Aj Lucas Group Limited · ASX:AJL
Aj Lucas — Shareholder Meeting (November 2015)
25 slides from Aj Lucas's shareholder meeting presentation, Nov 13, 2015
Slide 1: AJ Lucas Group Limited Annual General Meeting
For personal use only AJ Lucas Group Limited Annual General Meeting 13 November 2015
Slide 2: Agenda
Agenda For personal use only • Welcome • Chairman’s Remarks • CEO Presentation • Human Resources Nomination Committee Chair • AGM – Financial Results – Remuneration Report – Director Elections • Meeting Close 2
Slide 3: Disclaimer
Disclaimer For personal use only This Presentation has been prepared by AJ Lucas Group Limited (ACN 060 309 104) (Company). Summary information This Presentation contains summary information about the AJ Lucas Group. This information is of a general nature and does not purport to be complete nor doe
Slide 4: Trading results
Trading results For personal use only • Underlying EBITDA of $9.4million, compared to breakeven last year, a result of hard work by everyone • Resource sector remains tough, specifically coal mining sector on the East Coast – Production volumes increasing but the sector is suffering from a downturn
Slide 5: UK investments
UK investments For personal use only • Our UK investment in Shale Gas exploration setback with rejection by Lancashire County Council of applications to develop Preston New Road and Roseacre Wood sites in the Bowland Basin • These decisions are currently under appeal and we expect a decision by Q2 C
Slide 6: Capital position
Capital position For personal use only • Board and management proactively engaged in reviewing all funding requirements and options for the coming years • As highlighted, the Australian businesses have improved significantly compared to the last couple of years and AJ Lucas continues to meet its obl
Slide 7: CEO Address
For personal use only CEO Address 7
Slide 8: Overview & outlook
Overview & outlook For personal use only • As anticipated, 2015 was a tough year: – Customer confidence was low, leading to reduction in amount of discretionary work offered for tender – Curtailed capital investment in mining and infrastructure projects – No early return to ‘boom days’ • $9.4 millio
Slide 9: Safety in 2015
Safety in 2015 For personal use only • Our vision is “injury free every day” Total Recordable Injury Frequency Rate • Protection of our people and our assets is the primary focus of management • To do this we must – Must maintain proactive approach to HSEQ – Provide visible leadership at all levels
Slide 10: Developing a culture focused on safety
Developing a culture focused on safety For personal use only • Requires consistent and continuous focus on – Developing a culture of safe behaviours – Building and utilising best in class systems and procedures 10
Slide 11: Lucas Drilling Services (LDS)
For personal use only Lucas Drilling Services (LDS)
Slide 12: LDS – the "go to" drilling operator on the East Coast
LDS – the “go to” drilling operator on the East Coast For personal use only • Achieved targets on safety – no LTI’s in 2015 • In tough market conditions, LDS increased market share in drilling services to the coal sector – Actively engaged with every major coal producing company on the East Coast –
Slide 13: LDS – upside in the coal market
LDS – upside in the coal market For personal use only • While the major commodity we are exposed to is under price pressure, current forecasts show continued volume growth albeit at lower rates than recent history • Australian underground mines continue to be competitive internationally • Confident
Slide 14: Lucas Engineering & Construction Services (LEC)
For personal use only Lucas Engineering & Construction Services (LEC)
Slide 15: LEC – construction services
LEC – construction services For personal use only • Niche focused specialist engineering and infrastructure construction business • The market is tough and currently growth is not as strong as anticipated • Reluctance to initiate new projects • Pent up demand for infrastructure refurbishment and dev
Slide 16: LEC – pipelines
LEC – pipelines For personal use only • Despite being an industry leader, pipelines also needed to reduce staff numbers and streamline operations to meet market conditions • The competitive market warranted an innovative approach to service: – Customers’ expectations consistently exceeded through th
Slide 17: LEC – pipeline innovation
LEC – pipeline innovation For personal use only 17
Slide 18: Oil & Gas Investments
For personal use only Oil & Gas Investments
Slide 19: Cuadrilla Resources
Cuadrilla Resources For personal use only Current status • With total effective interest of 47% in Bowland licence AJL has a preeminent position in the developing UK shale gas market • LCC’s denial of planning permission in June was disappointing but only a temporary setback – Cuadrilla is appealing
Slide 20: Bowland (PEDL 165)
Bowland (PEDL 165) What we know For personal use only • 5 pre-2000 wells; 3 wells drilled by Cuadrilla – 3D seismic over 100km2 acquired in 2012 and reprocessed 2014 • Hydraulically fractured Preese Hall in 2011 • Estimated resource of > 200 Tcf oil and gas in place (OGIP); >1000m of gas charged sha
Slide 21: Financials
For personal use only Financials
Slide 22: Financial performance
Financial performance For personal use only • 2015 saw continued improvement in EBITDA performance despite contracted revenues – $5.3 million EBITDA, the first positive EBITDA since 2011 • The group continued to service its tax obligations during the year and received support from major lender, Kero
Slide 23: Formal Business Agenda
Formal Business Agenda For personal use only • Financial Report • Remuneration Report • Re-election of Julian Ball • Re-election of John O’Neill • Meeting Close 23
Slide 24: HR and Nominations Committee
HR and Nominations Committee Ian Meares, Committee Chairman For personal use only • The Remuneration report is included in the Annual Report of the company and it is recommended for Adoption • AJ Lucas’ remuneration policy aims to align employee remuneration with the labour market, and to attract, r
Slide 25: Formal Business Agenda
Formal Business Agenda For personal use only • Financial Report • Remuneration Report • Re-election of Julian Ball • Re-election of John O’Neill • Meeting Close 25