Wajax Corporation · TSX:WJX
Wajax — Investor Presentation (March 2015)
48 slides from Wajax's investor presentation, Mar 5, 2015
Slide 1: Wajax Investor Presentation: 4 Points of Growth
Click to edit Master title style Wajax Investor Presentation 4 Points of Growth March 5, 2015
Slide 2: Forward Looking Statements
Forward Click toLooking edit Master Statements title style This presentation contains certain forward-looking statements and forward-looking information, as defined in applicable securities laws (collectively, “forward-looking statements”). These forward-looking statements relate to future events or
Slide 3: Overview
Overview Click to edit Master title style 1 Key Messages 2 Building on a Strong Foundation 3 4 Points of Growth 4 Why Invest? Wajax Corporation Investor Presentation – 4 Points of Growth (March 5, 2015) Page 3
Slide 4: Key Messages
Click to edit Master title style Key Messages Wajax Corporation Wajax Corporation Investor – Investor Presentation – 4 Points Presentation of Growth (March 30, 2015) Page 5, 2015) Page 44
Slide 5: Key Messages
Key Click Messages to edit Master title style Objectives Actions Improve Excellence in “Core Capabilities” Earnings ≥ 7.5% 5YR CAGR Organic growth initiatives Growth Rate Acquisitions accelerate growth Invest in Invest in what will Major focus on the organizational skills that drive Organiza
Slide 6: Building on a Strong Foundation
Click to edit Master title style Building on a Strong Foundation Wajax Corporation Wajax Corporation Investor – Investor Presentation – 4 Points Presentation of Growth (March 30, 2015) Page 5, 2015) Page 66
Slide 7: Building on a Strong Foundation - Our Team
Building Click to on edita Master Strong title Foundation style - Dedicated Team of 2,725 Our Team Support Parts and Service • Distribution • 907 Shop and Field Technicians • Engineering 899 1166 • 259 Parts and • Production Service Support • Support and Administration • Other 660 Sales • 660 Inside
Slide 8: National Branch Network
Building Click to on edita Master Strong title Foundation style - National Branch Network Branch network covers all major resource and industrial markets. 2014 revenue by geographic region – 52% Western Canada – 21% Central Canada – 27% Eastern Canada National network of 123 branches Equipment
Slide 9: Expertise in a Wide Range of Markets
Building Click to on edita Master Strong title Foundation style - Expertise in a Wide Range of Markets 2014 Revenue by Market Government Other Construction and Utilities In 2014, 55% of revenue was derived 9% Metal 3% 16% from the following “core” markets that Processing 4% are very important to o
Slide 10: Broad Range of Products and Services
Building Click to on edita Master Strong title Foundation style - Broad Range of Products and Services Business Business Business Distribution, rental, modification and servicing Distribution, sales and service of heavy- Distribution, servicing, engineering, of mobile equipment from leading du
Slide 11: World Class Vendors
Building Click to on edita Master Strong title Foundation style - World Class Vendors Major Vendors 1) National and Regional Major Agreements • Leaders in their categories • Aligned with core markets • Top 5 relationships – 48% of total revenue(1) 2) Growing Roster of Important Vendors • Aligned wit
Slide 12: Long-Term Track Record
Building Click to on edita Master Strong title Foundation style - Long-Term Track Record Revenue / EBIT(1) Revenue EBIT $M $M $2,000 $200 $1,800 $180 10-YR CAGR: $1,600 $160 Revenue: 5.2% EBIT: 6.5% $1,400 $140 $1,200 $120 Maintained revenue $1,000 $100 but at lower margins due to $800 $80 weakness
Slide 13: 4 Points of Growth
Click to edit Master title style 4 Points of Growth Wajax Corporation Wajax Corporation Investor – Investor Presentation – 4 Points Presentation of Growth (March 30, 2015) Page 5, 2015) Page 13 13
Slide 14: Strategy Review Process and Summary Conclusions
4 Click Pointstoof Growth edit Master title style - Strategy Review Process and Summary Conclusions Process Summary Conclusions Historical Strengths Performance Strong track record with major vendors Expertise in a wide range of markets Market National infrastructure an advantage - attraction
Slide 15: Linking Objectives to 4 Points of Growth Framework
4 Click Pointstoof edit Growth Master - Linking title style to Strategy Objectives Objectives 4 Points of Growth Framework Improve Earnings ≥ 7.5% 5YR CAGR Growth Rate Invest in Invest in what will Organizational drive sustainable Capabilities performance Improve Long-Term Shareholder Reduce effect
Slide 16: Growth - Core Markets
4 Click Pointstoof edit Growth – Core Master title style Markets Core Markets Construction Viewed over the long-term, core markets are the highest growth opportunities for 16% Wajax: Organic growth in other markets Significant market sizes with market contributes to results: Oil share improvement
