North American Construction Group Ltd. · TSX:NOA
North American Construction — Q1 2020 Earnings Presentation
17 slides from North American Construction's earnings presentation, May 8, 2020
Slide 1: Corporate Presentation – 2020 Q1 Results
CORPORATE PRESENTATION - 2020 Q1 RESULTS - May 7, 2020
Slide 2: Everyone Gets Home Safe
EVERYONE GETS HOME SAFE Health, Safety and Environment are integral to our business ▪ COVID-19 pandemic has reinforced our culture and conviction of keeping employees safe ▪ Execution of safe work practices matters above all else Total Recordable Exposure Hours 1 Injury Frequency 4.2 4.2 3.4 3.1 2.7
Slide 3: Business Update
BUSINESS UPDATE ▪ Strong Q1 2020 showcased the revenue potential of our well-maintained heavy equipment fleet ▪ Favorable operating conditions throughout the 2019/2020 winter season generated high operating hours ▪ Maintenance investments provided upside in equipment reliability ▪ Since mid-March, f
Slide 4: Revised Operational Plan for 2020
REVISED OPERATIONAL PLAN FOR 2020 In response to the impact that COVID-19 has had on our customers & operations, we have reiterated and restated six priorities for 2020 1. Urgent attention paid to hygiene and physical distancing; uphold zero harm safety culture 2. Deploy & maximize utilization of av
Slide 5: Adjusted EBITDA and EPS
ADJUSTED EBITDA1 AND EPS (figures in millio ns o f Canadian do llars, except per share amo unts) Q1 2020 Q1 2019 Change Revenue $199 $186 $12 1 Gross profit 35 17.4% 30 15.9% 5 1.5% 2 General & administrative expenses 9 4.4% 9 4.7% 0 -0.3% Net income 19 7 12 Earnings per share (EPS) $0.74 $0.29 $0.4
Slide 6: Cash Provided by Operating Activities
CASH PROVIDED BY OPERATING ACTIVITIES (figures in millio ns o f Canadian do llars unless o therwise stated) Q1 2020 Q1 2019 Change Cash provided by operations prior to change in working capital 1 $55) $45) $10) Net changes in non-cash working capital (6) 2) (8) Cash provided by operating activities
Slide 7: Balance Sheet
BALANCE SHEET (figures in millio ns o f Canadian do llars unless o therwise stated) March 31, 2020 December 31, 2019 December 31, 2018 Cash $39 $6 $20 Liquidity 1 108 115 116 Property, plant & equipment 617 588 528 Total assets 837 793 690 Senior debt 1,2 $362 2.0x $296 1.7x $322 3.2x Net debt 1,2 4
Slide 8: Returns on Capital & Equity
RETURNS ON CAPITAL & EQUITY Return on Invested Capital1 – upward trend is currently at 9.9% ▪ Invested capital1 of $626 million continued to climb on growth capital in Q1 28.4% ▪ Strong 2020 Q1 KPIs across the board (revenue, adjusted EPS 1 and adjusted 26.4% EBITDA1) validate acquisition & growth s
Slide 9: 2020 Q2 Estimates
2020 Q2 ESTIMATES 2020 Q2 (figures in C$ millio ns, except per share amo unts) 2020 Q1 Estimates 2019 Q2 KEY MEASURES Adjusted EBITDA1 $60 $21 – $27 $37 Expected reduction of ~35% from 2019 Q2 1 Adjusted EPS $0.70 $0.15 – $0.30 $0.43 Positive earnings based on EBITDA range Sustaining capital 1 $38 $
Slide 10: Appendix
APPENDIX CO aniERican
Slide 11: Company Overview
COMPANY OVERVIEW ▪ Premier provider of mining services and heavy construction in western Canada with over 65 years in business Mining Services Mining ▪ 49% interest in Nuna Group of Companies, the premier mining contractor in northern Canada for more than 25 years ▪ Mobile fleet of over 900 heavy eq
Slide 12: Long Term Oil Sands Contracts
LONG TERM OIL SANDS CONTRACTS ▪ Long-term contracts remain in place with run-of-mine projections averaging 30+ years of remaining life ▪ Oil sands production resiliency through the crisis is a testament to the operating model of mining operations Owner Contract1,2 2000 2010 2020 2030 2040 2050 2060
Slide 13: Heavy Equipment Fleet
HEAVY EQUIPMENT FLEET ▪ As at March 31, 2020, over 900 mobile heavy equipment assets provide operational flexibility ▪ Managed on an individual asset bases and deployed with sole objective of maximum utilization ▪ Fleet count includes ~280 assets operated within Nuna Group of Companies ▪ Commissioni
Slide 14: Nuna Group of Companies
NUNA GROUP OF COMPANIES ▪ Nuna Group of Companies is the premier mining contractor in northern Canada ▪ Formed in 1993, Nuna is the established incumbent contractor on the mine sites in Nunavut and the Northwest Territories ▪ Q3 2019 represented strongest quarter of activity on record with momentum
Slide 15: First Nation & Inuit Partnerships
FIRST NATION & INUIT PARTNERSHIPS 1. Kitikmeot Corporation We take great pride & responsibility in our First Nation & Inuit partnerships ▪ Majority partner in Nuna, Kitikmeot Corporation is a wholly-owned business of Kitikmeot Inuit Association ▪ Our partners enable us to work effectively in bringin
Slide 16: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS The information provided in this presentation contains forward-looking statements and information which reflect the current view of North American Construction Group Ltd. (the “Company”) with respect to future events and financial performance, including the Company’s expec
Slide 17: Non-GAAP Financial Measures
NON-GAAP FINANCIAL MEASURES A non-GAAP financial measure is generally defined by the securities regulatory authorities as one that purports to measure historical or future financial performance, financial position or cash flows, but excludes or includes amounts that would not be adjusted in the most
North American Construction Group — Q1 2020 Earnings Presentation on 6ix