Murray & Roberts — FY2020 Earnings Presentation
56 slides from Murray & Roberts's earnings presentation, August 2020
Slide 1: For the Year Ended 30 June 2020
FOR THE YEAR ENDED 30 JUNE 2020
Slide 2: Presentation Overview
PRESENTATION OVERVIEW Henry Laas A New Strategic Future Slides 3-5 Salient features Slide 6 Platform overview Slides 7-9 Order book Slides 10-12 Daniël Grobler Statement of financial performance Slide 14 Normalised EBIT Slide 15 Net interest expense analysis Slide 16 Segmental analysis per platform
Slide 3: A New Strategic Future
A NEW STRATEGIC FUTURE Murray & Roberts is a multinational, specialised engineering and construction group, delivering projects across six continents. Implementation of the Group’s strategy over the last five years has had the desired effect of developing and diversifying the three business platform
Slide 4: The Murray & Roberts Group
THE MURRAY & ROBERTS GROUP A MULTINATIONAL SPECIALIST ENGINEERING AND CONSTRUCTION GROUP FOCUSED ON THE NATURAL RESOURCES MARKET SECTOR STOP.THINK.ACT.24/7: SAFETY FIRST IN EVERYTHING WE DO BUSINESS PLATFORMS OIL & GAS UNDERGROUND MINING POWER & WATER PURPOSE VISION VALUES Enabling fixed capital To
Slide 5: The Murray & Roberts Group
THE MURRAY & ROBERTS GROUP A MULTINATIONAL SPECIALIST ENGINEERING AND CONSTRUCTION GROUP FOCUSED ON THE NATURAL RESOURCES MARKET SECTOR STOP.THINK.ACT.24/7: SAFETY FIRST IN EVERYTHING WE DO BUSINESS PLATFORMS ENERGY, RESOURCES POWER, INDUSTRIAL MINING & INFRASTRUCTURE & WATER PURPOSE VISION VALUES E
Slide 6: Salient Features
SALIENT FEATURES FOR THE YEAR ENDED 30 JUNE 2020 FY2020 FY2019 Comments Financial performance: Revenue R20,8 billion R20,1 billion# • Group results negatively impacted by: • Estimated COVID-19 impact - R622 million • Vendor loan impairment - R80 million • Goodwill impairment - R63 million Attributab
Slide 7: Energy, Resources & Infrastructure
ENERGY, RESOURCES & INFRASTRUCTURE PLATFORM OVERVIEW NORTH AMERICA EMEA APAC Market focus: • Global: Energy sector • Australasia: Energy, infrastructure and resources Calgary Ayrshire (metals & minerals) Market conditions: Houston • R179 million COVID-19 profit impact • USA: Energy buoyant • Austral
Slide 8: Mining
MINING PLATFORM OVERVIEW AMERICAS SSA APAC Market focus: • Global: Underground and open pit mining services Vancouver and material logistics in global metals and minerals markets Salt Lake City North Bay Ulaanbaatar Market conditions: Santee • R206 million COVID-19 profit impact • Capital investment
Slide 9: Power, Industrial & Water
POWER, INDUSTRIAL & WATER PLATFORM OVERVIEW Market focus: SSA • Sub-Saharan Africa: Power, industrial and water markets Market conditions: • R43 million COVID-19 profit impact • Limited investment in South Africa, apart from expected investment in the short to medium term in overland transmission an
Slide 10: Order Book
ORDER BOOK SIGNIFICANT, QUALITY ORDER BOOK OF R54,2 BILLION Energy, Resources Power, Industrial Mining Total & Infrastructure & Water 54,2 50,8 46,8 34,4 30,6 23,1 22,8 19,6 19,4 0,9 0,6 0,4 Jun 19 Dec 19 Jun 20 Jun 19 Dec 19 Jun 20 Jun 19 Dec 19 Jun 20 Jun 19 Dec 19 Jun 20 1. Energy, Resources & In
Slide 11: Order Book: Geography & Time Distribution
ORDER BOOK GEOGRAPHY & TIME DISTRIBUTION Order book Order book Order book Platform % split Rbn Rbn SADC Int. June 2020 June 2019 FY Time Distribution 2021 8,7 Energy, Resources 34,4 23,1 100 2022 8,9 & Infrastructure >2022 16,8 2021 7,5 Mining 66 34 19,4 22,8 2022 4,0 >2022 7,9 2021 2020 0,4 Power,
