Acrow Limited · ASX:ACF
Acrow — Acrow Formwork & Construction Services — H1 FY2020 Earnings Presentation
31 slides from Acrow's earnings presentation, Feb 27, 2020
Slide 1: FY20 Half Year Financial Results
For personal use only Acrow Formwork & Construction Services Limited Results Presentation FY20 Half Year Financial Results 27 February 2020
Slide 2: Important Notice
IMPORTANT NOTICE This presentation is provided for information purposes only. The information in this presentation is in a summary form, does not purport to be complete and is not intended to be relied upon as advice to investors or other persons. The information contained in this presentation was p
Slide 3: Acrow Snapshot
ACROW SNAPSHOT1 A Leading Provider of Engineered Formwork Solutions and Scaffold Hire in Australia For personal use only National Customers Employees Sales contribution footprint Formwork - 6 states 1,300 243 FTE - 10 depots 68% Market Annualised Replacement Scaffold Cap’n Revenue2 value 32% $63m $1
Slide 4: Acrow Strategy
Continue to Execute on Strategy of Creating For personal use only ACROW STRATEGY Long-term Shareholder Value Become the Become the Earnings accretive leading leading Target High ROI Engineered Engineered Recruit train and Acquisitions retain the best Organic primarily across Formwork Scaffold Growth
Slide 5: Key Highlights
For personal use only KEY HIGHLIGHTS
Slide 6: 1H20 Key Achievements
For personal use only 1H20 KEY ACHIEVEMENTS Acquisition of $5.2m Equity National footprint Key Contract Uni-span Raise - 6 states Wins - 9 depots Capital provides Sun-Metals - Qld Scale benefits and access to world class capacity to leverage Barangaroo Station - NSW formwork products opportunities C
Slide 7: Key Financials – 1H20
For personal use only KEY FINANCIALS – 1H201 EBITDA1 NPAT1 NET DEBT REVENUE $5.5m $2.4m $17.5m +15% -25% +$13.8m $38.1m SALES INTERIM OP. CASH CONTRIBUTION DIVIDEND PROFIT1,2 MARGIN1 + 9% 0.7cps (ff) $4.4m 61.3% +36% 1.Underlying performance – Pre-AASB16 adoption. Comparisons are to the previous hal
Slide 8: Executive Summary
EXECUTIVE SUMMARY ❑ Operating performance (vs. previous half year): Total Revenue by Geography (1H20) For personal use only ▪ Revenue of $38.1m, +9% ▪ Sales Contribution of $23.4m, +11% and Contribution margin of 61.3%, +140bps 7% 4% 6% ▪ Underlying EBITDA of $5.5m, +15% ($7.9m, post adoption - 33%
Slide 9: Market & Business Overview
For personal use only MARKET & BUSINESS OVERVIEW
Slide 10: Major Transport Infrastructure Projects - Australia
For personal use only MAJOR TRANSPORT INFRASTRUCTURE PROJECTS - AUST Source: Macromonitor Dec 19 FY20 Half Year Results | 10
Slide 11: State of the Markets
STATE OF THE MARKETS State Civil Commercial Industrial Residential For personal use only Queensland New South Wales Victoria South Australia Western Australia Tasmania Good Stable Soft FY20 Half Year Results | 11
Slide 12: Acrow Equipment Hire Wins and Pipeline
ACROW EQUIPMENT HIRE WINS AND PIPELINE Hire Contracts Won ($m) ❑ Equipment hire contracts up 34% in 1H20 on previous half year, boosted by contributions from Natform and For personal use only Uni-span, primarily across QLD and NSW +34% ❑ Current pipeline of equipment hire opportunities at 13.4 recor
Slide 13: Segmental Breakdown
SEGMENTAL BREAKDOWN 1H20/ 1H20/ ❑ 1H20 includes two-months contribution from Uni- Year end 30 June ($000) 1H19 2H19 1H20 1H19 2H19 span For personal use only Formwork 18,519 19,211 21,736 17% 13% Commercial & Resi Scaffold 17,439 15,841 14,851 -15% -6% ❑ Formwork division reported a 13% increase in
Slide 14: Formwork Division
FORMWORK DIVISION 1H20/ 1H20/ ❑ Formwork hire revenue flat on previous half, with Year end 30 June ($000) 1H19 2H19 1H20 1H19 2H19 reduction in Natform revenue offset by two-months of For personal use only Formwork Hire 10,382 11,284 11,164 8% -1% Uni-span trading Consumables 6,458 6,173 6,247 -3% 1
Slide 15: Commercial & Residential Scaffold Division
COMMERCIAL & RESIDENTIAL SCAFFOLD DIVISION 1H20/ 1H20/ ❑ Commercial & Residential Scaffold division revenue Year end 30 June ($000) 1H19 2H19 1H20 1H19 2H19 impacted by exit of two-storey residential business in For personal use only Scaffold Hire 5,262 3,995 5,135 -2% 29% NSW & VIC Residential 4,17
Slide 16: Industrial Scaffold Division
