Maas Group Holdings Ltd. · ASX:MGH
Maas — FY2023 Earnings Presentation
56 slides from Maas's earnings presentation, Aug 17, 2023
Slide 1: FY23 Results Presentation
FY23 RESULTS PRESENTATION ~1,800 41 17 ~550 ~8,000 ~$872m 3 team quarries1 concrete assets residential commercial manufacturing members plants for hire lots2 property GDV3 plants 1 Includes both operational and non-operational quarry assets 2 Includes Land Lease Communities, total lot yield indicati
Slide 2: Agenda
AGENDA PRESENTERS GROUP FINANCIAL RESULTS & REVIEW 28 – 38 Proforma Profit & Loss 28 Expenses 29 Proforma Cashflow 30 – 31 Land Inventory 32 Capital Investments 33 Wes Maas Craig Bellamy Capital Management 34 CEO & Managing Chief Financial Officer Group Balance Sheet 35 Director Financial Model, Cap
Slide 3: Strongly Positioned to Deliver Attractive Returns Through the Cycle
STRONGLY POSITIONED TO DELIVER ATTRACTIVE RETURNS THROUGH THE CYCLE INVESTMENT FRAMEWORK Disciplined focus on return on capital employed (ROCE) ENABLED BY STRATEGIC FUNDAMENTALS Established and growing tangible Aligned founder-led team focused Proven track record of organic asset base of $1.25bn1 in
Slide 4: Values Driven
VALUES DRIVEN TRUST TEAMWORK only earned through action focused on safety and solutions COMMITMENT LEADERSHIP deliver on commitments to customers the courage to strive for excellence CANDOUR OWNERSHIP transparent conversations to get it right empowered to get it right and be accountable for the resu
Slide 5: Strategically Located
STRATEGICALLY LOCATED MAAS CONTINUES TO GROW ITS OPERATIONS AND ASSET PORTFOLIO FOCUSED ON THE EAST COAST OF AUSTRALIA. Key Maas Office / Hub Solar projects Quarry Battery storage projects Concrete Plant Wind projects Newell Highway Pumped hydro projects Inland Rail National Highway Major Railway Re
Slide 6: FY23 Highlights
FY23 HIGHLIGHTS RECORD RESULT – STRONG GROWTH FROM EXISTING AND NEW BUSINESSES Proforma Revenue Proforma EBITDA Proforma EBIT Cashflow Conversion2 $801.0M $163.1M $120.0M 88% Increase of 49%, Increase of 30%, high end Increase of 27%, including Up from 56% (FY22) driven solid pipeline for FY24 and o
Slide 7: 20+ Years of Growth
20+ YEARS OF GROWTH Since listing Proforma EBITDA CAGR 34%1 Avg Return on Capital: 15%2 2023 2022 Ongoing growth and expansion including Further through 2020 Lists on the ASX expansion of construction materials and strategic acquisitions of Schwarz civil 2019 Excavations, construction Dandy Premix c
Slide 8: Strategy Update and Priorities
STRATEGY UPDATE AND PRIORITIES Return on capital discipline Prudently managing costs and continues to be at the centre of capex in residential to adjust all decision making. to near term realities. Focused on operational excellence, Execution of capital recycling extracting synergies across opportun
Slide 9: Safety
SAFETY 3.7 45.5% DECREASE IN LTIFR LTIFR FROM FY22 BENCHMARK – FY23 • Our LTIFR trend continued to decrease in FY23 • We remain focused on creating a safety culture that empowers our people to look after one another and focus on safe behaviours and mindset through our safety slogan – Think Safe, Act
