Slide 1: Half Year Results FY2018 Investor Presentation
Half Year Results FY2018 Investor Presentation 20 November 2017 Raj Naran, Managing Director and CEO, ALS Limited Right Solutions • Right Partner www.alsglobal.com | Right Solutions • Right Partner
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
Slide 3: Half Year FY18 Financial Summary
Half Year FY18 Financial Summary Guidance met $70.1m *NPAT growth 18% *EBITDA growth 11% *Revenue growth 14.5% *EPS growth 18% Share buyback Up to $175m Full year guidance *NPAT $135m to $145m * Underlying result from continuing operations. 3 | Investor Presentation. Half Year Results FY2018 Right S
Slide 4: ALS Segments and Business Streams Revenue split
ALS Segments and Business Streams Revenue split COMMODITIES & LIFE SCIENCES INDUSTRIAL Environmental Geochemistry Food Metallurgy Pharmaceutical Trade Inspection Consumer Products Coal Oil & Gas (Laboratories) Asset Care Tribology 4 | Investor Presentation. Half Year Results FY2018 Right Solutions •
Slide 5: Half Year FY18 Financial Summary
Half Year FY18 Financial Summary H1FY17 Half Year FY18 ($mn) ($ mn) Half Year Divestment & Restructuring Amortisation Discontinued Statutory Underlying* Underlying* Impairment & other one of Operations Results Charges off items Intangibles Revenue 630.2 721.6 39.8 - - - 761.4 EBITDA 131.0 144.8 3.8
Slide 6: Interim H1FY18 Dividend
Interim H1FY18 Dividend AUD cents 50 Interim Dividend H1FY18 Dividend 8.0 cps 40 Final Dividend Payout ratio 58% (HY18 underlying NPAT) 27 26 Franked to 40% 30 20 Record date of 30th November 2017 20 15 10 11 10 21 6 19 19 8 13 11 9 7.5 8 5.5 0 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 6
Slide 7: Debt Metrics
Debt Metrics Mar-14 Mar-15 Mar-16 Mar-17 Sep-17 STATISTICS Gearing Ratio (comfort 45%) 34% 38% 27% 29% 27% Leverage (net debt/ EBITDA; max 3.00) 2.2 2.5 1.7 2.1 1.6 EBITDA interest cover (min 3.75) 12.2 9.1 7.7 8.5 10.3 BALANCE SHEET MEASURES Total Equity ($ mn) 1419 1228 1186 1185 1176 Net Debt ($
Slide 8: Cash Flow
Cash Flow H1FY17 H1FY18 Half year $ mn $ mn Underlying operating profit (EBIT) 87.7 110.5 Depreciation & Amortisation 40.1 39.3 Working capital (11.4) (51.5) CAPEX (28.3) (39.2) Other 3.9 4.3 Free cash flow 92.0 63.4 Acquisitions (20.9) (17.9) Divestments - 79.5 Dividends paid (30.2) (40.3) Borrowin
Slide 9: On-market Share Buy-Back
On-market Share Buy-Back Amount Up to $175 million Time period To commence mid-December 2017 For up to twelve months Shares Based on 17 Nov 2017 closing share price of $8.05 buyback would represent 4.3% of ALS shares on issue Capital management On-market buy-back provides the most efficient and flex
Slide 10: Global Operations Map
Global Operations Map 10 | Investor Presentation. Half Year Results FY2018 Right Solutions • Right Partner
Slide 11: Business streams
Business streams 11 | Investor Presentation. Half Year Results FY2018 Right Solutions • Right Partner
Slide 12: Sustainability Program
Sustainability Program 12 | Investor Presentation. Half Year Results FY2018 Right Solutions • Right Partner
Slide 13: Acquisitions completed during FY2018 to date (on plan)
Acquisitions completed during FY2018 to date (on plan) Total investment $30 m FOOD TRIBOLOGY PHARMACEUTICAL Marshfield (USA) Oilcheck (Brazil) Mikrolab / Toxicon (Sweden)* * completed since end of September half-year 13 | Investor Presentation. Half Year Results FY2018 Right Solutions • Right Partne
Slide 14: Life Sciences. Overview
Life Sciences. Overview Environmental Food & Pharma Revenue growth (in AUD) New contract wins in South America Revenue up 64% pcp driven by Asia (+15.3%) and solid organic growth in Australia recent Marshfield (US) and Australia (+5.0%) and Asia will contribute positively for Alcontrol (UK) ac
Slide 15: Life Sciences. Outlook
Life Sciences. Outlook EBITDA % of Revenue Latin America 16% EBITDA Recovery Continued focus on bolt on acquisitions 14% for food business Food strategy will deliver target revenue 12% of $200m this fiscal year 10% Improvement in performance from the environmental businesses in the Americas 8%
Slide 16: Commodities. Overview
Commodities. Overview Geochemistry Metallurgy Inspection Coal Sample volumes Revenue down 1.9% pcp Revenue up 8.7% pcp Revenue down 1.3% pcp. up 34% pcp Impact from Cyclone Contribution margin Contribution margin Debbie Revenue up 31% records improved down 100 bps pcp performance due t
Slide 17: Global Exploration Spend and ALS Global Mineral Sample Flow
100,000 150,000 200,000 250,000 300,000 350,000 400,000 0 50,000 Jan-06 Apr-06 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% -50% -40% -30% -20% -10% 100% Jan-06 Jul-06 2006 Apr-06 Oct-06 Jul-06 Jan-07 Apr-07 2006 Oct-06 Jan-07 Jul-07 2007 Apr-07 Oct-07 same 2 weeks last year) Jul-07 Jan-08 Apr-08 2007 Oct
Slide 18: Geochemical markets
Geochemical markets (junior / intermediate capital raisings, gold drilling) Source: S&P Global Intelligence Monthly Market Monitor – August 2017 18 | Investor Presentation. Half Year Results FY2018 Right Solutions • Right Partner
Slide 19: Exploration Budgets
Exploration Budgets Exploration budgets by location by amount budgeted, 2008-2017 6,000 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 5,000 4,000 3,000 2,000 1,000 0 Australia Canada US Africa Latin America Pacific / SE Asia Rest of the world Exploration budgets by region, 2017 Exploration budge
Slide 20: Commodities. Outlook
Commodities. Outlook Increased demand for pilot plant metallurgical services Optimistic market conditions for geochemistry Increased capacity and improved efficiency in geochemistry Demand for coal will continue but so will pricing pressures Inspection business focused on cost-based manage
Slide 21: Industrial. Overview
Industrial. Overview Asset Care Tribology • Business to be retained following review of strategic options. • Contribution margin remains above 24% • Mining and Oil & Gas maintenance programs offsetting revenue from final stage of LNG construction in Australia • Australia continues to perform strongl
Slide 22: Industrial. Outlook
Industrial. Outlook Well positioned to support mining, O&G and power generation maintenance programs in Australia Expected slow recovery of downstream O&G activity in Gulf States (USA) Lab automation and data management solutions driving increased efficiency and improved quality Tribology gr
Slide 23: Half Year FY18 Summary
Half Year FY18 Summary Guidance met $70.1m *NPAT growth 18% *EBITDA growth 11% *Revenue growth 14.5% *EPS growth 18% Share buyback Up to $175m Full year guidance *NPAT $135m to $145m * Underlying result from continuing operations. 23 | Investor Presentation. Half Year Results FY2018 Right Solutions