Nrw Holdings Limited · ASX:NWH
Nrw — Merger or Acquisition (August 2017)
38 slides from Nrw's merger presentation, August 2017
Slide 1: Golding Acquisition, Capital Raising & Preliminary FY17 Results
For personal use only Golding Acquisition, Capital Raising & Preliminary FY17 Results August 2017 Not for distribution in the United States or to US Persons
Slide 2: Important Notices and Disclaimer
Important Notices and Disclaimer For personal use only IMPORTANT: You must read the following before continuing. This investor presentation (“Presentation”) has been prepared by NRW Holdings Limited (ABN 95 118 300 217) (“NRW” or “Company”). This Presentation has been prepared in relation to: • NRW’
Slide 3: Important Notices and Disclaimer (cont'd)
Important Notices and Disclaimer (cont’d) For personal use only Investment risk An investment in NRW shares is subject to investment and other known and unknown risks, some of which are beyond the control of NRW. NRW does not guarantee any particular rate of return or the performance of NRW nor does
Slide 4: Important Notices and Disclaimer (cont'd)
Important Notices and Disclaimer (cont’d) For personal use only Disclaimer Euroz Securities Limited and UBS AG, Australia branch (the "Joint Lead Managers") and the advisers to NRW listed in the accompanying ASX announcement, together with each of their respective related bodies corporate, sharehold
Slide 5: Contents
Contents For personal use only 1 Golding - Strategic Rationale and Acquisition Overview 2 Golding Overview 3 NRW Preliminary Full Year 30 June 2017 Results & Combined Business 4 Acquisition Funding 5 Summary 6 Appendices - Glossary - Risks - Foreign Selling Restrictions Not for distribution in the U
Slide 6: 1. Strategic Rationale and Acquisition Overview
For personal use only 1. Strategic Rationale and Acquisition Overview 6
Slide 7: Golding is Transformational for NRW
Golding is Transformational for NRW For personal use only • Golding is a market leading, highly reputable Queensland based civil infrastructure, urban and mining services contractor operating across three core divisions: Civil, Mining, Urban. • Established in 1942, Golding employs approximately 700
Slide 8: Acquisition Overview
Acquisition Overview For personal use only • NRW has executed an agreement to acquire 100% of Golding. • Enterprise value of $85M with an assumed economic effective date of 1 July 2017. • Golding achieved FY17 revenue of $369M and EBITDA of $53M (unaudited)1. Acquisition of • Acquisition considerati
Slide 9: 2. Golding Overview
For personal use only 2. Golding Overview 9
Slide 10: Golding Overview
Golding Overview Founded in 1942, Golding is a market leading, highly reputable Queensland-based Civil, Mining and Urban services For personal use only contractor with an excellent safety record and a long-term “Tier 1” client base. • Golding has its origins in Gladstone and the Bowen Basin and focu
Slide 11: Diversity of Earnings through Industry Cycles
Diversity of Earnings through Industry Cycles For personal use only $M Golding Revenue 400 $369M • Golding has a history of achieving consistently +27% profitable revenue through-the-cycle. 300 $290M • FY17 (unaudited)1: 200 – Revenue of $369M. 100 – EBITDA of $53M. • Golding order book of $0.5B. 0
Slide 12: Civil – Diverse Capabilities with Tier Clients
Civil – Diverse Capabilities with Tier 1 Clients Golding has a long history of operations in the civil sector, with an exceptional technical capability and For personal use only a proven history of successfully delivering large and complex civil projects Public Resources Oil & Gas Infrastructure • B
Slide 13: Mining – Open-cut Capabilities
Mining – Open-cut Capabilities Golding’s focus on improving productivity in mining and pursuing selective growth opportunities has delivered For personal use only high margins and return on capital employed, new contract awards and extended tenure on existing contracts. Total Mine Dragline Load & Ha
Slide 14: Urban – Proven Operator & Delivery Platform
Urban – Proven Operator & Delivery Platform For personal use only Primary market Sime Sunland Stockland Mirvac Lendlease Darby Group • Residential and industrial sub-divisions. Turnkey solutions incorporating: • Earthworks, clearing, underground services, access roads, structures, minor marine works
Slide 15: Experienced Leadership Team
Experienced Leadership Team For personal use only Experienced management team to continue its focus on delivering profitable growth under NRW ownership Geoff Caton Dylan Pieters Alan Simms Dan Draper Brenton Akehurst Golding CEO GM – Mining GM – Mining GM – Urban GM – Civil Australia 11 yrs @ Goldin
Slide 16: 3. NRW Preliminary Full Year June 2017 Results & Combined Business
For personal use only 3. NRW Preliminary Full Year 30 June 2017 Results & Combined Business 16
Slide 17: NRW FY17 Results (unaudited)
NRW FY17 Results (unaudited) For personal use only NRW FY17 Preliminary Results (unaudited)1 $M NRW Revenue • Revenue: $370.3M (up 30%) 400 $370M +30% • EBITDA : $58.8M (up 24%) 350 $288M 300 • Net profit after tax: $28.5M (up 33%) 250 • Earnings per share: 9.1 cents 200 • Balance sheet restructured
Slide 18: Combined Revenue & Earnings Diversification
Combined Revenue & Earnings Diversification Financial – Pro Forma FY171 For personal use only • Pro forma FY17 revenues of $739M and EBITDA of FY17 Pro Forma Revenue1 FY17 Pro Forma EBITDA1 $112M. – Revenue and earnings diversification with balanced Total Total exposure to Civil, Mining, Urban and D
Slide 19: Strong Cashflow Conversion