Slide 17: Core Capabilities
Click to edit Master title style Core Capabilities Wajax Corporation Investor Presentation – 4 Points of Growth (March 5, 2015) Page 17
Slide 18: #1 - Core Capabilities
4 Click Pointstoof Growth edit Master title style #1 - Core Capabilities Our Goal ...is to be Canada’s leading industrial products and services provider, distinguished through: 1) The excellence of our sales force These three “Core 2) The breadth and efficiency of our repair Capabilities” are the an
Slide 19: Core Capabilities: Sales Force
4 Click Pointstoof Growth edit Master title style #1 - Core Capabilities: Sales Force Objective Initial Programs To distinguish Wajax 1) Implementation of a new Sales Reps to our customers and and customized Wajax vendors through the sales process and excellence of our increased investment in sales
Slide 20: Core Capabilities: Repair and Maintenance Operations
4 Click Pointstoof Growth edit Master title style #1 - Core Capabilities: Repair and Maintenance Operations Objective Initial Programs To achieve significant 1) Service profitability - Implementation improvement and of enhanced measurement systems ultimately leadership in and training to support imp
Slide 21: Core Capabilities: Product and Vendor Development
4 Click Pointstoof Growth edit Master title style #1 - Core Capabilities: Product and Vendor Development Objective To work closely with existing and new vendor partners to constantly expand our offering to our customers. Initial Programs Wajax Customers 1) Creation of market teams that combine exper
Slide 22: Product and Vendor Development Examples
4 Click Pointstoof Growth edit Master title style #1 - Core Capabilities: Product and Vendor Development Mining Mining Industrial and Commercial Broad Market Opportunities Market Estimate $400M (2) Ground Engaging Technology and Wear Parts. Working with new 3M Filtration The 3M™ High Flow series fil
Slide 23: Organic Growth
Click to edit Master title style Organic Growth Wajax Corporation Wajax Corporation Investor – Investor Presentation – 4 Points Presentation of Growth (March 30, 2015) Page 5, 2015) Page 23 23
Slide 24: #2 - Organic Growth
4 Click Pointstoof Growth edit Master title style #2 - Organic Growth We estimate that the majority of our earnings growth over the 5-year timeframe from 2015 - 2019 will result from investing in our Core Capabilities, increases in our base business and four major organic growth programs Engineered
Slide 25: Organic Growth: Engineered Repair Services (ERS)
4 Click Pointstoof Growth edit Master title style #2 - Organic Growth: Engineered Repair Services (ERS) Objective Engineered Repair Services includes a wide range of repair, maintenance and engineering services to satisfy customer needs in areas such as bearings and power transmission, hydraulics an
Slide 26: Organic Growth: Engineered Repair Services (ERS)
4 Click Pointstoof Growth edit Master title style #2 - Organic Growth: Engineered Repair Services (ERS) ERS projects focus on helping customers improve operating efficiencies and lower costs. While the projects can relate to cyclical markets, the focus is on gaining a greater share of MRO spending w
Slide 27: Organic Growth: Electrical Power Generation (EPG)
4 Click Pointstoof Growth edit Master title style #2 - Organic Growth: Electrical Power Generation (EPG) Objective Our objective is to grow significantly by leveraging what we consider to be the industry’s best team of EPG professionals. Working closely with our primary partner, MTU OnSite Energy (a
Slide 28: Organic Growth: Mining Equipment
4 Click Pointstoof Growth edit Master title style #2 - Organic Growth: Mining Equipment Objective Our strategy is to continue to be a leader in the sales and service of hydraulic mining shovels and to become a new force in the haul truck market (>140MT) based on Hitachi’s proprietary electric drive
Slide 29: Organic Growth: Diversify Oil and Gas Products and Services
4 Click Pointstoof edit Master title style Growth #2 - Organic Growth: Diversify Oil and Gas Products and Services Oil and Gas Wells Revenue Drilled ($M) Objective Our objective is to build on our strong 18,000 200 market share and expertise in core oil 180 and gas components(2) to diversify and 16,
Slide 30: Diversify Oil and Gas: New Products and Programs
4 Click Pointstoof edit Master title style Growth #2 - Organic Growth: Diversify Oil and Gas Products and Services New Products From Major Vendors Engineering, Design, Manufacturing and Refurbishment Programs Automated Mobile Pipe Handling System Designed to “learn” pick up and drop off points, this
Slide 31: Acquisitions
Click to edit Master title style Acquisitions Wajax Corporation Investor Presentation – 4 Points of Growth (March 5, 2015) Page 31
Slide 32: #3 - Acquisitions
