Slide 1: Downer Group 2015 Full Year Results
Downer Group 2015 Full Year Results 6 August 2015
Slide 2: Financial overview
Financial overview Net Profit After Tax (NPAT) $210.2 million, down 2.7% Earnings Earnings Before Interest and Tax (EBIT) $309.7 million, down 9.2% Return on Funds Employed (ROFE) 14.7%, down from 16.8% Revenue Total revenue1 $7,430.1 million, down 3.9% Cash flow Operating cash flow $486.5
Slide 3: New segment reporting
New segment reporting Downer announced a restructure of its business in January 2015. For ease of analysis, Downer has reported its segment results under both the former operating structure (Infrastructure, Mining, Rail) and the new service line structure (Transport Services; Technology and Communic
Slide 4: Transport Services
Transport Services Total revenue1 $m EBIT $m Comprises the Group’s road, rail, airport and port infrastructure businesses 2,014.1 1,867.0 96.2 91.3 Strong performance by NSW and Victorian road services offset by tougher conditions for Queensland road services; rail infrastructure below expectati
Slide 5: Technology and Communications Services
Technology and Communications Services Total revenue1 $m EBIT $m Comprises the Group’s fibre, copper and radio network infrastructure businesses 495.5 459.7 25.7 17.9 Revenue up 7.8%, EBIT up 43.6% Awarded a new five-year contract by nbnTM in June 2015 to continue rolling out the NBN under the
Slide 6: Utilities Services
Utilities Services Total revenue1 $m EBIT $m Comprises the Group’s power, gas and water network infrastructure and renewable energy businesses 583.5 358.8 34.0 28.0 Includes eight months’ contribution from Tenix - $387.4 million revenue, $16.6 million EBIT ($23.2 million EBIT excluding amortisat
Slide 7: Engineering, Construction & Maintenance
Engineering, Construction & Maintenance Total revenue1 $m EBIT $m Comprises the Group’s industrial and commercial construction and maintenance businesses and 1,889.3 2,040.6 51.5 71.6 resource based consultancies, QCC and Mineral Technologies (MT) Challenging year due primarily to $11.4 million
Slide 8: Mining
Mining Total revenue1 $m EBIT $m Revenue and EBIT declines due to a number of contract completions and volume reductions 1,589.7 1,982.9 132.6 171.4 Fewer opportunities for blasting business and pricing pressure on Ammonium Nitrate supply Several contract wins during the year: ― Blackwater coa
Slide 9: Rail
Rail Total revenue1 $m EBIT $m Lower revenue due to completion of passenger manufacture contracts 873.5 1,002.9 27.5 22.1 Increased EBIT driven by productivity improvements, lower restructuring costs and strong contribution from Keolis Downer (Yarra Trams, Gold Coast Light Rail) Awarded 10 yea
Slide 10: Group financials
Group financials
Slide 11: Financial performance
Financial performance $m FY15 FY14 Change (%) Total revenue1 7,430.1 7,734.6 (3.9) EBITDA 562.8 607.5 (7.4) EBIT 309.7 341.1 (9.2) Net interest expense (29.9) (43.0) 30.5 Tax expense (69.6) (82.1) 15.2 Net profit after tax 210.2 216.0 (2.7) EBIT margin 4.2% 4.4% Effective tax rate 24.9% 27.5% ROFE2
Slide 12: Summary of earnings
Summary of earnings $m Total Transport Tech & Utilities EC&M Mining Rail Corp Comm Statutory EBIT 309.7 96.2 25.7 34.0 51.5 132.6 27.5 (57.8) Add back unfavourable item: • Restructuring costs 21.6 5.4 0.9 2.6 0.8 5.6 3.7 2.6 • Tenix acquisition costs 5.2 5.2 • Consultancy losses 16.9 11.4 5.5 Less f
Slide 13: Operating cash flow
Operating cash flow $m FY15 FY14 EBIT 309.7 341.1 Add: depreciation & amortisation 253.1 266.4 EBITDA 562.8 607.5 Operating cash flow 486.5 583.4 Add: Net interest paid1 25.2 43.3 Tax paid 49.0 41.7 Waratah Train Project net cash (inflow)2 (62.6) (93.0) Adjusted operating cash flow 498.1 575.4 EBITD
Slide 14: Cash flow
