Atkinsrealis Group Inc. · TSX:ATRL
Atkinsrealis — Investor Presentation (May 2024)
37 slides from Atkinsrealis's investor presentation, May 2024
Slide 1: Fully Integrated Professional Services and Project Management Company
Fully Integrated Professional Services and Project Management Company Investors Presentation May 2024
Slide 2: Forward-Looking Statements, Forward-Looking Financial Information and Outlook
Forward-Looking Statements, Forward-Looking Financial Information and Outlook References in this presentation to the “Company”, “AtkinsRéalis”, “we”, “us” and “our” mean, as the context may require, SNC-Lavalin Group Inc. and all or some of its subsidiaries or joint arrangements or associates, or SN
Slide 3: Serving Diversified End Markets with Focused Capabilities
Serving Diversified End Markets with Focused Capabilities Founded in Market Leader: Headquarters: Countries Top 225 International Montreal, Canada Served Design Firms4: Overall #6 U.K. Total Employees1: Market Cap2 Transportation #3 Water Infrastructure ~38,000 $9.4B Transport Infrastructure In Euro
Slide 4: Fully Integrated Professional Services and Project Management Company
Fully Integrated Professional Services and Project Management Company Six segments providing seven comprehensive end-to-end Four Engineering Services Regions Nuclear Linxon services in eight clearly Canada defined end markets United Kingdom and Ireland (UKI) United Stated and Latin America (USLA) As
Slide 5: Operating in Four Regions Across the World
Operating in Four Regions Across the World We create sustainable solutions that connect people, data and technology to design, deliver and operate the most complex projects around the world AtkinsRéalis Regions AtkinsRéalis Europe Global Technology Centre (GTC) ~14,000 # of AtkinsRéalis Asia Employe
Slide 6: Leadership Team
Leadership Team Highly knowledgeable executive team with deep industry experience Ian Edwards Jeff Bell Philip Hoare Bob Alger Andrée-Claude James Cullens President and Chief Executive Officer Chief Financial Officer Chief Operating Officer President, Bérubé Chief Human Resources Joined 2020 Joined
Slide 7: Financial Targets and Capital Allocation Priorities (2022-2024) as Set in 2021
Financial Targets and Capital Allocation Capital Allocation Priorities (2022-2024)1 as Set in 2021 Priorities ▪ Improve debt leverage to achieve investment grade AtkinsRéalis Services*** Consolidated (annually) (by end of 2024) ▪ Prioritize positive FCF** to accelerate the strategy through organic a
Slide 8: Key Messages
Key Messages Pivoting into High-Growth Markets Capitalizing on the Investment Boom into 1 Intentional focus in Canada, U.S. and U.K. provides diverse revenue stream to perform well in volatile macroeconomic 4 Climate Change Adaption and Mitigation ~50% of the Company’s revenues in 2023 have been env
Slide 9: Strategic Framework for Accelerating Growth
Strategic Framework for Accelerating Growth 9
Slide 10: Strategically Engineering our Future by Pivoting to Growth and Creating Value
Strategically Engineering our Future by Pivoting to Growth and Creating Value Executing against our strategy One AtkinsRéalis Strategy › ▪ Record-high backlog in Engineering Services Regions** at $12.0B1 with a strong increase in the U.S. and U.K. Where we play How we win Strongly positioned with a
Slide 11: Ability to Grow and Create Long-Term Value Begins with Core Strengths
Ability to Grow and Create Long-Term Value Begins with Core Strengths Leveraging our Capabilities Harnessing our Global Scale To meet the global demands for a low-carbon future by To maintain a relentless focus on consistency, connecting people, data and technology and utilizing efficiency and opera
Slide 12: Opportunities Across our Business Expertise Drive Long-Term Value Proposition
