Boral — Investor Day (June 2023)
34 slides from Boral's investor day presentation, Jun 8, 2023
Slide 1: Boral Investor Day
Boral Investor Day 8th June 2023
Slide 2: Disclaimer
Disclaimer Forward looking statements – This presentation contains certain forward-looking statements, including with respect to the financial condition, results of operations and businesses of Boral Limited (“BLD”) and certain plans and objectives of the management of BLD. Forward-looking statement
Slide 3: Agenda
Agenda 1 Our Business Vik Bansal 2 PEMAF & Outlook Vik Bansal/Belinda Shaw 3 Cement Overview Rajeev Ramankutty 4 Quarries Overview Lloyd Wallace 5 Closing & Questions Vik Bansal v
Slide 4: Our Business – scale, scope, footprint
Our Business – scale, scope, footprint Australia’s largest integrated construction materials company with over 75 years of legacy ▪ A rich legacy founded in 1946 ~360 operating sites ▪ Largest integrated network provides competitive advantage ▪ Strategy focused on strengthening and growing the core
Slide 5: Our Business – integrated network
Our Business – integrated network Valuable upstream and downstream operations with market leadership positions ▪ ~50% of Upstream volumes supplied to downstream operations ▪ >90% of Downstream businesses source their raw material inputs internally ▪ Vertical integration delivers: o Secure source of
Slide 6: Our Business – industry value drivers
Our Business – industry value drivers Focus on strengthening these key value drivers will provide the platform for earnings and business growth Boral Opportunity • Degree of vertical integration between upstream and downstream assets within a region Integrated network • Securing positions to leverag
Slide 7: Our Business – leadership in place
Our Business – leadership in place A diverse executive team with good mix of experience and backgrounds CEO & Managing Director Vik Bansal EGM North EGM NSW/ACT EGM South EGM Cement EGM Chief Financial EGM Enterprise EGM EGM General Counsel Concrete & Concrete & Concrete & & Lime Commercial Officer
Slide 8: PEMAF Pillars
PEMAF Pillars How we think about ‘PEMAF’ is the way we run our business every day……………Our Boral Way. People Environment • Our Purpose and Values • Our business • Workforce health, safety decarbonisation focus & wellbeing • Environmental • Leadership, engagement stewardship & development of people •
Slide 9: People Progress
People Progress Our people are core to our business success 0% 100% Safety ▪ Relentless focus on safety with increased employee engagement and strong leadership ▪ Enhancing and standardizing our tools to manage and lead safety ▪ Our zero harm journey continues, FY23 YTD TRIFR so far improved by 35%
Slide 10: Environment Progress
Environment Progress Our business is mindful of our environmental impact, our communities and customer needs 0% 100% Decarbonisation ▪ Remaining focused on decarbonization initiatives ▪ Significant audit of program and target underway ▪ Berrima alternative fuel program underway, chlorine bypass inve
Slide 11: Environment
Environment Our cement manufacturing emissions account for roughly 80% of our Scope 1 and 2 emissions, with almost half of these emissions being hard to abate process emissions Total CO2 emissions by key drivers (kt) Total CO2 emissions by business (kt) Process Cement emissions manufacturing Conc, Q
Slide 12: Environment
Environment We have made good progress in reducing our cementitious intensity through our lower carbon concrete program Decarbonisation levers (kt) Key initiatives ▪ Good progress on overall on key initiatives other Other (efficiency) ▪ Renewable energy solar PPA agreement in place but delivery dela
Slide 13: Markets Progress
Markets Progress Our customer interactions and our commercial acumen critical to our success 0% 100% Customer Experience ▪ Realigning and standardizing customer service and allocations teams closest to customers and back within regions ▪ Understanding and measuring customer service levels, prioritis
Slide 14: Assets Progress
Assets Progress Our customer interactions and our commercial approach critical to our success 0% 100% Integrated Model ▪ Continuing to build our integrated networks that give us market leadership positions ▪ Optimising and leveraging our degree of vertical integration and asset footprint advantages
Slide 15: Financials Progress
Financials Progress We are focused improving our cash and commodity management with renewed focus 0% 100% Cash ▪ Heavy focus on all elements of cash conversion cycle ▪ All elements under focus – DPO, DSO and DOH ▪ Tighter capital spend with tighter capital allocation ▪ Cash related metrics e.g. disp
Slide 16: Financials Progress
Financials Progress We are improving on all key financial metrics of volumes, price and costs 0% 100% Volumes ▪ Volumes trend for year to date up on FY22 ▪ Rate of external volume growth slowing in Q4FY23 against previous three quarters ▪ May run rate slower after shorter April month compared to Q3F
Slide 17: Agenda
Agenda 1 Our Business Vik Bansal 2 PEMAF & Outlook Vik Bansal/Belinda Shaw 3 Cement Overview Rajeev Ramankutty 4 Quarries Overview Lloyd Wallace 5 Closing & Questions Vik Bansal v
Slide 18: Cement – positions relative to Australian portfolio
