Emeco Holdings Limited · ASX:EHL
Emeco — FY2015 Earnings Presentation
28 slides from Emeco's earnings presentation, Aug 27, 2015
Slide 1: 2015 Full Year Results
For personal use only 2015 FULL YEAR RESULTS 27 AUGUST 2015 IAN TESTROW, MANAGING DIRECTOR & CHIEF EXECUTIVE OFFICER GREG HAWKINS, EXECUTIVE DIRECTOR, FINANCE 1
Slide 2: Highlights: Building a more profitable business
HIGHLIGHTS Building a more profitable business For personal use only Having increased utilisation over FY15, the focus is now on building a more profitable business to drive future growth Group fleet utilisation currently 74%1, up from 50% at June 2014 Global mining industry experiencing prolong
Slide 3: FY15 Overview: Strategic achievements driving stronger 2H FY15
FY15 OVERVIEW Strategic achievements driving stronger 2H FY15 For personal use only Higher utilisation resulting in revenue uplift over 2H FY15, focus on margin recovery expected to drive improved profitability OPERATING PERFORMANCE FINANCIAL PERFORMANCE3,4,5,6 PCP Var 100% A$million 1H FY15 2H FY15
Slide 4: Emeco Operations
EMECO OPERATIONS For personal use only Our quality customer base continues to return to Emeco to resource their rental mining equipment and maintenance needs across all regions Canada $76.3M FY15 revenue Queensland Number of fleet: 110 $21.3M FY15 revenue Fleet WDV: $136M Number of fleet: 62 FY15 Re
Slide 5: Operational Review
For personal use only OPERATIONAL REVIEW
Slide 6: Sustainability: HSE, HR & Community
SUSTAINABILITY HSE, HR & Community For personal use only Emeco continues to provide a safe work environment of the highest standard, invest in employees’ development and support local communities Health, Safety & Environment Safety performance was consistent with the previous year, however TRIFR
Slide 7: Regional Performance: New South Wales
REGIONAL PERFORMANCE New South Wales For personal use only Defending our presence and building stronger relationships with existing customers Revenue EBITDA Utilisation1 30 June 15 100% 95% 80% 34.4 14.0 60% 50% 11.3 26.7 24.3 40% 18.8 7.6 20% 5.4 0% 1H FY14 2H FY14 1H FY15 2H FY15 1H FY14 2H FY14 1
Slide 8: Regional Performance: Queensland
REGIONAL PERFORMANCE Queensland For personal use only New management team retaking market share Revenue EBITDA Utilisation1 30 June 15 100% 85% 22.6 80% 8.2 60% 47% 40% 12.7 20% 0.9 8.4 8.6 (0.1) (1.5) 0% 1H FY14 2H FY14 1H FY15 2H FY15 1H FY14 2H FY14 1H FY15 2H FY15 Utilisation Operating Utilisati
Slide 9: Regional Performance: Western Australia
REGIONAL PERFORMANCE Western Australia For personal use only Focus on identifying opportunities in challenging market conditions Revenue EBITDA Utilisation1 30 June 15 100% 29.2 10.7 80% 28.9 9.0 60% 27.8 7.7 40% 6.6 28% 20% 23% 24.9 0% 1H FY14 2H FY14 1H FY15 2H FY15 1H FY14 2H FY14 1H FY15 2H FY15
Slide 10: Regional Performance: Canada
REGIONAL PERFORMANCE Canada For personal use only Diversifying rental business away from oilsands industry to reduce cyclicality of earnings Revenue EBITDA Utilisation2 30 June 15 100% 80% 44.3 15.5 40.3 37.1 60% 58% 36.0 12.8 10.7 40% 26% 8.4 20% 0% 1H FY14 2H FY14 1H FY15 2H FY15 1H FY14 2H FY14 1
Slide 11: Regional Performance: Chile
REGIONAL PERFORMANCE Chile For personal use only Improved operating performance at Encuentro project driving second half revenue growth Revenue EBITDA Utilisation2 30 June 15 100% 94% 7.1 80% 17.6 6.8 76% 60% 12.5 12.6 40% 11.9 4.3 20% 2.2 0% 1H FY14 2H FY14 1H FY15 2H FY15 1H FY14 2H FY14 1H FY15 2
Slide 12: Financials
For personal use only FINANCIALS
Slide 13: Financial Summary: At a glance
FINANCIAL SUMMARY At a glance… For personal use only Margins impacted by market conditions and costs incurred returning idle fleet to rent Rental and mine site services revenue up 1.3% and 15.6% A$million FY14 FY15 respectively, offset against a fall in revenue from sale of parts and machines Reve
Slide 14: Financial Summary: Financial metrics trending upward