Slide 12: Order Book, Near Orders & Pipeline
ORDER BOOK, NEAR ORDERS & PIPELINE STRONG PIPELINE Pipeline Rbn Order book Near orders Category 1 Category 2 Category 3 Energy, Resources & Infrastructure 34,4 1,0 66,4 52,3 390,7 Mining 19,4 10,4 45,1 39,0 60,8 Power, Industrial & Water 0,4 - 9,8 32,2 18,3 30 June 2020 54,2 11,4 121,3 123,5 469,8 3
Slide 13: Financial Results & Segmental Analysis
FINANCIAL RESULTS & SEGMENTAL ANALYSIS TUMELA MINE PROJECT - SOUTH AFRICA 13
Slide 14: Statement of Financial Performance
GROUP FINANCIALS STATEMENT OF FINANCIAL PERFORMANCE Rm FY2020 FY2019# Variance Revenue 20 838 20 113 725 EBITDA 834 1 324 (490) EBIT (17) 847 (864) Net interest expense (221) (56) (165) Taxation (151) (297) 146 Profit/(loss) from equity accounted investments 2 (4) 6 (Loss)/profit from continuing ope
Slide 15: Normalised EBIT Assessment
GROUP FINANCIALS NORMALISED EBIT ASSESSMENT Rm FY2020 Continuing EBIT (17) COVID-19 Impact 622 • Energy, Resources & Infrastructure 179 • Mining 206 • Power, Industrial & Water 43 • Bombela Concession Company 194 Goodwill Impairments 63 Uncertified Revenue Impairments 46 Normalised Continuing EBIT 7
Slide 16: Net Interest Expense Analysis
GROUP FINANCIALS NET INTEREST EXPENSE ANALYSIS Rm FY2020 FY2019 Variance Net interest expense from continuing operations (221) (56) (165) Implementation of IFRS 16 (65) Acquisition of additional 17% shares in Bombela Concession Company, financed post December 2018 (13) TNT acquisition funding (15) W
Slide 17: Segmental Analysis: Energy, Resources & Infrastructure
SEGMENTAL ANALYSIS FOR THE YEAR ENDED 30 JUNE 2020 Energy, Resources & Mining Power, Industrial & Water Bombela Infrastructure Engineering Commissioning Corporate Rm & Construction Global Marine & Maintenance & Other Total 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 Revenue 6 020 3 905 33 - 52
Slide 18: Segmental Analysis: Mining
SEGMENTAL ANALYSIS FOR THE YEAR ENDED 30 JUNE 2020 Energy, Resources & Mining Power, Industrial & Water Bombela Infrastructure Rm Africa Australasia The Americas Total 2020 2019 2020 2019 2020 2019 2020 2019 Revenue 3 210 2 853 3 628 3 148 5 134 4 860 11 972 10 861 Operating profit 242 239 - 253 388
Slide 19: Segmental Analysis: Power, Industrial & Water
SEGMENTAL ANALYSIS FOR THE YEAR ENDED 30 JUNE 2020 Energy, Resources & Mining Power, Industrial & Water Bombela Infrastructure Transmission Rm Power1 Water & Distribution Other2 Corporate Total 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 Revenue 1 052 2 025 11 21 312 - 612 471 - - 1
Slide 20: Segmental Analysis: Bombela Investments
SEGMENTAL ANALYSIS FOR THE YEAR ENDED 30 JUNE 2020 Energy, Resources & Mining Power, Industrial & Water Bombela Infrastructure Rm Bombela Investments 2020 2019 Revenue - - Operating profit 119 306 Order book - - Operating results declined from prior year 1. Bombela Concession Company: Earnings down
Slide 21: Segmental Analysis: Discontinued Operations
SEGMENTAL ANALYSIS FOR THE YEAR ENDED 30 JUNE 2020 Discontinued Operations Rm Middle East Other Total 2020 2019# 2020 2019 2020 2019# Revenue 119 54 63 91 182 145 Operating (loss) / profit 120 (56) (101) (90) 19 (146) Discontinued operations include: Operating profit in Middle East due to an exchang
Slide 22: Statement of Financial Position
