Boart Longyear — H1 2018 Earnings Presentation
17 slides from Boart Longyear's earnings presentation, Aug 23, 2018
Slide 1: HY 2018 Results
MDR700 Drill Rig HY 2018 Results August 2018 Jeff Olsen – Chief Executive Officer
Slide 2: Important Notice and Disclaimer
Important Notice and Disclaimer • This presentation has been prepared by Boart Longyear Limited, ABN 49 123 052 728 (Boart Longyear 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
Slide 3: HY 2018 Highlights
HY 2018 Highlights - Strong improvement result of continued cost and productivity focus Industry leading safety performance ▪ LTIR – 0.15 (HY2017 – 0.20) 1 Safety ▪ TCIR – 1.99 (HY2017 – 1.93) 1 ▪ Focus to leading indicators to drive better safety outcomes Delivered on significant productivity impro
Slide 4: Drilling Services: HY 2018 Operations
Drilling Services: HY 2018 Operations - Productivity improvements leveraging higher volumes Change ▪ Revenue - up 11% primarily from current clients expanding Key Financials (US $M): HY 2018 HY 2017 Fav / (Unfav) Financial Highlights existing drilling campaigns Revenue 267 241 11% ▪ EBITDA - up 14%
Slide 5: Global Products: H1 2018 Operations
Global Products: H1 2018 Operations - Continued growth with simplified sales footprint ▪ Revenue - up 11% due to stronger tooling and rig sales Key Financials (US $M): HY 2018 HY 2017 Change Fav / (Unfav) across all regions Financial Highlights Revenue 127 115 11% ▪ COGS – up 6% reflecting increased
Slide 6: Leading innovation in the industry
Leading innovation in the industry - Investment in tools to improve drill productivity and data collection XQTM Rods TruCoreTM TruScanTM TruShotTM (Deep-hole Drilling) (Core Orientation) (On-site Assay) (Down-hole Survey) • Quick-start, double- • Highly accurate core • Proprietary XRF onsite • Surve
Slide 7: Financial Overview
Salt Lake City Headquarters Financial Overview Brendan Ryan – Chief Financial Officer
Slide 8: Consolidated Results Summary: HY 2018
Consolidated Results Summary: HY 2018 - Volume increasing along with continued operational improvements (US $M) Consolidated Revenue Bridge • Revenue increased $38M (11%), driven by volume increases across both Drilling Services and Products • YOY increase in bidding activity & product backlogs Cons
Slide 9: Year-Over-Year Comparison
Year-Over-Year Comparison - Strong improvement result of continued cost and productivity focus Statutory Adjusted2 Change Change (US $M except EPS) HY 2018 HY 2017 (US $M) HY 2018 HY 2017 Fav / (Unfav) Fav / (Unfav) Revenue 394 356 11% Revenue 394 356 11% Gross Margin 64 51 26% Adjusted Gross Margin
Slide 10: HY 2018 Financial Highlights: Cash Management
HY 2018 Financial Highlights - Focus on continued optimisation of the business Moody’s and Standard & Poor improve outlook in H1 Credit Rating ▪ Reviews completed by both rating agencies through H1 ▪ Reaffirmed Caa2/CCC+ rating and upgraded outlook to stable (from negative) ▪ Aim to continue to work
Slide 11: Business Overview
Business Overview Jeff Olsen – Chief Executive Officer
Slide 12: Improving Leading Indicators
Improving Leading Indicators ▪ Mining industry debt ratings are improving Debt Ratios ▪ Improved industry balance sheets will result in increased drilling activity for reserve / resource replenishment MSCI World Metals & Mining Index5 ▪ Suggests increasing investor interest in mining sector Mining I
Slide 13: Key focus areas
Key focus areas - Continued focus on delivery of improved results Continue to be an industry leader Safety ▪ Simplify safety systems and standards ▪ Focus on leading indicators ▪ Deliver everybody home safely each day Customer is at the core of the Company’s strategic priorities Operations ▪ Reduce
Slide 14: Appendix
Appendix BOART R LONGYEAR ©
Slide 15: Key Performance Indicators by Quarter
Key Performance Indicators by Quarter Quarters ended 2018 Quarters ended 2017 Quarters ended 2016 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Total Com pany Revenue (US$ millions) 206.4 187.8 183.7 199.2 192.5 163.7 156.9 175.0 168.7 141.8 EBITDA (US$ millions) 15.3 13.0 (20.1) (4.5) (7.6) (4.4) (15.3) 13.8 15.5
Slide 16: Diversified End-Market Exposure
Diversified End-Market Exposure H1 2018 Total Revenue by Type – Products & Services FY 2018 Total Revenue by Region – Products & Services FY 2018 Drilling Services Revenue by Stage FY 2018 Drilling Services Revenue by Commodity HY 2018 Results – See page 17 for footnote descriptions 16
Slide 17: Footnote Disclosures
Footnote Disclosures • Footnote 1: Per 200,000 work hours. • Footnote 2: Loss from Trading Activities, Adjusted Gross Margin, Adjusted Operating Loss, Adjusted SG&A, Adjusted EBITDA and Adjusted NPAT Loss are non-IFRS measures and are used internally by management to assess the underlying performanc