Slide 10: Sustainability
SUSTAINABILITY Maas is committed to, and maturing on its journey to reduce environmental and climate related impacts Initiatives Sustainable Asphalt Production • Carbonphalt Asphalt, is produced using Recovered Carbon Black extracted from recycled vehicle tyres. • The Austek asphalt plant also uses
Slide 11: People, Culture & Community
PEOPLE, CULTURE & COMMUNITY 31% 66 ~1,800 FEMALE REPRESENTATION APPRENTICESHIP TEAMMATES IN SENIOR TRADE POSITIONS EXECUTIVE Highlights • Ongoing commitment to ‘growing our own’ through supported external training and development opportunities as well as the MGH leadership development program • In F
Slide 12: Trading Conditions & Outlook
TRADING CONDITIONS & OUTLOOK TRADING CONDITIONS • Infrastructure and renewable energy related projects continue to drive strong demand across the Construction Materials and Civil Construction and Hire businesses. Q423 saw strong volume and prices • Cost inflation pressures have moderated but persist
Slide 13: Business Unit Overview
BUSINESS UNIT OVERVIEW INDUSTRIAL OPERATING SEGMENTS REAL ESTATE OPERATING SEGMENTS CONSTRUCTION CIVIL CONSTRUCTION MANUFACTURING RESIDENTIAL COMMERCIAL MATERIALS & HIRE & EQUIPMENT SALES REAL ESTATE REAL ESTATE • Quarries • Equipment Hire • Equipment sales • Residential • Commercial • Concrete • Ci
Slide 14: Construction Materials
CONSTRUCTION MATERIALS QUARRIES CONCRETE ASPHALT LOGISTICS GEO-TECH 14
Slide 15: Business Unit Performance – Construction Materials
BUSINESS UNIT PERFORMANCE – CONSTRUCTION MATERIALS FY23 HIGHLIGHTS OUTLOOK • Construction Materials FY23 EBITDA delivered strong growth despite • Renewable Energy Zones associated projects driving solid demand and weather impacted 1H23 creating further opportunities • Dandy Premix acquisition (compl
Slide 16: Financial Performance – Construction Materials
FINANCIAL PERFORMANCE – CONSTRUCTION MATERIALS $ Million (Pro-forma) FY22 FY23 Movement • Revenue increased significantly on FY22 driven by strong performance of acquired businesses and 39% growth from Revenue 122.0 227.7 87% existing businesses • Existing business EBITDA growth in FY23 of 25% drive
Slide 17: Civil Construction & Hire
CIVIL CONSTRUCTION & HIRE CIVIL EQUIPMENT HIRE ELECTRICAL TRANSMISSION & DISTRIBUTION 17
Slide 18: Business Unit Performance – Civil Construction & Hire
BUSINESS UNIT PERFORMANCE – CIVIL CONSTRUCTION & HIRE FY23 HIGHLIGHTS OUTLOOK • Civil Construction and Hire delivered strong proforma EBITDA growth on • Outlook remains strong with significant pipeline of infrastructure and prior year despite weather impacted 1H23 renewable energy projects continuin
Slide 19: Financial Performance – Civil Construction & Hire
FINANCIAL PERFORMANCE – CIVIL CONSTRUCTION & HIRE $ Million (Pro forma) FY22 FY23 Movement • Revenue increased on FY23 driven by contribution from businesses acquired and existing business growth of 29% Revenue 252.3 372.5 48% • EBITDA increased by 38% driven by solid performance of newly EBITDA 49.
