Slide 1: Brokers Presentations cover letter to ASX
For personal use only 22 March 2010 Company Announcements Office Australian Stock Exchange Limited Exchange Centre 20 Bridge Street SYDNEY NSW 2001 Dear Sir/Madam Brokers Presentations Please find attached a copy of the presentation being made to brokers in the Brisbane, Sydney and Melbourne this we
Slide 2: Imdex Limited 1H10 post-results roadshow
For personal use only Imdex Limited 1H10 post-results roadshow March 2010 1H10 post-results roadshow – March 2010 1
Slide 3: Presentation Overview
Presentation Overview For personal use only Overview 1H10 Performance and Operational review Strategy for growth Outlook Appendices 1H10 post-results roadshow – March 2010 2
Slide 4: Overview
For personal use only Overview 1H10 post-results roadshow – March 2010 3
Slide 5: Overview
Overview For personal use only Imdex has a strong position in the global mining and mineral exploration and oil and gas markets through the provision of Drilling Fluids and Chemicals and Down Hole Instrumentation 1H09 represented an historic high in Imdex’s markets, 2H09 was an historic low followin
Slide 6: 1H10 Performance and Operating Review
For personal use only 1H10 Performance and Operating Review 1H10 post-results roadshow – March 2010 5
Slide 7: 1H10... improved performance on 2H09
1H10... improved performance on 2H09 For personal use only Improved operating performance on 2H09 – low point in current cycle (1H09 was high point) Revenue* of $58.4m (2H09: $56.7m; 1H09: $80.3m) Financial Operating EBITA of $7.5m (2H09: $4.5m; 1H09: $20.0m) Cash from operations of $4.6m (2H09: $9.
Slide 8: Recovery in revenues from 2H09 low
Recovery in revenues from 2H09 low For personal use only Revenue * 90 ($m) 80.3 80 72.9 69.1 70 60 57.9 56.7 58.4 50 45.9 40 30 29.8 23.1 20 10 0 1H06 2H06 1H07 2H07 1H08 2H08 1H09 2H09 1H10 Fluids and Chemicals Instrumentation * excludes other income & discontinued operations 1H10 post-results road
Slide 9: Recovery in EBITA from 2H09 low
Recovery in EBITA from 2H09 low For personal use only 25 EBITA * ($m) 19.8 20.0 20.0 20 15 12.2 10 10.1 7.5 5.4 4.5 5 2.0 0 1H06 2H06 1H07 2H07 1H08 2H08 1H09 2H09 1H10 * excludes discontinued operations and non- operational items Continued to invest in productive assets through the cycle Well posit
Slide 10: Drilling Fluids and Chemicals Division
Drilling Fluids and Chemicals Division For personal use only Revenue Performance in line with 2H09 ($m) 60 19% below 1H09 peak 50 50.5 Recovery in 4Q09 followed into 1H10 42.3 41.2 41.0 Africa, Canada and Latin America slower 40 25% of revenue from oil & gas market 30 29.1 New generation solids cont
Slide 11: Down Hole Instrumentation Division
Down Hole Instrumentation Division For personal use only Continuing Revenue 12% improvement on 2H09 ($m) 35 DHI – Oil & Gas 30 29.8 Target tool commercial – ongoing 26.8 development to ensure “best in 25 class” 20 17.4 High temperature tools - commercial 16.9 15.5 15 Drop tool - near commercial 10 M
Slide 12: Decreasing debt levels
Decreasing debt levels For personal use only 45 40 38.9 No outstanding vendor liabilities 35 34.0 33.0 30 AUD and SEK loans paid down as 25 scheduled 20 $6.8m raised in CAD to provide a 15 natural hedge 10 Gearing comfortable at 20.5% 5 - Interest cover (EBITA* : Net Interest) Dec 08 Jun 09 Dec 09 o
Slide 13: Strategy for growth
For personal use only Strategy for growth 1H10 post-results roadshow – March 2010 12
Slide 14: Strategy on track
Strategy on track For personal use only Medium Term Past 1H10 (2- 4 years) Early Stage End-market exposure2 1% 20% Minerals 20% Late Stage 49% 50% Minerals 60% Oil & Gas Management’s best estimate Management’s best estimate Fluids Divisional 19% Profit1 Downhole 43% Instrumentation 50% 57% 31% Servi
Slide 15: Platform for growth
Platform for growth For personal use only Improved customer intimacy Goal Geographic organisation – better structure People strategy – added key executives Increased share Achieving operational efficiencies and long term profitable growth Ongoing consolidation of R&D and manufacturing Enterprise Dep
Slide 16: Outlook
For personal use only Outlook 1H10 post-results roadshow – March 2010 15
