MITIE Group PLC · LSE:MTO
MITIE — Investor Presentation (September 2011)
41 slides from MITIE's investor presentation, Sep 22, 2011
Slide 1: Analyst & Investor Strategy Presentation
Slide 1 MITIE Group PLC Analyst & Investor Strategy Presentation 22 September 2011
Slide 2: Growth aspirations
Slide 2 Growth aspirations Ruby McGregor-Smith Chief Executive
Slide 3: MITIE today
MITIE today • MITIE is a strategic outsourcing and energy services company which manages facilities, energy, property and infrastructure for its clients • Market-leading FTSE 250 support services business • Second largest energy services company in the UK* • Revenues of £1.9bn and operating profit o
Slide 4: How we are structured
How we are structured FY2011 £1,891.4m MITIE Revenues 5.7% EBITA margin Facilities Technical Facilities Property Asset Overseas Management Management Management Management FY2011 Revenues £882.2m £437.1m £509.7m £62.4m £25.0m EBITA margin 6.4% 5.6% 4.2% 3.2% • Total security • Integrated FM • Proper
Slide 5: The outsourcing market evolves
The outsourcing market evolves 1980 1990 2000 2010 2010+ In-house Single service Bundled services Integrated FM Strategic outsourcing Security Broader cost savings Integrated delivery Buildings Management management and M&E engineering Single point contact information systems services Catering Stand
Slide 6: A few more of our notable clients
A few more of our notable clients Analyst & Investor Strategy Presentation | 6
Slide 7: Our strong track record
Our strong track record Revenue Basic Earnings Per Share before other items Analyst & Investor Strategy Presentation | 7
Slide 8: How we will continue to grow
How we will continue to grow • Record order book and sales pipeline − 85% of 2012 budgeted revenues secured as at 30 June 2011 (June 2010: 78%) − £6.8bn order book as at March 2011 − £11.4bn sales pipeline as at March 2011 • Committed long-term funding, low gearing and no material pension deficit •
Slide 9: The opportunities in our £11.4 billion sales pipeline
The opportunities in our £11.4 billion sales pipeline Support Services Central government Property Management Transport Utilities and Real Estate Retail Local government Manufacturing Leisure Technology Financial and Professional Services Construction Social Housing Other public sector Private:Publi
Slide 10: Private sector opportunities
Private sector opportunities • Energy services currently 34% of revenues and increasing • Opportunity to repeat the growth achieved with Rolls-Royce and Vodafone with a number of existing major clients over the next 2-3 years − Significant integrated FM opportunities in financial services and retail
Slide 11: Public sector opportunities
Public sector opportunities • Justice − MOJ pipeline of up to £1bn − Total facilities management contracts for MOJ – decision due in Autumn • Health − Energy services framework agreement − Large increase in FM opportunities • Local authorities − Edinburgh City Council – facilities management and pro
Slide 12: Well-positioned for the future
Well-positioned for the future • Leading UK outsourcing and energy services company with a 24- year track record of growth • Substantial pipeline of opportunities - £11.4bn will drive continued long-term growth in the business − Supported by a high-quality client base and long-term relationships • D
Slide 13: Market Opportunities
Slide 13 Market Opportunities Patrick Stirland Managing Director, Strategic Outsourcing
Slide 14: £11.4 billion sales pipeline
£11.4 billion sales pipeline Support Services Central government Property Management Transport Utilities and Real Estate Retail Local government Manufacturing Leisure Technology Financial and Professional Services Construction Social Housing Other public sector Education Health Private:Public sector
Slide 15: Local authority market
Local authority market Spending Review – October 2010 Localism Bill – December 2010 Local Authorities Response • Business model review • Bundling of adjacent services, e.g. FM, utilities, estate management, work style, capital projects • Procurement consolidation − neighbouring authorities procuring
Slide 16: Recent success
Recent success Essex County Council • Preferred bidder • £8m base contract value • District councils within Essex can access this contract • 10 year contract • Integrated facilities and property management with energy services and estates management • Service over 350 sites including Essex County Ha
Slide 17: Live opportunities
Live opportunities Edinburgh City Council • Transformational facilities, property, capital works and energy management contract • 18 month bidding process, down to two bidders: MITIE/Atkins/Lambert Smith Hampton (Vital Edinburgh) and Capita/Carillion • Decision due in October • 7 year (+ 5 year exte
Slide 18: Other public sector
Other public sector Olympic Park (legacy) • 5-year contract to deliver integrated FM to selected parts of the Olympic estate (post-Games) • Shortlisted to the last four bidders • Decision expected in December 2011 Sellafield • Largest re-bid in 2011 (current contract expires March 2012) • Potential
Slide 19: Central Government
Central Government OGC Framework • DBIS (Department of Business, Innovation and Skills) − FM bid • DFE & CLG (Department for Education and Department for Communities and Local Government) GPU (Government Property Unit) • Outsourcing of FM, energy management and property services across government de
Slide 20: Health market overview
