Slide 1: FY2016 H1 results presentation
FY2016 H1 results presentation For personal use only Andrew Bellamy, Chief Executive Officer 23 February 2016 Greg Jason, Chief Financial Officer
Slide 2: Highlights
Highlights For personal use only Revenue: $747.4 million Financial EBIT: $29.0 million NPAT: $16.8 million Net cash: $30.6 million Interim dividend: 2.0 cents per share fully franked Maturing major programs: stable performance on EPF and Operational HSSV programmes helped offset anticipa
Slide 3: Revenue and underlying earnings
Revenue and underlying earnings For personal use only Revenue (A$m) EBITDA (A$m) NPAT (A$m) FY2014 FY2015 FY2016 FY2014 FY2015 FY2016 FY2014 FY2015 FY2016 H1 H1 H1 H1 H1 H1 H1 H1 H1 1 2 1 2 505.8 680.2 747.4 37.7 44.9 41.8 14.4 21.0 16.8 Revenue growth reflected favourable foreign exchange transla
Slide 4: Objectives for sustained growth
Objectives for sustained growth For personal use only Strengthen Ongoing Target operations and objectives opportunities balance sheet • Shipbuilding margin • Maintain cash • Invest in R&D to grow achieved generation to support intellectual property programs and dividends base • Focus on applying lea
Slide 5: Financials
Financials For personal use only SHIPS SYSTEMS SUPPORT 5
Slide 6: Earnings summary
Earnings summary For personal use only H1 H1 H1 Revenue grew 10% over the Prior Income Corresponding Period (PCP) driven by FY2016 FY2015 FY2014 statement favourable foreign exchange translation of USA (A$m) (A$m) (A$m) and Philippines results Revenue 747.4 680.2 505.8 US shipbuilding margin in
Slide 7: Cash and debt
Cash and debt For personal use only FY2016 FY2015 FY2014 Strong Operating cash flow Cash flow H1 H1 H1 FY2015 H1 was enhanced by the sale of the (A$m) (A$m) (A$m) stock trimaran ($54.1 million) Operating 51.8 118.0 43.6 Continued discipline in capital expenditure Investing (2.4) (3.6) (2.0)
Slide 8: Discipline in long-term debt reduction
Discipline in long-term debt reduction For personal use only 160 140 135 120 114 112 105 Gross debt ($millions) 100 80 60 40 20 1 - - - 0 Jun 2014 Dec 2014 Jun 2015 Dec-15 AUD Denominated (AUD) USD Denominated (USD) SHIPS SYSTEMS SUPPORT 8
Slide 9: Positive trend in net cash / (debt)
Positive trend in net cash / (debt) For personal use only $ millions 100 Dec 2015 $31 M 50 Dec 2014 Cash Jun 2015 $7 M $(4) M - (Debt) (50) Jun 2013 Dec 2013 $(137) M $(100) M (100) Jun 2014 $(78) M (150) Dec 2012 $(101) M (200) Dec 2012 Mar 2013 Jun 2013 Sep 2013 Dec 2013 Mar 2014 Jun 2014 Sep 2014
Slide 10: Segment breakdown
Segment breakdown For personal use only ($m) Ships Systems Support Other1 Total Revenue 497.7 109.4 31.4 - 638.4 USA EBIT 27.4 0.8 3.3 (4.6) 26.9 EBIT Margin% 5.5 0.7 10.5 - 4.2 Revenue 78.8 - 26.8 - 105.6 Australia EBIT 8.8 - 3.5 (1.0) 11.3 EBIT Margin% 11.2 - 13.0 - 10.7 Revenue 15.1 - 1.2 - 16.3
Slide 11: Operations update
Operations update For personal use only SHIPS SYSTEMS SUPPORT 11
Slide 12: Overview – shipbuilding programs
Overview – shipbuilding programs For personal use only Order book of $2.8 billion at 31 December 2015 secures revenue through CY2020, including: o 10 Littoral Combat Ships for US Navy 10 funded, with 1 delivered, funding for eleventh vessel expected in FY2016 o 10 Expeditionary Fast Transports (fo
Slide 13: Progress across the business
Progress across the business For personal use only • Delivery of USS • Contracts for high Jackson (LCS 6) speed crew boats • Delivery of both high • Awarded LCS • Keel laid on USS speed catamaran • Cape York (CCPB 8) support contract Manchester ferries to Abu Dhabi officially named • USS Omaha (LCS
Slide 14: US Navy – Littoral Combat Ship
US Navy – Littoral Combat Ship For personal use only 10 ship contract awarded as prime contractor, worth US$3.5 billion and additional 1 ship option 2 LCS constructed and delivered by Austal for GD (LCS 2 and LCS 4) Margin and schedule pressure on LCS 6, 8 and 10. Austal implementing experienc
Slide 15: US Navy – Expeditionary Fast Transport
