Slide 1: Investor presentation FY22 Results
Investor presentation FY22 Results Raj Naran, Managing Director and CEO Luis Damasceno, Chief Financial Officer
Slide 2: Important notice and disclaimer
Important notice and disclaimer This presentation has been prepared by ALS Limited, (ALS or the Company). It contains general information about the Company’s activities as at the date of the presentation. It is information given in summary form and does not purport to be complete. The distribution o
Slide 3: Exceeded our 5-year strategic plan (FY17-22)
Exceeded our 5-year strategic plan (FY17-22) Targets: Achievements: Zero harm to our people 43% improvement in injury frequency rates vs FY17 $2 billion in revenue $2.2 billion 9.7% Mid-single digit organic growth +73% vs FY17 5-year Organic CAGR $400 million in underlying EBIT $409 million 18.8% ma
Slide 4: FY22 highlights
FY22 highlights1 Emissions and Higher dividends and Strong financial performance reduction commitments disciplined capital management • Carbon neutrality in FY232 • Exceeded 5-year strategic plan objectives in all • $158.5 million full year, 30% franked dividend key metrics (32.8 cps), representing
Slide 5: Sustainability
Sustainability Carbon neutrality in FY23 FY23 Targets Our Green Bonds Commitment • Achieve carbon neutrality1 in FY23 In FY22, we executed green bonds under a new USPP funding arrangement, • Achieve a 6% reduction in carbon intensity2 committing $30m to complete our projects to tackle climate change
Slide 6: Sustainability achievements since FY2018
Sustainability achievements since FY2018 PEOPLE ENVIRONMENT SOCIETY GOVERNANCE Deliver world class health and Minimise our environmental Make a positive contribution to Operate ethically and safety outcomes, attract and footprint and build our resilience our local communities responsibly to deliver
Slide 7: FY22 results: Group performance
FY22 results Group performance
Slide 8: FY22 statutory results
FY22 statutory results1 Summary Statutory Results FY22 ($m) FY21 ($m) % change Revenue 2,108.5 1,761.4 19.7% EBITDA 487.2 416.9 16.9% FX losses transferred from FCTR (26.9) - - Depreciation, amortisation and (138.9) (132.6) 4.8% impairment losses EBIT 321.4 284.3 13.0% Statutory NPAT increased by $2
Slide 9: FY22 U/L NPAT of $264.2 million, at the top-end of upgraded guidance
FY22 U/L NPAT of $264.2 million1, at the top-end of upgraded guidance Revenue • Strong organic revenue growth of +18.1% with significant organic revenue growth in Life Sciences (+13.4%) and Commodities (+30.8%) • Scope growth (the net of acquisitions and divestments) of +6.7% driven by the strong pe
Slide 10: FY22 revenue
FY22 revenue Strong organic growth of +18.1% in $m +117.0 (15.6) +319.5 2,182.3 1,761.4 +24.8% increase @ constant currency FY21 Organic Scope FX (1) FY22 Revenue 18.1% 6.7% (0.9)% 23.9% • Scope growth (the net of acquisitions and divestments) primarily driven by the acquisitions of Investiga, Nuvis
Slide 11: FY22 divisional highlights
FY22 divisional highlights1 Revenue growth and EBIT margin expansion across both Life Sciences and Commodities • Total revenue reached $1.1 billion, with organic growth of 13.4%. All businesses and key regions delivered double-digit organic revenue growth • Life sciences accounted for 53% of total g
Slide 12: FY22 revenue growth components by business stream
FY22 revenue growth components by business stream At constant currency % of revenue (25.0)% (15.0)% (5.0)% 5.0% 15.0% 25.0% 35.0% 45.0% Life Sciences: Life Sciences 13.4% 11.5% 53% Geochemistry 41.6% 2.3% Metallurgy 23.7% Commodities: 37% Inspection 2.6% Coal (17.8%) Asset care (1.5%) Industrial: 10
Slide 13: FY22 underlying EBIT
FY22 underlying EBIT Material margin improvement driven by Life Sciences and Commodities in $m +17.1 (0.3) +91.0 409.3 301.5 +151 bps @ constant currency FY21 Organic Scope (1) FX (2) FY22 Group Margin 17.1% +174 bps (23) bps +12 bps 18.8% Life Sciences 16.2% +98 bps (24) bps (6) bps 16.9% Commoditi
