Environmental Group Limited · ASX:EGL
Environmental — Investor Presentation (April 2023)
24 slides from Environmental's investor presentation, Apr 18, 2023
Slide 1: The Environmental Group Limited
The Environmental Group Limited Investor presentation Acquisition of Airtight Pty Ltd and Equity Raising 18 April 2023
Slide 2: Important notices and disclaimers
Important notices and disclaimers This presentation has been prepared and authorised by The Environmental Group Limited (“EGL”) in connection with a proposed equity raising by EGL by way of an institutional placement (“Placement”) of new, fully paid ordinary shares in EGL (“Placement Shares”) and a
Slide 3: Important notices and disclaimers (continued)
Important notices and disclaimers (continued) GENERAL INFORMATION The information in this presentation is of a general nature and is provided for information purposes only. It should be read in conjunction with EGL’s prior announcements, financial statements and information previously lodged with th
Slide 4: Important notices and disclaimers (continued)
Important notices and disclaimers (continued) FINANCIAL DATA Certain financial measures included in this presentation are 'non-IFRS financial information' under ASIC Regulatory Guide 230: 'Disclosing non-IFRS financial information' published by ASIC and are not recognised under AAS or International
Slide 5: Important notices and disclaimers (continued)
Important notices and disclaimers (continued) PAST PERFORMANCE Past performance and historical financial information are provided for illustrative purposes only. It should not be relied on and is not an indication of future performance, including future share prices. Historical information relating
Slide 6: Important notices and disclaimers (continued)
Important notices and disclaimers (continued) DISCLAIMER While the information in this presentation has been prepared in good faith and with reasonable care, no representation or warranty, express or implied, is made as to the accuracy, adequacy or reliability of any statements, estimate, opinions o
Slide 7: Contents
Contents CONTENT PAGE 1 Transaction overview 8 2 Overview of Airtight and acquisition rationale 13 3 Acquisition funding 20 7
Slide 8: Transaction overview
1 Transaction overview 8
Slide 9: Key highlights
Key highlights Unique opportunity to significantly expand in the air pollution control market • EGL has agreed to acquire Airtight Pty Ltd, a leading Australian air pollution services provider focused on mid-tier customers • Consideration of $7.0m cash plus up to $5.0m1 earnout based on FY24 earning
Slide 10: Transaction overview
Transaction overview Strategically aligned accretive acquisition funded by $8.0m placement • EGL has entered a binding agreement to acquire 100% of Airtight Pty Ltd (“Airtight”) for upfront cash consideration of $7.0m plus contingent consideration of up to $5.0m1 dependent on FY24 earnings TRANSACTI
Slide 11: Transaction overview
Transaction overview Strategically aligned accretive acquisition funded by $8.0m placement • Acquisition expands EGL’s solutions offering to include small to medium size airborne dust collection solutions and associated services/products STRATEGIC RATIONALE • Captures sections of the market outside
Slide 12: Transaction overview
Transaction overview Strategically aligned accretive acquisition funded by $8.0m placement • Up to $9.0m equity raising (“Equity Raising” or “Offer”), comprising: • $8.0m institutional placement (“Placement”) to new and existing institutional and wholesale investors • Up to $1.0m SPP from existing e
Slide 13: Overview of Airtight and acquisition rationale
2 Overview of Airtight and acquisition rationale 13
Slide 14: Business overview
Business overview Leading specialist air pollution solutions provider with a successful 20-year track record FY22 revenue by type FY22 revenue by geography • One of the largest specialist air pollution control companies 2% operating in Australia, with an extensive track record and a focus on reliabi
Slide 15: Business units
Business units Key divisions include Dust & Fume Control, Aftercare Servicing, Engineered Solutions and Waste-to-Energy DUST & FUME CONTROL ENGINEERED SOLUTIONS AFTERCARE SERVICING WASTE-TO-ENERGY Specialises in designing, installing and Offers engineering resources required Offers a number of preve
Slide 16: Key products
Key products Dust collector & Cyclones & Modular ducting Industrial fans extraction systems insertable filters Engineered Fume extraction Rotary valves Wood waste fired products systems heat plants 16
Slide 17: Leadership team
Leadership team Experienced leadership team with high quality staff • Stig Brixen joined Airtight in 2011 and leads a highly Stig Brixen experienced and capable team; culturally well aligned to EGL (Managing Director) • Dean Ingram joined Airtight in 2011 and is responsible for the Dean Ingram Glenn
Slide 18: Key investment highlights
Key investment highlights Airtight represents an attractive opportunity to expand EGL’s presence in the air pollution solutions market EXPERIENCED MANAGEMENT AND MARKET LEADER ROBUST MARGINS STAFF • Airtight holds a leading position in the • Experienced management with Airtight • Airtight has a trac
Slide 19: Potential synergies
Potential synergies Opportunity to achieve incremental margins and significantly grow service sales INCREMENTAL MARGINS ADDITIONAL REVENUES • Airtight have not traditionally • Airtight currently focused on securing service subcontracts gas and contracts (~2% of revenues) vapour works (ESP’s, • Addit
Slide 20: Acquisition funding
3 Acquisition funding 20
Slide 21: Funding overview
Funding overview Fully funded via new equity from institutional and retail shareholders • Up to $9.0m Equity Raising comprising: o $8.0m Placement to new and existing institutional and wholesale investors; and o Up to $1.0m SPP from Eligible Shareholders • Equity Raising will be conducted at a fixed
Slide 22: Sources and uses
Sources and uses Fully funded via new equity from institutional and retail shareholders • Acquisition fully funded by proceeds of Placement. Proceeds of SOURCES A$M SPP will be used for general working capital purposes New equity – Placement 8.0 • Acquisition agreement requires Airtight to deliver $
Slide 23: Equity raising details
Equity raising details EGL is undertaking a $9.0m equity raising • $9.0m Equity Raising consisting of: OFFER SIZE AND o A Placement to raise $8.0m; and STRUCTURE o A SPP from Eligible Shareholders to raise up to $1.0m • Approximately 45 million New Shares to be issued under the Offer • Equity Raisin
Slide 24: Equity raising timetable
Equity raising timetable SUMMARY OF KEY DATES DATE SPP record date (7.00pm Melbourne time) 7.00pm Monday, 17 April 2023 Announcement of Equity Raising and trading halt Tuesday, 18 April 2023 Announcement of results of Placement Thursday, 20 April 2023 EGL shares recommence trading Thursday, 20 April
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