Opportunities Across our Business Expertise Drive Long-Term Value Proposition › Unique end to end services over the In addition to driving growth in our core markets and whole lifecycle of an asset services, four key growth areas identified Leveraging our market leading U.K. Building scale and depth
Slide 13: Engineering a Better Future for our Planet and its People
Engineering a Better Future for our Planet and its People 13
Slide 14: Focused Approach to Engineering Sustainable Solutions to Help Customers Achieve Their Long-Term Goals
Focused Approach to Engineering Sustainable Solutions to Help Customers Achieve Their Long-Term Goals Delivering in Our Global Challenges AtkinsRéalis’ Advantage End Markets Meeting the global Expertise in nuclear new build and life extensions, hydroelectric power, Buildings demand for clean energy
Slide 15: Leading ESG and Integrity Programs
Leading ESG and Integrity Programs Our Advantages Embedding Integrity Strengthened ESG commitments › Recognitions into Operations through balance sheet action Prestigious Compliance ▪ World-class integrity ▪ Mandatory annual Training In May 2022, AtkinsRéalis extended its $2.5B Leader Verification f
Slide 16: Using our Foundation to Generate Long-term Profitability
Using our Foundation to Generate Long-term Profitability 16
Slide 17: Engineering Services Regions: Diversified, Growing and Resilient Business
Addressable Market1: $~315B Engineering Services Regions: Employees: ~26,600 TTM2 Revenue*: $6,6B Diversified, Growing and TTM2 Seg. Adj. EBITDA Margin3*: 15.1% Resilient Business Backlog4: $12,0B Incorporates consultancy, engineering, design and project management services around the world, primari
Slide 18: Engineering Services Regions: Long-Term Client Relationships
Engineering Services Regions: Long-Term Client Relationships Highlighted Clients TTM1 Revenue Segmentation* Canada U.K. U.S. Public Engineering & Design Private Project & Program Management Consulting, Strategy & Advisory Project Delivery Operations & Management Other Diverse, stable revenue streams
Slide 19: Engineering Services Regions: Well-diversified Across Regions and End Markets
Engineering Services Regions: Well-diversified Across Regions and End Markets Canada: United Kingdom United States Asia, Middle East, & Ireland (UKI): & Latin America (USLA): & Australia (AMEA): TTM1 Revenue: $1,5B TTM1 Revenue: $2,4B TTM1 Revenue: $1,6B TTM1 Revenue: $1,1B TTM1 Segment Adjusted TTM
Slide 20: Nuclear: Unique Global Services Capabilities
Addressable Market1: $~11B Nuclear: Unique Global Employees: ~3,600 TTM2 Revenue: $1,1B Services Capabilities TTM2 Segment Adj. EBIT Margin: 13.8% Backlog3: $1,8B Supports clients across the entire nuclear lifecycle with the full spectrum of services from consultancy, EPCM services, field services,
Slide 21: Linxon: Hitachi JV Focused on Electrification Opportunities
Addressable Market1: $~14B Linxon: Hitachi JV Focused on Employees: ~700 TTM2 Revenue: $0.6B Electrification Opportunities TTM2 Segment Adj. EBIT Margin: 0.3% Backlog3: $1,5B Offers, through our 51% / 49% AtkinsRéalis / Hitachi JV, engineering, procurement, management and construction services for e
Slide 22: Capital: Strategic Contributor of Cash Flow and Profitability
Capital: Strategic Contributor of Cash Flow and Profitability Highway 407 Key Data2 Capital is AtkinsRéalis’ investment, financing and asset management arm, responsible for developing projects, arranging Traffic for 2023: financing, investing equity, undertaking complex financial Total vehicle kilom
Slide 23: Diversified Capital Investments Portfolio
Diversified Capital Investments Portfolio Equity Name Description Held Since Concession Years Location Participation 1. Highway 407 ETR 108 km electronic toll road 1999 98 Canada (Ontario) 6.76% 2. 407 EDGGP 32 km H407 East extension (Phase 1) 2012 32 Canada (Ontario) 50% 3. Eglinton Crosstown 19 km
Slide 24: LSTK Projects: Delivering on exit strategy