INDUSTRIAL SCAFFOLD DIVISION Year end 30 June ($000) 1H19 2H19 1H20 ❑ Industrial Scaffold acquired through Uni-span. Two- Scaffold Hire - - 650 months contribution of sales and earnings For personal use only Labour Hire 885 Total Revenue - - 1,535 ❑ Provides new client opportunities in the energy, m
Slide 17: Uni-span Acquisition
UNI-SPAN ACQUISITION ❑ Uni-span acquired on 31 October 2019. Acquisition price of $21.2m For personal use only (pre-earnouts), representing a multiple of 4.4x normalised FY19 EBITDA. Earnings accretive. ❑ A leading provider of engineered formwork systems servicing primarily the civil Infrastructure
Slide 18: Integration Update
Well on track to achieve $1.5m - $2.0m in For personal use only INTEGRATION UPDATE annualised cost savings in FY21 Revenue Costs Joint Contract Wins Completed Next Phase •Sun-Metals •CYP Metro Rail - Melb Depot Depot •Sydney Metro Rail Consolidation Consolidation •Yatala (QLD) closure • Huntingwood
Slide 19: Key Contract Wins
KEY CONTRACT WINS Project Name Description Est. Value For personal use only Sun-Metals - Townsville Acrow/Uni-span contract with Sun-Metals Zinc refinery in QLD. Commenced Dec 19 for 6-9 months. Includes the supply of Supercuplock for high strutting support to main $4.1m+ structures and Uni-span MK
Slide 20: Financials
For personal use only FINANCIALS
Slide 21: Profit & Loss Statement
PROFIT & LOSS STATEMENT 1H20/ 1H20/ ❑ Sales revenue up 9% on previous half, supported by Year end 30 June ($000) 1H19 2H19 1H20 1H19 2H19 two-month contribution from Uni-span For personal use only Sales 35,958 35,052 38,122 6% 9% Total Contribution 21,626 20,989 23,384 8% 11% ❑ Sales Contribution up
Slide 22: Balance Sheet
BALANCE SHEET ( includes adoption of AASB16) Year end 30 June ($000) FY19 1H20 Var $ ❑ AASB 16 Leases adopted effective 1 July 2019 Cash 3,290 6,150 2,861 For personal use only Receivables 13,105 14,813 1,708 ❑ Adoption of AASB 16 impact: Inventory 3,413 5,725 2,312 ▪ Right-of-use assets +$16.1m Pre
Slide 23: Cash Flow
CASH FLOW Operating Cash Profit ❑ Operating Cash Profit of $4.4m, +36% on previous half year For personal use only Year ended 30 June ($000) FY16 FY17 FY18 FY19 1H20 ❑ Cashflow from operations $5.9m1 Underlying EBITDA 5,249 8,915 10,604 11,550 5,549 Maintenance capex -1,524 -2,356 -1,810 -2,741 -1,1
Slide 24: Capital Expenditure
CAPITAL EXPENDITURE Growth and Maintenance Capex ($’000) ❑ Maintenance capex has averaged ~$2.1m p.a. over the historical period. This capex represents spend on For personal use only maintaining the existing hire equipment Maintenance Growth & Non-hire ❑ Maintenance capex requirement lower in 1H20,
Slide 25: Outlook and Priorities
For personal use only OUTLOOK AND PRIORITIES
Slide 26: Outlook
OUTLOOK ❑ 3Q20 trading has commenced at slightly higher activity levels to the previous corresponding period, plus Uni-span contribution For personal use only ❑ Re-iterate guidance provided at FY19 AGM. We expect a significantly stronger 2H20 due to: ▪ a full six months contribution of Uni-span earn
Slide 27: Priorities
PRIORITIES ❑ Continue Uni-span integration: For personal use only ▪ Huntingwood depot closure ▪ Uni-span Head Office consolidation ▪ Shared services consolidation ❑ Pursue new client/market opportunities: ▪ Uni-span o VIC – Civil o NSW - Industrial o SA - Scaffold ▪ Natform o VIC/SA - Screens ❑ Prod
Slide 28: Appendix
For personal use only APPENDIX
Slide 29: Appendix – Profit & Loss AASB Reconciliation
APPENDIX 1 – PROFIT & LOSS AASB 16 RECONCILIATION Reversal of Recognition Pre - operating of AASB16 Post - For personal use only Six months to 31 Dec AASB16 lease depreciation AASB16 2019 ($000) adoption expense and Interest adoption EBITDA 5,549 2,312 - 7,861 Depreciation -2,193 - -2,056 -4,250 EBI
Slide 30: Appendix – Cashflow AASB Reconciliation
APPENDIX 2 – CASHFLOW AASB 16 RECONCILIATION Pre - Post- AASB 16 AASB 16 AASB 16 For personal use only Six months to 31 Dec 2019 ($000) Adoption Adjust. Adoption Cash flows from operating activities Receipts from customers 46,947 46,947 Payments to suppliers and employees (45,005) 2,312 (42,693) Cas
Slide 31: For personal use only
For personal use only Acrow Formwork and Constructions Services Limited ABN 36 124 893 465 Registered office Level 5, 126 Phillip Street, SYDNEY, NSW, AUSTRALIA, 2000 For further information please contact: Steven Boland Andrew Crowther Managing Director Chief Financial Officer Ph: (02) 9780 6500 Ph
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