GROUP FINANCIALS STATEMENT OF FINANCIAL POSITION Rm June 2020 June 2019# Variance Total assets 18 899 16 390 2 509 Property, plant and equipment 3 374 2 203 1 171 Other non-current assets 3 720 3 515 205 Current assets 8 390 7 196 1 194 Cash and cash equivalents 3 415 3 455 (40) Assets classified as
Slide 23: Debt Analysis
DEBT ANALYSIS PRUDENT GEARING LEVEL Total Debt (Rm) (3 522) Self servicing debt (1 148) Asset based finance - project specific (908) Bombela Concession Company preference shares (240) Group Debt Corporate debt (1 520) TNT acquisition – March 19 (acquisition value R635 million) (311) Overdrafts and s
Slide 24: Focus Areas & Presentation Takeaways
FOCUS AREAS & PRESENTATION TAKEAWAYS GREAT NORTHERN HIGHWAY KOODAIDERI BRIDGE – WESTERN AUSTRALIA 24
Slide 25: FY2021 Focus Areas
FY2021 FOCUS AREAS Order book growth Exit Middle East Project execution (Engineered Excellence) Progress Reduce working digitalisation capital 25
Slide 26: Presentation Takeaways
PRESENTATION TAKEAWAYS Murray & Roberts has established a stable base from which it can grow organically and through acquisition. Market focus broadened to mitigate cyclicality of natural resources markets. Emerged from initial COVID-19 period with a strong balance sheet and order book Robust cash p
Slide 27: Disclaimer
DISCLAIMER 1. This presentation includes certain various “forward-looking statements” within the meaning of Section 27A of the US Securities Act 10 1933 and Section 21E of the Securities Exchange Act of 1934 that reflect the current views or expectations of the Board with respect to future events an
Slide 28: For the Year Ended 30 June 2020
FOR THE YEAR ENDED 30 JUNE 2020
Slide 29: Appendix
FOR THE YEAR ENDED 30 JUNE 2020 APPENDIX
Slide 30: Statement of Financial Performance
GROUP FINANCIALS STATEMENT OF FINANCIAL PERFORMANCE Rm FY2020 FY2019# Variance Revenue 20 838 20 113 725 EBITDA 834 1 324 (490) EBIT (17) 847 (864) Net interest expense (221) (56) (165) Taxation (151) (297) 146 Profit/(loss) from equity accounted investments 2 (4) 6 (Loss)/profit from continuing ope
Slide 31: Statement of Financial Performance
GROUP FINANCIALS STATEMENT OF FINANCIAL PERFORMANCE Rm FY2020 FY2019# Variance Revenue 20 838 20 113 725 Revenue EBITDAincreased by 4%: 962 1 774 (812) 1. Mainly due to a strong contribution from Mining EBIT 487 1 275 (788) Continuing operations excluding 1 055 1 343 (288) Middle East (568) (68) (50
Slide 32: Statement of Financial Performance
GROUP FINANCIALS STATEMENT OF FINANCIAL PERFORMANCE Rm FY2020 FY2019# Variance Revenue 20 838 20 113 725 EBITDA 834 1 324 (490) Decrease in EBITDA: EBIT 487 1 275 (788) 1. COVID-19 Continuing impact of operations R622m, goodwill impairment R63m and uncertified excluding revenue impairment 1 055 of R
Slide 33: Statement of Financial Performance
GROUP FINANCIALS STATEMENT OF FINANCIAL PERFORMANCE Rm FY2020 FY2019# Variance Revenue 20 838 20 113 725 EBITDA 834 1 324 (490) EBIT (17) 847 (864) Decrease in EBIT Net interest as a result of lower EBITDA and: expense (42) (71) 29 1. Taxation Depreciation of R759m (FY2019: R418m). Current year incl
Slide 34: Statement of Financial Performance
GROUP FINANCIALS STATEMENT OF FINANCIAL PERFORMANCE Rm FY2020 FY2019# Variance Revenue 20 838 20 113 725 EBITDA 834 1 324 (490) EBIT (17) 847 (864) Net interest expense (221) (56) (165) Increase Taxationin net interest expense due to: (161) (296) 135 1. Income Implementation of accounted from equity
Slide 35: Statement of Financial Performance