Slide 20: Residential Real Estate
RESIDENTIAL REAL ESTATE RESIDENTIAL DEVELOPMENT HOME BUILDING BUILD-TO-RENT 20
Slide 21: Business Unit Performance – Residential Real Estate
BUSINESS UNIT PERFORMANCE – RESIDENTIAL REAL ESTATE FY23 HIGHLIGHTS • Decline in EBITDA driven by a reduction in land settlements (FY23: 181 vs FY22: 270 including build to rent) Residential Real Estate Pro Forma EBITDA (A$m) • Sales velocity slowed during FY23 as a result of multiple interest rate
Slide 22: Financial Performance – Residential Real Estate
FINANCIAL PERFORMANCE – RESIDENTIAL REAL ESTATE $ Million (Pro forma) FY22 FY23 Movement • Revenue reduced on FY22 driven by a reduction in land settlements (FY23: 181 vs FY22: 270 including build to rent) Revenue 103.6 89.7 (13%) 29.4 12.8 (56%) • EBITDA reduced by 56% inclusive of fair value EBITD
Slide 23: Commercial Real Estate
COMMERCIAL REAL ESTATE COMMERCIAL DEVELOPMENT COMMERCIAL CONSTRUCTION BUILDING MATERIALS LEASING 23
Slide 24: Business Unit Performance – Commercial Real Estate
BUSINESS UNIT PERFORMANCE – COMMERCIAL REAL ESTATE FY23 HIGHLIGHTS OUTLOOK • Development portfolio continued to expand during FY23 with the • Delivery of existing projects with Development maturity achieved over the acquisitions of sites within the Industrial, Self-storage, Childcare and next 3-5 ye
Slide 25: Financial Performance – Commercial Real Estate
FINANCIAL PERFORMANCE – COMMERCIAL REAL ESTATE $ Million (Pro forma) FY22 FY23 Movement • Revenue increased significantly on FY22 driven by strong growth across the Commercial Construction and Building supplies Revenue 85.4 138.2 62% businesses EBITDA 24.7 41.7 69% • EBITDA increased by 69% driven b
Slide 26: Manufacturing & Equipment Sales
MANUFACTURING & EQUIPMENT SALES JACON TOLL MANUFACTURING VMS 26
Slide 27: Business Unit Performance – Manufacturing & Equipment Sales
BUSINESS UNIT PERFORMANCE – MANUFACTURING & EQUIPMENT SALES FY23 HIGHLIGHTS OUTLOOK • Global demand for specialised equipment underpins Year on Year growth. • Focus on expansion into new markets , namely the USA and Europe Driven by demand for tunnelling, underground hard rock and concrete • Grow to
Slide 28: Group Proforma Profit & Loss
GROUP PROFORMA PROFIT & LOSS $ Million FY22 FY23 • Revenue growth of 49%, driven by existing businesses and businesses acquired Revenue 531.9 790.8 in FY23. Key drivers of the increase: Other Revenue 7.2 10.2 • Construction revenue from civil, electrical, commercial and homes constructions (increase
Slide 29: Expenses
EXPENSES Expenses increased in line with revenue growth, revenue mix and acquisitions $ Million FY22 FY23 Increase % • Operating expenses increased by 55%, driven by: Revenue 539.1 801.0 49% • $80.7m increase in expenses from businesses acquired in FY23 Materials & consumables1 248.4 389.4 68% • $15
Slide 30: Proforma Cash Flow
PROFORMA CASH FLOW $ million FY22 FY23 • Operating Cash Flow (pre-land inventory, FV gains, interest & tax) for FY23 EBITDA 125.1 163.1 is $116.6m, representing a cash conversion of EBITDA ratio of 88% driven by Fair value gains (FV gains) (18.8) (30.5) strong working capital management across the g
Slide 31: Proforma Cashflow by Segment
PROFORMA CASHFLOW BY SEGMENT Civil Construction Construction Residential Commercial Corporate & $ million Manufacturing Group & Hire Materials Real Estate Real Estate Eliminations EBITDA 68.7 52.0 12.8 41.7 4.1 (16.2) 163.1 Fair value gains - - (4.2) (26.2) - (0.1) (30.5) EBITDA excl. fair value gai
Slide 32: Land Inventory
