Webuild Spa · MIL:WBD
Webuild Spa — Salini Impregilo — Investor Day (May 2016)
30 slides from Webuild Spa's investor day presentation, May 23, 2016
Slide 1: Business Plan 2016 - 2019
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Slide 2: Agenda
BUSINESS PLAN 2016 – 2019 AGENDA Fabrizio Rossini Introduction & Agenda Head of Investor Relation 15 Pietro Salini 16.00 - 16.15 min Chief Executive Officer Who we are Guest speaker 15 16.15 - 16.30 min Parag Khanna Global Strategist Infrastructures global market trends 20 Pietro Salini 16.30
Slide 3: Who We Are
WHO WE ARE A Leading Global Pure Construction Player 3 Business Plan 2016 - 2019 Presentation
Slide 4: Our Unique Global Franchise
OUR UNIQUE GLOBAL FRANCHISE RECORD ACHIEVEMENTS Projects M&A and Financing Completed in Achievements Divestments Achievements 2016 Completed Panama Canal 2011-2015 S&P upgrade to BB+ ACQUISITIONS Athens Opera House New Rating by Impregilo Revenues CAGR 2011-2015: 43% Dagong Europe: BB+
Slide 5: Our Track Record
OUR TRACK RECORD New Panama Canal 5 Business Plan 2016 - 2019 Presentation
Slide 6: A Solid Path to Our Future Growth
A SOLID PATH TO OUR FUTURE GROWTH 6 Riyadh BusinessUnderground, Line 3 Plan 2016 - 2019 Presentation
Slide 7: Building Our Future on Solid Grounds
BUILDING OUR FUTURE ON SOLID GROUNDS A STORY OF REVENUE GROWTH Historical Strategic Focus: Scale & Growth Strategy evolution: Smart Growth Revenues (€bn) ~6.0 € 9 Bn 4.7 3.9 €6 Bn SCALE 1.4 € 1.4 Bn 2011 2013PF 2015 2015PF 2011 2015PF 2019 €4 bn of new orders already awarded in 2016 YTD €26 bn of ne
Slide 8: The Drivers of the Business Plan
THE DRIVERS OF THE BUSINESS PLAN To grow significantly through an efficient new orders selection. Targeting a book-to-bill >1.1x throughout the Business Plan To reduce consistently our portfolio's risk exposure To focus on cash generation through a suitable growth allowing a better use of financial
Slide 9: Evolving Our Strategy: Reshaping the Portfolio
EVOLVING OUR STRATEGY RESHAPING THE PORTFOLIO Geographic diversification to Low Risk countries Reshaping the portfolio New commercial approach and dynamic portfolio management Bid selection based on the "Salini Impregilo risk/return approach Commercial Planning Phases Targets fine tuning Crite
Slide 10: Evolving Our Strategy: Reshaping the Portfolio
EVOLVING OUR STRATEGY RESHAPING THE PORTFOLIO NORTH AMERICA EUROPE MIDDLE EAST 29% 33% 17% Cum. Rev 2016-19 Total € 29 Billion 18% 13% 40% Construction Backlog 2019 5% 18% 42% Total €39 Billion LATAM ASIA & OCEANIA 7% AFRICA 11% 3% Construction Backlog 2015 Total € 27 Billion 10% 6% 12% 13% 2% 21% L
Slide 11: Evolving Our Strategy: Reshaping the Internal Structure
EVOLVING OUR STRATEGY RESHAPING THE INTERNAL STRUCTURE Top Management Pietro Salini CEO New organization structured to extract value Massimo from global processes Claudio Lautizi Ferrari GM Intl GM Finance Operations and CFO Alessandro De Michele Centralized processes for procurement, HR, Rosa Longo
Slide 12: Prioritizing Cash Flow Generation
PRIORITIZING CASH FLOW GENERATION Stavros Niarchos Foundation Cultural Centre - Athens 12
Slide 13: Market for Infrastructures
MARKET FOR INFRASTRUCTURES OUR MARKET OF REFERENCE Global Infrastructures Market (€bn) Average Annual Growth of Investments in Constructions 8,022 Average 2009-2014 7,483 7.7% Average 2015-2020 6,869 6.9% 5.8% 4,297 4.0% 4.4% 4.0% 3.0% 3.0% 2.3% 2.4% 0.7% 1.3% 2000 2015 2018 2020 (1.5)% (3.6)% 1 2 3
Slide 14: De-risking Our Portfolio
DE-RISKING OUR PORTFOLIO Construction Backlog by Geography Construction Backog | Country Risk Breakdown 2015 (including Lane) 2019 SAL SAL + LANE € 39 bn Asia & Australia Asia & Australia USA 5% 6% Africa 2% € 27 bn 13% Africa 21% € 25 bn LatAm USA 18% 12% Middle East 80% Europe 13% 71% 67% 9% € 27
Slide 15: A Solid Path to Future Growth
A SOLID PATH TO FUTURE GROWTH Business Plan Construction Revenues Backlog Coverage Revenues by Geography EBITDA Asia & Australia 2015PF 6% ~ €9 Bn Africa 20% USA 23% NWC € 6 Bn €6 Bn Middle East 15% LatAm 9% New order Italy 11% Europe Capex 16% 99% 85% 64% Backlog €1.4 Bn 48% 2019 Asia & Australia F
Slide 16: Secured Profitability Improvement