GROUP FINANCIALS STATEMENT OF FINANCIAL PERFORMANCE Rm FY2020 FY2019# Variance Revenue 20 838 20 113 725 EBITDA 834 1 324 (490) EBIT (17) 847 (864) Net interest expense (221) (56) (165) Taxation (151) (297) 146 Effective Incomerate fromofequity tax remains high accounted mainly due to: investments 7
Slide 36: Statement of Financial Performance
GROUP FINANCIALS STATEMENT OF FINANCIAL PERFORMANCE Rm FY2020 FY2019# Variance Revenue 20 838 20 113 725 EBITDA 834 1 324 (490) EBIT (17) 847 (864) Net interest expense (221) (56) (165) Taxation (151) (297) 146 Profit/(loss) from equity accounted investments 2 (4) 6 (Loss)/income from continuing ope
Slide 37: Geographic Diversification
GEOGRAPHIC DIVERSIFICATION BRINGS RESILIENCE THROUGHOUT ECONOMIC CYCLE Revenue Distribution 2% 10% 32% 3% Oceania South Africa Americas 31% Rest of Africa Asia Europe 22% 37
Slide 38: Statement of Financial Position
GROUP FINANCIALS STATEMENT OF FINANCIAL POSITION Rm June 2020 June 2019# Variance Total assets 18 899 16 390 2 509 Property, plant and equipment 3 374 2 203 1 171 Other non-current assets 3 720 3 515 205 Current assets 8 390 7 196 1 194 Cash and cash equivalents 3 415 3 455 (40) Assets classified as
Slide 39: Statement of Financial Position
GROUP FINANCIALS STATEMENT OF FINANCIAL POSITION Rm June 2020 June 2019# Variance Total assets 18 899 16 390 2 509 Property, plant and equipment 3 374 2 203 1 171 Increase in property,assets Other non-current plant and equipment: 3 904 4 622 (718) 1. Current Mainly assets due to IFRS 16 implementati
Slide 40: Statement of Financial Position
GROUP FINANCIALS STATEMENT OF FINANCIAL POSITION Rm June 2020 June 2019# Variance Total assets 18 899 16 390 2 509 Property, plant and equipment 3 374 2 203 1 171 Other non-current assets 3 720 3 515 205 Non-current assets comprise of: Current assets 6 722 8 185 1. Cash Deferred taxation and cash as
Slide 41: Statement of Financial Position
GROUP FINANCIALS STATEMENT OF FINANCIAL POSITION Rm June 2020 June 2019# Variance Total assets 18 899 16 390 2 509 Property, plant and equipment 3 374 2 203 1 171 Other non-current assets 3 720 3 515 205 Current assets 8 390 7 196 1 194 Current assets Cash and cashcomprise: equivalents 2 813 2 891 (
Slide 42: Statement of Financial Position
GROUP FINANCIALS STATEMENT OF FINANCIAL POSITION Rm June 2020 June 2019# Variance Total assets 18 899 16 390 2 509 Property, plant and equipment 3 374 2 203 1 171 Other non-current assets 3 720 3 515 205 Current assets 8 390 7 196 1 194 Cash and cash equivalents 3 415 3 455 (40) Cash consists Assets
Slide 43: Statement of Financial Position
GROUP FINANCIALS STATEMENT OF FINANCIAL POSITION Rm June 2020 June 2019# Variance Total assets 18 899 16 390 2 509 Property, plant and equipment 3 374 2 203 1 171 Other non-current assets 3 720 3 515 205 Current assets 8 390 7 196 1 194 Cash and cash equivalents 3 415 3 455 (40) Assets classified as
Slide 44: Statement of Financial Position
GROUP FINANCIALS STATEMENT OF FINANCIAL POSITION Rm June 2020 June 2019# Variance Total assets 18 899 16 390 2 509 Property, plant and equipment 3 374 2 203 1 171 Other non-current assets 3 720 3 515 205 Current assets 8 390 7 196 1 194 Cash and cash equivalents 3 415 3 455 (40) Assets classified as
Slide 45: Strategy Overview & Platform Capability
STRATEGY OVERVIEW & PLATFORM CAPABILITY POLOKWANE SO2 ABATEMENT PROJECT, SOUTH AFRICA 45
Slide 46: New Strategic Future
