Als Ltd. · ASX:ALQ
Als — Investor Day (November 2015)
74 slides from Als's investor day presentation, Nov 3, 2015
Slide 1: Investor Day
For personal use only Investor Day Greg Kilmister – ALS overview Mark Beach – Reservoir Characterisation (Oil & Gas) - facilitated by Morgans Fraser Louden – Production Solutions (Oil & Gas) John Mackie – Drilling Services (Oil & Gas) Houston – Texas - USA Bruce McDonald – Geochemical Business Strea
Slide 2: Important Notice and Disclaimer
IMPORTANT NOTICE AND DISCLAIMER For personal use only • This presentation has been prepared by ALS Limited, (ALS or the Company). It contains general information about the Company’s activities as at the date of the presentation. It is information given in summary form and does not purport to be comp
Slide 3: Company Profile
Company Profile For personal use only geochemistry ALS Limited (ASX:ALQ) is an ASX 100 company that provides professional tribology metallurgy technical services to the global Mineral and Energy Resources (exploration, extraction, processing and trading), Life mineral Sciences (environmental, food a
Slide 4: Compliance and Sustainability
Compliance and Sustainability Core values of “Safety as a Priority” and “Honesty and Integrity” supported by For personal use only • long term compliance program. • Strong internal controls maintained by compliance portal which incorporates company policies, management sign-offs, environmental monit
Slide 5: Health Safety and Environment
Health Safety and Environment Performance at a glance: For personal use only LTIFR better than ASX TRIFR 50% reduction Decreasing All divisions meeting Top 100 average*. over 4 years. severity rate. target PPI score. ASX Top 100 ave. = 3.3 Group LTIFR Group TRIFR Duration Rate (Ave. Days Lost) PPI S
Slide 6: Dividend and Debt Position
Dividend and Debt Position Mar-14 Sept-14 Mar-15 For personal use only Australian versus Off-shore Profits Funding statistics c Gearing ratio Comfort 45% 33.9% 35.5% 38.3% o v Australian Profits Off-shore Profits d Leverage (net debt / EBITDA) Max 3.25 2.2 2.7 2.5 e e 100% n EBITDA interest cover Mi
Slide 7: First Half FY16 guidance
First Half FY16 guidance For personal use only NPAT (AUD$mn) 140 120 100 80 60 40 20 0 H1 FY05 H2 FY05 H1 FY06 H2 FY06 H1 FY07 H2 FY07 H1 FY08 H2 FY08 H1 FY09 H2 FY09 H1 FY10 H2 FY10 H1 FY11 H2 FY11 H1 FY12 H2 FY12 H1 FY13 H2 FY13 H1 FY14 H2 FY14 H1 FY15 H2 FY15 H1 FY16 ALS expects that underlying N
Slide 8: H1FY16 – Revenue by Region by Division
H1FY16 – Revenue by Region by Division For personal use only Mineral Division Life Sciences Division Industrial Division Energy Division 8 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 9: Strategic Goal
Strategic Goal in a nut shell…… For personal use only To be the market leader in any geography or market sector we operate - by creating an enduring competitive advantage. what does that look like…… • Technical leadership • Innovative services • Continually evolving services • Holistic full service
Slide 10: Group Strategy – geographies & markets
Group Strategy – geographies & markets H1FY16 For personal use only 7% H1FY11 revenue H1FY06 revenue +$700mn revenue $419mn $97mn 20% 44% 32% 34 42 % % 34% 31% Australia Asia South America North America Africa Europe Middle East 36% 31 65 % 37% % 36% 19% Environmental Food/Pharma Consumer Products G
Slide 11: ALS Laboratory Revenue – strategic mix
ALS Laboratory Revenue – strategic mix Revenue by Quarter For personal use only 100% H1FY16 80% Cyclical Cyclical Non-Cyclical 60% Engineering 40% Inspection 20% Non-Cyclical Metallurgy 0% Dec-01 Dec-04 Dec-07 Dec-10 Dec-13 Jun-00 Mar-01 Sep-02 Jun-03 Mar-04 Sep-05 Jun-06 Mar-07 Sep-08 Jun-09 Mar-10
Slide 12: ALS Strategic Assets
ALS Strategic Assets For personal use only Network Brand Systems Technology Culture ALS Strategic Asets • 408 sites • quality • LIMS • state-of-the-art • people • 73 countries • timeliness • MIS • innovators • training • 6 continents • service • standardisation • standardisation • focus • global IT
Slide 13: Reservoir Characterisation
RESERVOIR CHARACTERISATION For personal use only Investor Day - facilitated by Morgans Mark Beach – Reservoir Characterisation (Oil & Gas) • Houston – Texas - USA • 2nd November 2015 13 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 14: Reservoir Characterization – The laboratory services part of Oil & Gas
