Energy Action Limited · ASX:EAX
Energy Action — FY2013 Earnings Presentation
37 slides from Energy Action's earnings presentation, Aug 20, 2013
Slide 1: Financial Results Presentation for the Year Ended 30 June 2013
For personal use only Financial Results Presentation for the Year Ended 30 June 2013 1
Slide 2: Contents
For personal use only Contents 1. Business Overview 2. Financial & Operational Highlights 3. Financial Results 4. Operational Performance 5. Outlook 2
Slide 3: 1. Business Overview
For personal use only 1. BUSINESS OVERVIEW 3
Slide 4: Australia's Leading Energy Management Company
For personal use only Australia’s Leading Energy Management Company Formed in 2000, listed on ASX in 2011 Australian Energy Exchange Proven track record - year on year double digit Energy Procurement revenue and profit growth and history of paying dividends Created the market for online reverse auct
Slide 5: Energy Action is managing the risk of the electricity supply grid for its customers
For personal use only Energy Action is managing the risk of the electricity supply grid for its customers • Data collection & • Reverse Auctions & management Tenders for large users; • Base lining & KPI’s • Group Buying; • NGERS/ EEO GRI/ GRESB • Small business contracts; support^ ^ - National Green
Slide 6: Where does Energy Action fit into the energy market?
For personal use only Where does Energy Action fit into the energy market? Energy Action can reduce business’s reliance on grid supplied electricity by managing energy price, quantity, source & compliance 6
Slide 7: Corporate Snapshot
For personal use only Corporate Snapshot Capital Structure 12mth Share Price Performance ASX Code EAX Shares on Issue 25.3 million Market Cap (30 June 2013) $76 million Share Price $1.74 - $3.63 (52 week High/Low) Cash at Bank (30 Jun 13) $6.4 million Debt Nil Shareholders 744 Top 20 holding 78% Boa
Slide 8: Track record of profitable growth
For personal use only Track record of profitable growth NPAT Margin Employee Costs EBITDA Margin Future Contracted Revenue 8
Slide 9: 2. Financial & Operational Highlights
For personal use only 2. FINANCIAL & OPERATIONAL HIGHLIGHTS
Slide 10: FY13 Financial Highlights
For personal use only FY13 Financial Highlights Revenue up 28% to $22 million Operating NPAT1 of $5.0 million - 26% higher Future revenue4 up 17% since 30 June 2012 to $76.5 million 000’s FY13 FY12 Change Revenue 22,166 17,371 4,795 28% Revenue up 28% to $22.2 million Statutory NPAT 4,376 3,611 765
Slide 11: FY13 Operational Highlights
For personal use only FY13 Operational Highlights • NPAT growth driven by: 1,390 successful auctions in the 12 month period – up 14% =6.87 million mega watt hours contracted on behalf of corporate customers FY13 excludes 1,006 Ward Consulting sites under contract ($398 million of electricity contrac
Slide 12: 3. FY13 Financial Results
For personal use only 3. FY13 FINANCIAL RESULTS 12
Slide 13: Operating NPAT up 26%
For personal use only Operating NPAT up 26% 000’s FY13 FY12 Change $ $ Revenue ....up 28% Revenue & other income 22,166 17,372 28% Employee benefits expense (9,906) (8,167) 21% Staff costs represent 65% of Depreciation and Amortisation (773) (526) 47% total overheads – fell as a % of Rental expenses
Slide 14: Revenue up 28% to a record $22m
For personal use only Revenue up 28% to a record $22m • Activ8 revenue (up 19%) - accounts 000’s FY13 FY12 Change for c.60% of total revenue- average $ $ contract lengths are 50 months Revenue Activ8 12,889 10,826 19% • Despite fall in Auction contract Auction – large sites 4,928 4,185 18% lengths r
Slide 15: Profit converts to strong operating cashflow
For personal use only Profit converts to strong operating cashflow 000’s FY13 FY12 $ $ CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers 23,302 18,884 Driven by 28% revenue growth Payments to suppliers and employees (15,795) (13,057) Acquisition costs (491) - Interest received 195 183 Inc
Slide 16: Strong Balance Sheet
For personal use only Strong Balance Sheet 000’s June 13 June-12 $ $ CURRENT ASSETS Cash and cash equivalents 6,444 6,758 Strong cash position – post $2m Trade & other receivables 3,514 2,785 Other assets 981 162 first payment for Ward Consulting TOTAL CURRENT ASSETS 10,939 9,705 and $1.7m commissio
Slide 17: 4. Operational Performance
For personal use only 4. OPERATIONAL PERFORMANCE 17
Slide 18: Activ8 - energy monitoring & contract administration
For personal use only Activ8 - energy monitoring & contract administration • Contract administration: – Retailers are stepping out of customer ACTIV8 CASE STUDY service; • Data continuity: Following updates to network tariffs each – Independence from retailers for customers; year, Energy Action cond
Slide 19: Activ8 contributes 60% of total revenue
For personal use only Activ8 contributes 60% of total revenue • EAX’s Activ8 product provides energy reporting services via automated monitoring and contract management FY13 FY12 Variance – highly scalable Average Activ8 contract duration 50.0 49.8 0.4% • Over 8,400 sites under contract, up No. of A
Slide 20: The energy procurement process
For personal use only The energy procurement process Energy Pricing Variables Expectations Roles Responsibilities ► Contract Duration: How ► Monitoring of the ► Build a detailed ► Disclose all Fees and long do you want to hedge electricity market specification Commissions your negotiated price? ► In
