Sgh Limited · ASX:SGH
Sgh — H1 FY2025 Earnings Presentation
33 slides from Sgh's earnings presentation, Feb 11, 2025
Slide 1: Presentation of Half Year Results (ASX cover announcement)
11 February 2025 Company Announcements Office Australian Securities Exchange Limited 20 Bridge Street SYDNEY NSW 2000 PRESENTATION OF HALF YEAR RESULTS SGH Ltd (“SGH”) (ASX:SGH) attaches the Results Presentation for the six months ended 31 December 2024. This release has been authorised to be given
Slide 2: SGH HY25 Financial Results Presentation
SGH HY25 Financial Results Presentation Ryan Stokes AO, SGH MD & CEO 11th February 2025
Slide 3: SGH Overview – Who We Are
SGH Overview – Who We Are SGH Ltd (ASX:SGH) Strategic Growth-Sector Exposures • One of Australia’s leading diversified operating groups • ASX100 constituent, ~$19 billion market capitalisation Market leading businesses Mining Infrastructure & Transitional • Scale and leadership positions in respecti
Slide 4: SGH Overview – HY25 Result Overview
SGH Overview – HY25 Result Overview $5,513m 2% $843m 10% $508m 7% $821m 15% Revenue EBIT NPAT Op Cash Flow HY25 SGH EBIT Composition ($m) 900 $23m, -18% -$18m, -50% $843m, +10% $70m, +39% 800 $156m, -2%1 & Other Media Corporate & Other 700 $259m, +29% 600 500 400 $352m, +5% 300 200 100 Industrial Se
Slide 5: SGH Overview – Core Values & Operating Model
SGH Overview – Core Values & Operating Model Purpose, Objectives and Values Operating Model Purpose Recognising and serving exceptional businesses Strategic Maximise return to Objective stakeholders through long term sustainable value creation Disciplined & Accountable Operating Model Values Owner’s
Slide 6: SGH Overview – Capital Allocation Model
SGH Overview – Capital Allocation Model EPS Share Price Growth Appreciation Capital Allocation Industrials & Energy FCF Application Capital Structure <2.5x (ND/EBITDA) Deleverage Strong OCF Demand thematics CPI+ growth & op leverage Enhance ROE TSR > Return hurdles Outperformance Stable & growing ~1
Slide 7: SGH Overview – Investment Thematics
SGH Overview – Investment Thematics Sector - Industrials 350,000 Australian Infrastructure and Construction Spend ($m) Source: Bis Oxford Economics, Haver Analytics 300,000 • Thematic: Infrastructure & Construction 250,000 200,000 150,000 o $1.8t 7-year infra. and construction outlook, slightly up v
Slide 8: SGH Overview – Key Outcomes
SGH Overview – Key Outcomes Strong underlying growth continues HY25 Key Financials • Revenue of $5,513m, up 2% in variable market conditions $m HY25 HY24 % Change • EBIT margin of 15.3% up 111bp, driven by margin Revenue 5,513 5,386 2% expansion at Boral and Coates Earnings before interest, tax, dep
Slide 9: SGH Overview - Safety and Sustainability
SGH Overview - Safety and Sustainability People and Safety Rolling 12m LTIFR1 Rolling 12m TRIFR2 Dec 2024 Dec 2023 Dec 2024 Dec 2023 • LTIFR and TRIFR improved by 9% and 12%, respectively WesTrac 0.2 0.4 4.0 4.5 Boral 1.9 2.1 3.6 5.2 • Reduction in Actual and Potential Serious Harm Incidents Coates
Slide 10: WesTrac Business Unit Overview
WesTrac Business Unit Overview SGH Overview Industrial Services Energy Media & Other Financials Closing and Outlook 9
Slide 11: Industrial Services – WesTrac Highlights
Industrial Services – WesTrac Highlights Revenue and earnings growth continues • Revenue and EBIT growth delivered against low-single digit parts price reduction effective, 1 July 2024 • Revenue of $3.2b up 8% • Capital sales of $1.2b up 13%, Services of $2.0b up 5% 3,155 2,928 352 8% 5% 334 • EBIT
Slide 12: Industrial Services – WesTrac Highlights
Industrial Services – WesTrac Highlights Services demand WesTrac Revenue Split by Half ($m) 3,500 Capital sales • HY25 Services revenue growth of 5% 3,000 Services 2,500 • 10-year Services revenue CAGR of 11% 2,000 1,500 • Services remains strong, supported by major rebuild 1,000 activity and ageing
Slide 13: Boral Business Unit Overview
Boral Business Unit Overview SGH Overview Industrial Services Energy Media & Other Financials Closing and Outlook 12
Slide 14: Industrial Services - Boral Highlights
Industrial Services - Boral Highlights Earnings and margin expansion • Revenue of $1,811m down 2%, impacted by lower residential construction, partially offset by pricing traction • EBIT margin of 14.3% up 335bp • EBIT of $259m, up 29%, supported by performance improvement initiatives, operating dis
Slide 15: Industrial Services - Boral Highlights
Industrial Services - Boral Highlights Volume and pricing Sales Volume Movement (%) Avg. Selling Price Movement (%) +7% +4% • Robust demand for concrete, with variable demand for +4% -6% -6% -1% -1% +3% 0% +1% other products • Volumes impacted by softer residential construction, and lower roading ac
Slide 16: Coates Business Unit Overview
Coates Business Unit Overview SGH Overview Industrial Services Energy Media & Other Financials Closing and Outlook 15
