Slide 1: Presentation by CEO and CFO, August 2007
For personal use only Presentation by Dr Rodney Houston Chief Executive Officer & Mr Keith Halliwell Chief Financial Officer August 2007
Slide 2: Contents
For personal use only Contents Introduction Group Overview FY07 Results Business Segments Outlook P2 ORBITAL COPYRIGHT
Slide 3: Orbital Corporation Overview
For personal use only Orbital Corporation Overview Australian owned publicly listed company trading on ASX as OEC Listed on US OTC Bulletin Board (code OBTLY) Owner and developer of Orbital DI Shares on issue 473 million Debt $13.5 million (interest free loan from WA Government repayable i
Slide 4: Group Overview – Income Streams
For personal use only Group Overview – Income Streams Orbital Corporation Engineering Services Royalties and Licensing Manufacturing - Analysis& Design - Orbital Direct Injection Synerject JV - EMS Design & Devt. - Combustion Systems - Calibration & Testing - Control Systems - EMS Manufacturing - En
Slide 5: Orbital Global Locations
For personal use only Orbital Global Locations July 2005 December 2006 Synerject Newport News Toulouse Delavan France Wisconsin USA Changchun Chongqing Newport China China News Virginia USA Perth Australia March 2006 Orbital Locations Synerject Locations Regional Customer Support P5 ORBITAL COPYRIGH
Slide 6: Orbital's Vision
For personal use only Orbital’s Vision Innovative Technology Solutions for a Cleaner World Focused on: – Clean, efficient and safe transportation; – Efficient use of energy and resources; – Use of renewable and sustainable energies; where each are readily developable in Australia, and applicable to
Slide 7: FY07 Strategic achievements
For personal use only FY07 Strategic achievements Bajaj commence production of Orbital direct injection gasoline Autorickshaw vehicles in May 2007 Bajaj enter into a new license for LPG and CNG Autorickshaw vehicles Synerject establishes manufacturing and engineering facilities in China Shar
Slide 8: FY – Results
For personal use only FY 07 – Results A#039;m FY07 FY06 %YOY Total revenue 15.2 11.5 32% Total expenses (16.7) (14.6) 14% Share of profit of Synerject 3.2 4.1 (22% ) EBIT 1.6 1.0 57% Profit after taxation 1.3 0.5 160% EPS (cents) 0.299 0.125 139% NTA per share (cents) 3.470 1.880 85% •FY07 includes ful
Slide 9: FY07 Results – EBIT Analysis
For personal use only FY07 Results – EBIT Analysis 6 5 4 A#039;m 3 2 1 0 FY06 Engineering Licencing & Share of Other Employee CML Other FY07 Services Royalties Synerject Income Expenses settlement Expenses Profit P9 ORBITAL COPYRIGHT
Slide 10: FY07 – Financial Summary
For personal use only FY07 – Financial Summary • Cash Flow • Operating Cash Flow – Cash outflow of $0.2 million – a significant improvement on FY2006 – This includes settlement of legal dispute of $0.6 million paid in FY2007. • Other Cash Flow – Share placement and share purchase plan raising $8.8 m
Slide 11: FY07 Results – Earnings Contribution by Segment
For personal use only FY07 Results – Earnings Contribution by Segment 4 3 2 A$m 1 0 -1 FY 05 FY 06 FY 07 E n g in e e rin g R o ya lty & L ice n ce s S yn e rje ct •All business segments are now profitable P11 ORBITAL COPYRIGHT
Slide 12: Group Overview – Income Streams
For personal use only Group Overview – Income Streams Orbital Corporation Engineering Services Royalties and Licensing Manufacturing - Analysis& Design - Orbital Direct Injection Synerject JV - EMS Design & Devt. - Combustion Systems - Calibration & Testing - Control Systems - EMS Manufacturing - En
Slide 13: Orbital Growth Drivers
For personal use only Orbital Growth Drivers Emissions reduction (toxic and greenhouse legislation) Lower energy/fuel consumption (greenhouse and oil price) Alternative fuels (greenhouse and renewable) Cost effective powertrain solutions (China and India) P13 ORBITAL COPYRIGHT
Slide 14: Synerject Financials
For personal use only Synerject Financials Revenue Result 90 4.5 80 4 70 3.5 60 3 US#039;m US#039;m 50 2.5 40 2 30 1.5 20 1 10 0.5 0 0 FY05 FY06 FY07 FY05 FY06 FY07 Operating and Investing Cash Flows Net Debt 7 10 9 6 8 5 7 6 US#039;m 4 US#039;m 5 3 4 2 3 2 1 1 0 0 FY05 FY06 FY07 FY05 FY06 FY07 P14 ORBITAL COPY
