Slide 1: ASX Release: Presentation – Noosa Mining and Exploration Conference
20 July 2017 For personal use only ASX Release Mitchell Services Limited (ASX: MSV) Presentation – Noosa Mining and Exploration Conference Please find attached presentation being made today by Mitchell Services CEO, Andrew Elf, at the 2017 Noosa Mining and Exploration Conference. Greg Switala Compan
Slide 2: Noosa Mining & Exploration Conference Corporate Presentation
For personal use only NOOSA MINING & EXPLORATION CONFERENCE Corporate Presentation July 2017 1 www.mitchellservices.com.au
Slide 3: Disclaimer
DISCLAIMER For personal use only This investor presentation has been prepared by Mitchell Services Limited (“the Company”). Information in this presentation is of a general nature only and should be read in conjunction with the Company’s other periodic and continuous disclosure announcements to the
Slide 4: Mitchell Services Market Profile
MITCHELL SERVICES MARKET PROFILE For personal use only ASX Information Major Shareholders ASX Stock Symbol: MSV 1 Mitchell Group 21.32% Shares Issued: 1,476,785,715 2 Washington H Soul Pattinson 12.26% Share Price (at 13/7/2017): A$0.038 3 CVC 8.30% Market Capitalisation: A$56.1m 4 Acorn Capital 4.5
Slide 5: Mitchell Services Strategy - 'Timing'
MITCHELL SERVICES STRATEGY - ‘TIMING’ For personal use only ▪ Board and management have a strong understanding of the cyclical nature of the industry which drives investment decisions Mitchell Drilling Contractors sells to AJ Lucas for $150m 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 201
Slide 6: Mitchell Services Vision
MITCHELL SERVICES VISION For personal use only To be Australia’s leading provider of drilling services to the global exploration, mining and energy industries Be Sure. Be Safe Our people are your success Management Safety Leading Systems Operational Value Find a better way Team Technology Capability
Slide 7: FY17 Business Overview (Unaudited)
FY17 BUSINESS OVERVIEW (UNAUDITED) For personal use only Total Recordable Injury Recent contract Circa 90% of income is Frequency Rate of less $40.1m wins will utilise from Tier 1 * mining and energy companies than 15 as at 30 June revenue in FY17 18 rigs Other Rig fleet size Expected operating rig
Slide 8: Year on Year Revenue Growth
YEAR ON YEAR REVENUE GROWTH For personal use only Other Revenue Tier 1 Revenue $40.10m VALUE OF TIER 1 $32.97m • Large / multinational mining and energy companies $25.17m • Very high safety and 91.7% business system requirements 87.5% $15.02m 64.6% • Generally brownfield work for existing mining 36.
Slide 9: Impact of Increased Utilisation on Revenue
IMPACT OF INCREASED UTILISATION ON REVENUE For personal use only $40.10m • Mitchell Services was EBITDA positive at less than 30% annual rig $32.97m Expected utilisation in current operating rig pricing environment in count in the FY16 $25.17m near future Average Operating circa 40 • We expect to be
Slide 10: Leverage in an Improving Market
LEVERAGE IN AN IMPROVING MARKET For personal use only • STAGE 1: UTILISATION INCREASES • More rigs start working (This is happening) • STAGE 2: PRODUCTIVITY IMPROVES AS UTILISED RIGS WORK MORE SHIFTS • Seasonality impact reduces as rigs work through the wet season (This is starting to happen in limi
Slide 11: Business Development
BUSINESS DEVELOPMENT For personal use only Increased focus on geographical diversification • Highly focused on lead generation • Strong tender pipeline across Tier 1 and other clients require equipment that MSV already owns • Increase in revenue growth demonstrates Mitchell Services ability to win m
Slide 12: Market Outlook
MARKET OUTLOOK For personal use only • Competitive Profile of the market has improved but has now stabilised. • New entrants are still faced with barriers to entry such as high capital cost and inability to secure financing. • Gold in Western Australia is “hot”. • Greenfield exploration sector showi
Slide 13: Cyclical Industry Presents Opportunity
CYCLICAL INDUSTRY PRESENTS OPPORTUNITY For personal use only Listed Drilling Company – Share Price Movements* (Average is a non weighted average of daily close prices) Boart Longyear Major Drilling Foraco Orbit Garant AusDrill Capital Drilling Layne Christiansen Geo Drill Indexed Average 2005 2006 2
Slide 14: Summary
SUMMARY For personal use only • Mitchell Services vision is to be Australia’s leading provider of drilling services to the global exploration, mining and energy industries • Significant increase in rig utilisation to circa 40 rigs in the near future. • Successful geographical expansion to date and e