Reservoir Characterization – “The laboratory services part of Oil & Gas” For personal use only • What is Reservoir Characterization? Understanding the reservoir rock and fluid properties to optimize lifetime reservoir performance through exploration, development, and production. • ALS Oil & Gas Re
Slide 15: Surface Logging Services
Surface Logging Services For personal use only • Four legacy companies combined to create one of the largest and most experienced surface logging entities in the highly fractured US market. • The broadest range of capabilities and services in the industry Strategic Direction: Offshore Grow Market Sh
Slide 16: Surface Logging Services
Surface Logging Services For personal use only BHI Rig Count Oct 30, 2015 (775 rigs): ALS Surface Logging is positioned to efficiently service the industry drilling activity and localized needs with offices located in: • Gulf Coast & GOM • Permian • Mid Continent • Rockies • Northeast Well positione
Slide 17: Surface Logging Rentals
Surface Logging Rentals A leading supplier of gas detection Key differentiating strength in software For personal use only equipment to the North American and systems (MPLOT). market with two primary competitors. Rental Units OUT & US Rig Count 2500 500 Rental Units OUT 450 2000 400 350 1500 300 250
Slide 18: Reservoir Laboratories Overview
Reservoir Laboratories Overview For personal use only • The upstream oil & gas laboratory market is split into two tiers: three global oilfield specialists many technical niche and geographically limited labs • The industry is not totally satisfied with these options due to TAT, pricing, & trans
Slide 19: Reservoir Laboratories
Reservoir Laboratories London, UK For personal use only Houston, USA • 20 years providing wellsite handling services. • 27 years providing • Global leader in advanced wellsite services in North Sea & Africa. advanced cuttings • One of the largest core repositories in the region. analysis services. •
Slide 20: Reservoir Laboratories Strategy
Reservoir Laboratories Strategy Leverage unique opportunities Provide a distinctive value Demonstrate operational For personal use only to take possession of samples proposition through key excellence and service technical differentiators quality Core Fresh core from ALS O&G Coring or direct engagem
Slide 21: Production Solutions
PRODUCTION SOLUTIONS For personal use only Investor Day - facilitated by Morgans Fraser Louden – Production Solutions (Oil & Gas) • Houston – Texas - USA • 2nd November 2015 21 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 22: Introduction - ALS Production Solutions – What we do
Introduction - ALS Production Solutions – What we do For personal use only • Well Intervention Field Services Thru Tubing Tools Specialists (Milling & Fishing) • Well Intervention Tools Design & Manufacturing • Pipeline & Asset Monitoring Fibre Optic Leak and Security Monitoring • Permanent We
Slide 23: ALS Production Solutions – Mixed Activity Phases
ALS Production Solutions – Mixed Activity Phases For personal use only • Drilling & Completion Phase Decline FRAC Plug Milling (Wellvention) Permanent monitoring (Omega) • Production Phase Memory Well Monitoring (Omega) Growth Fishing & well intervention services (Wellvention) • Mid Stream P
Slide 24: ALS-Wellvention - First choice for Thru Tubing services
ALS-Wellvention - First choice for Thru Tubing services For personal use only • Known as the Thru Tubing Tools ‘specialists’ • Contracted directly to operators or through major service companies • Growing geographically through high performance reputation • Seven international locations • USP’s Sp
Slide 25: Wellvention & Global Coiled Tubing Trends
Wellvention & Global Coiled Tubing Trends • Business standing up well in several areas For personal use only • Statistics can be misleading • Strong focus upon Geographic Growth Region ALS – Wellvention Revenue Trend 2015 vs 2014 ytd USA & Mexico +532%* Canada +112% Middle East +105% Global Coiled T
Slide 26: ALS-Omega Well Monitoring – First choice for reliable gauges
ALS-Omega Well Monitoring – First choice for reliable gauges For personal use only • Product sales, rentals and field services • Permanent and memory gauges • Globally respected Brand Name • Five International locations • USP’s – Rental of permanent systems – One stop shop for complete system – Besp
Slide 27: Production Solutions – Part of ALS Oil & Gas Division
Production Solutions – Part of ALS Oil & Gas Division (Energy) For personal use only Production As % of Oil & Gas As % of Oil & Gas Solutions Division 2015 Division 2014 Contribution ytd Revenue 32% 24% Staff 23% (166) 19% (229) Countries 9* 8* Global Market Share* <5% <5% * - Actual Production Solu
