Emeco Holdings Limited · ASX:EHL
Emeco — H1 2019 Earnings Presentation
20 slides from Emeco's earnings presentation, Feb 19, 2019
Slide 1: Emeco Holdings Limited 2019 Interim Results
Emeco Holdings Limited 2019 Interim Results 19 February 2019
Slide 2: Important Notices and Disclaimer
IMPORTANT NOTICES AND DISCLAIMER 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 3: Results Overview
Results Overview Emeco
Slide 4: Highlights
HIGHLIGHTS During 1H19, Emeco continued on our path of earnings growth, margin improvement, increasing utilisation and reducing leverage. In response to strong ongoing demand, we have committed to purchasing additional core assets to drive continued growth People Earnings Operational Strong Positive
Slide 5: People and Safety
PEOPLE AND SAFETY Emeco is a leading employer with the safety of our people remaining our top priority. The quality of our people is a strategic and competitive advantage Safety Injury frequency rates • Emeco continues its focus on achieving zero harm • Long term injury frequency rate of zero as at
Slide 6: Australian Rental
AUSTRALIAN RENTAL Strong financial performance, particularly in the Eastern Region, instills confidence to invest in more assets Earnings and margin growth Fleet investment • Operating EBITDA of $114.0 million (up 51.2% on 1H18), driven by: • Confidence in the market has supported an investment in a
Slide 7: Workshops
WORKSHOPS Recently expanded workshop capacity to meet customer demand (Emeco and external) Increased activity Strategically located workshops • Workshop throughput increased, with combined internal and retail revenue increasing to $43.3 million (up 13.0% on 2H18) • Internal revenue of $18.0 million
Slide 8: Financial Performance
Financial Performance Emeco
Slide 9: Profit and Loss
PROFIT AND LOSS Significant earnings growth, with Operating EBITDA, EBIT and NPAT all increasing by 53-160% on 1H18 Earnings and margin growth Operating financial performance1 • 1H19 group earnings continue to grow on 1H18 A$m unless otherwise stated 1H18 1H19 Change • Operating revenue up 31% to $2
Slide 10: Cash Flow
CASH FLOW Strong cash flow supported investment in the business (debt repayment, asset purchase and inventory) Business investments Cash Flow Summary Based on Emeco’s confidence in the market and the business’ ability to generate strong operating cash, Emeco A$m 1H19 made the following significant i
Slide 11: Balance Sheet
BALANCE SHEET Emeco remains on track against its deleveraging path to refinance its notes on more attractive terms Stronger balance sheet Leverage metrics continue to improve • Net debt / run rate operating EBITDA of 2.1x, down from 2.6x in FY18 8.0x • During 1H19, Emeco also: • Reduced outstanding
Slide 12: Strategy and Outlook
Strategy and Outlook Emeco
Slide 13: FY19 and Beyond
FY19 AND BEYOND Emeco is focused on sustainably creating shareholder value by being the highest quality and lowest cost provider of earthmoving equipment solutions Strong market conditions, particularly with coal customers in the Eastern Region What we're seeing High levels of bidding activity i
Slide 14: Emeco's Long-Term Value Creation Model
EMECO’S LONG-TERM VALUE CREATION MODEL Being the highest quality and lowest cost provider of earthmoving equipment services to drive sustainable shareholder returns Generate returns Reinvest in the business — Attractive shareholder returns — In-demand core assets — Service debt — Strategically locat
Slide 15: Appendix A: Regional Rental Performance
Appendix A: Regional Rental Performance 14
Slide 16: Regional Rental Performance
REGIONAL RENTAL PERFORMANCE Continued strong demand in the Eastern Region. Project opportunities in the Western Region commencing in CY19 Eastern Region Eastern Region Operating EBITDA • Strong demand predominantly driven by coal market activity 100 86.1 EBITDA (A$m) • Fleet transferred from Western
Slide 17: Appendix B: Operating to Statutory Reconciliation
Appendix B: Operating to Statutory Reconciliation 16
Slide 18: Operating to Statutory Reconciliation
OPERATING TO STATUTORY RECONCILIATION 1H19 1H19 1H184 1H184 A$m unless otherwise stated Statutory Operating Statutory Operating Revenue 224.3 224.3 171.1 171.1 EBITDA1 96.0 102.8 56.0 67.0 EBITDA1 margin 42.8% 45.8% 32.7% 39.2% EBIT2 52.2 60.0 21.0 37.5 NPAT3 11.9 31.7 (0.3) 12.2 Notes: 1. 1H19 oper
Slide 19: Operating to Statutory Reconciliation
OPERATING TO STATUTORY RECONCILIATION A$m unless otherwise stated 1H19 1H18 Statutory NPAT 11.9 (0.3) Adjusted for: Impairment expense 1.0 5.2 Depreciation and Amortisation 42.8 29.4 Net Finance costs 28.9 25.4 Net FX loss/(gain) 11.4 (2.2) Total EBITDA 96.0 56.0 EBITDA discontinued operations - 1.5
Slide 20: Thank you
Thank you emecogroup.com