Slide 1: 2013-14 Full Year Result Investor Presentation
2013-14 Full Year Result Investor Presentation May 2014 Greg Kilmister – CEO Paul McPhee – Group General Manager Energy Division R IG H T S O L U T I O N S | R I G H T PA RT N E R
Slide 2: Important Notice and Disclaimer
IMPORTANT NOTICE AND DISCLAIMER • This presentation has been prepared by ALS Limited, (ALS 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 purport to be complete. The distribution
Slide 3: Company Profile
Company Profile ALS Limited (ASX:ALQ) is an ASX 100 company that provides professional technical services to the global Metals & Mining, Life Sciences, Oil & Gas, and Industrial sectors throughout the world. The Reward business is an Australian distributer of non-perishable hospitality supplies. Mar
Slide 4: OHS&E
OHS&E Group LTIFR ALS Group Compliance Portal PPI Chart LTIFR = Lost Time Injuries per million hours worked Profile: ALS LimitedFinancial Year: April 2013 – March 2014Total Score: 93.25% 14 12 10 8 6 ASX top 100 average = 3.6 4 1.8 2 Target Act ual PPI To t al PPI Met ric PPI Met ric Descript io n S
Slide 5: Financial Summary
Financial Summary FY14 Significant FY14 FY13 Change in Statutory Differences1 Underlying Underlying2 Underlying AUD$mn Revenue 1503.4 0 1503.4 1455.6 +3.3% EBITDA 325.7 (13.3) 339.0 406.0 -16.5% Depreciation & (83.2) (7.0) (76.2) (55.4) +37.5% Amortisation EBIT 242.5 (20.3) 262.8 350.6 -25.0% Financ
Slide 6: Historical Trend – Five Year Journey
Historical Trend – Five Year Journey Revenue Underlying After Underlying Tax Profit Earnings Per Share AUD $m AUD $m AUD 1,600 CAGR 16.1% 250 $0.70 1,503 238 $0.70 1,456 $0.66 1,406 222 1,400 $0.60 200 1,200 CAGR 23.1% CAGR 14.7% 1,108 172 $0.50 $0.45 1,000 150 $0.41 826 132 $0.40 800 $0.30 100 $0.2
Slide 7: FY14 – Revenue by Region by Division
FY14 – Revenue by Region by Division Europe North America Middle East Asia Africa South America Australia Life Sciences Division Minerals Division Energy Division Industrial Division Reward Distribution RIGHT SOLUTIONS | RIGHT PARTNER 7
Slide 8: Foreign Currency Revenues
Foreign Currency Revenues Asia ZAR Krona 2% 4% 3% Average Exchange Rate GBP 7% FY2014 FY2013 Change 3%3% 3% EURO 3% USD 0.9235 1.0323 -10.5% 6% 5% CAD 0.9776 1.0354 -5.6% AUD FY2014 revenue 47% 42% EURO 0.6880 0.8016 -14.2% 15% AUD $1.503 billion GBP 0.5796 0.6536 -11.3% CAD 14% SEK 6.0287 6.8819 -1
Slide 9: Revenue Growth - laboratories
Revenue Growth - laboratories ALS (laboratories) Revenue Growth 1250 Revenue (AUD$mn) 1000 • Organic Growth -18.0% 750 500 • Acquired Growth +17.5% 250 • Currency Impact +4.1% 0 Reported Growth 3.6% Revenue Growth YoY Industrial Energy +100% Life Sciences Minerals -40% -30% -20% -10% 0% 10% 20% 30%
Slide 10: Dividend
Dividend Full Year Dividend per Share AUD 18% CAGR cents 50 • Payout ratio 93% 40 • Franked to 50% 27 26 • Dividend Reinvestment Plan 30 20 retained at 5% discount 20 15 11 10 19 21 19 13 9 0 FY10 FY11 FY12 FY13 FY14 RIGHT SOLUTIONS | RIGHT PARTNER 10
Slide 11: CAPEX (excluding land & building purchases) and Depreciation
CAPEX (excluding land & building purchases) and Depreciation CAPEX Vs Depreciation & Amortisation1 CAPEX as a % of D&A 22% 91% 126% 70% 71% 58% 106% 64% • Capacity CAPEX reduced substantially Millions in line with market conditions $20 Reservoir Group acquired-- • Replacement CAPEX being maintained
Slide 12: Cash Flow and Funding
Cash Flow and Funding Cash Flow Mar-14 Mar-13 Underlying EBITDA $328mn -19% Statistics Operating Cash Flow $346mn -6% Gearing Ratio Comfort 45% 33.9% 29.3% CAPEX (excl. land & buildings) $68mn -16% Leverage (net debt / EBITDA) Max 3.00 2.2 1.0 EBITDA interest cover Min 3.75 12.2 20.7 AUD$m Balance S
Slide 13: Employee Numbers - total head count
Employee Numbers - total head count • Mineral Division head count down by 46% 14,000 from peak in June 2012…but expertise and management structure retained 12,000 • Life Sciences Division head count growing as we enter new geographies (South America, United Kingdom) and develop Food/Pharma 10,000 fo
Slide 14: Margin – peer comparison
Margin – peer comparison 35% 33.4% 31.1% 30% 25% 24.3% 21.9% 20.5% 20% 18.8% 19.0% 16.8% 16.7% 15.7% 15.4% 15% 13.2% 12.9% 10% 5.8% 5% 0% ALS SGS B.V. Intertek Eurofins Mistras Core Labs EBIT EBITDA Note: FY Dec 13 for all companies excluding ALS (FY Mar 14) and MISTRAS (FY Jun 13) EBIT and EBITDA u
Slide 15: ALS journey over the last decade
ALS journey over the last decade FY2005 FY2009 FY2014 revenue revenue revenue $448m $951m $1,503m Environmental Food/Pharma Consumer Products Geochemistry Metallurgy Inspection Engineering Oil & Gas Coal Asset Care Tribology Reward Distribution Chemical Campbell Brothers Services 1,600 Severn Trent
Slide 16: Growth of non-Minerals Divisions
Growth of non-Minerals Divisions Lab Services Revenue Lab Services EBITDA Non-Mineral EBITDA margin 1,400 450 21% 21% 24% 20% 24% 23% 25% 25% 24% 400 1,200 350 1,000 AUD$ millions AUD$ millions 300 800 250 600 200 150 400 100 200 50 - - FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY06 FY07 FY08 FY0
Slide 17: Minerals Division
geochemistry metallurgy Minerals Division inspection mine site services Overview • Geochemistry EBIT margin 26.0% for full year • Rationalization of Hub and Spoke laboratories to protect margin • Inspection EBIT margin improved from 9.5% to 20.3% YoY 2014 2013 Change • New metallurgical facility in
Slide 18: Life Sciences Division
environmental food/pharma Life Sciences Division electronics consumer products Overview • Pricing pressure in Australia and Canada • 6% organic growth in environmental revenue in Europe • Operational issues in South America fixed 2014 2013 Change • Centre of Excellence (GLP laboratory) in Edmonton c
Slide 19: Energy Division
coal Energy Division oil & gas Overview • Successful acquisition and integration of the Reservoir Group and EarthData 2014 2013 Change • Operations in 60 countries with 1,650 staff • Coring – soft in North America in Q4FY14 Revenue $248mn $105mn +136% • Oil & Gas EBITDA 25.3% - weaker than expected
Slide 20: Industrial Division
asset care Industrial Division tribology Overview • Revenue mix shifted from “outage” to construction • Australian market price sensitivity impacted margins • Declining power and welding & fabrication markets - higher margin work • Significant mobilization costs for LNG projects 2014 2013 Change • s