Electro Optic Systems Holdings Limited · ASX:EOS
Electro Optic Systems — Investor Presentation (September 2022)
23 slides from Electro Optic Systems's investor presentation, Sep 8, 2022
Slide 1: Electro Optic Systems Holdings Limited Investor Presentation
For personal use only Electro Optic Systems Holdings Limited Investor Presentation – 8 September 2022 1
Slide 2: Important Notice and Disclaimer
Important Notice and Disclaimer CONTENT OF PRESENTATION FOR INFORMATION PURPOSES ONLY For personal use only Forward-looking Statements This presentation may contain statements that are, or may be deemed to be, forward-looking statements. Such statements can generally be identified by the use of word
Slide 3: Important Notice and Disclaimer
Important Notice and Disclaimer Preparation of Information For personal use only All financial information has been prepared in accordance with Australian Accounting Standards. Certain financial data included in this presentation is ‘non IFRS financial information’ noting that the financial informat
Slide 4: Introduction: EOS is Under New Management
Introduction EOS is Under New Management For personal use only Andreas Schwer, CEO Commenced 1 August 2022 • Over 30 years in global Defence, Manufacturing and Space • Previously with Rheinmetall AG, Manitowoc and Airbus • Recent roles in Middle East • German citizen, PhD in System Modelling & Numer
Slide 5: Agenda
Agenda For personal use only CEO Actions from Strategic Review Andreas Schwer H1 Financial Results and Funding Update Clive Cuthell Outlook Andreas Schwer Q&A Andreas Schwer and Clive Cuthell 5
Slide 6: CEO Actions from Strategic Review
CEO Actions from Strategic Review The first half result has been disappointing - a Comprehensive Program of Change has been established For personal use only Actions arising from Strategic Review: Comprehensive Program of Change • Renew the leadership team and add managers with deep commercial exper
Slide 7: Comprehensive Program of Change (1/3)
Comprehensive Program of Change (1/3) 1. Revisit of Company Strategy & Approach to Market For personal use only A. Cash Management: Immediate stop of discretionary cash drain into non-profitable businesses. B. Scope of Business & Product Portfolio: Concentration of business with two strategic pillar
Slide 8: Comprehensive Program of Change (2/3)
Comprehensive Program of Change (2/3) For personal use only 2. Restructuring / Reorganisation A. Portfolio Assessment: • SpaceLink: Ongoing negotiations with strategic investors. Deadline: end 2022 • EM Solutions: Very profitable, independent, attractive business B. Reorganisation • Right-Sizing: Ex
Slide 9: Comprehensive Program of Change (3/3)
Comprehensive Program of Change (3/3) 3. Processes & Indirect Savings For personal use only A. Working Processes: • Adaptation of working processes to the new, simplified organisation structure in order to increase overall efficiency and responsiveness. Introduction of granular labour cost tracking
Slide 10: Results H1 2022
For personal use only Results H1 2022 10
Slide 11: Performance Overview – Key Indicators
Performance Overview – Key Indicators The first half result has been disappointing For personal use only Six months ended 30 June $m 2022 2021 Revenue 53.8 97.8 EBITDA (Loss) (34.7) (0.3) Impairments & Provisions (58.2) - Operating Loss (98.9) (11.7) Cash (used in) / from Operations (17.1) 4.6 Cash
Slide 12: EBITDA: Underlying 1H Performance Drivers
EBITDA: Underlying 1H Performance Drivers The main 1H challenges relate to timing of sales revenue For personal use only 1. Customer Delays Market growth expected to • Delayed customer contract awards & administration accelerate in 2023 & 2024 • Market-wide increase in national security activity 2.
Slide 13: SpaceLink Impairment
SpaceLink Impairment The investments in SpaceLink have been fully provided against For personal use only Context • Since Q2 2020 the SpaceLink business model has required sale of SpaceLink equity to fund the capital-intensive satellite acquisition and launch phase • Changes in capital markets since
Slide 14: Company Financing
Company Financing The legacy debt has been refinanced and Stage 2 refinancing discussions are underway For personal use only The Company has been in discussions with a longstanding major equity investor, Washington H. Soul Pattinson (‘WHSP’), and has completed Stage 1 of a funding project. The Compa
Slide 15: Outlook & Conclusion
For personal use only Outlook & Conclusion 15
Slide 16: Outlook
Outlook For personal use only • Previous guidance issued by the Company indicated 2022 revenue at or above 2021 levels, i.e. $212m or above. • Company revenue is made up of delivery against contracts won in previous years plus delivery against new contracts won in the year. • Delivery against existi
Slide 17: Conclusion – Key Actions are Underway
Conclusion – Key Actions are Underway After a challenging 1H, Key actions are underway For personal use only Conclusion • 1H 2022 has been challenging • EOS is under new management • Further work to complete Stage II of refinancing is underway • The market is expected to improve in 2023 & 2024 Key A
Slide 18: Questions
For personal use only Questions 18
Slide 19: Thank You
For personal use only Thank You 19
Slide 20: Appendices
For personal use only Appendices 20
Slide 21: Detailed Financial Information - EBITDA Reconciliation
Detailed Financial Information - EBITDA Reconciliation For personal use only Period ended 30 June $m 2022 2021 Loss for the period (98.9) (11.7) Add back income tax benefit / (expense) 6.6 (2.9) Loss before tax (105.5) (8.8) Impairment of assets & Onerous contracts (58.2) - Finance costs (6.2) (2.9)
Slide 22: Detailed Covenant Information
Detailed Covenant Information Covenant Calculation Minimum ratio For personal use only Asset Coverage Ratio A:B, where: (a) The net assets of the Group excluding intangible assets (b) B means the aggregate of: Not less than 1.8 (i) the Outstanding Amount under borrowing & related facilities, (ii) th
Slide 23: For personal use only
For personal use only 23
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