Emeco Holdings Limited · ASX:EHL
Emeco — FY2018 Earnings Presentation
22 slides from Emeco's earnings presentation, Aug 21, 2018
Slide 1: 2018 Full Year Results
For personal use only Emeco Holdings Limited 2018 Full Year Results 21 August 2018
Slide 2: Important Notices and Disclaimer
IMPORTANT NOTICES AND DISCLAIMER Reliance on third party information For personal use only The information and views expressed in this Presentation were prepared by Emeco Holdings Ltd (the Company) and may contain information that has been derived from publicly available sources that have not been i
Slide 3: Results Overview
For personal use only Results Overview Ian Testrow Managing Director and CEO 2
Slide 4: FY18 Highlights
FY18 HIGHLIGHTS Emeco continues to execute on its strategy to become a high quality and low cost provider of equipment rental solutions, with increased scale, enhanced maintenance capabilities and a stronger balance sheet For personal use only People and Financial Operational Strong balance sheet Po
Slide 5: People and Safety
PEOPLE AND SAFETY Emeco is a leading employer with the safety of our people remaining the top priority For personal use only • Emeco continues to build its workforce with ~500 employees across Injury frequency rates Australia as at 30 June 2018, including ~350 skilled tradespeople and 24 apprentices
Slide 6: Australian Rental
AUSTRALIAN RENTAL Rental revenue increased by 81.2% and EBITDA was up by 120.7% For personal use only Overview Revenue by commodity • Revenue of $355.2 million (up 81.2%) and EBITDA1 of $168.2 million (up 120.7%), Lithium, 1% Civil, 2% driven by the rental fleet approximately tripling over the past
Slide 7: Workshops
WORKSHOPS Force acquisition provided Emeco with four strategically located workshop facilities, expanding Emeco’s customer offering and providing low capital intensive earnings For personal use only Overview • Force has major maintenance facilities strategically located close to key customer sites i
Slide 8: Financial Performance
For personal use only Financial Performance Justine Lea Chief Financial Officer 7
Slide 9: Profit and Loss
PROFIT AND LOSS Emeco generated positive operating net profit after tax, the first time since FY13 For personal use only Overview Operating financial performance1 • Group operating revenue up 63.5% on FY17 • Operating EBITDA of $153.0 million (up 83.2% on FY17), with operating A$m unless otherwise s
Slide 10: Cash Flow
CASH FLOW Emeco’s strong earnings and capital expenditure discipline has resulted in significant cash generation For personal use only Overview Cash flow summary from continuing operations • Stronger operating EBITDA drove improved operating free cash flow performance A$ million FY17 FY18 Operating
Slide 11: Balance Sheet
BALANCE SHEET Emeco is focused on continued deleveraging to facilitate refinancing on more attractive terms For personal use only Overview Leverage metrics continue to improve • Through strong operating cash flows and equity funded acquisitions, Emeco reduced net debt / pro forma run rate operating
Slide 12: Strategy and Outlook
For personal use only Strategy and Outlook Ian Testrow Managing Director and CEO 11
Slide 13: Strategy & Outlook
STRATEGY & OUTLOOK Substantial earnings growth potential given the significant fleet size For personal use only Historical Australian fleet (excludes support equipment), revenue and return on assets Fleet size (no. of machines) / revenue ($m) 900 40% 800 Return on assets (%) 30% 700 600 20% 500 10%
Slide 14: FY19 and Beyond
FY19 AND BEYOND Emeco is strategically well positioned to build earnings from its strong market position and improved balance sheet For personal use only — Strong underlying levels of activity in early FY19 What we're — Limited supply of equipment and longer lead times seeing in the market — Custome
Slide 15: Appendix: Additional Regional Information
For personal use only Appendix: Additional Regional Information 14
Slide 16: Queensland
QUEENSLAND Queensland continues to grow as a result of increased scale and strengthening market conditions For personal use only Overview Operating revenue • Strong growth in FY18 through integration of acquired businesses and 150 improving existing fleet utilisation and rates 123.0 Revenue (A$m) 12
Slide 17: New South Wales
NEW SOUTH WALES New South Wales continues to be a stable contributor For personal use only Overview Operating revenue • Mature customer base continues to deliver strong base earnings with limited 120 101.6 contribution from acquisitions in comparison to Western Australia and Queensland 86.0 Revenue
Slide 18: Western Australia & South Australia
WESTERN AUSTRALIA & SOUTH AUSTRALIA Significant increase in the scale of Western Australia and South Australia following acquisitions For personal use only Overview Operating revenue • Strong growth in FY18 from contribution of acquired businesses 120 107.1 • The WA/SA business face some challenges
Slide 19: Appendix: Operating to Statutory Reconciliation
For personal use only Appendix: Operating to Statutory Reconciliation 18
Slide 20: Operating to Statutory Reconciliation
OPERATING TO STATUTORY RECONCILIATION For personal use only FY18 FY18 FY174 FY174 A$m unless otherwise stated Statutory Operating Statutory Operating Revenue 381.0 381.0 196.0 233.0 EBITDA1 130.7 153.0 51.9 83.5 EBITDA1 margin 34.3% 40.2% 26.5% 35.8% EBIT2 49.7 83.2 (85.8) 12.0 NPAT3 5.3 20.1 (157.2
Slide 21: Operating to Statutory Reconciliation
OPERATING TO STATUTORY RECONCILIATION For personal use only A$m unless otherwise stated FY18 FY17 Statutory NPAT from continuing operations 5.3 (157.1) Adjusted for: Business acquisition and restructuring costs - 88.0 Impairment expense 11.2 8.2 Depreciation and Amortisation 69.9 54.7 Net Finance co
Slide 22: Thank you
For personal use only Thank you emecogroup.com