Sgh Limited · ASX:SGH
Sgh — Seven Group Holdings — FY2017 Earnings Presentation
31 slides from Sgh's earnings presentation, Aug 22, 2017
Slide 1: Results for the Year Ended 30 June 2017
Results for the Year Ended 30 June 2017 Enabling Customer Performance
Slide 2: Group Overview | Disclaimer
Group Overview | Disclaimer Basis of preparation of slides Included in this presentation is data prepared by the management of Seven Group Holdings Limited (“SGH”) and other associated entities and investments. This data is included for information purposes only and has not been subject to the sam
Slide 3: Group Overview | Our Businesses
Group Overview | Our Businesses Industrial Services SGH Ownership Business Description Strategic Position WesTrac Australia 100% CAT dealer in WA and NSW/ACT #1 equipment solution company in WA and NSW/ACT Coates Hire 47% Industrial and general equipment hire Largest equipment hire company in Austra
Slide 4: People | Safety and Culture
People | Safety and Culture Safety Continuing to implement a cultural safety program with front line leadership and key roles across the businesses through: – Training programs at all levels to ensure compliance and commitment – Development of enhanced safety management systems – Management KPIs i
Slide 5: Group Overview | Highlights
Group Overview | Highlights Result at the upper end of guidance Underlying EBIT of $297m up 9% YoY ($333m incl. discontinued operations, up 10%) – compared to guidance at half-year of 5-10% up Statutory NPAT of $16m ($46m incl. discontinued operations) impacted by net SWM significant items of $2
Slide 6: Post Balance Date Event | Sale of WesTrac China
Post Balance Date Event | Sale of WesTrac China Value accretive transaction at strong point in the cycle Sale and Purchase Agreement signed on 1 July 2017 following approach from Lei Shing Hong (LSH), a neighbouring CAT dealer in China ~$540m sales proceeds, representing net book value including
Slide 7: Group Overview | Key Financials
Group Overview | Key Financials Continuing Operations Including Discountinued Operations Underlying Results FY17 FY16 % Change FY17 FY16 % Change Trading revenue $ 2,282.3 m $ 2,237.2 m 2% $ 2,884.7 m $ 2,837.7 m 2% 1 Earnings before interest and tax $ 297.2 m $ 271.5 m 9% $ 333.3 m $ 302.8 m 10% 1
Slide 8: Financials | P&L Reconciliation
Financials | P&L Reconciliation Underlying trading performance Less: Significant items Statutory results (as reported) Year ended 30 June 2017 ($m) Cont. Discont. Total Cont. Discont. Total Cont. Discont. Total Revenue 2,282.3 602.4 2,884.7 - - - 2,282.3 602.4 2,884.7 Other income 51.7 4.2 55.9 (4.4
Slide 9: Financials | Profit and Loss
Financials | Profit and Loss $m FY17 FY16 Change % Revenue 2,282.3 2,237.2 2% Other income 51.7 69.5 -26% Share of results from equity accounted investees 121.0 90.0 34% Total revenue and other income 2,455.0 2,396.7 2% Expenses (excl. depreciation, amortisation and interest) (2,127.3) (2,092.1) 2%
Slide 10: Financials | Significant Items
Financials | Significant Items $m FY17 FY16 Impairment reversal/(impairment) – SWM equity 128.4 (0.4) Gain /( Loss) on sale of investments and MtM on derivatives 1.9 4.0 Restructuring, redundancy, transaction and other costs (4.8) (10.5) Share of equity accounted investees' Significant Items (303.3)
Slide 11: Financials | Earnings Summary
Financials | Earnings Summary Continuing Operations Total WesTrac Allight Coates Media Energy Other Other WesTrac $m Group Aus Sykes Hire Invest. Invest. China Revenue 2,282.3 2,203.7 68.7 - - 4.6 5.3 - 602.4 Statutory EBIT 119.8 159.1 (3.7) 18.6 (175.9) 83.5 56.3 (18.1) 38.2 Add unfavourable Signif
Slide 12: Financials | Cash Flow
Financials | Cash Flow $m FY17 FY16 Free cash flow per share is up 3c from 93c to 96c continuing the consecutive growth Underlying EBIT 333.3 302.8 over the past three years Add: depreciation and amortisation 33.6 38.0 Underlying EBITDA 366.9 340.8 Investment cash flow includes: – $46m in listed
Slide 13: Financials | Balance Sheet
Financials | Balance Sheet Reduction in trade receivables mainly due to As at As at As at Change property settlements and High Court judgement $m 30 Jun 17 30 Jun 16 30 Jun 16 % Inventories reduction due to lower equipment (adjusted) (adjusted) inventory, partially offset by increased parts Trad
Slide 14: Financials | Debt Maturity Profile of Continuing Operations
Financials | Debt Maturity Profile of Continuing Operations At 30 June 2017, the Group had $810m of available undrawn borrowing facilities (excluding China) Current “<1 year” debt includes a number short-term OEM facilities that are regularly rolled over for further terms and are categorised as