Cement – positions relative to Australian portfolio Our fixed plant positions has direct supply to over 70% of the Australian cement market Cement industry map Australian market ~10mt1 Boral Darwin CA ▪ Boral cement assets are east coast focused where ABL/ ICL ~71% of cement is supplied NT (1%) Othe
Slide 19: Cement – portfolio
Cement – portfolio Portfolio of well located and integrated Infrastructure type Assets critical to serve the market Berrima Maldon Marulan Geelong Taronga Sunstate JV NSW NSW NSW Vic QLD Qld Clinker & cement Specialty cements Limestone & Lime Cement & slag Fly ash Multiple cements ▪ Clinker (1.5mt)
Slide 20: Cement – competitive cost
Cement – competitive cost Berrima is a well performing operation supporting a long life ▪ Berrima is a long term, cost competitive asset which compares well to global benchmark performance but opportunity exists to make it better ▪ We have a broad range of initiatives to continue to optimise our bus
Slide 21: Cement – carbon
Cement – carbon Our focus on reducing carbon emissions to remain domestically and globally competitive Berrima Safe Guard Mechanism response CO2e tonnes per tonne of clinker Safeguard Mechanism (SGM) ▪ SGM commenced in 2016, legislated framework that limits the emissions of ~215 large industrial fac
Slide 22: Cement – carbon alternative fuels
Cement – carbon alternative fuels We have made good progress on our alternative fuels program, DA delays. FY18 FY20 FY23 FY24 FY25 FY26 0% 9% 18% 30% 45% 60% Solid Waste Derived Firing (SWDF) Project (2018) Chlorine Bypass Project DA increase SWDF (2023 -24) (2022-23) Key initiatives ▪ Boral commenc
Slide 23: Cement – Marulan position
Cement – Marulan position Our Marulan asset a unique asset with significant competitive advantage ▪ +100 year old mine at mid-life with limestone mining beginning in the 1860’s ▪ Boral secured the unique asset as part of the Blue Circle Southern Cement acquisition in 1987 ▪ Total resource of 720mt,
Slide 24: Cement – Maldon position
Cement – Maldon position The Maldon Bag cement facility provides packaged product solutions and manufacturing flexibility ▪ The Maldon operation commenced in 1940’s ▪ The kiln was shutdown in 2013, sub-scale and higher cost, the facility now provides important manufacturing flexibility to our NSW po
Slide 25: Cement – Geelong position and project update
Cement – Geelong position and project update Our Geelong Cement Facility total project investment of ~$165m is delivering cost and customer benefits ▪ The Geelong Cement Facility was commissioned in H2 2022 at a total cost of ~$165m very close to on time ▪ The facility has capacity for 1.7m tonnes p
Slide 26: Agenda
Agenda 1 Our Business Vik Bansal 2 PEMAF & Outlook Vik Bansal/Belinda Shaw 3 Cement Overview Rajeev Ramankutty 4 Quarries Overview Lloyd Wallace 5 Closing & Questions Vik Bansal v
Slide 27: Quarries – positions relative to Australian portfolio
Quarries – positions relative to Australian portfolio We continue to invest to grow our national quarry network, which serves all major population centres and significant projects in key regional locations National operations Recent investments and developments ▪ 69 quarry operations 1 ▪ Deer Park n
Slide 28: Quarries – portfolio
Quarries – portfolio An extensive portfolio of highly-integrated assets in all States and Territories with long lives ahead of them QLD & NT NSW & ACT VIC TAS SA WA Hard rock & sand Hardrock, limestone, sand Hard rock & sand Hard rock & sand Hard rock & sand Hard rock & sand ▪ 15 quarries ▪ 20 quarr
Slide 29: Quarries – prized assets, key value drivers
Quarries – prized assets, key value drivers Building networks around prized quarry assets to leverage investments and build competitive advantage ▪ Quarries are scarce strategic assets which provides good strategic moat ▪ Long-term, high quality reserves to underpin investment returns ▪ Located in c
Slide 30: Quarries – increasing scarcity and value
Quarries – increasing scarcity and value Consents and approvals are getting harder to secure increasing barriers to entry ▪ State government approvals are not keeping pace with the industry’s reserve depletion, legislation hurdles are delaying consents ▪ The resources required to manage existing app
Slide 31: Quarries – whole of life value
Quarries – whole of life value Optimise the value of our quarries over their ‘whole life’ Case study: Salisbury Quarry, Adelaide Quarrying November 1900s Quarrying + Recycling 2022 Quarrying + Recycling + Remediation 2024+ Development 2030+ HOUSING 1974 v 31
Slide 32: Quarries – vertical integration case study
Quarries – vertical integration case study Our Sydney business is a uniquely integrated network, with three distinct sources of competitive advantage Multiple high quality, Integrated, high 1 3 long life resources capacity production Peppertree, Marulan, facilities Dunmore quarry hard St Peters Conc
Slide 33: Agenda
Agenda 1 Our Business Vik Bansal 2 PEMAF & Outlook Vik Bansal/Belinda Shaw 3 Cement Overview Rajeev Ramankutty 4 Quarries Overview Lloyd Wallace 5 Closing & Questions Vik Bansal v
Slide 34: Overview of day & Safety
Overview of day & Safety Host Stop Marulan Cement Rajeev Ramankutty & Team 1 Stop Peppertree Quarry Lloyd Wallace & Team 2 Stop Berrima Cement Rajeev Ramankutty & Team 3 v