Slide 28: Strategy in a Downturn – Mid Stream refocus for Omega Monitoring
Strategy in a Downturn – Mid Stream refocus for Omega Monitoring For personal use only Fiber Optic Pipeline Monitoring Why? • Leak detection • Can detect leaks instantly • Security • Greatly reduce environmental damage • Reduce number of pipeline fatalities • Leak is located to within metres - low e
Slide 29: Pipeline Monitoring – The costs of pipeline incidents in USA
Pipeline Monitoring – The costs of pipeline incidents in USA For personal use only • $243m property damage in 2015 • $7bn property damage in 20yrs • Around 280 incidents/yr • 20 fatalities in 2014 (average 13) Data Source: US DOT Pipeline and Hazardous Materials Safety Administration – 29th Oct 2015
Slide 30: Pipeline Monitoring – The costs of pipeline incidents in USA
Pipeline Monitoring – The costs of pipeline incidents in USA For personal use only Omega Pipeline Monitoring Services • 33% Sales Revenue growth in 2015 • 41% growth in number of projects • A swiftly growing Omega service • Few ‘service’ competitors Data Source: US DOT Pipeline and Hazardous Materia
Slide 31: Strategy in a downturn - Technology Innovation Delivers Added Value
Strategy in a downturn - Technology Innovation Delivers Added Value For personal use only New Technologies delivered include: • Pressure Activated Circulating Sub • InfoCoil system for real time data on coiled tubing (Real-Time Coil) • SubSea Coil Disconnect system • FlowMaster permanent FRAC plug •
Slide 32: Summary Production Solutions
Summary For personal use only Production Solutions Delivering business growth via • Geographic expansion • New Activity Phase focus • Value added Technologies • Market share leverage 32 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 33: Drilling Services
DRILLING SERVICES For personal use only Investor Day - facilitated by Morgans John Mackie – Drilling Services (Oil & Gas) • Houston – Texas - USA • 2nd November 2015 33 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 34: Global Rig Counts - Market Decline
Global Rig Counts - Market Decline For personal use only 34 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 35: Worldwide E&P Spending Declining
Worldwide E&P Spending Declining UDS$ billion 2013A 2014A 2015E 2013-14 % 2014-2015% For personal use only North America $176 $194 $125 +9.9% -35.2% Middle East $35 $40 $43 +15.5% +5.9% Latin America $74 $77 $70 +3.5% -8.7% Russia $48 $44 $35 -8.1% -19.9% India – Asia – Australia $108 $106 $91 -1.6%
Slide 36: ALS Oil & Gas Drilling Services Locations
ALS Oil & Gas Drilling Services Locations For personal use only 36 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 37: Improving Cost Base
Improving Cost Base For personal use only • Australia – Asia (Coring) • Canada - America (Coring) • Change Operating model in Africa (Libya, Tunisia ) • Middle East- Europe ,Africa (Drilling Tools ) 37 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 38: 2014-15 Global Coring Market Share and Competitor landscape
2014-15 Global Coring Market Share and Competitor landscape For personal use only 10% 25% 8% 14% 23% 20% Baker Hughes ALS CorPro Halliburton National Oilwell Varco Canamera (US/Canada) Others 38 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 39: Coring Capabilities
Coring Capabilities For personal use only Wireline Pressurized Offshore – deep water Conventional 39 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 40: Coring Innovation - QuickCapture 2.0
Coring Innovation - QuickCapture 2.0 For personal use only A 2nd generation QuickCapture tool is currently in development, with improvements in: • Relief valve reliability • Debris tolerance • Sample canister seal reliability • Safety and serviceability • Corrosion resistance • 4” core system • Key
Slide 41: Coring Innovation - Jam Recovery System - Galileo
Coring Innovation - Jam Recovery System - Galileo Telescopic Jam Recovery System For personal use only • Inner sleeves telescope when core jams, allowing coring operation to continue • 3 ½” Core System – 7 7/8” hole size Developed for North American land market Prototypes tested, ready for field
Slide 42: Drilling Tools
Drilling Tools For personal use only Wedgetail® Roller Reamer Taz® Shingleback® Stabilizers Multiple Activation Circulation Sub* Cedar Drilling Turbines LossMaster™ 42 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 43: Why Reamers Today?