Slide 15: Financials | Capital Management
Financials | Capital Management 5% increase in final dividend to 21cps, fully franked Policy of maintaining the dividend has provided reliable, fully franked cash returns for shareholders over an extended period of time TELYS dividends have been paid consistently since first issued by Seven Netw
Slide 16: WesTrac Australia
WesTrac Australia Our highly trained technicians help our customers achieve world-leading machine productivity
Slide 17: Industrial Services | WesTrac Australia
Industrial Services | WesTrac Australia Value proposition WesTrac enables customers in the resource and construction industries to reduce lifecycle equipment ownership costs, thereby minimising new capital investment while maximising production We are investing in technology and utilising data i
Slide 18: Case Study | Enabling Customer Performance
Case Study | Enabling Customer Performance “We have analysed BHP Billiton’s equipment classes by their maintenance cost and business priority to identify where standardisation could have larger benefits. This led to a focus on our Caterpillar 793F trucks.” “…we anticipate [this] will result in cost
Slide 19: Industrial Services | WesTrac Australia
Industrial Services | WesTrac Australia Trading revenue up 3% YoY Product sales down 22%, impacted by a $148m reduction in Roy Hill deliveries from the prior year; however non-mining sales were up 11%, Product mainly in the construction sector sales Signs of mining capital recovery emerging with
Slide 20: Coates Hire
Coates Hire Coates Hire is a leading supplier of equipment to the infrastructure sector
Slide 21: Coates Hire | Positive outlook for infrastructure projects
Coates Hire | Positive outlook for infrastructure projects Coates Hire and WesTrac set to capture further upside Strong growth in infrastructure activity on the East Coast has improved demand for construction equipment and heavy machinery Further upside to be captured given that peak investment
Slide 22: Industrial Services | Coates Hire
Industrial Services | Coates Hire Strong growth from East Coast infrastructure NSW and VIC businesses continue to perform well through infrastructure and construction activity with revenue up ~15% in both states partially offset by the continued softer trading conditions particularly in WA Group
Slide 23: Media
Media Seven West Media - delivering engagement and value through powerful storytelling
Slide 24: Media | Seven West Media
Media | Seven West Media $m FY17 FY16 Change Strong ratings and revenue share but result impacted by non-cash impairments SWM share of associate NPAT 1 68.3 85.0 -20% Total impairments of $912m after tax reflecting the impact of declining Other investment income 1.4 3.3 -58% growth on asset carryi
Slide 25: Energy
Energy Longtom is positioned to deliver 80 PJ of gas into the East Coast market (Photo: Matthew Bewley)
Slide 26: Energy | Asset Overview
Energy | Asset Overview Focus on bringing gas to market $m FY17 FY16 We have gas available and we are working on bringing it to market Sale of gas and condensate 4.6 5.7 Other income - 3.2 Significant upside opportunity seen in East Coast gas contract prices given the well-publicised shortage of
Slide 27: Energy | Beach Energy Investment
Energy | Beach Energy Investment Strong FY17 operating performance $m FY17 FY16 Record full year production of 10.6 MMboe, up 9% on previous year Production (Mmboe) 10.6 9.8 Underlying NPAT of $162m significantly improved on $36m in prior year Sales revenue 649.3 558.0 Cost focused culture evi
Slide 28: Investments
Investments The “Kodo“ development in Adelaide will provide 208 apartments over 30 storeys
Slide 29: Investments | Property and Listed Portfolios
Investments | Property and Listed Portfolios $m FY17 FY16 Property impacted by slowdown in Perth market Revenue 5.4 11.8 KS5, KS6 and KS7 development deferred until market improves Other income 35.7 36.5 Associate NPAT share 0.5 1.5 12 lots sold at the Dianella residential development compared t
Slide 30: Outlook | Key Takeaways and Questions
Outlook | Key Takeaways and Questions Focus on continued Capturing parts and Strong operating Driving shareholder strategy execution service opportunity in cash flow through value through capital a stronger market the cycle management We remain committed and Our parts performance is Our market-leadi
Slide 31: FY17 Results Presentation | 22 August 2017 | 31
FY17 Results Presentation | 22 August 2017 | 31