Slide 1: 1H19 Results Presentation
Austin Engineering Limited 1H19 Results Presentation 27 February 2019 www.austineng.com
Slide 2: Important Information
Important Information This presentation has been prepared by Austin Engineering Limited (ABN 60 078 480 136) (“Austin” or the “Company”). The information in this presentation should be read in conjunction with Austin’s continuous disclosure announcements. The information is of a general nature and h
Slide 3: Agenda
Agenda ▪ Overview ▪ Analysis of Financial Results ▪ Review of Operations ▪ Innovation Update ▪ Market Outlook and Guidance ▪ Appendices P3 Austin Engineering Limited 1H19 Results Presentation | February 2019 www.austineng.com
Slide 4: Overview
Overview • Operating cash inflows of $10.7 million driving $12.4 million reduction in net debt Debt reduction from 30 June 2018 and improved • Improved payment terms with key global clients operating cash flow • Further debt reductions completed in January 2019 and February 2019 • Sale of former Per
Slide 5: Analysis of Financial Results
Analysis of Financial Results Chief Financial Officer: Sam Cruickshank P5 Austin Engineering Limited 1H19 Results Presentation | February 2019 www.austineng.com
Slide 6: Financial Performance: Normalised
Analysis of Financial Results Financial Performance: Normalised Six months ending 31 Dec 2018 30 Jun 2018 31 Dec 2017 Dec to Dec % Change • Revenue decreased by 17% compared to 1H18 (pcp) due to: Revenue $M 122.1 128.3 146.9 (17%) — Closure of Hunter Valley operations Gross profit $M 30.8 32.3 35.2
Slide 7: Financial Performance: Statutory
Analysis of Financial Results Financial Performance: Statutory One-off net gain: Six months ending 31 Dec 2018 30 Jun 2018 31 Dec 2017 Dec to Dec % Change • Net gains on sale of assets during 1H19 of $1.5 million from the sale of Peru’s former operating property and assets sold following Revenue $M
Slide 8: Asset Sales
Analysis of Financial Results Asset Sales Book Realised Agreed sales settling $M Value Value* subsequent to 31 Dec 2018 Chile Crane Business Aust Bore Crane Chile crane Property 1.9 3.0 property assets sold property Crane assets sold 6.9 7.5 $6.9m $7.5m Crane assets still for sale 5.6 Other Assets H
Slide 9: Cash Flow
Analysis of Financial Results Cash Flow Six months ending Historical cash flow from operating activities 31 Dec 30 Jun 31 Dec $M 2018 2018 2017 15 Cash flows from operating activities 10 NPAT 2.3 (15.9) 4.0 5 Add: • Depreciation and amortisation 3.1 5.4 5.4 - • Impairments – 17.7 – (5) • Movement in
Slide 10: Working Capital
Analysis of Financial Results Working Capital As at As at As at Tight management of working capital remains a key 31 Dec 30 Jun 31 Dec 2018 2018 2017 focus for the business. Net working capital at 31 December 2018 increased by $M $4.3 million on pcp to $29.6 million due to: 100.0 • Receivables (-12%
Slide 11: Balance Sheet
Analysis of Financial Results Balance Sheet As at As at • Net cash position of $8.3 million 31 Dec 30 Jun Gearing Summary 2018 2018 • Net debt decreased during 1H19 by $12.4 million, to $33.5 million Total Assets $M 202.6 223.8 • Net debt from continuing operations : Normalised EBITDA1 less Total Sh
Slide 12: Review of Operations
Review of Operations Managing Director: Peter Forsyth P 12 Austin Engineering Limited 1H19 Results Presentation | February 2019 www.austineng.com
Slide 13: 1H19 Australia
Review of Operations by Region 1H19 Australia Iron Ore Australia 31 Dec 30 Jun 31 Dec Six months ending 2018 2018 2017 Coal Brisbane Perth Revenue $M 58.5 59.0 65.0 Copper Mackay Gold Hunter Valley EBITDA (normalised) $M 4.7 4.4 3.5 Other EBITDA margin % 8.0% 7.5% 5.4% Operations • Perth operations
Slide 14: 1H19 Americas
Review of Operations by Region 1H19 Americas Americas 31 Dec 30 Jun 31 Dec Iron Ore Six months ending 2018 2018 2017 Coal USA Colombia Revenue $M 55.6 62.4 73.8 Copper Chile Gold EBITDA (normalised) $M 3.9 2.7 5.4 Peru Other EBITDA margin % 7.0% 4.3% 7.3% USA • USA delivered a material increase in e
Slide 15: 1H19 Asia
Review of Operations by Region 1H19 Asia Asia 31 Dec 30 Jun 31 Dec Iron Ore Six months ending 2018 2018 2017 Coal Indonesia Revenue $M 8.0 7.0 8.0 Copper Gold EBITDA (normalised) $M 2.4 1.9 2.5 Other EBITDA margin % 30.1% 27.1% 31.3% Operations • The Indonesian facility has increasingly become a key
Slide 16: Safety
Review of Operations Safety Safety statistics TRIFR 12 Month Rolling Average LTIFR 12 Month Rolling Average 20 20 18 18 16 16 14 14 12 12 10 10 8 8 6 6 4 4 2 2 0 0 Jun 17 Dec 17 Jun 18 Dec 18 Jun 17 Dec 17 Jun 18 Dec 18 • Total Reportable Incident Frequency Rate (TRIFR) and Lost Time Injury Frequenc