Why Reamers Today ? For personal use only • Reduced Torque • Reduced Vibration • Reduced Stick Slip • Better Stabilization • Improved Well Bore 43 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 44: Down Hole Tools Innovation – Multi Activation Circulating Sub
Down Hole Tools Innovation –Multi Activation Circulating Sub For personal use only The TAZ Tool 44 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 45: Down Hole Tools Innovation - Drilling Turbine Enhancements
Down Hole Tools Innovation - Drilling Turbine Enhancements For personal use only Cedar TCI Radial Bearings Adjustable Double Bent Housing Middle Stab Rig Cedar Power replaceable Section Bottom Sleeve Stab. Rig replaceable Pin or Box Cedar Bearing Ended Drive Section Shaft 45 RIGHT S O L U T I O N S
Slide 46: Down Hole Tools Innovation - 3D Blade profiling
Down Hole Tools Innovation - 3D Blade profiling For personal use only Cedar Turbine Profile Common Turbine Profile 46 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 47: Growth Opportunities
Growth Opportunities For personal use only • Gulf of Mexico • Middle East • Latin America • Asia • India • China 47 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 48: Geochemistry Business Stream
GEOCHEMISTRY BUSINESS STREAM For personal use only Investor Day - facilitated by Morgans Bruce McDonald – Geochemical Business Stream • Houston – Texas - USA • 2nd November 2015 48 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 49: ALS Geochemistry – Part of ALS Minerals Division
ALS Geochemistry – Part of ALS Minerals Division For personal use only Geochemistry Inspection Trade Metallurgy Geochemistry As Percentage of Services ALS Contribution Mineral Division Minerals Revenue 74% Division EBIT 80% EBIT Margin Range 20 – 30% Mine Site Engineering Staff 80% Services Services
Slide 50: Global presence in all important geological provinces
Global presence in all important geological provinces For personal use only Major Mineral Province Hub laboratory Analytical laboratory Preparation laboratory On-site laboratory Anywhere you go – we’ll be there 50 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 51: Global presence in all important geological provinces
Global presence in all important geological provinces For personal use only Current count of 83 active locations world-wide. • Includes 12 dedicated mine-site locations in some of the largest deposits on the planet (Oyu Tolgoi, Las Bambas, Tasiast). • Includes 5 Full Service “Hub” Laboratories ser
Slide 52: ALS Geochemistry Hallmarks
ALS Geochemistry Hallmarks • Flexible Geographic Distribution For personal use only Hub and Spoke Distribution allows scalable business model • Full Scope of Service Meet requirements of industry for all significant commodity groups • Broadly Distributed Analytical Products Highly coordinated
Slide 53: Hub and Spoke Model
Hub and Spoke Model • global operating control For personal use only • continental scope • scalable spokes • capable hubs • reduced quality risk • focused capabilities Hub laboratory Analytical laboratory Preparation laboratory On-site laboratory 53 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 54: Business in a Down Cycle – Hub & Spoke
Business in a Down Cycle – Hub & Spoke For personal use only • Consolidation of Expertise Up Cycle Advantages • Economies of Scale • Load Balancing • Turning down the ‘volume’ inMothballed the Spokesor Closed Restricted Scope Anchorage Bucaramanga Santiago La Serena – Restricted work capacity e.g. 2
Slide 55: Mineral Cycles – Australia as a proxy
Mineral Cycles – Australia as a proxy For personal use only Australian Mineral Exploration Spend (excluding iron ore & coal) in March 2015 AUD$ equivalent 700 58% 37% decrease decrease 600 500 54% AUD $million (Mar-15 equivalent) 44% decrease 54% decrease decrease 400 300 200 100 GFC Induced 7.5 yea
Slide 56: Weathering the Storm
Weathering the Storm For personal use only USD$ Billions 56 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 57: Costs and productivity highly controlled….
