Slide 1: Full Year Results 2013
Macmahon Holdings Limited For personal use only Full Year Results 2013 20 August 2013
Slide 2: 2013 - Year in Review
2013 - Year in Review For personal use only Mining focused strategy implemented with sale of construction business Mining revenue 1,173 effected in February 880 Consolidated net loss of $29.5 million greater than anticipated due to 645 674 provisions taken for disputed claims, doubtful debts and
Slide 3: Operational Update – Surface Mining
Operational Update – Surface Mining For personal use only Awarded Macmahon’s largest mining contract in January 2013 • 5 year, $1.8 billion Christmas Creek Mine expansion • Rapid ramp-up complete – 669 people on site, over 100 major items of equipment commissioned • Majority of equipment is client
Slide 4: Operational Update – Underground Mining
Operational Update – Underground Mining For personal use only Three year contract extension awarded at Olympic Dam - 6th extension since first contract award in 2004 Ranger 3 Deeps ramp-up complete, mine decline progressing well – reaching 1,000 metres in July 2013 Argyle progressing on a redu
Slide 5: Operational Update – International
Operational Update – International For personal use only Ramp-up at Calabar, Nigeria progressing well 10 years of operation in South East Asia – one year extension awarded at Lhok Nga, Indonesia Expansion opportunities with Lafarge being tendered in both Nigeria and Malaysia Presence establi
Slide 6: Operational Update – Mongolia
Operational Update – Mongolia For personal use only Mongolian coal industry stagnant due to lower coal prices being received from Chinese customers. Production not at projected levels Production at Tavan Tolgoi scaled back to match demand ROM and border stockpiles full, with approximately 1.2
Slide 7: Map of Operations
7 For personal use only Map of Operations
Slide 8: People
People For personal use only Group employee numbers 679 employees transferred or made redundant 4,791 in sale of construction projects to Leighton Group 3,536 3,495 3,098 3,021 Successful ramp-up for Christmas Creek and Tropicana Gold Project complete – currently 933 people on site Focus on ri
Slide 9: Safety
Safety For personal use only Fatality recorded at CSA Mine Shaft in New South Wales Kanthan, Malaysia recorded nine years LTI free Eaglefield/Lenton and underground shotcreting operations recorded six years LTI free 3 day MacStart program launched – incorporates safety into all aspects of in
Slide 10: Financials
For personal use only Financials
Slide 11: Income Statement
Income Statement For personal use only $ millions 2013 2012 Change Total revenue from continuing operations 1,173.4 880.1 33% Earnings before interest and tax (EBIT) from continuing operations 84.5 62.6 35% Interest (18.3) (13.3) 38% Profit before tax from continuing operations 66.3 49.3 34% Tax exp
Slide 12: Profit Waterfall
12 0.0 -30.0 -20.0 -10.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 For personal use only 2012 NPAT 56.1 $ million 2012 NPAT from discontinued operations (19.3) 2012 NPAT from 36.7 continuing operations Note: Numbers may not add due to rounding Profit Waterfall Mining - Volume 24.1 Mining - Margin (7.2) Pro
Slide 13: Mining Performance
Mining Performance For personal use only $ millions 2013 2012 Change Record revenue of $1.2 billion (up 33% on pcp) Segment revenue 1,173.4 880.1 33% following the commencement of mining operations Profit before tax 69.5 72.3 (4%) at Tropicana Gold Project and Christmas Creek Profit before tax mar
Slide 14: Exit from Construction – Discontinued Operations
Exit from Construction – Discontinued Operations For personal use only $ millions 2013 2012 Segment revenue 581.7 990.7 (Loss) / profit before tax (126.0) 25.9 (Loss) / profit after tax (73.1) 19.3 Order book 63 1,171 Full year loss before tax of $126.0 million mainly attributable to Hope Downs 4,
Slide 15: Cash Flow
Cash Flow For personal use only $ millions 2013 2012 Change EBITDA 67.5 167.8 (60%) Net interest paid (18.8) (9.2) 104% Income tax (paid) / refund (9.6) (4.8) 100% Working capital and provisions 69.5 (67.0) 204% Operating cash flow 108.6 86.8 25% Proceeds from sale of assets 59.11 7.2 721% Capital e
Slide 16: Balance Sheet and Gearing
