Service Stream Limited · ASX:SSM
Service Stream — H1 FY2021 Earnings Presentation
25 slides from Service Stream's earnings presentation, Feb 24, 2021
Slide 1: FY21 First-Half Results Presentation
FY21 First-Half Results Presentation 24 February 2021
Slide 2: Company Profile
Company Profile Service Stream Limited (ASX:SSM) is a S&P/ASX200 company providing integrated end-to-end asset life-cycle services across essential infrastructure networks within the Telecommunications and Utilities sectors Network owners and operators, regulators and Long-term, low-risk government
Slide 3: Key Messages
Key Messages A transitional year following revenue from nbn construction operations concluding and activations peaking in FY20, however the business continues to demonstrate strong fundamentals which position Service Stream well to achieve future growth ► Group’s first half financial performance dow
Slide 4: FY21 H1 Group Highlights
FY21 H1 Group Highlights First half EBITDA from Operations of $40.2m, in line with expectations Strong cash flow generation, conversion of 108% and net cash position retained Working capital remains highly efficient at 1.3% of revenue Financial Interim dividend of 2.5 cents per share (fully
Slide 5: COVID-19
COVID-19 Positive exposure to essential network infrastructure has supported the Group to navigate through the pandemic Exposure to essential infrastructure networks has provided a solid revenue base and sustained resilience through the COVID-19 pandemic The Group’s balance sheet, cashflow and l
Slide 6: Safety Performance
Safety Performance Maintaining our focus on the safety of our people, our customers and the community Continued to deliver industry leading safety performance, demonstrating a strong safety culture throughout the organisation On target to deliver further year-on-year improvements across TRIFR an
Slide 7: Financial Performance
FINANCIAL PERFORMANCE
Slide 8: Financial Headlines
Financial Headlines Revenue EBITDA from Operations Adjusted NPAT Net Cash Dividends $409.9m $40.2m $20.1m $10.5m 2.5cps 17.7% v 1H FY20 30.8% v 1H FY20 37.8% v 1H FY20 +$14.4m v 1H FY20 Maintained payout ratio Group Revenue down from EBITDA from Operations, NPAT-A down from $32.3m Strong 1H
Slide 9: Key Financial Measures
Key Financial Measures FY21 half-year results reflect the reduction in Telecommunications works and continued COVID-19 effects impacting near-term performance Group Revenue ($m) FY21 FY20 $m Change 504.2 497.8 1st Half 1st Half $500 431.4 409.9 $400 338.8 348.0 294.1 Profitability: $300 240.8 261.0
Slide 10: Segment Results
Segment Results Utilities segment growing in share of Group revenue and earnings as the business shifts from the integration program to driving growth Revenue by Segment EBITDA by Segment FY21 FY20 $m Change (%) 1st Half 1st Half Utilities 199.6 199.2 0.2% Telecommunications 209.9 297.9 (29.5%) Elim
Slide 11: Cashflow & Capital Management
Cashflow & Capital Management Solid operating cashflows and strong balance sheet, testament to favourable business fundamentals and will position the Group to support future growth FY21 FY20 $m Change Cash flow and debt position: 1st Half 1st Half Reported EBITDA 39.1 56.4 (17.3) Strong OCFBIT con
Slide 12: Divisional Highlights
DIVISIONAL ; HIGHLIGHTS
Slide 13: Utilities
Utilities Utility network engineering, design & construction, maintenance and operations Revenue ($m) $250 199.2 199.6 $200 Focus over the first half has been on building momentum to support revenue growth, mobilisation of new $150 contracts, and implementation of Group ERP (IFS) into Comdain $100
