Murray & Roberts — FY2006 Earnings Presentation
48 slides from Murray & Roberts's earnings presentation, August 2006
Slide 1: Murray & Roberts 2010 Report to Stakeholders
MURRAY & ROBERTS 2010 REPORT TO STAKEHOLDERS FINANCIAL YEAR TO 30 JUNE 2006
Slide 2: Globalising Murray & Roberts
STOP.THINK Globalising Murray & Roberts
Slide 3: A Year in Perspective: Bahrain Dhow Tragedy
A YEAR IN PERSPECTIVE BAHRAIN DHOW TRAGEDY On the evening of 30 March 2006 a celebratory event for the leadership team on the World Trade Centre Project turned into an unimaginable g nightmare g for 130 p people, p , their family, y, friends and colleagues. z 58 people lost their lives z 10 from Mur
Slide 4: Induction video
Induction video
Slide 5: Health, Safety and the Environment: Stop.Think Aspiration
HEALTH SAFETY AND THE ENVIRONMENT STOP.THINK ASPIRATION Zero harm consequence from our activities on z our company and clients, z all ll people, l and d z the environment y and p Fatality permanent disability y benchmarked at zero LTIFR targeted at a benchmark < 3,0 z with a long-term objective < 1,
Slide 6: Stop.Think Bill of Rights
STOP THINK BILL OF RIGHTS STOP.THINK PERSONAL RESPONSIBILITY FOR PERSONAL RIGHTS z a safe and healthy work environment z STOP and THINK before carrying out any specific task z make a situation safe before proceeding z question any instruction that has HSE risk attached z approach pp any ypperson whe
Slide 7: Health, Safety and Environment: Significant Achievements
HEALTH SAFETY AND THE ENVIRONMENT SIGNIFICANT ACHIEVEMENTS z Dubai Airport Contract 14,000,000 hours without a lost time injury z Murray & Roberts Cementation 2,000,000 fatality free shifts (a safety record in the contract mining sector) z Murray & Roberts Construction 10,000,000 hours without a fat
Slide 8: Health, Safety and Environment: Performance in the Year
HEALTH SAFETY AND THE ENVIRONMENT PERFORMANCE IN THE YEAR LOST TIME INJURY FREQUENCY RATE z LTIFR - 4,65 4 65 iin 116 116,25 25 million illi h hours worked k d (2005 4 (2005: 4,60) 60) FATALITIES (all in South Africa) 10 no (2005:12 no) z Construction – Above Ground 4 no (2005: 7 no) z Construction
Slide 9: Prospects Statements 2006
PROSPECTS STATEMENTS 2006 Annual Report 2005 The directors are of the view that the next few years will be positive for the Group and that there will be real growth in headline earnings in the year to 30 June 2006 Interim Report 2006 Excluding [the Group’s BBBEE transaction], headline earnings per s
Slide 10: Trading Statement 2006
TRADING STATEMENT 2006 July 2006 Murray & Roberts advised shareholders in its interim report that headline earnings per share (“heps”) excluding a R95 million charge to the income statement relating to the granting of shares to almost 14000 employees in terms of the Group’s Broad Based Black Economi
Slide 11: Financial Year to 30 June 2006
FINANCIAL YEAR TO 30 JUNE 2006 DIVIDEND FOR YEAR 33% to 60 cents per share ORDER BOOK 18% to R 10,0 billion REVENUES 16% to t R 11,9 11 9 billion billi OPERATING PROFIT 47% to R 800 million HEADLINE EARNINGS 26% to 184 cents per share (excluding BBBEE Cost)
Slide 12: Murray & Roberts 2010: Committed Workflow Project Pipeline
MURRAY & ROBERTS 2010 > R 30 BILLION COMMITTED WORKFLOW PROJECT PIPELINE SADC , billion R 5,5 Concor R 1,5 billion International R 3,0 billion Gautrain R 4,5 billion Industrial R 11,0 billion Clough R 5,0 billion
Slide 13: Leadership Capacity
LEADERSHIP CAPACITY MURRAY & ROBERTS 2010 Keith Smith (56) Brian Bruce (57) Sean Flanagan (47) Peter Adams (58) John Cooper (56) Edwin Hewitt (40) Roger Rees (53) Malose Chaba (46)
Slide 14: Share Performance
SHARE PERFORMANCE The Share has improved 120% since 1 July 2005 Market Capitalization has risen above R 10 billion Share Volume Traded Price Murray & Roberts Holdings Limited 12000000 1 July 2005 to 29 August 2006 3000 2850 10000000 2700 2550 8000000 2400 2250 6000000 2100 1950 4000000 1800 1650 200
Slide 15: Broad Based Black Economic Empowerment
