Slide 1: FY22 First Half Results Presentation
FY22 FIRST HALF RESULTS PRESENTATION for the six months ended 31 December 2021 Leading essential network service provider 24 February 2022
Slide 2: Contents
Contents 1 Group Overview 03 – 06 2 LLS Acquisition 08 – 09 3 Segment Performance 11 – 13 4 Financial Performance 14 – 17 5 Group Outlook 19 6 Appendix 21
Slide 3: Key highlights
Key highlights ● Soild operating result across re-based legacy Service Stream operations ● Exceptional cash result for the half year – OCFBIT conversion of 235% Telecommunications ● Closing net debt $47.1m ● Significant strategic milestone reached with Lendlease Services (“LLS”) acquisition successf
Slide 4: Financial headlines
Financial headlines EBITDA from Adjusted Total Revenue1 Operations2 NPAT Net debt Dividend $566.2m $39.3m $16.4m $47.1m Nil +38.1% vs pcp -2.3% vs pcp -18.6% vs pcp • Lendlease Services (LLS) • Rebased EBITDA margin • Statutory NPAT $5.3m • Exceptional EBITDA to • Interim dividend not revenue $168m
Slide 5: Enhanced Group revenue profile
Enhanced Group revenue profile Solid order book of ~$5.6bn in secured revenue across the growing infrastructure services market ● Revenue mix improving with diversification, noting initial contribution from Lendlease Services (LLS) following completion on 1 November 21 ● Group’s contract profile con
Slide 6: COVID-19
COVID-19 The Group has maintained operational delivery and managed through the Omicron outbreak without material financial impact Business Impacts Workforce Impacts Risk Mitigation (Limited COVID-19 impacts to date) (Short-term in nature) ● Strong volume of contracted works ● Reduced preventative /
Slide 7: Contents
Contents 1 Group Overview 03 – 06 2 LLS Acquisition 08 – 09 3 Segment Performance 11 – 13 4 Financial Performance 14 – 17 5 Group Outlook 19 6 Appendix 21
Slide 8: Lendlease Services acquisition
Lendlease Services acquisition Transformational acquisition providing the foundations for future growth Strategic rationale: ● Aligned with Service Stream’s strategy to diversify revenues, enhance capabilities and expand the Group’s addressable markets Created a broader portfolio of operations acros
Slide 9: Integration update
Integration update The integration program is progressing well with the timing realisation of $17m in synergies brought forward Delivery timeframe (18-24 months) Transaction Restructure Integration Exit TSA Complete Complete begins 2021 2022 2023 1 Nov 1 Jan 30 Jun 1 Nov 50% run rate synergies 100%
Slide 10: Contents
Contents 1 Group Overview 03 – 06 2 LLS Acquisition 08 – 09 3 Segment Performance 11 – 13 4 Financial Performance 14 – 17 5 Group Outlook 19 6 Appendix 21
Slide 11: Telecommunications
Telecommunications Expanded the breadth and depth of services delivered to major Telco clients under long-term agreements Revenue ($m) Highlights Major Clients 234.1 ● NBN 209.9 Revenue growth ~11% reflecting contribution of LLS, 1 including mobilisation of network upgrade program ● Optus (N2P) ● Te
Slide 12: Utilities Infrastructures
Utilities Infrastructures Increasing our long-term O&M (services) revenues across water, electricity and industrial client base Revenue ($m) Highlights Major Clients 277.4 Revenue growth ~40% reflecting contribution from LLS ● Sydney Water 199.6 1 and increase in infrastructure upgrade (construction
Slide 13: Transport
Transport Providing long-term operational support and maintenance services to public and private road asset owners Revenue ($m) Highlights Major Clients 55.0 ● Main Roads Western Australia Revenue reflects contribution from initial two 1 months of operations, post completion ● Transport New South Wa
Slide 14: Contents
Contents 1 Group Overview 03 – 06 2 LLS Acquisition 08 – 09 3 Segment Performance 11 – 13 4 Financial Performance 14 – 17 5 Group Outlook 19 6 Appendix 21
Slide 15: Profit and Loss
Profit and Loss Comparison of results for the six months to 31 December 2021 $m 1H22 1H21 Change $ Total Revenue +38.1%: Revenue 560.4 409.9 150.5 EBITDA 30.4 39.1 (8.7) • Includes $168m contribution from LLS post acquisition Non-operational costs (8.9) (1.1) (7.8) • SSM legacy operations down $11.7
Slide 16: Cashflow
Cashflow Comparison of results for the six months to 31 December 2021 Key highlights $m 1H22 1H21 Change $ EBITDA from Operations 39.3 40.2 (0.9) • Exceptional H1 cash conversion with OCFBIT of 235% +/- non-cash items & change in working 53.0 2.2 50.9 capital • Includes one-off benefit from release
Slide 17: Balance sheet & capital management
Balance sheet & capital management Comparison of results as at December 2021 SSM SSM LLS $m Balance sheet Dec-21 Jun-21 provisional Cash and cash equivalents 70.6 50.6 3.0 • Provisional accounting of LLS Acquisition adopted at Trade and other receivables 90.0 46.8 79.1 December 21 Inventories 15.8 6
Slide 18: Contents
Contents 1 Group Overview 03 – 06 2 LLS Acquisition 08 – 09 3 Segment Performance 11 – 13 4 Financial Performance 14 – 17 5 Group Outlook 19 6 Appendix 21
Slide 19: Group outlook
Group outlook The Group has maintained guidance provided for FY22, and expects continued growth into FY23 and beyond Trading Update FY22 H2 Priorities ● The Group maintains its guidance for FY22 and expects post acquisition pro forma FY22 EBITDA from Operations (inclusive of a full run rate of syner
Slide 20: Contents
Contents 1 Group Overview 03 – 06 2 LLS Acquisition 08 – 09 3 Segment Performance 11 – 13 4 Financial Performance 14 – 17 5 Group Outlook 19 6 Appendix 21
Slide 21: Reconciliation of statutory to adjusted profitability measures
1. Reconciliation of statutory to adjusted profitability measures $m 1H22 1H21 Reconciliation of Revenue to Total Revenue Revenue 560.4 409.9 Share of revenue from joint ventures 5.8 - Total Revenue (including joint ventures) 566.2 409.9 Reconciliation of EBITDA from Operations to EBITDA / NPAT EBIT
Slide 22: About
About Service Stream Limited is a public company listed on the Australian Securities Exchange (Code: SSM). The Service Stream Group is a provider of essential network services to the telecommunications, utility and transport sectors. Service Stream operates across all states and territories, has a w