Slide 14: Telecommunications
Telecommunications Revenue ($m) Telecommunication network engineering, design & construction, maintenance and operations 297.9 $300 $250 209.9 $200 Revenue for 1H FY21 was $209.9m, $88.0m below pcp, due to the conclusion of nbn D&C program in $150 FY20 and reduction in activation volumes (as expec
Slide 15: Group Strategy & Outlook
GROUP STRATEGY & OUTLOOK
Slide 16: Group Strategy
Group Strategy Diversification strategy into the broader Utility market has bolstered the Group’s core earnings base, with the business working to replace revenues from historical nbn peak earnings across a more diversified revenue base to support sustainable long-term growth CURRENT STATE GROUP FOC
Slide 17: Group Outlook
Group Outlook Service Stream expects continued demand for its services associated with the maintenance of critical infrastructure across the Utility and Telecommunication markets, however near-term performance has been impacted FY21 OUTLOOK FY21 H2 PRIORITIES The outlook for FY21 has been progress
Slide 18: Historical Financial Performance Data
HISTORICAL FINANCIAL PERFORMANCE DATA 18
Slide 19: Appendix 1: Profit & Loss
Appendix 1 PROFIT & LOSS $ million 1H17 2H17 1H18 2H18 1H19 2H19 1H20 2H20 1H21 1 Utilities $48.6 $46.0 $54.7 $52.1 $51.3 $213.0 $199.2 $184.9 $199.6 Telecommunications 1 $194.6 $217.8 $244.4 $290.7 $298.1 $291.3 $297.9 $246.3 $209.9 Interest Income $0.3 $0.3 $0.4 $0.5 $0.6 $0.1 $0.1 $0.0 $0.0 Other
Slide 20: Appendix 2: Reconciliation of Statutory to Adjusted Profitability Measures
Appendix 2 RECONCILIATION OF STATUTORY TO ADJUSTED PROFITABILITY MEASURES $ million 1H17 2H17 1H18 2H18 1H19 2H19 1H20 2H20 1H21 Reported EBITDA $21.1 $27.3 $32.1 $35.2 $38.0 $51.5 $56.4 $49.2 $39.1 add-back adjustments: - Acquisition costs (TechSafe) - ($0.5) - - - - - - - - Write-back of Deferred
Slide 21: Appendix 3: Segment Results
Appendix 3 SEGMENT RESULTS $ mi l l i on 1H17 2H17 1H18 2H18 1H19 2H19 1H20 2H20 1H21 UTILITIES Metering and Technical Services 1 $48.6 $46.0 $54.7 $52.1 $51.3 $52.7 $51.9 $44.1 $44.8 Comdain $0.0 $0.0 $0.0 $0.0 $0.0 $160.2 $147.3 $140.8 $154.8 Segment Revenue $48.6 $46.0 $54.7 $52.1 $51.3 $213.0 $1
Slide 22: Appendix 4: Cash Flow
Appendix 4 CASH FLOW $ million 1H17 2H17 1H18 2H18 1H19 2H19 1H20 2H20 1H21 Reported EBITDA $21.1 $27.3 $32.1 $35.2 $38.0 $51.5 $56.4 $49.2 $39.1 +/- non-cash items & change in w/capital $3.2 $5.3 $25.0 $7.6 ($11.6) $1.8 ($23.7) $4.5 $3.2 OCFBIT $24.3 $32.5 $57.1 $42.8 $26.4 $53.3 $32.8 $53.7 $42.4
Slide 23: Appendix 5: Capital Expenditure
Appendix 5 CAPITAL EXPENDITURE $ million 1H17 2H17 1H18 2H18 1H19 2H19 1H20 2H20 1H21 Leasehold Improvements $0.2 $0.1 $0.1 $0.2 $0.4 $0.1 $0.2 $0.2 $0.0 Motor Vehicles $0.1 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.3 $0.0 Plant & Equipment (non-IT) $0.1 $1.0 $0.3 $0.3 $0.4 $1.6 $0.7 $0.1 $1.4 Capital Expend
Slide 24: Disclaimer
Disclaimer Important information for Investors This presentation has been prepared by Service Stream Limited (SSM). Whilst the information in this presentation has been prepared in good faith and with reasonable care, no representation or warranty, express or implied, is made as to the accuracy or r
Slide 25: Service Stream Limited
SERVICE STREAM LIMITED ABN: 46 072 369 870 Level 4, 357 Collins Street, Melbourne VIC 3000 www.servicestream.com.au