America and Europe
300+ customers worldwide
1,700+ employees globally
Summary financials as of or LTM 3/31/16:
— Volume invoiced over 2.6B pounds
— Revenues of $1.3B
— Leverage ratio of approximately 4.1
— Liquidity over $78M
Our mission is to responsibly capture the inherent economic value of aluminum recycling solutions
4
Value Proposition
Cost advantages over primary aluminum
Closed-loop (maximizes consumption of
owned metal units and cheapest source of
metal)
Molten delivery reduces cost and can
expand capacity
Scale and expertise boost efficiency and
quality
Production and delivery flexibility
Scrap procurement capabilities
Scrap Suppliers Customers
SECONDARY
Aluminum recycling −
wrought, cast and
specification alloys
Wrought alloy
processors
(e.g., rolling
mills, extruders)
Automotive OEMs,
foundries and
casters
Industrial
(new)
Post-consumer
(old)
Aluminum
by-products
(e.g. dross)
Secondary Aluminum Industry
Key Bridge in the Supply Chain
5
26.0 36.9
43.5 54.9
67.3 9.8
13.8
19.7
27.7
37.7
35.7
50.7
63.2
82.5
104.9
2002 2007 2012 2017E 2022E
Primary Secondary
5.2%
CAGR %'12 - '22E
Secondary Aluminum Demand
Global aluminum production % Share of aluminum production – NA and Europe
Secondary aluminum production is expected to grow faster than primary production and should account
for half of all production in North America and Europe by 2022
(Tonnes in millions)
6.7%
4.5%
69.4%
63.1%
57.4%
52.9% 50.4%
30.6%
36.9%
42.6%
47.1%
49.6%
2002 2007 2012 2017E 2022E
Primary Secondary
Source: Freedonia Group, October 2013.
6
Aluminum Pricing
Source: Metalprices.com
Price Movements Tied to Inventory???
$1,400
$1,600
$1,800
$2,000
$2,200
$2,400
$2,600
$2,800
$3,000
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
3-May-11 3-Nov-11 3-May-12 3-Nov-12 3-May-13 3-Nov-13 3-May-14 3-Nov-14 3-May-15 3-Nov-15 3-May-16
$/T
Met
ric
Tonn
esP1020 Price vs. LME Primary Inventory
Aluminum stock P1020 price
$1,400
$1,600
$1,800
$2,000
$2,200
$2,400
$2,600
$2,800
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
3-May-11 3-Nov-11 3-May-12 3-Nov-12 3-May-13 3-Nov-13 3-May-14 3-Nov-14 3-May-15 3-Nov-15 3-May-16
$/T
Met
ric
Ton
nes
NASAAC/380 Price vs. NASAAC LME Inventory
NASAAC stock NASAAC price MW380
7
Automotive End Use Outlook
Auto builds forecasted to rise in all
regions
— North American increases largely in
Mexico
— European producers expanding to
Eastern Europe
Huge growth projected in body, bumper
and closure
Castings pounds per vehicle to increase
— Powertrain to increase from 196 lbs
to 209 lbs
— Chassis, Suspension and Steering to
increase from 21 lbs to 38 lbs
Capacity exists to process the
expanded alloy mix from new products
and applications
Source: Ducker Worldwide, October 2012.
Auto Builds
Aluminum Content per Vehicle
343 Pounds/Vehicle
57%
17%
6%
5%
15%
Current Component MixPowertrain
Wheels
Chassis, Suspension& Steering
Body, Bumper andClosure
All Other
550 Pounds/Vehicle
38%
11%7%
32%
12%
Future Component MixPowertrain
Wheels
Chassis, Suspension& Steering
Body, Bumper andClosure
All Other
Ramp Up is Underway – Impact to be Determined
8
Scrap Market and Outlook
Industrial Scrap
− Flow remains fairly strong
− Auto body scrap supply chain being defined
Post-Consumer Scrap
− Low prices driving down flow
− Steel industry slowdown has negative impact
− China remains less active
Aluminum by-products (dross)
− Driven by rolling mill / extrusion / casting volumes
− Expected to increase with auto body trends
Impact of currency fluctuations
− Leads to changes in flow of scrap, ingot and
products
Source: USGS
$0.70
$0.80
$0.90
$1.00
$1.10
$1.20
$1.30
$1.40
Jan-
11
Mar
-11
May
-11
Jul-
11
Sep
-11
Nov
-11
Jan-
12
Mar
-12
May
-12
Jul-
12
Sep
-12
Nov
-12
Jan-
13
Mar
-13
May
-13
Jul-
13
Sep
-13
Nov
-13
Jan-
14
Mar
-14
May
-14
Jul-
14
Sep
-14
Nov
-14
Jan-
15
Mar
-15
May
-15
Jul-
15
Sep
-15
Nov
-15
Jan-
16
Mar
-16
May
MTD
$/L
b
Platts MW A-380 vs. MB226 (USD)
MB226 (USD) MW380
Bumpy Ride to Continue9
01
14
11
28
51
02
99
99 10
2 12
01
20
11
61
00
85
81
82
80 8
88
5 98 10
19
6 10
28
38
36
05
7 66 7
47
4 80 81
81
72 74
71
54
54 56
Ja
n-1
3
Ma
r-13
Ma
y-1
3
Ju
l-1
3
Se
p-1
3
Nov-1
3
Ja
n-1
4
Ma
r-14
Ma
y-1
4
Ju
l-1
4
Se
p-1
4
Nov-1
4
Ja
n-1
5
Ma
r-15
Ma
y-1
5
Ju
l-1
5
Se
p-1
5
Nov-1
5
Ja
n-1
6
US Exports of Aluminum Scrap to China(Metric Tonnes 000's)
9
Financial Strength of Supply Chain
Scrap Suppliers Customers
SECONDARY
Aluminum recycling
− wrought, cast and
specification alloys
Wrought alloy
processors
(e.g., rolling
mills, extruders)
Automotive
OEMs, foundries
and casters
Industrial
(new)
Post-consumer
(old)
Aluminum
by-products
(e.g. dross)
Aluminum Supply Chain Remains Strong
10
Secondary Aluminum Outlook
Increasing use of aluminum
Global expansion of the industry
Technology
Demand for eco-friendly products
Legislation
Opportunities Risks
Currency
Relocation of production
Financial health of industry
Impact of low prices
Global balance of prime and scrap
Positive Outlook Despite Risks