Finning International Inc. · TSX:FTT
Finning International — Investor Presentation (June 2020)
19 slides from Finning International's investor presentation, Jun 18, 2020
Slide 1: Investor Presentation
INVESTOR PRESENTATION Kevin Parkes, President, Finning Canada Greg Palaschuk, EVP and CFO Amanda Hobson, SVP Investor Relations and Treasury June 18-19, 2020
Slide 2: Disclosures
Disclosures Forward-looking information This presentation includes “forward-looking information” (as defined in applicable Canadian securities legislation) that is based on expectations, estimates and projections that we believe are reasonable as of the date of this presentation, but may ultimately
Slide 3: Finning Overview
Finning Overview Largest Caterpillar dealer Market Statistics(1) - FTT (TSX) Share price 19.35 Unrivalled service since 1933 Market Cap 3.1B S&P/DBRS rating BBB(+*-/high) Diversified by geography, customer base, product and sector Annual dividend / share 0.82 ~12,800 employees Dividend yield
Slide 4: COVID-19 Response and Key Priorities
COVID-19 Response and Key Priorities Prioritizing health and safety of employees, customers, and communities Supporting operations of critical services (e.g. hospitals, emergency services, utilities) Employees Activated robust business continuity plans Implemented social distancing and work
Slide 5: Diversified and Resilient Business
Diversified and Resilient Business Resilient product support business Strong Leaner cost structure vs prior downturns Business Model Diversification by geography, industry, product - critical in a higher-risk environment Rejuvenated, engaged, and action-oriented leadership team Cost and ca
Slide 6: COVID-19 Lessons Provide Catalyst for Change
COVID-19 Lessons Provide Catalyst for Change Work from home works – 1/3rd of employees can efficiently work remotely Sustained reduction in travel and discretionary costs Employees Improved employee productivity Potential to reduce the cost of regional administration and office footprint by
Slide 7: Canada - Resilient Business Model Anchored by Product Support
Canada - Resilient Business Model Anchored by Product Support Canada - Product Support and New Equipment Revenue 4.0B Product Support CAGR 3.5B 3.0B 2008 to 2019 7% 2.5B New Equipment Range CAD 2.0B 2008 to 2019 1.5B 1.0B Maximum $1.7B 0.5B Average $1.2B 0.0B 2008 2009 2010 2011 2012 2013 2014 2015
Slide 8: Oil Sands Mining: Established, Large-Scale and Long-Life Resource
Oil Sands Mining: Established, Large-Scale and Long-Life Resource 30+ years of resource life PRODUCERS PROJECTS in a typical oil sands mining project Muskeg River CNRL Jackpine Horizon Mildred Lake Syncrude Suncor Imperial Oil Aurora CNRL CNRL Millennium Syncrude Suncor North Steepbank
Slide 9: Oil Sands – Significant Product Support Opportunity
Oil Sands – Significant Product Support Opportunity Product Support Drivers CAT 797 Truck - Population 340 Large and aging equipment population Best-in-class product support capabilities OEM - component rebuild approach IKC(2) - reduces costs and improves productivity for customers Improve
Slide 10: Canada - Priority Value Drivers
Canada - Priority Value Drivers Mining Leadership Profitable Growth Partnering with mining customers to lower costs, increase fleet performance, and build capabilities Construction Industries Sales Leadership Offering integrated product and service solutions to meet customer needs and capture market
Slide 11: Finning UK & Ireland Footprint – 2017 Case Study
Finning UK & Ireland Footprint – 2017 Case Study Response, Repair, Rebuild Hub UK & Ireland’s Improved Financial Performance Response and Repair Centre Response Centre Revenue CAGR Revenue growth well in excess of GDP Adjusted SG&A Network reconfiguration, leveraged service as % of revenue(1) operat
Slide 12: Canada - Facilities Network Transformation
Canada - Facilities Network Transformation Benefits British Columbia R Whitehorse R Yellowknife Improves customer turnaround / experience Alberta Maximizes labour productivity / quality Fort McMurray / Fort McKay Fort St. John Peace River RRR Lowers cost to serve Terrace Houston R R Saskatchew
Slide 13: Advanced Digital and e-Commerce Capabilities
Advanced Digital and e-Commerce Capabilities 80% CAT Assets Connected Technology – a great risk mitigator in a crisis in Finning territories Machine Condition Monitoring eCommerce on www.parts.cat.com Integrated Knowledge Centers (IKCs) Integrated Procurement Marketing Automation 24/7 Ca
Slide 14: Medium-Term Outlook
Medium-Term Outlook GROWTH DRIVERS MEDIUM-TERM OUTLOOK Infrastructure investment (e.g. LNG, TMX, Keystone) Product support (e.g. IKC1, rebuilds, CVAs2) CANADA Mining equipment replacement Autonomy adoption Mining equipment replacement Autonomy adoption SOUTH AMERICA Construction product support grow
Slide 15: UK’s HS2 – Largest Infrastructure Project in Europe
UK’s HS2 – Largest Infrastructure Project in Europe Combined Budget Phases 1 and 2 £100B High Speed Rail 2 (HS2) Quick Facts Phase 1 230 km high speed rail line from London to Birmingham Phase 2 Earthwork to be completed by 2024 Opening expected 2028 – 2031 Phase 1 Notice to proceed – April
Slide 16: Sustainability Has Been a Long-Term Priority for Finning
Sustainability Has Been a Long-Term Priority for Finning E Reducing GHG emissions from facilities and fleets, enhancing waste management, and minimizing potential risks from spills Safety and health Fostering a culture of safety and health, promoting meaningful Inclusion and diversity S inclusion of
Slide 17: Sustainability – Performance Highlights
Sustainability – Performance Highlights ENVIRONMENT PEOPLE & COMMUNITIES GHG Emissions 2019 vs 2017 Leveraging Technology CANADA TOTAL New electronic job hazard assessment (eJHA) tool is -8.6% -7.5% supported by satellite- 30% 6% enabled communication devices so employees can use it in remote locati
Slide 18: Capital Allocation
Capital Allocation Cumulative Capital Allocation – 2013 through 2019 Cumulative Free Cash Flow – 2013 through 2019 ($ millions) 3,500 Debt repayment 710 Dividends Retained cash & other 3,000 2,500 510 Share repurchases $1.9 B 2,000 860 Acquisitions Reinvested 1,500 in the business $1,220M 230 1,000
Slide 19: Strong Liquidity Profile
Strong Liquidity Profile Total Global Credit Capacity1 Enhanced financial flexibility and liquidity with new $500M committed credit facility Regional Credit Facilities $0.9B 5-Year Committed Revolving Credit $2.7B Facility $1.3B Long-term Debt Maturity Schedule % of total long-term debt maturing eac
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