Boart Longyear — FY2017 Earnings Presentation
20 slides from Boart Longyear's earnings presentation, Feb 28, 2018
Slide 1: FY 2017 Results
LRTM 500 Drill Rig FY 2017 Results February 2018 Jeff Olsen – Chief Executive Officer
Slide 2: Important Notice and Disclaimer
Important Notice and Disclaimer • This presentation has been prepared by Boart Longyear Limited, ABN 49 123 052 728 (Boart Longyear or the Company). It contains general information about the Company’s activities as at the date of the presentation. It is information given in summary form and does not
Slide 3: FY 2017 Highlights
FY 2017 Highlights - Improvement in operating performance and market outlook Leading safety performance focused on continuous improvement LTIR – 0.22 (2016 – 0.11) 1 Safety TCIR – 1.62 (2016 - 1.41) 1 Released global incident management protocols, learning management system (BITS) and associat
Slide 4: Advancing Drilling Equipment
Advancing Drilling Equipment - Continuing to deliver a safer and more productive drill rig LF™160 Rig and MDR700 Mobile LF™350E Rig FREEDOM™ Loader Drill Rig (Surface Coring and Deep (Surface Coring) (Underground Coring) Hole exploration) • 100% hands-free rod • Semi-automated rod handling • Complet
Slide 5: Leading innovation in the industry
Leading innovation in the industry - Developing tools to improve drill productivity and data collection LongyearTM Bits XQTM Rods TruScanTM TruShotTM (Diamond Coring) (Deep-hole Drilling) (On-site Assay) (Down-hole Survey) • Patented new • New patented thread • Proprietary XRF on-site • Launching in
Slide 6: Drilling Services: FY 2017 Operations
Drilling Services: FY 2017 Operations - Productivity improvements supported with higher volumes 2017 Financial Highlights Change Key Financials (US $M): FY 2017 FY 2016 Revenue - up 12% from FY2016 with clients Fav / (Unfav) extending their drilling campaigns late into the year Revenue 501 448 12%
Slide 7: Global Products: FY 2017 Operations
Global Products: FY 2017 Operations - Growth in business unit lead indicator to market improvement 2017 Financial Highlights Change Key Financials (US $M): FY 2017 FY 2016 Fav / (Unfav) Revenue - up 22% from FY2016 with stronger H2 sales Revenue 239 195 22% Margin - Total margin impacted by lowe
Slide 8: Financial Overview
Financial Overview Brendan Ryan – Chief Financial Officer
Slide 9: Consolidated Results Summary: FY 2017
Consolidated Results Summary: FY 2017 - Volume increasing along with continued operational improvements (US $M) Consolidated Revenue Bridge • Revenue increased $97M (15%), driven by volume increases across both Drilling Services and Products • Consecutive half on half increases in revenue since H120
Slide 10: Year-Over-Year Comparison
Year-Over-Year Comparison - Strong focus on productivity and cost control in improving market 2 Statutory Adjusted Change Change (US $M except EPS) FY 2017 FY 2016 (US $M) FY 2017 FY 2016 Fav / (Unfav) Fav / (Unfav) Revenue 739 642 15% Revenue 739 642 15% Gross Margin 111 86 29% Adjusted Gross Margi
Slide 11: Completed Recapitalisation
Completed Recapitalisation - Met objectives to reduce debt, improve liquidity and extend maturity (US $M) Reduced Debt Significant reduction in debt and future PIK rates Converted $196M into Equity, Further $88M reduced to 1.5% PIK Reduced Term Loan PIK rate to 8% (from 2019 onwards) Expan
Slide 12: Business Overview
Business Overview Jeff Olsen – Chief Executive Officer
Slide 13: Stronger Leading Indicators
Stronger Leading Indicators - Significant improvement in key customer metrics and outlook S&P Debt Rating Outlook5 Mining industry debt ratings are improving Debt Ratios Improved industry balance sheets will result in increased drilling activity for reserve / resource replenishment Improvement
Slide 14: FY 2018 Strategic Objectives
FY 2018 Strategic Objectives - Build on the operational improvements delivered in 2017 Continue to be an industry leader Simplify safety systems and standards Safety Implement soft start hazard risk program Expand onboarding program to include detailed technical training Remain focused on main
Slide 15: Questions?
Questions? @ BOART LONGYEAR
Slide 16: Appendix
BOART R LONGYEAR ©
Slide 17: Safety & Environment
Safety & Environment Total Incident Rates1 2.23 2.33 2.50 2.15 2.00 1.78 1.56 1.62 1.62 1.35 1.41 1.50 1.24 1.00 0.50 0.14 0.12 0.13 0.19 0.11 0.18 0.11 0.22 0.08 0.10 - Leading safety performance KPI’s FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 • LTIR – 0.22 • T
Slide 18: Key Performance Indicators by Quarter
Key Performance Indicators by Quarter Quarters ended 2017 Quarters ended 2016 Quarters ended 2015 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Total Company Revenue (US$ millions) 183.7 199.2 192.5 163.7 156.9 175.0 168.7 141.8 160.9 186.8 200.3 187.2 EBITDA (US$ millions) (20.1) (4.5) (7.6) (4.4) (15.3) 13.
Slide 19: Diversified End-Market Exposure
Diversified End-Market Exposure FY 2017 Total Revenue by Type – Products & Services FY 2017 Total Revenue by Region – Products & Services FY 2017 Drilling Services Revenue by Stage FY 2017 Drilling Services Revenue by Commodity FY 2017 Results – See page 20 for footnote descriptions 19
Slide 20: Footnote Disclosures
Footnote Disclosures • Footnote 1: Per 200,000 work hours. • Footnote 2: Loss from Trading Activities, Adjusted Gross Margin, Adjusted Operating Loss, Adjusted SG&A, Adjusted EBITDA and Adjusted NPAT Loss are non-IFRS measures and are used internally by management to assess the underlying performanc