Mincon Group Plc · EURONEXT:MIO
Mincon — FY2020 Earnings Presentation
39 slides from Mincon's earnings presentation, March 2021
Slide 1: Mincon Results 2020
The Driller’s Choice MINCON RESULTS 2020
Slide 2: Summary 2020
SUMMARY 2020 Mincon Product Revenue in €'m Third-Party Product Revenue in €'m LOCAL Operating Profit in €'m CHALLENGES, GLOBAL RESILIENCE € 108.9 € 100.8 Operating profit growth of 55% was Increased global reach, selling 01 achieved versus 2019 continuing 04 into 81 countries. operations. Direct end
Slide 3: Mincon's History
MINCON’S HISTORY 1977 - 1999 2000-2010 2011-2020 1977 2003 2011 2015 2018 Mincon is established in Mincon acquires a DTH bit Mincon establishes a sales Mincon's Australian Mincon acquires Driconeq Group, a Shannon, Ireland by Paddy manufacturer in Benton, office to service the West businesses are co
Slide 4: Design
DESIGN Mincon is building a business for the future by investing in the next generation of engineers to deliver on its goal of designing innovative products that use less energy per metre drilled. More efficient drilling solutions will lower the total drilling cost, which also results in reduced ope
Slide 5: Manufacturing
MANUFACTURING To ensure consistent quality, Mincon’s products are manufactured at Mincon-owned factories. Where Mincon has control and oversight of all aspects of production – including proprietary heat-treatment processes. Mincon’s eight manufacturing facilities are strategically located around the
Slide 6: Service
SERVICE Mincon’s comprehensive range of drilling solutions is backed by an unparalleled service offering across its four global regions. Dedicated and experienced service teams work with customers to develop the best solutions. Feedback from the field is provided to product engineers, feeding a cycl
Slide 7: The Mincon Customer
THE MINCON CUSTOMER Mincon has a comprehensive range of innovative rock drilling solutions and products that are used in a wide range of applications. Mincon customers are businesses active in mining, construction, and waterwell/geothermal drilling. Mining Quarries, exploration drilling, open-pit mi
Slide 8: Business Review 2020
BUSINESS REVIEW 2020
Slide 9: Sector Sales Analysis
SECTOR SALES ANALYSIS Other, 1% Construction 2020 30% WE SERVE THREE Mining SALES INDUSTRIES 51% MIX Waterwell/ Geothermal DIVERSIFIED THE RANGE 18% OUR REVENUE WE TARGET OF OUR STREAMS APPLICATIONS BUSINESS Other, 2% WHERE MINCON PROVIDES PRODUCTS CAN RESILIENCE Construction AND 25% MAKE A 2019 DIF
Slide 10: Direct Sales Approach
DIRECT SALES APPROACH Revenue approach in €'millions WE HAVE EXPANDED OUR CUSTOMER BASE. WE HAVE OVER 1,600 € 99.6 € 83.7 Direct CUSTOMERS ACROSS 81 COUNTRIES. Distributor WE ARE NOW BETTER POSITIONED TO € 30.3 € 36.9 CONTINUE GROWING DIRECT SALES. 2020 2019 The Driller’s Choice
Slide 11: Direct Sales Approach
DIRECT SALES APPROACH We have transitioned into a full drill-string OEM supplier to our industries, by acquiring new manufacturing facilities and designing new products. The current product offering, and after-sales service, has given us a better footing for selling directly to large mining and cons
Slide 12: Mining
MINING Excluding capital equipment sales, mining 2020 VERSUS 2019 revenue grew by 4% on continuing CONTINUING OPERATIONS Mining revenue growth (excluding rigs) operations of 2019. We traded through temporary mining closures in Southern Africa and parts of the Americas. 19% 12% Government restriction
Slide 13: Mining
MINING Europe / Middle East Increased orders from gold mining production customers in the Middle East has boosted Americas mining revenue in the region. A more direct sales approach in North America has brought about an Asia Pacific increase in market share in the mining industry in this Our revenue
Slide 14: Construction
CONSTRUCTION We diversified the revenue streams of the CONSTRUCTION Group further in 2020, with additional REVENUE GROWTH growth in the construction industry. Construction revenue grew 33% in the year, and now now accounts for 30% of our overall Group revenue. 17% 61% Large gains in market share, 44
Slide 15: Construction
CONSTRUCTION Large Complex Construction Projects that Electric Boat in Mincon supplied during 2020: Connecticut, USA BC Hydro, Site C Project in British Columbia, Canada Chesapeake Bay project in Virginia, USA KFS Finland Oy built a 600-metre-long complex- shaped interlocked-casing wall to act as a
Slide 16: Waterwell/Geothermal
WATERWELL/GEOTHERMAL Our waterwell/geothermal revenue declined WATERWELL/GEOTHERMAL 3% in 2020. REVENUE GROWTH Our customers within this industry are smaller drilling contractors, due to the type of drilling undertaken. The industry contracted with the onset of the Covid-19 pandemic. -13% -1% We tra
Slide 17: Other Industries
OTHER INDUSTRIES Revenue outside our three main industries accounted for 1% of our overall revenue in 2020, it This other revenue stream is mostly accounted for 2% in 2019. generated in Sheffield, UK, through the sale of our manufactured carbide to competitors in our industries. Due to internal dema
Slide 18: 2020 Financial Performance
2020 FINANCIAL PERFORMANCE
Slide 19: Income Statement
