Ioco Limited · JSE:IOC
Ioco — EOH Holdings — HY2023 Earnings Presentation
33 slides from Ioco's earnings presentation, April 2023
Slide 1: Interim Results HY2023
INTERIM RESULTS ~ | HY2023
Slide 2: Operational Overview
OPERATIONAL OVERVIEW Stephen van Coller Chief Executive Officer
Slide 3: Highlights Lowlights
Continuing Group Revenue increased 8% IMPROVEMENT CONTINUES DESPITE TOUGH CONDITIONS International revenue increased 45% Stable GP margins 29% Operating profit for H1- R110m - greater than FY2022- R100m Highlights Significant improvement H1 2023 on H2 2022 Lowlights Slowdown in SOE contracting impac
Slide 4: EOH successfully raised R600 million
EOH successfully raised R600 million Lebashe specific issue of R100 million Significant impact on business • Owns +20% of EOH • Generating free cash flows • A-shares extended for 5 years • Ability to invest into organic growth • Cementing our Level 1 BBBEE status • Efficient decision making Efficien
Slide 5: Growth
Accelerating the GET era EOH a sustainable business with solid foundations to drive growth 6% market share in South Africa, Go-To-Market and top significant organic growth opportunity customer focus Contract wins remain encouraging OEM partnership • 1585 new deals strategy working • Won AWS Rising S
Slide 6: Growth | New business R1.2bn
Growth | New business R1.2bn Manufacturing R239 000 000 Mining R151 453 603 Financial Services R144 000 000 Mining R126 228 929 Mining R125 911 332 Global Service Desk 3-year contract covering 4-year custom software development Global workspace 3-year contract covering 3-year Field Services global s
Slide 7: Efficiency
Accelerating the GET era EOH a sustainable business with solid foundations to drive growth Business margins stable Re-alignment of portfolio, reporting and accountability Leaner corporate structure and New ERP launched property lease portfolio Efficiency Efficient Capital Structure Corporate restruc
Slide 8: Talent
Accelerating the GET era EOH a sustainable business with solid foundations to drive growth Talent is a scarce commodity in the Pay for performance LTIP in digital world place, proper rewards International Top Employer award Remuneration and incentivisation Talent MyNextMove – use opportunity to Cult
Slide 9: Enable & Grow
Talent Include Enable & Grow Male | 56% Female | 44% Total Spend EL & UL | R15 954 475 AIC | 64 % of total workforce Inclusion roundtables hosted | 4 People with Disabilities | 165 2nd group of Youth Solvers Drone Pilot - PWD | 4 Care Employee Experience iOCO specialized Digital Testing Academy | 12
Slide 10: Top Employer Certification
Top Employer Certification Global certification recognizing excellence in people practices Performance Career and Talent Remuneration Upskilling Recognition Reskilling Business Strategy Ethics & Integrity Wellness People Strategy Diversity & Inclusion and Diversity Psychological Inclusion & Equity L
Slide 11: Impacting our communities
Impacting our communities We remain relevant to RSA in 2023 and beyond Entrepreneurship Supports Youth start- Rise against hunger Step up to a green up businesses and Volunteers collectively start up program will creates CVs for packed 15 000 meals develop 25 unemployed youth facilitators 50 learner
Slide 12: Financial Overview
Financial Overview Megan Pydigadu Chief Financial Officer
Slide 13: HY23 financial summary
HY23 financial summary HY23 HY22 Rm Unaudited Continuing Discont. Unaudited Continuing Discont. Revenue 3,244 3,215 29 3,511 2,980 532 iOCO 2,360 2,331 29 2,305 2,110 195 NEXTEC 884 884 - 907 871 37 IP - - - 300 - 300 Gross Profit 934 934 - 1,049 861 188 Gross margin 29% 29% - 30% 29% 35% Operating
Slide 14: Strong comeback from HY2'22 (R'm)
Strong comeback from HY2’22 (R’m) Improvement on key metrics 5% HY2'22 HY1'23 3,215 3,051 13% 934 829 112% 181 85 82% (37) (200) Revenue Gross Profit Adjusted EBITDA Profit after tax Revenue Gross Profit Adjusted EBITDA Profit after tax
Slide 15: Continuing External Revenue (R'm)
Continuing External Revenue (R’m) 8% Revenue growth year on year HY1'22 HY1'23 20% 779 10% 11% 650 634 593 575 13% South 13% 533 10% Africa 451 , 67% 398 South 10% Africa , 73% 335 3% 291 255 45% 230 197 203 Int, 33% Int, 27% Infrastructure Digital Enterprise Apps & Platforms People Infrastructure O