Slide 14: FY22 financial summary
FY22 financial summary Reconciliation of underlying to statutory FY21 ($m) FY22 ($m) Underlying results Nuvisan equity Full Year (including Nuvisan COVID subsidies & (1) Nuvisan underlying share of profit incl in Restructuring & Amortisation of Underlying proportinately grants net of direct Statutor
Slide 15: Disciplined and efficient capital management
Disciplined and efficient capital management • Strong Group liquidity of $432m and balance sheet flexibility enabling pursuit of acquisitions and funding of organic growth • Solid leverage ratio (1.9x as at March 2022) and improved EBITDA interest cover (15.3x as at March 2022) Balance Sheet • New 1
Slide 16: FY22 cash flow
FY22 cash flow Strong underlying EBITDA cash conversion driven by reduction in DSO Full year ($m) FY21 FY22 CASH FROM OPERATIONS (before capex) Underlying operating EBIT 301.5 409.4 Depreciation & amortization 123.7 137.8 $ $441m +61m vs FY21 Amortization on ROU Interest on ROU (44.6) (7.3) (53.4)
Slide 17: Operational capex by business
Operational capex by business Targeted spending on key growth opportunities in $m • Increase in capex by 47% vs pcp. Total capex of $119m representing 5.4% of revenue (3.6% growth and 1.8% maintenance spend) • Continued investment in growth opportunities in Life Sciences and expanding capacity in Ge
Slide 18: Debt metrics
Debt metrics Strong balance sheet following completion of Nuvisan and MinAnalytical acquisition Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 STATISTICS (BANK COVENANTS) Leverage (net debt/ EBITDA) (max 3.25) 1.7 1.8 2.1 1.6 1.9 EBITDA interest cover (min 3.75) 11.3 10.5 11.0 11.4 15.3 BALANCE SHEET MEASURES T
Slide 19: FY22 results: Review by division
FY22 results Review by division Investor Presentation. Full Year Results FY22 19
Slide 20: Life Sciences overview
Life Sciences overview Strong performance across the division • Total revenue growth of +24.2% vs pcp, of which • Underlying EBIT margin of 16.9%, +68 bps vs pcp, • Megatrends driving long-term structural growth in Life 13.4% organic, 11.5% scope with -0.7% unfavourable driven by the strong increase
Slide 21: Nuvisan pharmaceutical services
Nuvisan pharmaceutical services 49% acquisition completed in October 2021 Synergies with Nuvisan and the ALS Pharmaceutical organisation • Advisory Board and governance structure established • Synergies being explored across geographies and product portfolios • Joint Global Pharmaceutical service ca
Slide 22: Commodities overview
Commodities overview Strong organic revenue and margin growth Geochemistry Metallurgy Inspection Coal • Sample volume +32% vs pcp, +35% vs FY20 • Organic revenue growth of +24% vs • Organic revenue growth • Organic revenue decline • Volume increase was driven by both major miners (~60% of total pcp
Slide 23: Geochemistry: Supportive outlook for commodities
Geochemistry Supportive outlook for commodities ALS Global mineral sample volume (trailing 52 week running average) and global exploration spend 400 Average Weekly Sample Volume Global Exploration Spend USD bn Relative Gold Price in USD 27 350 24 Global Exploration Spend US$bn Average Weekly Sample
Slide 24: Geochemistry: Strong sample volume growth in FY22
Geochemistry Strong sample volume growth in FY22 ALS Global mineral sample volume to 13 May 2022 | two-week growth trend 100% 90% DELTA (last 2 weeks sample flow Versus same 2 80% 70% 60% 50% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 weeks last year) 40% 30
Slide 25: Strong improvement junior and intermediate fund raisings and pipeline activity
Strong improvement junior and intermediate fund raisings and pipeline activity Junior and intermediate financings | January 2020 – March 2022 Project drilling activity by commodity | January 2020 – February 2022 Data as at 06 April 2022. Data as at 07 March 2022. Source: S&P Global Market Intelligen
Slide 26: MinAnalytical laboratory services
