Southern Cross Electrical Engineering Limited · ASX:SXE
Southern Cross Electrical Engineering — FY2023 Earnings Presentation
25 slides from Southern Cross Electrical Engineering's earnings presentation, Aug 30, 2023
Slide 1: Full Year Results Presentation
Full Year Results Presentation Year Ended 30 June 2023 30 August 2023 Full Year Results Presentation FY23 11
Slide 2: Introduction to SCEE
Introduction to SCEE Leading national electrical, instrumentation, …built by design through operational excellence and a communications and maintenance services group… disciplined M&A strategy • Established in 1978 in Perth, and listed in 2007 (ASX:SXE) Historically focused on resources and industri
Slide 3: Electrification and decarbonisation
Electrification and decarbonisation Australia is undergoing an energy transition to achieve net zero emissions by 2050 Reduction in fossil fuel consumption will require a high degree of electrification in the road transport and industrial sectors. Electrification is also expected to occur across a r
Slide 4: SCEE's strategy
SCEE’s strategy SCEE Group primarily sees itself as an electrical contractor diversified across the resources, commercial and infrastructure sectors • Our growth strategy continues to be to deepen our presence in those sectors and broaden our geographic diversity through expanding our core competenc
Slide 5: Financial Performance
Financial Performance 5
Slide 6: FY23 record results
FY23 record results Revenue $464.7m (FY22: $553.3m) down 16.0% on prior year Record EBITDA $38.2m (FY22: $35.3m) up 8.1% on prior year * Record EBIT $29.6m (FY22: $26.7m) up 10.7% on prior year * Record NPAT $20.1m (FY22: $15.3m) up 31.6% on prior year Result included $2.1m (FY22: $2.2m) amortisatio
Slide 7: Record profits
Record profits Summary financials: Revenue of $464.7m (FY2: $553.3m) down 16.0% on prior record year as major resources projects (Kemerton and Gudai-Darri) completed in first half and anticipated new camps awards either FY23 FY22 % reduced or received later $m $m Ongoing significant revenue contribu
Slide 8: Record cash
Record cash Cash increased to record $77.7m (FY22: $53.1m) up 46.3% on prior Balance sheet summary: year driven by record profits and return of working capital from major resources projects Remain debt free Jun 23 Jun 22 $56.6m of bank guarantees and surety bonds on issue at 30 June $m $m out of a t
Slide 9: Cashflow
Cashflow Will pay final Trivantage acquisition payment of $7.3m in September meaning Trivantage has achieved all earn-out targets in full since acquisition. Also will be funding $10.5m of fully franked dividends in October Full Year Results Presentation FY23 99
Slide 10: Highlights
Highlights 10
Slide 11: Operations
Operations Lost Time Injury (“LTI”) free across group for the year (2.4 million manhours LTI-free in FY23) Kemerton Lithium, Rio Gudai Darri and BHP Villages projects successfully completed Juwi Solar Farms and Tom Price Battery Storage projects ongoing NSW activity increasing after weather and coro
Slide 12: Diversified across markets and operations
Diversified across markets and operations FY 23 Order Book FY 23 Order Book Revenue breakdown by Sector by Geography by Sector $m $m $m • Record order book $610m • Over 80% of order book on • Resources fell back from FY22 as major iron ore projects completed East Coast • Infrastructure gaining momen
Slide 13: Long-standing blue-chip client base
Long-standing blue-chip client base Seven selected clients – Woolworths, Coles, BHP, Rio These seven clients have long-standing and deep Tinto, Multiplex, CPB and Built – have consistently relationships with SCEE spanning decades and some provided over 40% on average of revenues over the last across
Slide 14: Growth of recurring revenues and earnings
Growth of recurring revenues and earnings Strong track record of recurring revenues and earnings Wide range of recurring works under services, growth - FY23 recurring revenues were 37% of total annual maintenance, sustaining capital, and framework revenue agreements, including: Recurring Revenues ($
Slide 15: Strong dividend yield and financial position
Strong dividend yield and financial position Shareholder returns over last seven years Strong cash position to support continued growth 4.0 cps fully-franked dividend to be paid 11 October 2023 Dividends paid (cps) $m FY17 FY18 FY19 FY20 FY21 FY22 FY23 3.0 0.0 3.0 3.0 3.0 5.0 5.0 Cash 77.7 Debt 0.0
Slide 16: Electrification and decarbonisation
Electrification and decarbonisation SCEE exposed to the electrification and decarbonisation of the economy through three avenues: • Supporting the decarbonisation of client operations – such as in the resources sector undertaking battery, solar, wind and powerline projects for mining companies • Ass
Slide 17: Electrification and decarbonisation (cont.)
Electrification and decarbonisation (cont.) SCEE BUSINESS WHAT OUR CLIENTS SAY EXAMPLE SCEE PROJECTS BHP: “We will…take action to reduce our operational GHG emissions • BHP Juwi Northern Goldfields Solar Project (Scopes 1 and 2) in line with our…goal of net zero” Rio Tinto: “We’re targeting net zero
Slide 18: Track record of successful acquisitions
Track record of successful acquisitions Completed value-accretive acquisitions of Datatel in Revenue contribution of acquisition in first full year of 2016, Heyday in 2017 and the Trivantage Group in 2020 consolidation Actively exploring further acquisition targets offering increased geographic dive
Slide 19: Conclusion and outlook
Conclusion and outlook 19
Slide 20: Conclusion and outlook
Conclusion and outlook Record EBITDA*, EBIT* and NPAT up 8.1%, 10.7% and 31.6% respectively on prior year Record Cash $77.7m (FY22: $53.1m) up 46.3% on prior year and no debt Record Order Book $610m (FY22: $565m) up 8.0% on prior year Final Dividend 4.0 cps declared and fully franked, with 1.0 cps i
Slide 21: Q&A
Q&A 21
Slide 22: Corporate summary
Corporate summary Capital Structure Shareholders at 21 August 2023 ASX Code SXE Thorney Investments 15.9% Share Price (28 August 2023) 73.5c First Sentier Investors 8.5% No. of ordinary shares (28 August 2023) 261.5m Other Institutions in Top 30 Shareholders 10.4% Market Capitalisation (28 August 20
Slide 23: Appendix – IFRS reconciliation
Appendix – IFRS reconciliation SCEE’s results are reported under International FY23 FY22 Financial Reporting Standards (IFRS). SCEE discloses certain non-IFRS measures that are not prepared in $m $m accordance with IFRS. The non-IFRS measures should only be considered in addition to, and not as a Co
Slide 24: Appendix – selection of current projects
Appendix – selection of current projects BHP Juwi Northern Goldfields Multiplex Western Sydney Solar Project – SCEE Electrical International Airport - Heyday Over $15m Over $100m Ergon Energy Asset Inspection CPB Sydney Metro Pitt Street and Maintenance Services – Station and Towers - Heyday SCEE El
Slide 25: Disclaimer
Disclaimer Some of the information contained in this presentation contains “forward-looking statements” which may not directly or exclusively relate to historical facts. These forward-looking statements reflect the current intentions, plans, expectations, assumptions and beliefs of Southern Cross El
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