LAND INVENTORY Land Inventory movement • Residential land multi-year lag between englobo acquisition to land settlements as estates are developed. Land settlements to date made $ million Residential Commercial Elimination Group from land acquired pre-April 2021. Opening Land Inventory 90.4 14.9 (4.3
Slide 33: Capital Investments
CAPITAL INVESTMENTS FY23 Capital Investments $ million • Significant Growth CAPEX through acquisitions, investment and growth-related PPE Construction materials acquisitions1 113.9 additions Civil construction & hire acquisition1 31.2 • Acquisitions for FY23 include Austek (75% acquired, Constructio
Slide 34: Capital Management
CAPITAL MANAGEMENT Net Debt as at 30 June 20231 • FY23 Weighted average cost of debt of 4.9% (margin range of 1.8% - 2%) $ Million 30 June 2023 • ~25% of banking facilities are under fixed rate contracts Borrowings • Share buyback commenced Current 52.1 • Board Policy of dividend pay-out ratio of 20
Slide 35: Group Balance Sheet
GROUP BALANCE SHEET Balance Sheet1 • Property, plant and equipment increased by $181.7m from 30 June 2022 driven by the $ million acquisitions of Dandy premix, Schwarz Excavations, Austek and Clermont quarries as well 30 June 2022 30 June 2023 as growth CAPEX in the Civil, Construction and Hire and
Slide 36: Group Financing Model
GROUP FINANCING MODEL Return on Capital Cash Conversion Capital Recycling Share Buy-backs Employed Targeted recycling of non- Capital allocated to high ROCE Reinvesting in MGH driving EPS Target cash conversion of 85%+ core/lower return assets assets growth driving ROCE Target Leverage Organic EBITD
Slide 37: Capital Employed
CAPITAL EMPLOYED Capital Employed by Segment Balance Capital Balance Average Business Working Land Proforma FY23 FY22 $ million 30 June Other1 Employed 30 June Capital Acquisitions capital Inventory EBIT ROCE2 ROCE2 2022 During FY23 2023 Employed Civil Construction & Hire 246.7 36.7 4.8 - (14.8) 26.
Slide 38: Capital Recycling
CAPITAL RECYCLING • Identification of ~$70m plus of assets for recycling in FY24 • Assets identified for recycling include • Completed Commercial Property • Quarry & Concrete Property (incl. buffer land) • Non-core Fleet & Electrical Assets • Non-core Operating Property Evaluation of returns against
Slide 39: Growth Initiatives
GROWTH INITIATIVES CONSTRUCTION CIVIL CONSTRUCTION & RESIDENTIAL REAL COMMERCIAL REAL MANUFACTURING & MATERIALS HIRE ESTATE ESTATE EQUIPMENT SALES • Continue to consolidate and • Growth continues to be • Pipeline in excess of 8,000 lots • Recycling of capital , driven by • Increase Toll Manufacturin
Slide 40: Key Messages
KEY MESSAGES Result at high end of tightened guidance range FY23 result adds to Group's long term track record of growth and returns New acquisitions performing above expectations alongside strong growth from existing businesses Focused on operational excellence and cost/capex discipline, driving or
Slide 41: Disclaimer
DISCLAIMER Important information The purpose of this presentation is to provide general information about MAAS Group Holdings Ltd (Maas or the Company) and its subsidiaries and business. The information in this presentation is current as at 17 August 2023. It is in summary form and is not necessaril
Slide 42: Questions
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Slide 43: Appendix
APPENDIX MAAS
Slide 44: Historical Financial Performance
HISTORICAL FINANCIAL PERFORMANCE Revenue ($m)1 EBITDA ($m)1 EBIT ($m)1 180.0 140.0 900.0 800.0 160.0 120.0 700.0 140.0 100.0 600.0 120.0 100.0 80.0 500.0 400.0 801.0 80.0 163.1 60.0 120.0 60.0 125.1 94.2 300.0 40.0 539.1 200.0 40.0 75.9 49.9 59.8 64.7 20.0 35.7 225.2 283.4 20.0 50.1 100.0 196.3 - -
Slide 45: Proforma Segment Performance