Slide 17: People
Review of Operations People Leadership Team and Headcount Headcount Leadership team • Sam Cruickshank appointed Chief Financial Officer on 2500 11 January 2019 • Rochelle Oberholzer and Sophie Raven appointed as Joint Company Secretaries on 1 February 2019 2000 Headcount 1500 • Headcount fell to 1,8
Slide 18: Innovation Update
Innovation Update Managing Director: Peter Forsyth P 18 Austin Engineering Limited 1H19 Results Presentation | February 2019 www.austineng.com
Slide 19: Austin Ultima Dump Body
Innovation Update Austin Ultima Dump Body Innovation in summary: • Design focus is maintained on safety, weight reduction, increased fatigue life and higher impact resistance. • Improved specifications for manufacturing and in-field servicing, alternative construction materials and enhancements that
Slide 20: Two Piece Excavator Bucket
Innovation Update Two Piece Excavator Bucket Innovation in summary: Consumable lower structure Reusable Upper structure • Designed with safety in mind, the upper structure represents the core capital expenditure component for our clients. This is reusable for significantly higher numbers of operatin
Slide 21: Stairway Access Water Tank
Innovation Update Stairway Access Water Tank Innovation in summary: • The World’s safest water tank, designed for safer access and operation • Unique interlocking corrugated baffle system provides greater strength, rigidity and truck stability Key advantages: • The safest tank to access in the marke
Slide 22: Market Outlook and Guidance
Market Outlook and Guidance Managing Director: Peter Forsyth P 22 Austin Engineering Limited 1H19 Results Presentation | February 2019 www.austineng.com
Slide 23: Industry Outlook
Market Outlook and Guidance Industry Outlook ASX Metals and Mining – Top 40 Capex A$m Parker Bay Surface Mining Equipment Index 60,000 50,000 40,000 30,000 20,000 10,000 0 FY04 FY00 FY01 FY02 FY03 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19E FY20E • Capital expenditure
Slide 24: Commodities – Iron Ore and Copper
Iron Ore 22% Market Outlook and Guidance Coal 41% Copper 21% Commodities – Iron Ore and Copper Gold 6% Other 10% 1 Copper – recent historic pricing (USD/lb) 2 Copper – global production and pricing • Rising supply in 2019 and 2020 in response to higher pricing with • World copper consumption is proj
Slide 25: Commodities – Coal and Gold
Iron Ore 22% Market Outlook and Guidance Coal 41% Copper 21% Commodities – Coal and Gold Gold 6% Other 10% 1 Thermal Coal (USD/mt) 2 Thermal Coal – world trade • Thermal coal prices declining in 2019, outlook to 2020 is for the spot • World trade in thermal coal is expected to decline from 1.1Bt in
Slide 26: FY19 Guidance
Market Outlook and Guidance FY19 Guidance FY19 Normalised EBITDA of $25–$28 million* • No change to guidance provided in August 2018 — based on the current order book, committed work, and tender opportunities • Around 80% of projected revenue for FY19 relates to firm orders and other committed work,
Slide 27: Appendices
Appendices: – Competitive advantage – Market analysis – Operations – Products and services P 27 Austin Engineering Limited 1H19 Results Presentation | February 2019 www.austineng.com
Slide 28: Competitive advantage
Appendix: Competitive advantage Market leading position Visibility over orders • Large global producer of custom truck • High visibility over orders for the next bodies and buckets six months • Strategically located across four • Recurring revenue from repairs and continents including Australia, Asi
Slide 29: Market analysis
Appendix: Market analysis The Americas Australia Asia • History of success with the strong • New truck body innovations have • Batam is a world-class facility, Westech product brand created business opportunities meeting Austin’s global standards • Existing customer base, particularly • Strong commo
Slide 30: Operations
Appendix: Operations Australia • Located on the east and west coast, providing an array of manufacturing, repair and support services Brisbane Perth • Perth is the largest workshop in Australia Mackay • Mackay is focussed on body/bucket repairs and maintenance Hunter Valley • New product supplied to
Slide 31: Products and services
Appendix: Products and services Austin Engineering Products Service • Leading designer and manufacturer of customised dump truck • A complete service provider, offering on and off-site repair and bodies, buckets and ancillary products used in the mining maintenance and heavy equipment lifting to cus
Slide 32: www.austineng.com
Innovation Update Limited Austin Engineering www.austineng.com P 32 www.austineng.com