Slide 1: Investor presentation 1H FY24 Results
Investor presentation 1H FY24 Results Malcolm Deane, CEO and Managing Director Luis Damasceno, Chief Financial Officer © Copyright 2023 | ALS Limited 1
Slide 2: Important notice and disclaimer
Important notice and disclaimer This presentation has been prepared by ALS Limited, (ALS or the Company). It contains general information about the Company’s activities as at the date of the presentation. It is information given in summary form and does not purport to be complete. The distribution o
Slide 3: Investment proposition
Investment proposition | Global business with diverse end markets, services and customers underpinned by industry mega trends and strong market positions - Strategically positioned to capture growth opportunities from industry megatrends - Leading market-share and margins in Geochemistry and Environ
Slide 4: 1H FY24 highlights
1H FY24 | highlights Leading Captured industry megatrends in Environmental industry growth business, delivering high single-digit organic growth and margins in and record margins Environmental Geochemistry maintained market leadership due to Leading world class hub & spoke model, client service posi
Slide 5: Financials
Financials | maintained leading EBIT margins above long- term floor of 19% and exceeded U/L NPAT guidance Key financial highlights REVENUE1 UNDERLYING NPAT • Total revenue growth supported by strategic acquisitions and FX tailwinds $1,285m $158.4m +7.4% growth (1.9)% decline • Exceeded 1H FY24 under
Slide 6: Operations: delivered strong improvements in-line with FY27 strategic plan
Operations | delivered strong improvements in-line with our FY27 strategic plan Key operational highlights: • Resilient geochemistry performance supported by innovation journey and downstream market-share growth reducing overall cyclicality • Metallurgy benefiting from increased demand of battery re
Slide 7: Operations: progressing our sustainability agenda
Operations | progressing our sustainability agenda Key sustainability highlights: • Further 10% reduction on total recordable injury frequency rate YTD1 • Maintained or improved ratings for 3 out of 4 ESG rating agencies • Maintained carbon neutrality2 for Scope 1 and 2 emissions, and commenced revi
Slide 8: Strategy and portfolio insights
Strategy and portfolio insights © Copyright 2023 | ALS Limited 8
Slide 9: Portfolio: underpinned by strong industry megatrends
Portfolio | underpinned by strong industry megatrends 1H FY24 portfolio revenue contribution1 In % of Group revenue Portfolio exposed to industry megatrends ✓ Regulation and outsourcing ✓ Demand for sustainability services Minerals ✓ Energy transition & electrification 5% ✓ Technology development 19
Slide 10: Portfolio: balanced and disciplined approach to growth agenda
Portfolio | balanced and disciplined approach to our growth agenda • 6 acquisitions executed for total consideration of Hidro1 Pro-Analiz $77 million, ~$36m revenue (12 months run rate Analytical contribution), in-line with capital allocation strategy Solutions India1 • Acquisition strategy remains
Slide 11: Portfolio: synergies leveraged across the portfolio
Portfolio | synergies leveraged across the portfolio Production management Shared clients between businesses • Instrument and automation standards • Strong client synergies between our • Hub & Spoke model and practices - Geochemistry, Metallurgy, and Environmental testing businesses. System innovati
Slide 12: Minerals: unique operating model supported by three key pillars
Minerals | unique operating model supported by three key pillars 1 2 3 Hub and Client Value added services Spoke model Long-term growth service and profitability structurally • Largest and best-distributed • Global standardised • Increasing demand supported network of global Hub processes and proced
Slide 13: Minerals: reduced cyclicality to exploration through downstream growth
Minerals | demonstrates reduced cyclicality to exploration through downstream growth and innovation journey ALS Minerals end-market exposure1 Exploration Metallurgy Mine site production Consulting and • Core business with additional • Support clients from initial project • Growth focus area data ana
Slide 14: Minerals: high performance methods supporting growth momentum
Minerals | high performance methods supporting growth momentum • Increasing demand from exploration clients seeking multi- Case element data with lower detection limits and increased Study precision • Continued improvements to detection limits provide clients with greater confidence to distinguish a
Slide 15: Minerals: data analytics supporting mining clients
Minerals | data analytics supporting mining clients Case Study 1. Collecting geoscience information ALS GoldSpot Discoveries – Historical maps, technical reports, government-base leveraging AI for lithium exploration datasets and literature review 2. Assessing the data relevance • Using AI and in co