Strong Cashflow Conversion For personal use only • Acquisition debt facility: $M – $48M 120 – 3 year term • NRW committed to retaining a prudent balance sheet: 100 – Annualised debt repayment (including interest) to NRW noteholders ($20M) and to Acquisition $48M debt facility ($18M). 80 • High cashf
Slide 20: Pro Forma Balance Sheet (unaudited)
Pro Forma Balance Sheet (unaudited) For personal use only Pro Forma New NRW Golding Combined $M Placement SPP Acquisition FY171 Acquisition Group Debt FY171 Cash and cash equivalents 42 25 5 48 (85) 35 Interest bearing loans (63) (48) - (111) Net Debt (21) 25 5 - (85) (76) Total Assets (ex Net Debt)
Slide 21: 4. Acquisition Funding
For personal use only 4. Acquisition Funding
Slide 22: Placement Overview
Placement Overview For personal use only Offer Size and Structure • NRW is raising ~$25M via a Placement to institutional investors. • Represents 12.1% of NRW's existing issued share capital at the floor price of the bookbuild range. • New shares will rank pari passu with existing shares. Offer Pric
Slide 23: Sources and Uses of Funds
Sources and Uses of Funds For personal use only • Net proceeds from the Placement will be used primarily to fund the acquisition of Golding, providing NRW with enhanced financial flexibility through the integration period. Sources of Funds $M Existing cash reserves 12.0 Acquisition debt facility 48.
Slide 24: 5. Summary
For personal use only 5. Summary 24
Slide 25: Summary
Summary For personal use only • Acquisition of Golding represents a transformational milestone and delivers a step change in scale for NRW’s business in Australia. • Delivers an established platform and geographic diversification across sectors, enhancing exposure and unlocking opportunities to grow
Slide 26: Sector Diversification
Sector Diversification For personal use only NRW FY17 Revenue Analysis1 Pipeline Combined2 13% Civil Resources 24% 21% 31% Infrastructure & Urban 7% 26% Mining 48% Action Drill & Blast 30% • Golding delivers expansion and diversification of NRW’s business profile and geographic exposure. • Significa
Slide 27: Leading Civil, Mining and Urban Contractor
Leading Civil, Mining and Urban Contractor Diversified portfolio of projects across Australia with balanced exposure to the For personal use only Civil, Mining, Urban and Drill and Blast sectors Note: Map for illustrative purposes only and does not include all projects Not for distribution in the Un
Slide 28: 6. Appendices
For personal use only 6. Appendices
Slide 29: Glossary of Terms
Glossary of Terms For personal use only $ Australian dollar EBITDA Earnings before interest, tax, depreciation and amortisation EPS Earnings per share EV Enterprise value FY17 Financial year ending 30 June 2017 FY18 Financial year ending 30 June 2018 Golding Golding Group Pty Ltd NPAT Net profit aft
Slide 30: Risks
Risks Acquisition Risks For personal use only • Completion risk: Completion of the Acquisition is conditional on certain matters, including vendor obtaining change of control consents applicable to key mining contracts. If any of the conditions are not met, completion of the Acquisition may be defer
Slide 31: Risks (cont'd)
Risks (cont’d) Acquisition Risks (cont’d) For personal use only • Historical liability: If the acquisition of Golding completes, NRW may become directly or indirectly liable for any liabilities that Golding has incurred in the past as a result of prior acts or omissions, including liabilities which
Slide 32: Risks (cont'd)
Risks (cont’d) Risks associated with NRW’s business For personal use only • Reliance on key personnel: NRW depends substantially on its executive director, senior management and key personnel to oversee the day-to-day operations and the strategic management of NRW. There can be no assurance given th
Slide 33: Risks (cont'd)
Risks (cont’d) Risks associated with NRW’s business (cont’d) For personal use only • Loss of contracts / reduction in contract scope: NRW’s revenues are subject to underlying contracts with varying terms. There is a risk that NRW’s contracts may be cancelled or may not be renewed if NRW’s clients de
Slide 34: Risks (cont'd)
Risks (cont’d) Risks associated with NRW’s business (cont’d) For personal use only • Environment: Environmental management and compliance is an important part of a number of the business of NRW’s clients. These client’s operations are subject to numerous laws, regulations and guidelines relating to
Slide 35: Foreign Selling Restrictions
Foreign Selling Restrictions For personal use only This document does not constitute an offer of New Shares of the Company in any jurisdiction in which it would be unlawful. In particular, this document may not be distributed to any person, and the New Shares may not be offered or sold, in any count
Slide 36: Foreign Selling Restrictions (cont'd)
Foreign Selling Restrictions (cont’d) For personal use only Hong Kong WARNING: The contents of this document have not been reviewed by any regulatory authority in Hong Kong. You are advised to exercise caution in relation to the offer. If you are in doubt about any contents of this document, you sho
Slide 37: Foreign Selling Restrictions (cont'd)
Foreign Selling Restrictions (cont’d) For personal use only Singapore This document and any other materials relating to the New Shares have not been, and will not be, or registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this document and any other document or material
Slide 38: For personal use only
For personal use only Not for distribution in the United States or to US Persons 17