Slide 16: Continuing adjusted EBITDA by segment (R'm)
Continuing adjusted EBITDA by segment (R’m) HY1'22 HY1'23 103 83 61 56 47 36 37 32 32 26 21 23 4 -8 Infrastructure Digital Enterprise Apps & Platforms People Infrastructure Operational Services Software Reseller Solutions Solutions Technology The above includes intra and inter segment performance to
Slide 17: Continuing Normalised EBITDA (R'm)
Continuing Normalised EBITDA (R’m) HY22 HY23
Slide 18: Investing for future growth & efficiencies R48m
Investing for future growth & efficiencies Strong focus on future proofing business with targeted spend on exponential growth & savings opportunities Investment Type Area of Investment 18 1 16 8% 2 9 R48m 51% 15 41% 7 - 4 5 3 2 7 - 2 3 2 - - Operational RocketLab Infrastructure IT Other Technology S
Slide 19: Finance Charges (R'm)
Finance Charges (R’m) Reduced costs allows the Group to pursue investment Remaining Loan @ 31 March 2023: R673m opportunities Amortising 2,706 RCF loan 37% 26% 2,532 Term loan 2,034 2,034 37% 8% Future finance cost as leverage ratio improves (per HY) 30% 1,228 175 (22%) 161 28% 113 673 100 60% 82 46
Slide 20: Tax Rate
» Tax Rate 37% 27% 111% Effective Tax Reduction in Nextec turnaround ——_Non-deductible Tax payable in Prior period Rate H1 Finance Charges entities legal & advisory fees assessed loss entities taxes
Slide 21: Balance Sheet
Balance Sheet R’m HY23 FY22 R’m HY23 FY22 Non-current assets Equity Stated capital 4 217 4 217 Property, plant and equipment 151 185 Other reserves 465 495 Intangible assets 90 84 Accumulated loss (4 684) (4 679) Goodwill 675 675 Equity and Equity attributable to EOH (1) 34 Assets Liabilities Non-co
Slide 22: Debt Update (R'm)
Debt Update (R’m) Rolling Term credit loan, 223 facility, 250 Amortising loan, 200 The above excludes utilisation of any general banking facilities
Slide 23: Working Capital (R'm)
Working Capital (R’m) Managing closely within confines of the current economic climate 1,798 1,829 2,007 295 218 253 125 90 83 (1,628) (1,701) (1,838) Jan-22 Jul-22 Jan-23 Trade Payables Inventory Trade Receivables Net working capital
Slide 24: Cash bridge (R'm)
Cash bridge (R’m) Economic pressure on customers, investments & high finance costs have put a strain on cash generation SIU Payments 12% 31% Litigation against previous 30% directors Automation Specification 27% Pia Solar Cash Split Discontinuing 2% Continuing 98%
Slide 25: Legacy payments to come (R'm)
Legacy payments to come (R’m) Closing out remains a key focus 40 40 3 8 42 42 21 3 FY23 FY24 FY25 FY26 Department of Water & Sanitations Department of Defense SARS
Slide 26: A reminder of how we see our Business with the correct capital structure
A reminder of how we see our Business with the correct capital structure Profit after EBITDA Revenue tax R483m R5,961m R112m 8% margin 2% margin
Slide 27: Exceeding progress towards target profit of R112 million
Exceeding progress towards target profit of R112 million HY’23 values doubled
Slide 28: Outlook
Outlook
Slide 29: SOLVE
SOLVE We exist to improve lives through the technologies we create, leaving the world better than we found it. 29
Slide 30: Technology Platforms to free Clients up to focus on their core business
Technology Platforms to free Clients up to focus on their core business Infrastructure Operational & Industrial Digital Enablement EasyHQ Services Technology Software Dev Infrastructure Services Data & Analytics GRC aaS Digital Industries Enterprise Applications Automation Cloud People Solutions NEX
Slide 31: Outlook
The central growth focus is partnering with both key OEM’s The tough economic and and top customers assisting political conditions in RSA are them to realise their set to continue but create both digital strategies opportunities and threats EOH will continue to save to Saving to invest in growth and
Slide 32: Highlights Lowlights
Continuing Group Revenue increased 8% IMPROVEMENT CONTINUES DESPITE TOUGH CONDITIONS International revenue increased 45% Stable GP margins 29% Operating profit for H1- R110m - greater than FY2022- R100m Highlights Successful rights issue - 200% over subscribed - 92% followed rights Lowlights Slowdow
Slide 33: Thank you
Thank you