MinAnalytical laboratory services 100% acquisition completed in December 2021 • Founded in 2010 with operations in Perth and Kalgoorlie focussed on serving gold sector testing • In addition to its Fire Assay testing services, in 2020 Minanalytical became the first commercial application for PhotonAs
Slide 27: Industrial overview
Industrial overview Challenging trading environment due to temporary COVID-19 impacts Asset Care Tribology • Organic revenue decline of -1.5% vs pcp driven by COVID-19 related • Organic revenue growth of +7.9% vs pcp with all regions performing well challenge in Australia and closure of business in
Slide 28: FY22 results: Strategic priorities and outlook for FY23
FY22 results Strategic priorities and outlook for FY23
Slide 29: Strategic priorities for FY23
Strategic priorities for FY23 Continue to focus on key initiatives SUSTAINABILITY & ESG FOCUS ON OUR PEOPLE PRICE MANAGEMENT AGENDA • Continue to exercise pricing power on highly • Continue to improve sustainability profile of the • Compensation in line with current market demanded services Group ex
Slide 30: Our refreshed strategic plan will capitalise on industry megatrends
Our refreshed strategic plan will capitalise on industry megatrends ALS will be primarily a testing organisation focused on global expansion and growth aligned with the industry megatrends Advancing Technology Sustainability Digitalisation Energy Transition Life Sciences Development Services Demand
Slide 31: Outlook for FY23
Outlook for FY23 Demonstrated ability to perform in current market conditions Life Sciences • Strong volume performance across Environmental, Food and Pharmaceutical in all geographies • Continue to focus on price increases, productivity enhancement, and on procurement activities to manage inflation
Slide 32: ALS FY22 results: Appendix
ALS FY22 results right solutions. Appendix right partner.
Slide 33: FY22 underlying results by division
FY22 underlying results by division EBIT margin increase of 164 bps FY22 ($m) Life Sciences Commodities Industrial Total Group (1) FY22 VFY21 VFY20 FY22 VFY21 VFY20 FY22 VFY21 VFY20 FY22 VFY21 VFY20 Revenue 1,154.6 24.2% 20.1% 819.1 31.1% 27.5% 208.6 1.0% (16.7)% 2,182.3 23.9% 17.7% Organic growth 1
Slide 34: FY22 underlying EBIT evolution
FY22 underlying EBIT evolution Strong margin growth in $m Other (5.2) 7.2 (3.6) (12.4) +72.5 +44.1 409.3 301.5 FY21 Life Sciences Commodities Industrial Corporate FX (1) FY22 Margin 17.1% 16.9% 29.9% 8.1% (2.3)% 0.1% 18.8% PCP +68 bps +230 bps (177) bps (16) bps +38 bps +164 bps (1) Realised/unreali
Slide 35: FY22 restructuring and other items
FY22 restructuring and other items COVID-19 SaaS system Other non- Total non- Total in $m Start-up Restructuring Acquisition subsidies development operational items recurring costs non-recurring repayment Commodities - - - - 0.6 0.6 9.9 10.5 Life Sciences 2.5 1.2 - - 0.1 3.8 10.1 13.9 Industrial - 0
Slide 36: Underlying effective tax rate movement
Underlying effective tax rate movement Change $m FY22 FY21 YoY Underlying Profit before Tax (from continuing operations) 371.5 261.4 42.1% Tax (105.6) (74.0) 42.7% Effective Tax Rate (ETR) 28.4% 28.3% +12 bps FY23 outlook: ETR expected to be between 28% and 29% on an underlying basis right solutions
Slide 37: Corporate cost evolution
Corporate cost* evolution Reinforcing corporate functions to support business growth 60.0 2.2% 2.1% 1.9% 1.9% 50.0 1.8% 2.0% 40.0 1.5% 30.0 50.0 1.0% 20.0 39.1 37.0 37.6 26.5 0.5% 10.0 - - FY18 FY19 FY20 FY21 FY22 Total Corporate costs * 1.8% 2.2% 2.1% 2.1% 2.3% % of revenue • Strict cost control in
Slide 38: Net debt evolution
Net debt evolution 22 24 138 11 (7) 131 902 292 (322) 614 31 March 2021 Net Free Cash Flow Acquisitions Dividends paid Treasury shares Fx Interest and Tax Restructuring costs Payback net COVID 31 March 2022 Net Debt bought on-market subsidies Debt right solutions. right partner. Investor Presentatio
Slide 39: 5-year Plan achievement review
5-year Plan achievement review right solutions. right partner.