Costs and productivity highly controlled…. For personal use only Reductions occur in vertical slices. Wage per FTE (in USD) held over time with increase as severances issued. 57 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 58: Accelerate Market Leadership with Innovation
Accelerate Market Leadership with Innovation For personal use only • Super Ultra Trace Analysis for Soils and Sediments • Ionic LeachTM • Clay Fractionation • Low Cost Lead Isotopic Analysis • Low Cost Carbon and Oxygen Isotopes in Carbonates • Hyperspectral Mineralogy • Rapid Portable XRF Analysis
Slide 59: World Exploration Trends - Regions
World Exploration Trends - Regions For personal use only Region ALS Global Geochem Exploration Revenue Spend Africa 13% 16% Aust/Asia 23% 18% Europe/RoW 27% 19% North America 24% 21% Latin America 12% 26% Exploration Spend Data from Metals Economic Group Report Nov 2014 59 RIGHT SOLUTIONS · RIGHT PA
Slide 60: World Exploration Trends - Commodities
World Exploration Trends - Commodities For personal use only Region ALS Global Geochem Exploration Revenue Spend Gold 43% 43% Copper 18% 25% Lead/Zinc 11% 5% Uranium 0.1% 5% Nickel 10% 4% Diamonds N/A 4% PGM 1.2% 2% Other 17% 12% Exploration Spend Data from Metals Economic Group Report Nov 2014 60 R
Slide 61: ALS Geochemistry Revenue CY2015
ALS Geochemistry Revenue CY2015 For personal use only 100% 90% 22% 80% 70% 25% 60% greenfield 50% 40% brownfield 30% 53% 20% 10% 0% North South Africa Australia Europe Asia Total 56% of all geochemistry work comes America America from existing mining operations Majors Intermediates Juniors 61 RIGHT
Slide 62: Questions
Questions For personal use only INNOVATION SYSTEMS STANDARDS Questions 62 RIGHT SOLUTIONS | RIGHT PARTNER RIGHT SOLUTIONS | RIGHT PARTNER 62 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 63: Life Sciences Division
LIFE SCIENCES DIVISION For personal use only Investor Day - facilitated by Morgans Raj Naran – Life Sciences Division • Houston – Texas - USA • 2nd November 2015 63 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 64: Services Offered – ALS Life Sciences
Services Offered – ALS Life Sciences For personal use only Environmental Food Pharmaceutical Consumer Testing 64 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 65: Life Sciences Overview
Life Sciences Overview For personal use only Overview • Strong Environmental revenue growth in South America (+22%), Europe (+11%) and Asia (+10%). Australia down slightly in a very competitive market but no loss of market share. • New Environmental LIMS progressively deployed in Australia – highly
Slide 66: Life Sciences Facilities – global coverage
Life Sciences Facilities – global coverage For personal use only Nordic Region United Kingdom Eastern Europe East Asia North America Middle East Environmental laboratory Food/Pharma laboratory South America Consumer Products laboratory Australia Sales Office 66 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 67: Environmental Business
Environmental Business For personal use only • Mature business • Global footprint: 71 laboratories in 32 countries Additional 50 sales offices to access broader geographical market • Largest provider of environmental analytical services in the world • World class USEPA compliant full service lab
Slide 68: Environmental Strategy
Environmental Strategy For personal use only Environmental Revenue by Quarter 140 28% AUD$ millions 120 24% EBIT margin (ave 12 mths) 100 20% 80 16% 60 12% 40 8% 20 4% - 0% Sep-10 Dec-10 Sep-11 Dec-11 Sep-12 Dec-12 Sep-13 Dec-13 Sep-14 Dec-14 Jun-10 Mar-11 Jun-11 Mar-12 Jun-12 Mar-13 Jun-13 Mar-14 J
Slide 69: Food Strategy – the journey has begun
Food Strategy – the journey has begun For personal use only Norway Denmark Czech Republic Taiwan Hong Kong Columbia Singapore existing ALS Food operations Tanzania near-term target expansion Indonesia Fiji for Food operations Namibia New Caledonia Australia Argentina New Zealand 69 RIGHT SOLUTIONS ·
Slide 70: Food Strategy – the journey has begun
For personal use only 70 AUD$ millions - 5 10 15 20 25 30 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Net Revenue Dec-12 Food Strategy – the journey has begun Mar-13 Jun-13 Sep-13 Dec-13 Mar-14 EBIT margin Jun-14 Sep-14 Food/Pharma Revenue by Quarter Dec-14 Mar-15 Jun-15 Se
Slide 71: Food Strategy – the journey has begun
Food Strategy – the journey has begun Achievements to date For personal use only • Multi-language LIMS built and being rolled out globally • Client portal built – version 3 (ALSolutions) to be released in October 2015 • MIS built and rolled out • Global instrument standards in place • Global methods
Slide 72: Thank You
Thank You For personal use only Questions? 72 RIGHT SOLUTIONS · RIGHT PARTNER
Slide 73: Tribology Strategy
Tribology Strategy For personal use only Tribology Revenue by Quarter 14 30% AUD$ millions 12 25% 10 20% EBIT margin 8 15% 6 Sydney Tribology Laboratory 10% 4 5% 2 0 0% Jun-10 Mar-11 Jun-11 Mar-12 Jun-12 Mar-13 Jun-13 Mar-14 Jun-14 Mar-15 Jun-15 Sep-10 Dec-10 Sep-11 Dec-11 Sep-12 Dec-12 Sep-13 Dec-1
Slide 74: Asset Care - plant health monitoring
Asset Care - plant health monitoring For personal use only Inspection Inspection Field Inspection Data Data Storage Collection Issue Closing the Plant Work Order Health Monitoring Inspection Report Loop Issue In Field Engineer Desktop Inspection Inspection Data Inspection Scope Analysis Data Analysi