US Navy – Expeditionary Fast Transport For personal use only Formerly Joint High Speed Vessel (JHSV), renamed by US Navy to Expeditionary Fast Transport (EPF) 10 ship award to Austal valued at US$1.6 billion (fully funded), securing work through to CY2017 Program progressing well – matured int
Slide 16: Austal strongly positioned in US
Austal strongly positioned in US For personal use only Winning service contracts on Austal-built vessels have US Foreign Policy remains LCS and investing in support continued to be funded and focused on Asia-Pacific business to best position programs are maturing defence strategy Austal for addition
Slide 17: Australia – Cape Class Patrol Boats
Australia – Cape Class Patrol Boats For personal use only $330 million contract for the design, construction and through-life support of 8 Cape Class Patrol Boats for the Australian Border Force Final vessel delivered in August 2015 Austal now performing through-life support on 8 completed ves
Slide 18: Australia – High Speed Support Vessels
Australia – High Speed Support Vessels For personal use only US$124.9 million contract for the design, construction and integrated logistics support of two 72 metre High Speed Support Vessels for the Royal Navy of Oman Construction is progressing well at the Henderson shipyard o Sea trials HSSV
Slide 19: Australian defence shipbuilding
Australian defence shipbuilding For personal use only The Federal Government's plan for a strong and sustainable naval shipbuilding industry was announced 4 August 2015 and remains a firm priority for the Turnbull Government Initiative Impact on Austal The Government will invest over A large, long
Slide 20: Australian defence shipbuilding
Australian defence shipbuilding For personal use only Initiative Impact on Austal Advancing the Future Frigate Variant of Austal’s LCS is a potential platform for future frigate. programme to replace the ANZAC (Upgunned LCS soon to be classed as a frigate by US Navy) class frigates from CY2023 to Ot
Slide 21: Philippines
Philippines For personal use only Delivered two 45 metre high speed catamaran ferries to Abu Dhabi National Oil Company in August 2015 under a $30 million design and construct contract Commenced construction of two crew boats, to be delivered in Q3 CY2016: o 70 metre catamaran under US$34 millio
Slide 22: Systems and Support
Systems and Support For personal use only Austal is steadily adding experience and capability to deliver a growing portfolio of Naval sustainment contracts US expanding activity beyond own vessels: o Prime contractor for Post Shakedown Availability (PSA) and other post delivery test and trial pr
Slide 23: Strategy and Outlook
Strategy and Outlook For personal use only SHIPS SYSTEMS SUPPORT 23
Slide 24: Strategy
Strategy For personal use only Sustain the Strengthen the Diversify the Scale the business business business business • Maintain current • Improve margins • Grow annuity-style • Position Austal for annual revenue in by driving revenue by building future Navy medium to long- efficiencies / on existin
Slide 25: Pipeline for vessel programs
Pipeline for vessel programs For personal use only Pursuing opportunities to deliver on strategy by growing Austal’s order book and securing additional long-term revenue Target markets Vessels • US: strong potential to extend existing • Future frigate evolved from modified LCS and EPF programs Lit
Slide 26: Outlook
Outlook For personal use only LCS program to stabilise Good opportunity for award Best position Austal for and mature – greatest effect of additional LCS and EPF Pacific Patrol Boat to be on vessels at early in addition to existing block replacement, Future Frigate, stage construction buy contracts
Slide 27: Disclaimer
Disclaimer For personal use only Andrew Bellamy, Chief Executive Officer Telephone: +61 8 9410 1111 For further information visit www.austal.com Disclaimer This presentation and any oral presentation accompanying it has been prepared by Austal Limited (“Austal”). It should not be considered as an of