Slide 15: Synerject Overview
For personal use only Synerject Overview Supplies and manufactures EMS and electronic fuel injection systems for global non- automotive market Access to Siemens-VDO automotive components and know how for non-automotive applications Exclusive manufacturing rights to Orbital DI air/fuel injector
Slide 16: Synerject – Products and Markets
For personal use only Synerject – Products and Markets 4 Stroke 2 Stroke Port Injection Direct Injection Direct Injection Port Injection P16 ORBITAL COPYRIGHT
Slide 17: Legislative drivers for Technology and EMS
For personal use only Legislative drivers for Technology and EMS World Motorcycle Emissions Legislation Technology Carburetor China Europe India Taiwan Emissions EMS or Carburetor & Catalyst EMS Closed Loop & Catalyst 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 P17 ORBITAL COPYRIGHT
Slide 18: Synerject M3 ECU Product
For personal use only Synerject M3 ECU Product Same ECU for all engine displacements 50cc to 250cc M3 ECU targeted at high volume markets of China and India 60 50 40 Total Unit Volumes in the Motorcycle, 30 M/cycle only Marine and Recreation 20 Markets China&India M/cycle 10 0 2006 2009 2012 P18 ORB
Slide 19: Synerject - Outlook
For personal use only Synerject - Outlook Continued investment in manufacturing and engineering facility in China for profit growth in 2009/10 Launch of new products in India and China will add revenue growth in 2008 Continued implementation of cost reductions and efficiencies at US Delavan fa
Slide 20: Licensing and Royalties
For personal use only Licensing and Royalties 3 2.5 2 A#039;m 1.5 1 0.5 0 FY05 FY06 FY07 Revenue Contribution •Segment costs include R&D and patent expenses •Royalty volumes in FY2007 similar to FY2006 •Royalty revenue reduced in FY2007 due to stronger A$ •Increased investment in R&D in 2007 P20 ORBITA
Slide 21: Licensing and Royalties - Products
For personal use only Licensing and Royalties - Products Over 500,000 Orbital DI engines in the market P21 ORBITAL COPYRIGHT
Slide 22: Licensing and Royalties - Outlook
For personal use only Licensing and Royalties - Outlook Bajaj gasoline DI autorickshaw increasing volume through FY2008 and FY2009 Extension of Orbital DI applications into growth products e.g. High end motorcycles and ATVs Extension of Orbital technology into new markets e.g. gaseous and spar
Slide 23: Engineering Services
For personal use only Engineering Services 14 12 10 8 A#039;m 6 4 2 0 -2 FY05 FY 06 FY 07 Revenue Contribution •Engineering revenue increased by 45% to $12.5 million •Orbital has facility capacity to increase engineering revenue without significant increase in costs P23 ORBITAL COPYRIGHT
Slide 24: Engineering Services
For personal use only Engineering Services Fee-for-service business providing fundamental design, development and research in: Engine management systems Fuel systems Combustion systems Fuel economy and emissions Gaseous and Alternative Fuels e.g. LNG/CNG fuel systems P24 ORBITAL COPYRIGHT
Slide 25: Engineering Services - Markets
For personal use only Engineering Services - Markets Markets for gaseous and alternative fuels system solutions in the non-auto and auto market (LPG,CNG, Kerosene and diesel) growing globally New market for Orbital services in the commercialisation of clean technology (internally or externally d
Slide 26: Engineering Services - Outlook
For personal use only Engineering Services - Outlook Focus on emerging markets in Asia and lever our IP along with R&D investment for strong selling propositions Cyclic nature of customer outsourcing has some near term influence, building long term strategic alliances with key customers to enabl
Slide 27: Orbital Summary
For personal use only Orbital Summary Innovative Technology Solutions for a Cleaner World Targeting profit growth and positive cash flows with increased emphasis on Orbital technology, Synerject and a broad customer base Focus on the development and commercialisation of a range of innovative tec