INCOME STATEMENT 2020 2019* Change Revenue growth of 8% and 11% on a €'000 €'000 €'000 % constant currency basis. Sales Mincon product 108,556 100,731 7,825 8% Sales bought in product 21,347 19,940 1,407 7% Constant currency growth: Revenue 129,903 120,671 9,232 8% Organic of 6% Cost of sales (84,18
Slide 20: Income Statement
INCOME STATEMENT We managed to increase revenue while at the same time reducing operating costs, which reflected: Seeing the full-year impact in 01 2020, after 2019 business restructure. Significant curtailment in travel 02 and other costs, in light of the pandemic. Benefit of government supports of
Slide 21: Balance Sheet
BALANCE SHEET Balance Sheet Non-Current Assets Intangible assets & Goodwill 2020 €'000 36,987 2019 €'000 31,937 Change % Property plant & equipment 45,820 41,172 Deferred tax asset 1,093 616 Our inventory carrying amount Total Non-Current Assets 83,900 73,725 14% increased during the year Total Inve
Slide 22: Balance Sheet
BALANCE SHEET The Group had zero occurrence 0 of debtor write-offs during a year where many businesses struggled. As a measurement of days, debtors decreased 6% compared with 2019. We decreased our creditors during the year, mainly through the purchase of Lehti in Finland as this was a vertical acqu
Slide 23: Cashflow
CASHFLOW 2020 2019 Change Cashflow €'000 €'000 €'000 % Profit for the year 14,386 12,383 2,003 Depreciation 6,482 5,242 1,240 Other adjustments 4,577 (5,022) 9,599 Cash from operating activities 25,445 12,603 12,842 102% We invested in acquisitions along with taking Changes in trade receivables 919
Slide 24: Cash Invested
CASH INVESTED The Driller’s Choice
Slide 25: Product Development
PRODUCT DEVELOPMENT —
Slide 26: Greenhammer
GREENHAMMER The 10” Greenhammer system on our Mincon-owned 01 rig is ready to drill, but site access has been restricted due to Covid-19 safety measures As soon as these restrictions are lifted, 02 we are ready to get onsite Due to maintenance issues we have experienced on the mine- 03 owned PV351 r
Slide 27: Large Hammers & Bits
LARGE HAMMERS & BITS LARGE DIAMETER/LOW PRESSURE HAMMER Hammer has been assembled in Finland and has been functionally tested Results have been an excellent match for the design simulations Hammer and bit has been shipped to Malaysia Subject to Covid 19 restriction levels not significantly changing,
Slide 28: Outlook 2021
OUTLOOK 2021
Slide 29: Outlook 2021
OUTLOOK 2021 The perspective for 2021 is positive with the In January 2021 we acquired Hammer new opportunities, however these are subject to Drilling Rigs (HDR) in the USA, a company the global Covid-19 pandemic. that specialises in drill mast attachments to heavy equipment that is used in a variet
Slide 30: Appendix
APPENDIX
Slide 31: Europe and Middle East
EUROPE AND MIDDLE EAST Mincon Group is headquartered at its Shannon factory in Ireland, where the business was founded in 1977. This remains the centre of excellence for manufacturing of DTH hammers, as well as development of new drilling technologies. Mincon has three additional world-class manufac
Slide 32: Europe and Middle East
EUROPE AND MIDDLE EAST Key Region information Mincon 4 Number of employees: 290 factories: manufacturing DTH and RC hammers, DTH and RC drill bits, geotechnical systems, drill pipes, drilling accessories, tungsten 620 carbide buttons. Customers in region: Construction and Key geotechnical, customer
Slide 33: Americas
AMERICAS Mincon North America marked the Group’s expansion into the Americas, starting in the early 90s. Since then the region has expanded significantly with two cutting-edge manufacturing facilities and service centers in Canada, USA, and customer centres in Peru, and Chile. With the addition of c
Slide 34: Americas
AMERICAS Key Region information Mincon Number of employees: 132 factories: 2 manufacturing DTH drill bits, rotary drill bits Customers in region: 422 Construction Key and HDD, customer markets: Water well and Mincon 12 geothermal, service Mining centres: The Driller’s Choice
Slide 35: Asia Pacific
ASIA PACIFIC Mincon has had a presence in the Asia Pacific region since starting manufacturing Perth in 1990. Today, the Perth factory manufactures world-class DTH & RC drill bits and drill pipes. Mincon also has a distribution centre in North Rockhampton, servicing customers on Australia’s east coa
Slide 36: Asia Pacific
ASIA PACIFIC Key Region information Mincon Number of employees: 57 factories: 1 manufacturing DTH drill bits, RC drill bits, drill pipes Customers in region: 245 Key Production mining, customer markets: Exploration mining, Mincon service centres: 3 Quarrying The Driller’s Choice
Slide 37: Africa
AFRICA In 2005 Mincon established a presence in Africa, when it acquired a distributor in South Africa. Since then it has expanded its sub-Saharan footprint with an office in Namibia, and opened a dedicated regional headquarters for West Africa, based in Las Palmas, Gran Canaria. Driconeq Africa, ba
Slide 38: Africa
AFRICA Key Region information Mincon Number of employees: 73 factories: 1 manufacturing drill pipes, drill accessories Customers in region: 347 Key Production mining, customer Exploration mining, Mincon markets: service centres: 4 Construction and waterwell The Driller’s Choice
Slide 39: Mincon Results 2020 Q&A
The Driller’s Choice MINCON RESULTS 2020 Q&A