PROFORMA SEGMENT PERFORMANCE Strong growth across 4 segments Revenue ($m) EBITDA ($m) EBIT ($m) 160.0 1,000.0 200.0 179.4 900.0 858.7 180.0 137.1 4.1 140.0 3.5 30.6 800.0 160.0 138.2 41.7 120.0 134.3 40.9 700.0 140.0 103.0 1.8 0.4 583.1 89.7 12.8 100.0 600.0 120.0 24.7 19.8 24.0 12.8 85.4 100.0 80.0
Slide 46: Group Statutory Profit & Loss
GROUP STATUTORY PROFIT & LOSS Statutory Net Profit after Tax (NPAT) Reconciliation of Statutory to Pro forma NPAT $ Million FY22 FY23 $ Million FY22 FY23 Revenue 509.9 795.0 Statutory NPAT attributable to owners of MGH 61.6 65.5 Other Revenue 7.2 10.3 Pre-acquisition NPAT 1.2 - Revenue 517.1 805.3 S
Slide 47: Property Compendium
PROPERTY COMPENDIUM MAAS
Slide 48: Maas Property Portfolio Overview
MAAS PROPERTY PORTFOLIO OVERVIEW INDUSTRIAL SELF STORAGE CHILDCARE COMMERCIAL 22 properties 8 properties 6 properties 5 properties $429m GDV $80.2m GDV $41.4m GDV $31.3m GDV APARTMENT / MIXED USE RETAIL TOWNHOUSE / HOTEL TOTAL COMMERCIAL 2 properties 2 properties 2 properties PROPERTY GDV $120.9m GD
Slide 49: Property Portfolio
PROPERTY PORTFOLIO Key Maas Office / Hub Central QLD Childcare Self Storage Industrial Northern NSW / Commercial Southern QLD Retail Mixed Use Central West NSW Apartments Hotel Residential Community Southern NSW Newcastle, Hunter & Central Coast 49
Slide 50: Sandgate Industrial
SANDGATE INDUSTRIAL NEWCASTLE, NSW • 8.63 Hectare property located in a strategic and central position close to major road networks such as M1 Pacific Motorway and the Newcastle Inner City Bypass • Existing leased area of 9,970m2 comprising 20 tenancies primarily focused on fresh produce and produce
Slide 51: Wagga Wagga Childcare
WAGGA WAGGA CHILDCARE WAGGA WAGGA, NSW • Adaptive re-use of former PCYC Centre with an approved Development Application for 132 licensed place childcare centre • Tenant has been secured on 15-Year Lease at a starting rent of $504,900 p.a • Anticipated completion is projected for mid-2024 51
Slide 52: Hume Self Storage
HUME SELF STORAGE CANBERRA, ACT • The property is situated within an industrial estate to the south of the Canberra CBD, benefiting from transportation connections • The self-storage facility consists of 265 units operating at 95% Capacity • An additional 202 units are currently being constructed an
Slide 53: Residential Pipeline Activity
RESIDENTIAL PIPELINE ACTIVITY ESTATE LOCATION FY23 FY24 FY25 FY26 FY27 FY28 FY29 FY30 Killarney Estate, Kelso Bathurst Southlakes Estate Dubbo > Keswick Estate Dubbo Magnolia Estate Dubbo Bunglegumbie Road Dubbo RAAF Residential Dubbo > Miriam Estate Dubbo > Sheraton View Estate Dubbo > Collina Nort
Slide 54: Long Term Residential Pipeline
LONG TERM RESIDENTIAL PIPELINE Lots* Projects Active# Future# Pipeline Term NSW Dubbo >2,600 7 2 5 15-18 years Mudgee 50 2 2 Nil 2 years Orange >350 2 1 1 6-8 years Tamworth >1,800 2 1 1 15-18 years Griffith >330 1 Nil 1 3-4 years Bathurst 89 1 Nil 1 2-3 years Lithgow >230 1 Nil 1 6-8 years QLD Rock
Slide 55: Southlakes Estate
SOUTHLAKES ESTATE DUBBO, NSW • Originally 2,600 lots with 1,600 lots remaining • Lots ranging from 400m2 – 2,000m2 and include Torrens Title subdivisions and gated estates • Products including land sales, house and land packages, spec homes and Build-to- Rent • Western NSW’s largest master planned c
Slide 56: Ellida Estate
ELLIDA ESTATE ROCKHAMPTON, QLD • Future 2,300 lot Master planned community • One of the most strategic land holdings in regional Queensland • Total land area of approx. 280 hectares • Positioned within the major growth catchment of Rockhampton • Proximity to CQ University, shopping & commercial cent