Slide 17: Market recovery in FY10/FY11
Market recovery in FY10/FY11 For personal use only Early stages of recovery are present Indications that momentum is building Drillers reporting Long term increased USA land supply/ Greater quality and Increased based oil & demand drilling activity number of commodity gas industry imbalances globall
Slide 18: Further signs of recovery in demand
Further signs of recovery in demand For personal use only Drilling activity determined by metals prices and cash availability Metals prices expected to remain relatively firm during 2010 Early signs of increased 2010 exploration spend by major/intermediate companies * Juniors raised ~US$6bn in 2009
Slide 19: Further signs of recovery in demand (cont)
Further signs of recovery in demand (cont) For personal use only Exploration by commodity: Estimated Exploration Spend Worldwide Gold 44% 14.0 US$ Billions Base Metals 33% 12.0 Diamonds 5% 10.0 Uranium 8% 8.0 Exploration by stage: 6.0 Greenfields 33% 4.0 Minesite/late stage 67% 2.0 Early signs in 20
Slide 20: Further signs of recovery in demand (cont)
Further signs of recovery in demand (cont) 120% For personal use only Peak Tools on hire 100% Up 120% since 80% April 09 low Percentage of Peak 60% Low 40% 20% 0% Nov-07 Nov-08 Nov-09 Oct-07 Oct-08 Oct-09 Mar-08 May-08 Jul-08 Mar-09 May-09 Jul-09 Sep-07 Dec-07 Jan-08 Feb-08 Apr-08 Jun-08 Aug-08 Sep-
Slide 21: Outlook for 2H10
Outlook for 2H10 For personal use only Key initiatives Continued R&D investment to maintain technology leadership Roll out of solids control units in Australia and overseas Global roll out of next generation core tool Further expansion into the oil & gas market (DFC and DHI) Global rebranding of flu
Slide 22: In summary
In summary Whilst market conditions in 1H10 were tough, they were an For personal use only improvement on 2H09 (cyclical low) Imdex’s strategy is sound two divisions – DFC & DHI supplying two main end markets – mining and oil & gas Market fundamentals are improving buoyant commodity prices large, in
Slide 23: Appendices
For personal use only Appendices 1H10 post-results roadshow – March 2010 22
Slide 24: Profit & loss
Profit & loss For personal use only ($m) 1H09 2H09 1H10 Revenue (excl interest income) 80.3 56.7 58.4 EBITDA 21.8 6.0 9.4 Depreciation (1.8) (1.5) (1.9) EBITA 20.0 4.5 7.5 Amortisation (3.6) (3.0) (3.1) Net interest expense (0.7) (0.2) (0.8) Tax expense (5.6) (0.1) (0.7) NPAT before non recurring it
Slide 25: Non-cash impairment write downs
Non-cash impairment write downs Area $m Comment For personal use only 22,260,000 shares Sino Gas and Energy Mark-to-market valuation 4.9 Holdings Original cash cost $0.3m Non core investment AMC performed well. Asia Pacific strong. Other regions slow to recover. Fluids Businesses 11.0 Re-branding to
Slide 26: Conservative balance sheet
Conservative balance sheet ($ millions) Dec 09 Jun 09 Solid working capital ratios For personal use only Net cash 9.7 12.0 Receivables 26.4 23.4 Low gearing Inventory 26.4 26.4 Remain within banking Investment in SGE 15.1 20.5 covenants Fixed assets 11.9 10.8 Intangibles 53.2 79.2 $9.7m cash on hand
Slide 27: Oil & gas – worldwide upstream capex
Oil & gas – worldwide upstream capex For personal use only US$Bn 500 Global spend estimated to 21% have dropped 21% in 2009 400 Still high in historical terms 300 Medium/long term supply/demand imbalances 200 remain Exploration - increasingly 100 complex 0 Good opportunities for 2000 2001 2002 2003
Slide 28: A snapshot of Imdex's business
A snapshot of Imdex’s business For personal use only Drilling Fluids & Chemicals (DFC) Key markets • Consumable item Mining & Mineral • Keep drill holes open and lubricate Exploration moving parts while removing cuttings to the surface • Environmental focus • Manufacture & supply Oil & Gas Down Hole
Slide 29: Disclaimer
Disclaimer For personal use only This presentation has been prepared by Imdex Limited (“the Company”). It contains general background information about the Company’s activities current as at the date of the presentation. It is information given in summary form and does not purport to be complete. Th