Slide 16: Minerals: increased exploration and investment into battery and clean energy metals
Minerals | increased exploration and investment into battery and clean energy related metals Global energy investment in clean energy and fossil fuels Exploration budget by commodity (%)1 • Exploration budgets for (2015-2023) (US$Bn)2 CAGR % clean energy and battery (2018-23) related metals represen
Slide 17: Life Sciences: steady growth supported by global megatrends
Life Sciences | steady growth supported by global megatrends • A global and sustainable Life Sciences portfolio Growth of Environmental business: of businesses, underpinned by strong growth Revenue (A$m) and EBIT margin (%) industry megatrends such as: increasing 1,000 20.0% 17.7% regulation, new co
Slide 18: Environmental: a global leader with a global network
Environmental | a global leader with a global network Medium term portfolio 153 global locations in 35 countries evolution driven by: Major environmental hub locations Service centres • Organic growth ahead of peers and indicative of market share gains • Second largest provider of North environmenta
Slide 19: Environmental: regulations and emerging contaminants supporting growth
Environmental | regulations and emerging contaminants supporting growth Case ALS geographic and technological Study PFAS growth opportunity leadership for PFAS testing • Comprehensive PFAS capabilities and capacity in all regions - • Growth drivers for PFAS: regulation, litigation, heightened consum
Slide 20: Environmental: technology strategy
Environmental | technology strategy • Market segment focused structure to support scalable global sharing between technical teams (as seen in Geochemistry and will similarly flow through to Food) • Agnostic approach to digital – Harmonized in house proprietary line of business application (GEL LIMS)
Slide 21: Nuvisan: under strategic review
Nuvisan | under strategic review CRO/CDMO market Nuvisan performance Strategic review of and journey Nuvisan investment • Reduced investment into • CRO business (53% of Nuvisan • Reviewing long-term global pharmaceutical revenue) challenged by CRO/CDMO market R&D impacting European economic conditio
Slide 22: Financial review
Financial review Group performance © Copyright 2023 | ALS Limited 22
Slide 23: 1H FY24 financials: statutory results
1H FY24 financials | statutory results1 Statutory NPAT decreased by $13.9m Statutory Results 1H FY24 ($m) 1H FY23 ($m) % change to $133.5m, primarily due to Revenue 1,222.5 1,194.2 2.4% • Underperformance of Pharmaceutical business EBITDA 302.4 309.3 (2.2)% • Increased one-off items such as: – Dispo
Slide 24: Strong total revenue growth supported by acquisitions and FX tailwinds
1H FY24 financials | strong total revenue growth supported by recent acquisitions and FX tailwinds Total revenue growth of 7.4% Underlying revenue growth composition (A$m) Organic growth of 2.4% excluding Nuvisan, a result of: ✓ Increasing global demand for Environmental services 2.4% 3.1% 3.5% (1.6
Slide 25: Maintained market leading operating margins
1H FY24 financials | maintained market leading operating margins Underlying Group EBIT margin composition (%) • Underlying margins1 contracted by (126) bps at CCY, reflecting underperformance Divestment of 1H FY23 1H FY24 1H FY23 Asset Care Continuing Organic Scope FX2 Continuing from Food and Pharm
Slide 26: Life sciences (ex. Nuvisan) delivered strong organic growth and EBIT margin
1H FY24 financials | life sciences (ex. Nuvisan) delivered strong organic growth and EBIT margin performance Underlying organic revenue growth by business (%) • Life Sciences 1H FY24 organic revenue growth (ex. Nuvisan) was 5.0% reflecting the continued 14.7% 14.7% strength and scale of our large gl
Slide 27: Disciplined capital allocation supporting growth and returns
1H FY24 financials | disciplined capital allocation supporting growth and returns to shareholders • Strong Group liquidity of $486 million with balance sheet flexibility to pursue strategic growth opportunities • Strong leverage ratio at 2.0x and EBITDA interest cover ratio at 15.1x, well within the
Slide 28: Balance sheet and overall liquidity remains strong
1H FY24 financials | balance sheet and overall liquidity remains strong • Leverage well below banking Debt maturity profile A$m (as at 30 September 2023) Pro forma debt1 maturity profile A$m (post USPP issuance) covenants (leverage ratio of 450 3.25x) Weighted average debt maturity: 4.9 years 450 20
Slide 29: EBITDA cash conversion
1H FY24 financials | EBITDA cash conversion • Improved underlying EBITDA cash conversion EBITDA cash conversion (%) by 241 bps vs last year. On track to deliver EBITDA cash conversion above 90% in FY24 97% 99% 102% 97% • Maintained DSO of 52 days, largely in line 92% 85% 82% with the prior year 80%
Slide 30: Investing in our growth