SECURED PROFITABILITY IMPROVEMENT Selective Commercial Plan EBITDA Backlog Expected EBITDA margin New orders Average peers 7.4% 5.1% NWC 11% Target Profitability 10% Savings 9% 8.6% Capex Centralized procurement/CAPEX process 8% 7% HR Costs 2015 PF 2016E 2017E 2018E 2019E Financial Items Plants & ma
Slide 17: Working Capital Normalisation
WORKING CAPITAL NORMALISATION TARGETING A REDUCTION IN WORKING CAPITAL Expected Working Capital Trend (€m) EBITDA Focus on new contracts with 900 11% advance payments 800 9% NWC 700 600 7% 500 Optimization of stock levels 5% 400 Capex 300 3% 200 1% 100 Financial Improved management of Items 0 -1% pa
Slide 18: Capex Optimization
CAPEX OPTIMIZATION Considerations Expected Trend EBITDA Pure construction companies require greater capex investments Capex Capex as a % of Sales Large projects are more Capital intensive Projects complexity and extended Average of NWC duration drive capex requirements ~€300-350m Selected Exam
Slide 19: Highly Sustainable Financial Structure
HIGHLY SUSTAINABLE FINANCIAL STRUCTURE Gross Debt / EBITDA Net Debt / EBITDA EBITDA 3.7x Leverage 2.0-2.5x Increase Solid Cash reduction due to Position Lane NWC acquisition 2015A* 2016E 2017E 2018E 2019E EBITDA Gross Debt / EBITDA 2015A 2016E 2107E 2108E 2019E Capex EBITDA / Gross Interest Expenses
Slide 20: Evolving Our Financial Structure
EVOLVING OUR FINANCIAL STRUCTURE Optimize Financing Costs Significantly Reduced Average Total Debt Cost Net Financial Expenses EBITDA 5.3% 3.8% Further >€100m At 31-Dec-2014 At 31-Dec-2015 reduce Avg. cost of debt <€70m Average Bank Debt Cost thanks to NWC favourable 4.3% 2.6% markets At 31-Dec-2014
Slide 21: Free Cash Flow Generation
FREE CASH FLOW GENERATION €/ million Secured backlog profitability EBITDA EBITDA Selective approach on new orders Centralized management of global processes WC Changes NWC NWC management CAPEX CAPEX rotation Capex Tax planning Taxation Financial Items Gross Debt Reduction Financial charges Financial
Slide 22: The US Market Opportunity
THE US MARKET OPPORTUNITY 22 New Gerald Desmond Bridge - CALIFORNIA
Slide 23: The US Market Opportunity
THE US MARKET OPPORTUNITY Importance of US construction market – US non-residential market: 3rd largest market at a global level, expected to achieve $228 billion by 2020 – Stable market with a good level of profitability thanks to favourable payment terms The US construction market has favourab
Slide 24: Lane Track Record
LANE TRACK RECORD PORTFOLIO OF HIGH QUALITY PROJECTS IN EXECUTION Purple Line, Montgomery and Prince I-4 Ultimate Project, Orange & IH-35E Managed Lanes, Dallas George’s Counties, MD Seminole Counties, FL & Denton Counties, TX Contract Value: $2bn (Lane share Contract Value: $2.3bn (Lane
Slide 25: Lane Salini Impregilo Competitive Advantages
LANE SALINI IMPREGILO COMPETITIVE ADVANTAGES Salini Impregilo and Lane Presence in the US Main Assumptions Solid financial strength WA – Bonding capacity in excess of $3bn ME OR – $1.35b in annual revenue WI NY – $2.62bn backlog MI PA – $1.2bn new orders CA NV IL IN OH Significant commercial syn
Slide 26: Closing Remarks
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Slide 27: Our Vision
OUR VISION LEADERSHIP COMPETENCE INNOVATION To become the largest pure construction player focused on complex large infrastructure projects To improve people’s life quality and to contribute to economic development of the countries we work with To be the “Go to” player in the world of complex infras
Slide 28: Our Targets for 2019
OUR TARGETS FOR 2019 Solid revenues growth supported by secured selected backlog € 9 billion Revenues EBITDA growth supported by backlog and cost reduction above 10% EBITDA margin Free Cash Flow generation > € 900 million of Ready for investment grade rating FCF generation in the Business Plan Incre
Slide 29: Disclaimer
DISCLAIMER This presentation may contain forward-looking objectives and statements about Salini Impregilo’s financial situation, operating results, business activities and expansion strategy. These objectives and statements are based on assumptions that are dependent upon significant risk and uncert
Slide 30: Business Plan 2016 - 2019 Presentation
30 Business Plan 2016 - 2019 Presentation