Balance Sheet and Gearing For personal use only Gearing $ millions 2013 2012 Change 23.1% Current assets 435.3 528.9 (18%) 15.4% Non-current assets 509.2 460.1 11% Total assets 944.5 989.0 (4%) 0.6% Net assets 401.2 356.8 12% Jun-09 Jun-10 Jun-11 Jun-12 Jun-13 Net debt/(cash) 61.7 82.6 (25%) Gearing
Slide 17: Outlook
For personal use only Outlook
Slide 18: Strategy
Strategy For personal use only Strengthening our position as a leading provider of end-to-end mining services Refine core competencies Focus on business fundamentals Achieve sustainable growth Mining focused strategy (exit Extend existing mining contracts Maintain strong, long-term constructio
Slide 19: New Management Team
New Management Team For personal use only Ross Carroll Chief Executive Officer and Managing Director Theresa Mlikota Fraser Ramsay Nick Cernotta Robert Barker David Todd Roger Hughes Chief Financial Officer Chief Operating Officer Chief Operating Officer Group General Manager General Manager Acting
Slide 20: Market Conditions
Market Conditions For personal use only Coal Production and Investment, Australia Production of major commodities expected to increase despite expected reduction in short-term investment Declining market conditions and downward pressure on commodity prices have resulted in a reduced domestic ten
Slide 21: Order Book
Order Book For personal use only Mining order book of $3.2 billion consisting mainly of long-term contracts with blue-chip clients $383 million of expected contract renewals Almost $900 million of revenue secured for 2014, including expected contract renewals Order book and run-off ($ million)
Slide 22: Business Outlook
Business Outlook For personal use only Revenue outlook for 2014 expected to be in the range of $0.9 – 1.2 billion, but remains at risk: • Fewer new work opportunities • Scope reductions and contract deferrals by customers • Significant increase in competition Margin pressure expected to continue
Slide 23: Summary
For personal use only Summary
Slide 24: Summary
Summary For personal use only 50 years of operation Consolidated net loss of $29.5 million resulting from major construction losses Record mining revenue and strong historical financial performance Strong operating cash flow from mining operations - $117.9 million Solid order book of $3.2
Slide 25: Full Year Results 2013
Macmahon Holdings Limited For personal use only Full Year Results 2013 20 August 2013
Slide 26: Construction Sale
Construction Sale For personal use only $ millions Construction sale Rail assets sale Total Contract consideration 22.2 - 22.2 Sale of assets 15.6 4.5 20.1 Employee entitlements transferred (4.8) (0.1) (4.9) Working capital adjustments (4.0) 0.2 (3.8) Total consideration 29.0 4.6 33.6 26
Slide 27: Normalisation of 2013 Operating Cash Flow
Normalisation of 2013 Operating Cash Flow For personal use only Discontinued Continuing $ millions Total operations operations Operating cash flow (9.3) 117.9 108.6 Delayed 2012 debtors collected in 2013 (57.0) (7.0) (64.0) Delayed 2013 debtors - 12.0 12.0 Other (5.4) - (5.4) Normalised 2013 operati
Slide 28: Major Projects
Major Projects For personal use only Project Value Started Christmas Creek (WA) $1.8 billion 2012 Orebody 18 / Wheelara (WA) $975 million 2006 Tropicana Project (WA) $900 million 2012 Eaglefield / Lenton (QLD) $550 million 2003 Olympic Dam (SA) $687 million 2004 Argyle Mine (WA) $376 million 2006 Ta
Slide 29: Revenue and Order Book Diversity
Revenue and Order Book Diversity For personal use only 2013 revenue by client 2013 revenue by commodity 2013 revenue by location Order book by client Order book by commodity Order book by location Note: Revenue and order book information presented on this page relates to mining activities only and e
Slide 30: Disclaimer and Important Notice
Disclaimer and Important Notice For personal use only This presentation contains forward looking statements that are subject to risk factors associated with the mining and construction businesses. While Macmahon considers the assumptions on which these statements are based to be reasonable, whether
Slide 31: Full Year Results 2013
Macmahon Holdings Limited For personal use only Full Year Results 2013 20 August 2013