4 Click Pointstoof Growth edit Master title style #3 - Acquisitions Our focus is on building our capacity to acquire and integrate regional Engineered Repair Services companies into our Industrial Components ERS business. Acquisitions are intended to accelerate the growth we achieve organically and
Slide 33: Systems
Click to edit Master title style Systems Wajax Corporation Investor Presentation – 4 Points of Growth (March 5, 2015) Page 33
Slide 34: #4 - Systems
4 Click Pointstoof Growth edit Master title style #4 - Systems We plan to increase our investment in systems over the 5-year timeframe to improve operational efficiencies, support for our sales and service teams and to increase the integration and operational consistency of our product divisions. Ou
Slide 35: 4 Points of Growth Summary
Click to edit Master title style 4 Points of Growth Summary Wajax Corporation Wajax Corporation Investor – Investor Presentation – 4 Points Presentation of Growth (March 30, 2015) Page 5, 2015) Page 35 35
Slide 36: 4 Points of Growth Summary
4 Click Pointstoof Growth edit Master title style Summary Objectives Actions Improve Excellence in “Core Capabilities” Earnings ≥ 7.5% 5YR CAGR Organic growth initiatives Growth Rate Acquisitions accelerate growth Invest in Invest in what will Major focus on the organizational skills that dr
Slide 37: Financial Targets
4 Click Pointstoof Growth edit Master title style Financial Targets Recent Performance (3) Strategic Plan 3 Year CAGR(1) Target 2014 (2011-2014) Consolidated Revenue 1.8% $1.45B EBIT $ -8.9% $69.6M EBIT % N/A 4.8% EPS -13.8% $2.46 ≥ 7.5% Equipment(2) EBIT % N/A 6.8% The company expects to Power Syst
Slide 38: Capital Allocation and Funding
4 Click Pointstoof Growth edit Master title style Capital Allocation and Funding Expected Incremental Capital Requirements over 5 years: Acquisitions Up to $100 million IT Investments (combination of capital and expense) Up to $30 million Rental Fleet and Other Capital(1) Up to $40 million Working C
Slide 39: Why Invest?
Click to edit Master title style Why Invest? Wajax Corporation Wajax Corporation Investor – Investor Presentation – 4 Points Presentation of Growth (March 30, 2015) Page 5, 2015) Page 39 39
Slide 40: Why Invest?
Why Click Invest? to edit Master title style Solid foundation Renewed growth strategy Strongly and uniquely positioned within the industry Realistic financial targets Ability to fund growth Dividend – expected stability with future growth opportunity(1) (1) Subject to the Company’s finan
Slide 41: For additional information, please contact
Click to edit Master title style For additional information, please contact: Mark Foote President and Chief Executive Officer Email: mfoote@wajax.com John Hamilton Senior VP, Finance and Chief Financial Officer Email: jhamilton@wajax.com
Slide 42: Appendices
Click to edit Master title style Appendices Wajax Corporation Wajax Corporation Investor – Investor Presentation – 4 Points Presentation of Growth (March 30, 2015) Page 5, 2015) Page 42 42
Slide 43: Appendix 1 - Equipment: Diverse Range of Products and Services
Appendix 1 - Strong Click to edit MasterFoundation title style Diverse Range of Products and Services Products and Services Sales and service of excavators, articulated dump trucks, lift trucks, mining trucks and shovels, forest harvesting equipment, utility equipment, loader backhoes, container h
Slide 44: Appendix 2 - Power Systems: Diverse Range of Products and Services
Appendix 2 - Strong Click to edit MasterFoundation title style Diverse Range of Products and Services Products and Services Heavy-duty diesel and natural gas engines, transmissions and power generation equipment supported by a national parts and service network. Major Vendors MTU, Detroit, Allis
Slide 45: Appendix 3 - Industrial Components: Products and Services
Appendix 3 - Strong Click to edit MasterFoundation title style Diverse Range of Products and Services Products and Services Bearings, power transmission, hydraulics, pneumatics, pumps, filtration, instrumentation, process bulk material handling, fluid handling, safety and mill supplies and enginee
Slide 46: Appendix 4 - Non-GAAP and Additional GAAP Measures
Appendix 4 – Non-GAAP Click to edit Master title and styleAdditional GAAP Measures This presentation contains certain non-GAAP and additional GAAP measures that do not have a standardized meaning prescribed by GAAP. Therefore, these financial measures may not be comparable to similar measures presen
Slide 47: Appendix 5 - Key Messages
Appendix Click to edit 5 - Key Master Messages title style Building on a Our 4 Point Growth Strong Our Goal Strategy Foundation We plan to invest in four areas: ...is to be Canada’s leading industrial As one of Canada’s products and services provider, 1) Core Capabilities - the distinguished through
Slide 48: Thank You!
Click to edit Master title style Thank You!