Health market overview • The UK healthcare market has four segments – primary, secondary, community and central bodies Analyst & Investor Strategy Presentation | 20
Slide 21: Health market overview
Health market overview Opportunity in: Soft Services Facilities Services Integrated Facilities Management Energy Services Analyst & Investor Strategy Presentation | 21
Slide 22: Justice proposition
Slide 22 Justice proposition Jeff Flanagan Group Corporate Development Director
Slide 23: £11.4 billion sales pipeline
£11.4 billion sales pipeline Support Services Central government Property Management Transport Utilities and Real Estate Retail Local government Manufacturing Leisure Technology Financial and Professional Services Construction Social Housing Other public sector Education Health Private:Public sector
Slide 24: Justice overview
Justice overview • Home Office and MOJ both have to achieve 25% savings over four years • The MoJ has quantified the market over the next five years − Well-defined market and opportunity − A visible pipeline over a defined timespan − MoJ procurement is centralised − MoJ has acted to begin the proces
Slide 25: MoJ
MoJ • Desire to shift away from short-term custodial sentences • More rehabilitation and community sentences • Prison population is over 85,000, prisons are operating at full capacity, the estate has a significant maintenance backlog and incarceration is expensive • The average cost per year per per
Slide 26: Key budget priorities for MoJ
Key budget priorities for MoJ • Courts and tribunals system will be brought together in a single agency • Efficient central London estate • Reduce and reorganise arm’s length bodies • Shared services models • Reduce spending on courts and legal aid by developing access to alternative dispute resolut
Slide 27: Specific MoJ markets
Specific MoJ markets • Total facilities management • Prisons management • Electronic monitoring • Community payback • Probation trusts Analyst & Investor Strategy Presentation | 27
Slide 28: Total facilities management
Total facilities management • Appointed to the MoJ’s Total Facilities Management Framework − Route to bid for FM at courts and two prisons • Total FM for courts in two lots – North and South of England − Fully integrated FM − Decision due late September, contract commences 1 Feb 2012 − Can only be a
Slide 29: Prisons management
Prisons management • Framework to appoint 6 to 8 providers, expected to be agreed by 30 October 2011 − First award expected by 30 September 2012 • Outsourcing of 8 to15 prisons per year • 14 year contracts Analyst & Investor Strategy Presentation | 29
Slide 30: Community payback
Community payback • Compact – our joint venture with A4e to bid under the community payback framework − MITIE: logistics and supervision − A4e: rehabilitation and training • Four-year contracts • Four providers on the framework – Compact, Serco, Sodexo and the Probation Service • London is the first
Slide 31: Home Office
Home Office • Two principal customers – UK Border Agency and Police • UKBA procures centrally for immigration detention services • Police procurement is local, through 43 forces Analyst & Investor Strategy Presentation | 31
Slide 32: Immigration removal centres
Immigration removal centres • UK Border Agency contracts − Awarded Campsfield House and commenced contract in May 2011 5 year + 3 year contract, £5m pa Includes a proposal for energy services that would be in addition to base contract value • 7 currently private sector managed, 4 public sector Analy
Slide 33: Summary
Summary • MoJ market opportunities − Total facilities management − Prisons management − Community payback − Electronic monitoring • Home Office market opportunities − Police services − Immigration removal centres Analyst & Investor Strategy Presentation | 33
Slide 34: Energy services and infrastructure
Slide 34 Energy services and infrastructure Mike Tivey Managing Director Asset Management
Slide 35: The converging forces are well established in the market
The converging forces are well established in the market Security Efficiency of supply without loss Low carbon Flexibility to meet demand technology Analyst & Investor Strategy Presentation | 35
Slide 36: The drivers are in place
The drivers are in place Analyst & Investor Strategy Presentation | 36
Slide 37: Rapidly growing demand for energy & carbon strategies
Rapidly growing demand for energy & carbon strategies 1. Reduce consumption 2. Diversify supply to include renewable energy • £450 billion – the amount the UK must spend on energy efficiency measures and energy supply infrastructure by 2025* • In the EU, there are an estimated 700-1040 active energy
Slide 38: UK Energy services market
UK Energy services market 7000 6000 Energy Consultancy & Compliance 5000 Utility Procurement & Data 4000 Management Energy Retrofit (Incl renewables) 3000 2000 Supplyand Supply andPerfotmance Performance Contracting Contracting 1000 Total Market 0 2011 2014 2020 Analyst & Investor Strategy Presentat
Slide 39: Our capability
Our capability 34% of Energy MITIE Services Group revenue Analyst & Investor Strategy Presentation | 39
Slide 40: Summary
Summary • Macroeconomic, environmental and legislative forces driving unprecedented demand for energy and carbon strategies − Reduce energy consumption − Diversify energy supply • MITIE’s capabilities − Decentralised energy − Renewable energy − Energy consumption reduction − Carbon compliance − Data
Slide 41: Summary and questions
Slide 41 Summary and questions Ruby McGregor-Smith Chief Executive