Slide 17: Industrial Services - Coates Highlights
Industrial Services - Coates Highlights Resilient customer activity • Revenue of $546m, down 4% in varying market conditions, adjusted for the sale of Coates Indonesia in the PCP • Customer activity remains resilient in East, West and North, softer in Victoria 156 546 160 569 4% 2% Cost focus an
Slide 18: Industrial Services - Coates Highlights
Industrial Services - Coates Highlights Asset utilisation and R&M efficiency Coates R&M vs Sales and Redline2 History 2Redline: Percentage of the hire fleet, on an original cost basis, that is unavailable for hire 30% • Time utilisation of 59.2%, down 1% and slightly below R&M/Sales Redline 25% 60%
Slide 19: Energy Business Unit Overview
Energy Business Unit Overview SGH Overview Industrial Services Energy Media & Other Financials Closing and Outlook 18
Slide 20: Beach (30%) and SGH Energy Highlights
Beach (30%) and SGH Energy Highlights Beach Energy • Strong HY25 production of 10.2mmboe, up 15% on new offshore wells online and production optimisation initiatives • First half revenue and NPAT up 5% and 37%, respectively, on higher customer gas nominations, pricing and production 990 237 941 Deli
Slide 21: Media and Other Overview
Media and Other Overview SGH Overview Industrial Services Energy Media & Other Financials Closing and Outlook 20
Slide 22: Media & Other Overview
Media & Other Overview Seven West Media (40%) • Revenue and NPAT down 6% and 41% respectively, against 5.4% lower total TV advertising market • Market decline partially offset by increasing revenue share, up 0.5 share points to 41.5% 727 HY25 costs down 2%, full-year expected to be $20-30m 775 37 •
Slide 23: SGH Finance
SGH Finance Richard Richards, SGH CFO 11th February 2025
Slide 24: Financials – Profit and Loss
Financials – Profit and Loss $m HY25 HY24 Change % Revenue 5,512.8 5,385.8 2.4% Other income 37.1 22.1 67.9% Share of results from equity accounted investees 100.1 85.5 17.1% Revenue and other income 5,650.0 5,493.4 2.9% Expenses (excluding. depreciation, amortisation and interest) (4,551.9) (4,476.
Slide 25: Financials – Significant Items
Financials – Significant Items $m HY25 HY24 Fair value adjustments arising from acquisition of Boral 6.0 (2.2) Net gain on disposal of controlled entities - 32.6 Producing & development asset impairment reversal 2.7 - Property EBIT 0.3 3.6 Transformation and restructure costs - (2.9) Remediation cos
Slide 26: Financials – Business Unit Earnings
Financials – Business Unit Earnings $m Total SGH WesTrac Boral Coates Energy Media Investments Corporate Revenue from continuing operations 5,513 3,155 1,811 546 1 - - - Statutory EBIT 797 352 256 156 65 (16) (1) (16) Add: unfavourable significant items 55 - 9 - 7 40 - - Subtract: favourable signifi
Slide 27: Financials – Cash Flow
Financials – Cash Flow $m HY25 HY24 Key Commentary Underlying EBIT 842.7 763.7 • Underlying OCF up 15% to $821m, Add: depreciation and amortisation 255.4 253.2 driven by business performance and release of net working capital Underlying EBITDA 1,098.1 1,016.9 • Higher investing cash outflow reflects
Slide 28: Financials – Balance Sheet
Financials – Balance Sheet $m HY25 FY24 Change % Trade and other receivables and contract assets 1,490.8 1,524.7 (2.2)% Inventories 2,182.6 2,337.9 (6.6)% Assets held for sale 7.7 7.3 5.5% Investments 1,441.0 1,391.6 3.5% Property, plant and equipment 3,620.3 3,642.1 (0.6)% Oil and gas assets 764.2
Slide 29: Financials – Capital Management
Financials – Capital Management Net Debt and Leverage Facility Maturity, Proforma as at 31 December 2024 ($m) • Deleverage achieved post-Boral acquisition to 2.18x 1 1,452 • Targeting 2.0x to support future investment in growth Corporate facility extended for 5 and 7 years • Ability to invest then d
Slide 30: Priorities and Outlook
Priorities and Outlook Ryan Stokes AO, SGH MD & CEO 11th February 2025
Slide 31: SGH Closing and Outlook – FY25 Priorities
SGH Closing and Outlook – FY25 Priorities FY25 key priorities SGH EBIT History with HoH Growth ($m) • Deleverage SGH balance sheet through strong 1600 1H EBIT operating cash flows 1400 2H EBIT 1200 • Lock in margin improvement at Boral to support through- 1000 11% the cycle mid-teen EBIT margins 800
Slide 32: SGH Closing and Outlook – FY25 Guidance
SGH Closing and Outlook – FY25 Guidance FY25 Guidance • Strong HY25 result and positive outlook for core sector exposures supports confidence in SGH earnings guidance of: “High single-digit EBIT growth expected in FY25” Industrial Services Outlook • Underlying growth in services activity, coupled wi
Slide 33: Disclaimer
Disclaimer Basis of preparation of slides Included in this presentation is data prepared by the management of SGH Ltd (“SGH”) and other associated entities and investments. This data is included for information purposes only and has not been subject to the same level of review by the company as the