Slide 21: Australian Energy Exchange
For personal use only Australian Energy Exchange • The Australian Energy Exchange (AEX) is FY13 FY12 Variance Energy Action’s online reverse auction No. of successful auctions 1,390 1,225 14% platform. Energy suppliers competitively Average auction contract duration 26.9 32.5 (17%) bid for our custo
Slide 22: Australian Energy Exchange - Carbon Uncertainty
For personal use only Australian Energy Exchange - Carbon Uncertainty Impact of Carbon tax uncertainty – Energy Action’s response • EAX has taken a leading market position and developed an innovative ‘carbon exclusive’ auction platform • In June 80% of auctions were run on a carbon exclusive basis •
Slide 23: The energy efficiency journey
For personal use only The energy efficiency journey The Australian electricity grid is inherently inefficient: Shedding Shifting Onsite Storing Responding Shaping •Using less •Responding to Generating •Onsite battery •Demand side •Anticipating energy price signals •Extracting storage: management hig
Slide 24: Activ8+ - efficiency & sustainability
For personal use only Activ8+ - efficiency & sustainability • Activ8+ provides businesses with energy efficiency and sustainability consultancy $000’s FY13 FY12 Variance services Revenue 2,059 1,006 105% Cost of goods sold (977) (314) • Offers a range of advisory and project Gross profit 1,082 692 5
Slide 25: Ward Consulting
For personal use only Ward Consulting • Energy Action acquired leading energy management business, Ward Consulting Services, in August 2012 • Acquisition has added considerable value to EAX – new revenue streams ($1.5m over 11 months), access to blue-chip customers • Business has been efficiently in
Slide 26: Review of Sales Function
For personal use only Review of Sales Function Detailed and comprehensive sales review completed, aimed at ensuring that the Group’s sales team is structured and incentivised for the next phase of Energy Action’s exciting growth trajectory The new structure will lay the platform for a sales team tha
Slide 27: Diversified Customer & Industry Base
For personal use only Diversified Customer & Industry Base Auction Volumes Growing • 4,908 customers at 30 June 2013 • Up from 4,393 at 30 June 2012 27
Slide 28: Market share - significant scope to increase our penetration
For personal use only Market share – significant scope to increase our penetration • Growing trend amongst companies to outsource non-core services such as energy management and sustainability • AEX is an unrivalled service offering and a foundation for ORGANIC growth: Estimated addressable market i
Slide 29: 40% of C&I businesses use a broker
For personal use only 40% of C&I businesses use a broker • Growing trend amongst companies to outsource non- core services such as energy management, procurement and sustainability • Utility Market Intelligence (UMI) report dated July 2013 (17th in the series) - survey of 598 large commercial and in
Slide 30: Energy Action's Energy Insights Survey: Is your energy contract contestable?
For personal use only Energy Action’s Energy Insights Survey Is your energy contract contestable? Increased understanding of energy consumption and negotiating market contracts 498 respondents Over the past year, awareness of energy contract contestability and annual electricity consumption has incr
Slide 31: Energy Action's Energy Insights Survey: Do you deal with an energy broker?
For personal use only Energy Action’s Energy Insights Survey Do you deal with an energy broker? Energy management efforts essential to staying competitive Businesses are taking a more aggressive stance toward energy management, with 70 per cent currently dealing with an energy broker or consultant,
Slide 32: Case Study - Finley RSC
For personal use only Case Study – Finley RSC • Finley Returned Soldiers Club (RSC) in the Riverina region of NSW has used all of Energy Action’s services since 2008. • The Club is home to 1,600 members, houses two bowling greens, an auditorium, squash courts, bar and gaming area. • Results Energy A
Slide 33: 5. Outlook
For personal use only 5. OUTLOOK 33
Slide 34: Drivers for Growth
For personal use only Drivers for Growth AEX is an unrivalled service offering and a foundation for growth: o Gives EAX access to large potential customer base o Can market complementary services to AEX customers Increased capability and access to clients through acquisition of Ward Consulting Servi
Slide 35: FY14 outlook
For personal use only FY14 outlook • We expect operating NPAT growth of 10-15% for FY14. We are resourcing for the large number of 2015 contract renewals to position for market share growth; investment in Activ8+, sales teams and supporting marketing initiatives • Company growth continuing despite u
Slide 36: Further information
For personal use only Further information Val Duncan Managing Director 02 9633 6403 valduncan@energyaction.com.au Nathan Francis Chief Financial Officer & Company Secretary 02 9633 6405 nathanfrancis@energyaction.com.au 36
Slide 37: Disclaimer
For personal use only Disclaimer This presentation has been prepared by Energy Action Limited. This presentation is not intended as an offer or solicitation with respect to the purchase or sale of any security nor does it constitute an offer or solicitation in any jurisdiction in which such an offer