NEW STRATEGIC FUTURE ESSENCE OF THE NEW STRATEGIC FUTURE PLAN To be a multinational specialist engineering and construction Group focused on the natural resources sector • Specialist contractor vs. general contractor • Defines geographic reach, core business and market focus • Resources, industrial,
Slide 47: Strategic Direction
STRATEGIC DIRECTION BUSINESS MODEL: COMPREHENSIVE SERVICE OFFERING ACROSS PROJECT LIFE CYCLE IN SELECTED NATURAL RESOURCES MARKETS Geography Business Platform Capabilities (Project Life Cycle) Project Life Cycle (Multinational) • Detailed engineering • North America Design and Energy, Resources • Pr
Slide 48: Energy, Resources & Infrastructure
ENERGY, RESOURCES & INFRASTRUCTURE The Energy, Resources & Infrastructure platforms’ extensive service offering spans the full asset life cycle, including specialist engineering, construction & EPC, commissioning, and operations & maintenance. Services are provided on new build facilities (greenfiel
Slide 49: Energy, Resources & Infrastructure
ENERGY, RESOURCES & INFRASTRUCTURE Clough (Australia) works with some of the world’s largest companies to engineer, construct, commission and maintain a comprehensive range of facilities for energy, metals and minerals, and infrastructure projects. The company’s full project lifecycle delivery model
Slide 50: Mining
MINING The Mining platform’s service offering spans the project life cycle, including feasibility studies, specialist engineering, vertical and decline shaft construction, mine development, specialist mining services such as raise boring and grouting, and contract mining, as well as open pit mining.
Slide 51: Mining
MINING Cementation Canada & USA is a leading provider of underground mining contracting and engineering services throughout North and South America. The company specialises in the design and construction of underground facilities including shaft, ramp accesses, mine development and raises, as well a
Slide 52: Mining Platform: Commodity Order Book Breakdown
MINING PLATFORM COMMODITY ORDER BOOK BREAKDOWN % Total Platform Sub-Saharan Total Platform Americas Asia-Pacific R22.8bn Africa R19,4bn R3,5bn R3,0bn June 2019 R12,9bn June 2020 2% 4% 9% 14% 4% Copper Gold 11% 42% 38% 15% 48% Copper-Gold 7% Diamonds Silver 26% 23% 2% Platinum 11% 7% Nickel 95% 2% 1%
Slide 53: Power, Industrial & Water
POWER, INDUSTRIAL & WATER The Power, Industrial & Water platform operates predominantly in Southern Africa and sub-Saharan Africa. Its service offering includes feasibility studies, detailed engineering, procurement, construction, commissioning and repairs and maintenance work. The platform has a pr
Slide 54: Power, Industrial & Water
POWER, INDUSTRIAL & WATER Murray & Roberts Power & Energy is the platform’s engineering, procurement and construction ("EPC") projects implementer, adding unique value to the constructability, integration and ultimate performance of the projects it undertakes. Murray & Roberts Power & Energy offers
Slide 55: Disclaimer
DISCLAIMER 1. This presentation includes certain various “forward-looking statements” within the meaning of Section 27A of the US Securities Act 10 1933 and Section 21E of the Securities Exchange Act of 1934 that reflect the current views or expectations of the Board with respect to future events an
Slide 56: For the Year Ended 30 June 2020
FOR THE YEAR ENDED 30 JUNE 2020
Murray & Roberts Holdings — FY2020 Earnings Presentation on 6ix