BROAD BASED BLACK ECONOMIC EMPOWERMENT > R 600 MILLION WEALTH CREATED IN 12 MONTHS ! Letsema Bokamoso General Staff Trust 1,3% > R 125 million value created for 14000 employees Letsema Khanyisa Black Employee Benefit Trust 2,2% >R 4 million available for distribution Letsema Vulindlela Black Executi
Slide 16: Human Capital Development
HUMAN CAPITAL DEVELOPMENT > 30000 EMPLOYEES FROM 1 JULY 2006 Salaries and Wages SADC >R3 3,0 0 billion p.a. pa > 20% of Revenues International < R 0,5 billion p.a. < 15% of Revenues E l Employees SADC > 30 000 people ± R 100 000 per person International < 1 500 people ± R 300 000 per person
Slide 17: Slide 17
Slide 18: International Financial Reporting Standards
FINANCIAL YEAR ENDED 30 JUNE 2006 INTERNATIONAL FINANCIAL REPORTING STANDARDS In finalising the audited accounts for the reporting period in t terms off IFRS some adjustments dj t t have h b been necessary to t the th restated audited accounts for the period ended 30 June 2005 2005 Attributable Attr
Slide 19: Financial Year Ended 30 June 2006
FINANCIAL YEAR ENDED 30 JUNE 2006 (cents per share) 2006 2005 DIVIDEND 60 45 HEADLINE EARNINGS (excl BBBEE cost) 184 146 (p (percentage) g ) OPERATING MARGIN 6,7 5,3 RETURN ON SHAREHOLDER FUNDS 16,1 16,0 (R millions) ATTRIBUTABLE EARNINGS 561 493
Slide 20: A Strong Balance Sheet
FINANCIAL YEAR ENDED 30 JUNE 2006 A STRONG BALANCE SHEET (R millions) 2006 2005 TOTAL ASSETS 10 385 8 104 Cash 1 808 1 931 Fixed & Current 8 577 6 173 TOTAL EQUITY & LIABILITIES 10 385 8 104 Permanent capital 3 194 3 164 Non-current liabilities 1 028 890 C Current liliabilities bili i 6 163 4 050
Slide 21: Revenues Up and Growing
FINANCIAL YEAR ENDED 30 JUNE 2006 REVENUES UP AND GROWING R968m R46m R11,9bn R4,0bn R7,0bn +R736 +R736m +R814m +R99m -R356m R356 +R1 7b +R1,7bn Construction & Materials & Fabrication & Discontinued Revenue Engineering Services Manufacture Operations
Slide 22: Operating Profit Up at 6,7% Margin
FINANCIAL YEAR ENDED 30 JUNE 2006 OPERATING PROFIT UP AT 6,7% MARGIN R86m -R147m R537m R1m R801m +R85m +R211m -R15m -R25m -R11m +R245m R324m Construction & Materials & Fabrication & Corporate Discontinued Operating Engineering Services Manufacture Operations Profit (EBIT)
Slide 23: Cash Flow Strong
FINANCIAL YEAR ENDED 30 JUNE 2006 CASH FLOW STRONG R1,73bn R1,64bn (R183m) (R356m) (R183m) (R85m) (R195m) (R152m) R1,06bn +R985m +R51m +R159m -R163m +R28m +R19m -R69m +R723m +R1,73bn Opening Financing Investing Dividends Interest, Tax Working Exceptional Operating Closing Cash Activities Activities
Slide 24: Engineering Contracting
FINANCIAL YEAR ENDED 30 JUNE 2006 ENGINEERING CONTRACTING R611m R48m R603m R26m 2006 2005 2006 2005 Revenue Operating Profit Margin : 7,9% (2005: 4,3%)
Slide 25: Construction SADC
FINANCIAL YEAR ENDED 30 JUNE 2006 CONSTRUCTION SADC R2,21bn R124m R2,12bn R35m 2006 2005 2006 2005 Revenue Operating Profit Margin : 1,6% (2005: 5,6%)
Slide 26: Construction Middle East
FINANCIAL YEAR ENDED 30 JUNE 2006 CONSTRUCTION MIDDLE EAST R1,55bn R77m R906m -R41m R41 2006 2005 2006 2005 Revenue Operating Profit Margin : 5,0% (2005: loss)
Slide 27: Mining Contracting SADC
FINANCIAL YEAR ENDED 30 JUNE 2006 MINING CONTRACTING SADC R1.87bn R1,85bn R100m R93m 2006 2005 2006 2005 Revenue Operating Profit Margin : 5,3% (2005: 5,0%)
Slide 28: Mining Contracting International
FINANCIAL YEAR ENDED 30 JUNE 2006 MINING CONTRACTING INTERNATIONAL R64m R804m R662m R37m 2006 2005 2006 2005 Revenue Operating Profit Margin : 8,0% (2005: 5,6%)
Slide 29: Construction Materials - Fabrication
FINANCIAL YEAR ENDED 30 JUNE 2006 CONSTRUCTION MATERIALS - FABRICATION R 81 R781m R61m R58m R620m 2006 2005 2006 2005 Revenue Operating Profit Margin : 7,4% (2005: 9,8%)
Slide 30: Construction Materials - Steel
FINANCIAL YEAR ENDED 30 JUNE 2006 CONSTRUCTION MATERIALS - STEEL R1,67bn R127m R1,46bn R86m 2006 2005 2006 2005 Revenue Operating Profit Margin : 7,6% (2005: 5,9%)
Slide 31: Construction Materials - Infrastructure
FINANCIAL YEAR ENDED 30 JUNE 2006 CONSTRUCTION MATERIALS - INFRASTRUCTURE R980 R980m R218m R743m R130m 2006 2005 2006 2005 Revenue Operating Profit Margin : 22,2% (2005: 17,5%)