LSTK Projects: Delivering on exit strategy Ontario LSTK projects largely physically complete Eglinton Trillium Infrastructure Ontario City of Ottawa ▪ All stations / buildings structurally complete; 15/16 ▪ Full train fleet running to timetable across full stations have received their final occupanc
Slide 25: Delivering on Value-Creation Opportunities
Delivering on Value-Creation Opportunities 25
Slide 26: Historical Financial Overview
Historical Financial Overview AtkinsRéalis Services Capital LSTK Projects Consolidated Revenue ($M) Segment Adj. EBIT ($M) 8,634 490 766 7,371 7,549 126 413 7,008 673 712 540 581 6,641 7,989 5,975 6,330 117 119 93 113 -59 -303 -261 -531 2020 2021 2022 2023 2020 2021 2022 2023 AtkinsRéalis Services B
Slide 27: Free Cash Flow Growth Trajectory
Free Cash Flow Growth Trajectory Consolidated FCF* ($M) Net cash generated (used from) operating activities: AtkinsRéalis Services and Capital Net cash generated (used from) operating activities: LSTK Projects and Discontinued Operations Acquisition of property and equipment, payment of lease liabil
Slide 28: Strong Balance Sheet
Strong Balance Sheet ▪ Long-term net limited recourse and recourse debt ▪ Return to investment grade rating important for: to Adjusted EBITDA ratio* target range of 1.5x- ▪ Winning long duration O&M 2.0x contracts and other types of work ▪ 1.7x as at March 31, 2024 ▪ Lower cost of debt ▪ Strong acce
Slide 29: Disciplined Approach to Capital Allocation
Disciplined Approach to Capital Allocation Strenghten Grow and Create Value Strengthening the balance sheet Investing in the business Returning capital to shareholders Improve debt leverage ratios to achieve Accelerate strategy through Opportunistically return capital to investment grade organic and
Slide 30: Financial Targets (2022-2024) Set in 2021
Financial Targets (2022-2024)1 Set in 2021 AtkinsRéalis Services** Consolidated (annually) (by end of 2024) 4-6% 8-10% 80-90%2 1.5-2.0x Organic revenue Segment Adjusted Free cash flow to Adjusted net Net limited recourse growth* EBIT to segment income (loss) attributable to and recourse debt revenue
Slide 31: 2024 Revised Outlook
2024 Revised Outlook1 (in $M) 2024 Targets 2023 Actuals Engineering Services Regions organic revenue growth* Between 8% and 10% 20.9% Between 15% and 20% Nuclear organic revenue growth* 14.3% Previous: Between 12% and 15% Engineering Services Regions Segment adjusted EBITDA to segment net revenue Be
Slide 32: Key Takeaways
Key Takeaways 32
Slide 33: Key Takeaways
Key Takeaways Advancing our Deploying Resolute focus Focused Steadfast footprint capabilities on growing pipeline investment approach to into markets that locally and globally of new business in providing investing in organic offer high growth to our clients opportunities in leading sustainable and
Slide 34: Appendix
Appendix 34
Slide 35: Q1 2024 Quarterly Recap
Q1 2024 Quarterly Recap (All results reflect comparisons to prior-year period of Q1 2023, except otherwise indicated) Revenue ($M) Segment Adjusted EBIT ($M) Adjusted Diluted EPS Net Cash Generated from From PS&PM*($) (Used for) Operations ($M) AtkinsRéalis Services4 Capital LSTK Projects 2,264 175
Slide 36: Capital Market Profile and Analysts’ Coverage
Capital Market Profile and Analysts’ Coverage Denis Jasmin Tel.: 514-393-8000 Ext. 57553 Vice-President, E-mail: denis.jasmin@atkinsrealis.com Investor Relations www.atkinsrealis.com Firm Analyst Rec. Tel. Market Details1 ATB Capital Markets Chris Murray Buy 647-776-8246 BMO Capital Markets Devin Do
Slide 37: Endnotes
Endnotes (See also the cautionary statement regarding non-IFRS financial measures and ratios, supplementary financial measures and non-financial information at slide 2 of this presentation.) 1. Organic revenue growth (contraction) is a non-IFRS ratio comparing organic revenue, itself a non-IFRS fina
AtkinsRéalis Group — Investor Presentation (May 2024) on 6ix