Slide 40: $2.2 billion in revenue, an increase of 73% since FY17
$2.2 billion in revenue, an increase of 73% since FY17 Exceeded the revenue target of $2.0 billion in $b +0.2 (0.1) +0.7 2.2 1.3 +12.3% increase @ constant currency FY17 Organic Scope FX (1) FY22 (1) Revenue 9.7% 2.5% (0.7)% 11.6% Life Sciences 7.8% 4.6% 0.0% 12.5% Commodities 15.3% 0.4% (1.9)% 13.9
Slide 41: $409 million in underlying EBIT, doubled since FY17
$409 million in underlying EBIT, doubled since FY17 Exceeded the EBIT target of $0.4 billion in $m +44.0 (31.3) +204.3 409.4 192.4 +434 bps @ constant currency FY17 Organic Scope FX (1) FY22 Group Margin 15.3% 449 bps (16) bps (84) bps 18.8% Life Sciences 15.6% 42 bps 40 bps 49 bps 16.9% Commodities
Slide 42: 5-year achievement (ROCE, DIV, EPS and TSR)
5-year achievement (ROCE, DIV, EPS and TSR) Return on capital employed (ROCE *), incl. intangibles Dividend declared (in $m) and payout ratio (in %) 20.1% 180 58.0% 59.0% 60.4% 59.9% 60.0% 65.0% 160 55.0% 45.0% 158 17.7% 140 120 109 111 45.0% 16.2% 15.6% 100 84 85 35.0% 80 68 25.0% 13.6% 60 15.0% 12
Slide 43: 5-year achievement (working capital, DSO and cash conversion)
5-year achievement (working capital, DSO and cash conversion) Ex. Nuvisan equity-accounted EBITDA cash conversion Working capital * % on revenue 101.8% 12.8% 97.1% 97.1% 97.1% 12.2% 93.0% 90.7% 11.0% 10.5% 8.5% 8.4% FY17 FY18 FY19 FY20 FY21 FY22 FY17 FY18 FY19 FY20 FY21 FY22 * Working capital: worki
Slide 44: Weighted average debts maturity (drawn and undrawn debts)
Weighted average debts maturity (drawn and undrawn debts) Material improvement, reaching a record 6.9 years in post Jul-22 USPP funding 31 Mar 2018 31 Mar 2019 31 Mar 2020 31 Mar 2021 W. Av. Maturity: 2.8 years W. Av. Maturity: 2.1 years W. Av. Maturity: 4.1 years W. Av. Maturity: 5.0 years 300 450
Slide 45: Debt management and denomination evolution
Debt management and denomination evolution Achieving a well-balanced mix and significant reducing FX risk exposure FY18 (31 Mar) FY19 (31 Mar) FY20 (31 Mar) FY21 (31 Mar) AUD 4% AUD CAD CAD 17% AUD USD 18% 17% 31% 32% EUR 12% USD 53% GBP USD USD 6% EUR CAD CAD 82% 79% 16% GBP 13% 12% 8% USD CAD USD
Slide 46: right solutions. right partner.
right solutions. right partner. © Copyright 2022 | ALS Limited 46