Slide 32: Construction Materials - Housing
FINANCIAL YEAR ENDED 30 JUNE 2006 CONSTRUCTION MATERIALS - HOUSING R324m R63m R174m R11m 2006 2005 2006 2005 Revenue Operating Profit Margin : 19,4% (2005: 6,3%)
Slide 33: Construction Services
FINANCIAL YEAR ENDED 30 JUNE 2006 CONSTRUCTION SERVICES R235m R71m R170m R38m 2006 2005 2006 2005 Revenue Operating Profit Margin : 30,2% (2005: 22,4%)
Slide 34: Industrial Manufacturing
FINANCIAL YEAR ENDED 30 JUNE 2006 INDUSTRIAL MANUFACTURING R968 R968m R869m R101m R86m 2006 2005 2006 2005 Revenue Operating Profit Margin : 8,9% (2005: 11,6%)
Slide 35: Clough Limited
FINANCIAL YEAR ENDED 30 JUNE 2006 CLOUGH LIMITED REVENUE EBIT (R millions) 2006 2006 2005 COMPANY 922 ( 6) (53) Projects 530 (43) (87) Services 143 10 5 Petrosea 154 16 6 Other 95 11 23 Attributable Earnings (15) (58)
Slide 36: Concor Limited
FINANCIAL YEAR ENDED 30 JUNE 2006 CONCOR LIMITED REVENUE EBIT (R millions) 2006 2006 2005 TOTAL 1828 46 37 Contracting 1471 ( 8) 15 Materials & Services 357 54 22
Slide 37: Slide 37
Slide 38: Risk Management: Opportunity Management System
RISK MANAGEMENT OPPORTUNITY MANAGEMENT SYSTEM C Cumulative l ti Filter Filt Status St t by b Turnover T Turnover Scope of Work Revenue Basis Project Delivered Partner(s) Location Legal g System y Consultant(s) Client(s) 0 bn 5 bn 10 bn 15 bn 20 bn 25 bn 30 bn 35 bn 40 bn (Chart reflects project oppo
Slide 39: Global Business Model: Regional Construction Economy
GLOBAL BUSINESS MODEL REGIONAL CONSTRUCTION ECONOMY 2010 – 60% Revenues Characterised by a multiplicity of clients and competitors
Slide 40: Global Business Model: Global Resources Economy
GLOBAL BUSINESS MODEL GLOBAL RESOURCES ECONOMY 2010 – 40% Revenues Characterised by a concentration of clients and competitors
Slide 41: Project Order Book
PROJECT ORDER BOOK Project Order Book R10 billion at 30 June 2006 Middle East 23% Rest est of o World o d 6% SADC 71%
Slide 42: Project Order Book: Growth
PROJECT ORDER BOOK Growth in Order Book 18% to 30 June 2006 Construction 53% Mining 40% Materials & Engineering 5% Services 2%
Slide 43: Year Ahead: Area of Focus Construction SADC
YEAR AHEAD TO 30 JUNE 2007 AREA OF FOCUS CONSTRUCTION SADC Performance breakdown in four “standard” standard projects exposed a vulnerability in our integrated construction capability. – New leadership team selected and appointed – Opportunity Management System installed and functional – ERP System
Slide 44: Year Ahead: Area of Focus Clough Australia
YEAR AHEAD TO 30 JUNE 2007 AREA OF FOCUS CLOUGH AUSTRALIA Performance breakdown in two oil & gas EPC projects exposed a vulnerability to project selection and relative scale. – Balance sheet recapitalised twice within 12 months – Independent chairman takes office at AGM – Deputy Chairman appointed t
Slide 45: Year Ahead: Area of Focus 2010 Soccer World Cup
YEAR AHEAD TO 30 JUNE 2007 AREA OF FOCUS 2010 SOCCER WORLD CUP Extended and complex procurement negotiation on Gautrain points to public sector challenge for time-defined delivery. – Dedicated leadership appointed to ensure performance – BEE enterprise development to be prioritised – Human capital p
Slide 46: Year Ahead: Area of Focus Major Project Capacity
YEAR AHEAD TO 30 JUNE 2007 AREA OF FOCUS MAJOR PROJECT CAPACITY Scale of projects in Opportunity Management System indicates step-change in nature of industry structure. – Appointed Group Projects Director – Project management systems upgraded and enhanced – Global business partnerships based on ris
Slide 47: Year Ahead to 30 June 2007: Prospects
YEAR AHEAD TO 30 JUNE 2007 PROSPECTS The Directors remain are of the view that the next few years will be positive to the Group and that including the consolidation of its acquisitions, revenues could be at substantially higher levels by 2010 at the target operating margin g of between 5,0% to 7,5%.
Slide 48: Thank You
THANK YOU This presentation is available on http://www.murrob.com
Murray & Roberts Holdings — FY2006 Earnings Presentation on 6ix