1H FY24 financials | investing in our growth • Capex % on revenue increased by 178 bps vs pcp, Capital expenditure (A$m and % of revenue1) 6.6% approximately $28m. Total capex of $85m representing 90.00 7.0% 80.00 5.6% 5.5% 6.6% of revenue (4.2% growth and 2.4% maintenance spend) 6.0% 70.00 4.8% 36
Slide 31: Divisional review
Divisional review © Copyright 2023 | ALS Limited 31
Slide 32: Good growth contribution from most businesses within the portfolio
Divisional review | good growth contribution from most businesses within the portfolio Revenue growth by division and business vs. pcp Total growth Total Group Revenue @ CCY growth (CCY) at 3.6% Total Group 0.7% 2.9% 3.6% Life Sciences Total growth (CCY) 6.2% Environmental 8.5% 3.2% 11.7% Organic gr
Slide 33: Commodities performed well despite exploration slowdown
Divisional review | commodities performed well despite exploration slowdown Overview Underlying results (A$m) Change in • Total revenue growth of 0.9%, of which (0.4)% organic, 0.9% scope with a 1H FY24 1H FY23 Change CCY1 0.4% favourable currency impact. Growth was underpinned by strong price Reven
Slide 34: Life sciences supported by strong performance from Environmental
Divisional review | life sciences supported by strong performance from Environmental business Underlying results (A$m) Overview Change in • Total revenue growth of 12.7%, of which 1.7% organic and 4.5% scope with a 1H FY24 1H FY23 Change CCY1 6.5% favourable currency impact. Growth was driven by goo
Slide 35: Outlook
Outlook © Copyright 2023 | ALS Limited 35
Slide 36: Outlook: FY24
Outlook | FY24 Group outlook Medium to long-term outlook for both Life Sciences and Commodities remains strong. Participate and benefit from attractive end markets, underpinned by strong industry megatrends. Well positioned to execute on FY27 objectives. Effective price management across divisions.
Slide 37: Questions
Questions © Copyright 2023 | ALS Limited 37
Slide 38: Appendix
Appendix 1H FY24 Investor Presentation
Slide 39: Global business with diverse end markets, services and customers
Appendix | Global business with diverse end markets, services and customers underpinned by industry mega trends and strong market positions Commodities Life Sciences (42% 1H FY24 revenue contribution) (58% 1H FY24 revenue contribution) Minerals and industrial materials Environmental Food and pharmac
Slide 40: Reconciliation of underlying to statutory NPAT
Appendix | reconciliation of underlying to statutory NPAT 1H FY23 ($m) 1H FY24 ($m) Underlying Half Year Underlying continuing operations Nuvisan Nuvisan equity Restructuring Amortisation Statutory continuing (including Nuvisan underlying share of profit and other items 2 of intangibles result opera
Slide 41: 1H FY24 restructuring and other items
Appendix | 1H FY24 restructuring and other items Acquisition / SaaS system Other non-operational Total non-recurring in $m Start-up Restructuring Divestment development items costs Commodities - 0.0 - - - 0.0 Life Sciences 2.4 2.5 - - - 4.9 Corporate - 0.4 1.3 12.5 0.6 14.7 Discontinued business - -
Slide 42: Underlying effective tax rate movement
Appendix | underlying effective tax rate movement Change $m 1H FY24 1H FY23 YoY Underlying Profit before Tax (from continuing operations) 222.1 227.5 (2.4)% Tax 63.4 65.4 (3.1)% Effective Tax Rate (ETR) 28.5% 28.7% (20) bps FY24 outlook: ETR expected to be between 28% and 29% on an underlying basis
Slide 43: Net debt evolution
Appendix | net debt evolution Leverage Ratio Leverage Ratio 1.9 x 2.0 x 75 6 20 94 1,153 (131) 60 1,028 30 September 2022 Net Free Cash Flow Acquisitions net of Dividends paid Treasury shares bought Fx Interest and Tax 30 September 2023 Net Debt divestments on-market Debt right solutions. right part
Slide 44: Current financings remain subdued but trending in-line with recent years
Appendix | current financings remain subdued but are trending in-line with recent years • Current financings below Junior and intermediate financings (US$Bn)1 2020–2022 period but in 2014 to September 2023 25 line with 10–year averages2 • Near-term financings to 20 remain subdued as macro- factors i
Slide 45: Sample flow improvement reflective of increasing market-share growth
Appendix | sample flow improvement reflective of increasing market-share growth • (13)% decline in sample flows ALS Global mineral sample volume (trailing 52-week running average), during period, in line with lower 450,000 S&P Global Exploration Spend and ALS Geochemistry Revenue in US$1 27.00 400,0
Slide 46: Acronyms and definitions
Appendix | acronyms and definitions BPS Base points CCY Constant Currency DSO Days sales outstanding EPS Earnings per share ERP Enterprise Resource Planning ESG Environmental, Social and Governance FCF Free cash flow FX Foreign exchange Industrial Materials Includes Inspection, Coal, Oil & Lubricant
Slide 47: right solutions. right partner.
right solutions. right partner. © Copyright 2022 | ALS Limited 47