Slide 1: Full Year Results Presentation
For personal use only FULL YEAR RESULTS PRESENTATION Financial Year 2018 1 www.mitchellservices.com.au
Slide 2: 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 3: Mitchell Services Market Profile
MITCHELL SERVICES MARKET PROFILE For personal use only ASX Information Major Shareholders ASX Stock Symbol MSV Mitchell Group 20.4% Shares Issued 1,738,673,346 Washington H Soul Pattinson 9.9% Share Price (at 20/08/2018) A$0.044 CVC Limited 6.1% Market Capitalisation A$77m Board of Directors Senior
Slide 4: Safety Update
SAFETY UPDATE For personal use only • Finishing each day without harm is a core Mitchell Services value • Key initiatives implemented to strengthen safety culture and performance have primarily focused on key risks and field leadership • Continued year on year reduction in recordable incident occurr
Slide 5: 2018 Business Overview
2018 BUSINESS OVERVIEW For personal use only Utilised an additional Total revenue of $72.70m Total EBITDA of $6.3m 22% of the fleet year on year ↑ 80% from FY2017 279% of FY2017 EBITDA Successful acquisition and Total recordable injury 350+ integration of earnings frequency rate improved by accretiv
Slide 6: Results Overview
RESULTS OVERVIEW Profit & Loss For personal use only EBITDA ($000's) FY18 FY17 FY16 Change FY2016 FY2017 FY2018 7,000 $000's $000's $000's % 6,000 Revenue 72,700 40,303 32,970 80% 5,000 2nd Half EBITDA 6,254 2,238 522 179% 4,000 3,000 EBIT (1,361) (3,197) (4,795) 57% 2,000 NPBT (2,340) (4,407) (6,04
Slide 7: Group Debt Profile
GROUP DEBT PROFILE For personal use only Debt levels reflective of growth organisation in early stages of the cycle Shareholder Loans $9 million debtor finance facility • Funding mechanism for the 2015 Nitro asset acquisition • To fund day to day working capital • Matures July 2020 (no fees for earl
Slide 8: Capital Expenditure
CAPITAL EXPENDITURE For personal use only 9.00 Millions • Growth capital reflective of material organic 8.00 growth in the underground and large diameter 7.00 markets 6.00 • Maintenance capex is reflective of the higher 5.00 equipment utilisation rate and material levels of equipment ramp up to serv
Slide 9: Impact of Increased Utilisation on Revenue
IMPACT OF INCREASED UTILISATION ON REVENUE For personal use only $72.70m • Average operating revenue per rig continues to increase Average Operating $40.30m Rig Count • We anticipate further $32.97m 37.1 material increases in revenue and $25.17m Average Operating profitability in FY19 Rig Count $15.
Slide 10: Leverage as Operating Rig Count Increases
LEVERAGE AS OPERATING RIG COUNT INCREASES For personal use only 65 Rigs in Fleet • Average operating rig count increased by 15.4 rigs year on year • Utilisation improvement from 35% in August 2018: 45 Current Operating Rigs FY2017 to 57% in FY2018 FY2018: 37.1 Operating Rigs (average) • Revenue up 8
Slide 11: Operating Revenue by Client Type
OPERATING REVENUE BY CLIENT TYPE For personal use only Strong year on year revenue growth anticipated to continue in FY19 ◼ Tier 1 Revenue ◼ Other Revenue VALUE OF TIER 1 $72.7m • Large / multinational mining and energy companies • Very high safety and business system $40.3m requirements $65.23m $33
Slide 12: Operating Revenue by Commodity
OPERATING REVENUE BY COMMODITY For personal use only FY16 $32.97m FY17 $40.30m FY18 $72.70m 1.3% 3.1% 5.7% 14.0% 6.0% 14.9% 12.6% 28.6% 32.8% 2.6% 13.2% 21.2% 44.4% 17.8% 18.5% 4.8% 5.5% 46.0% 55.6% 50.9% Gold Copper Coal Lead/Zinc/Silver Other Management remains mindful of the importance of diversi
Slide 13: Operating Revenue by Drilling Type
OPERATING REVENUE BY DRILLING TYPE For personal use only FY16 $32.97m FY17 $40.30m FY18 $72.70m 2.0% 1.3% 1.2% 22.6% 33.9% 38.5% 60.3% 64.8% 75.4% Surface Underground Non-Drilling Increase in underground revenue strengthens overall revenue diversity Management remains mindful of the importance of di
Slide 14: 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 15: Market Outlook
MARKET OUTLOOK For personal use only • Competitive Profile of the market has stabilised and prices have started to increase but remain competitive in certain sectors • Pipeline of identified opportunities remains strong and demand continues to increase for drilling services • Clients are more active
Slide 16: 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 • Tender pipeline provides opportunity to further increase rig utilisation • Previous acquisitions of surface assets early in t