FINANCIAL SUMMARY Financial metrics trending upward For personal use only Utilisation growth combined with reduced prep-for-rent costs improving profitability in 2H FY15 Quarterly revenue Quarterly Operating EBITDA EBITDA A$million A$million Margin 140 132.3 40 36.9 50% 123.9 117.6 120 110.7 35 30.2
Slide 15: Operating Costs: Adapting to challenging market conditions
OPERATING COSTS Adapting to challenging market conditions For personal use only FY15 margins impacted by one-off costs to return machines back to rent Operating costs as a % of revenue Depreciation A$million % of revenue FY14 FY15 100 38.9% Repairs and 1 94.7 26.8% 26.4% % of revenue maintenance 80
Slide 16: Rental Fleet and Capital Strategy
RENTAL FLEET AND CAPITAL STRATEGY Matching the rental fleet to market demand For personal use only We continue to right size our fleet to match asset classes to regional demand Number Rental fleet1 Net capex of fleet WDV A$million $694M 600 50 WDV WDV $531M WDV 40 500 $613M $496M 30 400 42.6 20 28.2
Slide 17: Balance Sheet: Successful refinancing
BALANCE SHEET Successful refinancing provides flexible and sustainable debt structure For personal use only We continue to right size our fleet to match asset classes to regional demand A$million Net debt Liquidity1 A$million 500 150 450 34.1 27.8 100 400 34.1 27.8 4.6 41.8 350 41.8 403.1 413.9 50 7
Slide 18: Strategy & Outlook
For personal use only STRATEGY & OUTLOOK
Slide 19: Successful Strategy Implementation
SUCCESSFUL STRATEGY IMPLEMENTATION Strategic achievements over FY15 For personal use only Business development focus driving utilisation increase to average 74% over 2H FY15 Reshaping the core Diversifying Canada rental away from oilsands industry with growing coal and iron ore opportunities red
Slide 20: Strategic Outlook: Continuing the journey to profitability
STRATEGIC OUTLOOK Continuing the journey to profitability For personal use only Over FY16 we’ll continue to strengthen our core while identifying opportunities to succeed during challenging market conditions Return to profitability Reduce net debt Implemented Emeco’s asset management system (EOS) at
Slide 21: Questions
For personal use only QUESTIONS
Slide 22: Further Information
For personal use only FURTHER INFORMATION Thank you for your interest in Emeco For further investor enquiries please contact: Brendan Shalders Group Manager, Investor Relations & Corporate Development +61 (0) 8 9420 0258 brendan.shalders@emecogroup.com 22
Slide 23: Appendices
For personal use only APPENDICES
Slide 24: Earnings Composition
EARNINGS COMPOSITION For personal use only REVENUE BY GEOGRAPHY REVENUE BY COMMODITY FY14 FY15 FY14 FY15 Coking Coking Thermal Thermal WA Coal Coal WA Coal Coal 22% 11% 12% 23% Canada 19% 17% Canada Copper Copper 34% 32% 10% Other 12% Other 7% $241.1m QLD $242.9m 8% $241.1m $242.9m QLD Gold 14% 9% 1
Slide 25: Detailed Financials
DETAILED FINANCIALS For personal use only Profit & Loss Cashflow A$million FY14 FY15 PCP $ A$million FY14 FY15 PCP $ Revenue 241.1 242.8 1.7 Operating cashflow 57.4 32.6 (24.8) EBITDA 67.3 43.4 (23.9) General working capital 36.6 7.1 (29.5) Margin(%) 27.9% 17.9% (10.0)% Sales & parts inventory 6.4 0
Slide 26: Geographical Segments
GEOGRAPHICAL SEGMENTS For personal use only New South Wales Queensland Western Australia A$million FY14 FY15 PCP $ A$million FY14 FY15 PCP $ A$million FY14 FY15 PCP $ Revenue 45.5 58.7 13.2 Revenue 31.1 21.3 (9.8) Revenue 53.8 57.0 3.2 EBITDA 18.8 19.4 0.6 EBITDA 8.2 (0.6) (8.8) EBITDA 17.2 16.7 (0.
Slide 27: Disclaimer
DISCLAIMER For personal use only Reliance on third party information The information and views expressed in this Presentation were prepared by Emeco Holdings Ltd (the Company) and may contain information that has been derived from publicly available sources that have not been independently verified.
Slide 28: Thank you
For personal use only Thank you Learn more about us emecogroup.com