Cash flow $m FY15 FY14 Total operating 486.5 583.4 Net capital expenditure (98.3) (249.6) Tenix, ATE and VEC acquisitions (368.3) - Other (31.6) (29.2) Total investing (498.2) (278.8) On-market share buy-back1 (11.7) - Net proceeds/(repayment) of borrowings 79.7 (260.9) Dividends paid (114.8) (95.6)
Slide 15: Debt maturity profile
Debt maturity profile 500 Finance leases USPP (completed July 2015) 400 USPP ECA finance A$m Equivalent A$MTN 300 Syndicated bank facility Bilateral bank facilities 200 100 0 Dec-15 Dec-16 Dec-17 Dec-18 Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 Dec-24 Dec-25 Jun-16 Jun-17 Jun-18 Jun-19 Jun-20 Jun-21 Jun-22
Slide 16: Balance sheet and capital management
Balance sheet and capital management $m FY15 FY14 Total assets 4,004.4 3,868.4 Total shareholders’ equity 2,035.3 1,962.0 Net debt1 179.0 32.7 Gearing: net debt to net debt plus equity 8.1% 1.6% Gearing (including off balance sheet debt)2 14.0% 9.2% Adjusted net debt / adjusted EBITDAR3 1.9 1.8 Inte
Slide 17: Outlook
Outlook
Slide 18: Work-in-hand: $18.5 billion
Work-in-hand: $18.5 billion By Division - old structure By Division1 – new structure By contract type1 Infrastructure - AUS $7.6b (41%) Rail $5.1b (27%) Fixed Price / Lump Sum $6.3b (34%) Infrastructure - NZ $2.7b (15%) Transport Services $4.3b (24%) Schedule of Rates $5.7b (31%) Mining $3.1b (17%)
Slide 19: Outlook
Outlook • Downer’s business mix has provided a sound base • Providing guidance for the 2016 financial year has proven more difficult than in the past five years • In this environment, it is difficult to predict the flow of uncontracted revenue, which is slightly higher than at this time last year •
Slide 20: Supplementary information
Supplementary information
Slide 21: Group revenue – FY14 to FY15
Group revenue – FY14 to FY15 Revenue movement – FY14 to FY15 ($m) 8,000 7,735 (1,479) 387 (38) 7,430 1,002 7,000 (177) 6,000 5,000 4,000 © Downer Group Limited All rights reserved Page 21
Slide 22: FY15 audited segment reporting
FY15 audited segment reporting The tables below show FY15 revenue and EBIT under the former and new reporting structures. HISTORICAL REPORTING STRUCTURE 2015 Infrastructure Infrastructure Mining Rail Unallocated Total $m Australia New Zealand Segment revenue 3,669.4 1,202.0 1,532.4 611.6 4.5 7,019.9
Slide 23: New divisional structure – historical financials
New divisional structure – historical financials Technology and Transport Services Communications Services Utilities Services 2,500 500 600 400 500 2,000 400 1,500 300 300 Revenue ($m) 1,000 200 200 500 100 100 0 0 0 FY13 FY14 FY15 FY13 FY14 FY15 FY13 FY14 FY15 100 30 35 25 30 80 25 20 60 EBIT ($m)
Slide 24: New divisional structure – historical financials
New divisional structure – historical financials EC&M Mining Rail 3,000 3,000 1,600 2,500 2,500 1,200 2,000 2,000 1,500 1,500 800 Revenue ($m) 1,000 1,000 400 500 500 0 0 0 FY13 FY14 FY15 FY13 FY14 FY15 FY13 FY14 FY15 160 200 60 120 150 40 EBIT ($m) 80 100 20 40 50 0 0 0 FY13 FY14 FY15 FY13 FY14 FY1
Slide 25: Debt and bonding facilities
Debt and bonding facilities Debt facilities $m Debt facilities by type % Total facilities 1,158.1 Syndicated bank facility 34 Drawn 548.1 A$MTN 34 Available facilities 610.0 Bilateral bank facilities 18 Cash 372.2 ECA finance 9 Total liquidity 982.2 Finance leases & other 4 USPP2 1 100 Bonding facil
Slide 26: Disclaimer
Disclaimer Reliance on third party information This Presentation may contain information that has been derived from publicly available sources that have not been independently verified. No representation or warranty is made as to the accuracy, completeness or reliability of the information. No respo
Slide 27: Downer
Downer | Relationships creating success