Verbrec Ltd · ASX:VBC
Verbrec — H1 FY2024 Earnings Presentation
25 slides from Verbrec's earnings presentation, Feb 28, 2024
Slide 1: Enabling a sustainable future for our Clients and their Customers
Enabling a sustainable future for our Clients and their Customers 1
Slide 2: Disclaimer
Disclaimer This presentation contains certain statements and forecast provided by or on behalf of Verbrec Limited. Any forward-looking statements reflect various assumptions by or on behalf of Verbrec. Accordingly, these statements are subject to significant business, economic and competitive uncert
Slide 3: Agenda
Agenda 1. Corporate Profile 2. Half Year in Review 3. Commitment Checklist 4. H1 FY2024 Results 5. Key Messages for H2 FY2024 6. Energy Transition Recognised Partner 7. Project Highlight for a Sustainable Future 8. Conclusion
Slide 4: Who is Verbrec
Who is Verbrec is a leading Engineering, Asset Management, Infrastructure, Training and Verbrec mining technology services provider, operating across the entire asset life-cycle. We operate across multiple regions, including Australia, New Zealand, PNG, and the Pacific Islands, executing projects fo
Slide 5: Services & Geographical Footprint
Services & Geographical Footprint Enabling innovative solutions for a more sustainable future. Evolution Engineered Verbrec operates across the entire asset life cycle. 5 Verbrec Investors Presentation 2023
Slide 6: A digital twin for Stockyards
Products & Technology A digital twin For Stockyards enabling delivery of on-spec products in challenging conditions, whilst increasing throughput and reducing downtime. Visibility = profitability Predict and address off- Intuitive tools help Designed and Real time 3D stockyard spec shipments before
Slide 7: Verbrec at a glance
Verbrec at a glance Safety Enabling sustainability across: Zero Harm, Always LTIFR MTIFR TRIFR 3 FY16 1.14 1.14 2.28 400+ FY17 FY18 0 0 2.39 1.45 3.59 4.35 TEAM MEMBERS CORE FY19 0 0 0 MARKETS ENERGY MINING INFRASTRUCTURE FY20 0 0 0 FY21 0 0 0 FY22 0 4.35 8.70 FY23 0 1.20 6.02 FY24 0 0 2.5 Recognise
Slide 8: Corporate Snapshot
Corporate Snapshot Equity, Cash & Finance Facilities Capital Structure 31 December 30 June 2023 ASX code VBC 2023 Market Cap (as at 27 February 2024) $25.1m Total equity attributable to $17.1 m $13.0 m Share price (as at 27 February 2024) $0.087 owners of the Company Shares on issue (as at 27 Februa
Slide 9: Half Year – In Review
Half Year – In Review Operational Review Poor Performing Projects Capital Raise • Operational review of • The Company incurred • Verbrec raised over the business resulted in one-off expenses and $4 million in an improved operational write-downs in previous oversubscribed efficiencies (including peri
Slide 10: Training Business – Divestment
Training Business – Divestment Divestment One-off impacts Continuing Operations • Verbrec divested the • The divestment of the • H1 FY2024 results are unprofitable parts of its training training business presented with a focus business in November 2023, (Discontinued Operations) on Continuing which
Slide 11: Commitment Checklist
Commitment Checklist STATUS Sale of non-profitable training business resulting in annualised EBITDA savings of $2.0 million Review of projects including high risk construction activities resulting in annualised EBITDA savings of up to $1.0 million Operational review and reduction in overheads result
Slide 12: Commitment Checklist
Commitment Checklist STATUS Introduce improved project management systems and procedures Gross margin improvements (review of underlying rates on MSA contracts with a focus on profitable work) Increase work winning skills and effectiveness Grow existing high performing businesses (including Asset Ma
Slide 13: Financial Performance
Financial Performance H1 FY2024 H1 FY2023 Change to PCP Revenue $50.0 m $59.1 m ($9.1 m) Gross Profit $17.4 m $15.1 m $2.4 m Gross Margin 34.9 % 25.5 % 9.4 % EBITDA $5.0 m $1.3 m $3.6 m EBITDA Margin 10.0 % 2.3 % 7.7 % Profit / (Loss) after tax for Continuing Operations $2.9 m ($1.4 m) $4.3 m (Loss)
Slide 14: Financial Performance - Commentary
Financial Performance - Commentary • 9.4% ($2.4 million) increase H1 FY2023 H1 FY2024 in Gross Margins compared 100% 100% to previous corresponding 90% 90% period. 80% 80% • $11.4 million reduction in 70% 70% Cost of Sales associated 60% 60% with only a $9.1 million 50% 50% reduction in Revenue 40%
Slide 15: Financial Performance - Commentary
Financial Performance - Commentary • 10.0% EBITDA margin ($5.0 million) H1 FY2023 H1 FY2024 produced in H1 FY2024. 15.0% 15.0% • EBITDA margin has increased by 7.7% 10.0% 10.0% ($3.6 million) compared to pcp. • Impact of one-off’s and legacy 5.0% 5.0% projects reduced during period. 0.0% 0.0% • The
Slide 16: Financial Performance - Commentary
Financial Performance - Commentary • Comprehensive Profit attributable to H1 FY2024 Continuing Operations of $2.95 million. $3,000,000 • Comprehensive Loss attributable to Discontinued Operations of $2.77 million. $2,000,000 • Statutory total Comprehensive Profit $1,000,000 attributable to owners of
Slide 17: Financial Performance - Commentary
Financial Performance - Commentary EPS as a proportion of Share Price • Basic earnings per share First Half of attributable to Continuing FY2024 Operations is 1.2 cents for H1 13.8% FY2024, an increase of 1.9 cents compared to the previous corresponding period. • The EPS attributable to Continuing O
Slide 18: Key Messages — H2 FY2024
Key Messages — H2 FY2024 Relationship Clients Be the provider of choice for our Chosen Overbrec evolution engineered Best People, Great Teams Growing a culture around the best people Clients and teams e = — \— Build Capability Delivery Embrace the new technologies and skills critical to becoming an
Slide 19: Electrification & Energy Storage
Electrification & Energy Storage • Verbrec’s Infrastructure & Defence 70 160 350 project portfolio contains 11% 60 140 300 projects related to Electrification & 50 120 250 Energy Storage. 100 40 200 • AEMO Integrated System Plan (2022) 80 30 150 predicts: 60 • Storage Capacity to increase 20 40 100
Slide 20: Gas Market Transition
Gas Market Transition • Verbrec’s Process & Hydrocarbon project portfolio 18 contains 37% projects related to Gas Market 16 Transition. 14 • AEMO Draft Integrated System Plan (2024) predicts: 12 • Peaking gas-fired generators will play a 10 crucial role as significant coal fired 8 generation retires
Slide 21: Sustainable Mining & Green Commodities
Sustainable Mining & Green Commodities Addressing a fundamental issue in • Verbrec’s Minerals & Metals project portfolio contains 28% an innovative way projects related to Sustainable Mining & Green Commodities. • Verbrec’s digital twin product, StacksOn enables our mining clients to deliver on-spec
Slide 22: Sustainable Focus Areas
Sustainable Focus Areas • Verbrec primarily serves the Energy, Mining and Infrastructure sectors. Industry • The Australian Market Energy Operator, 17% in its draft 2024 integrated system plan estimates that the annualised capital 31% Infrastructure & cost of all generation, storage, firming Defence
Slide 23: Sustainable Focus Areas
Sustainable Focus Sustainable Areas Focus Areas • Infrastructure & Defence project portfolio - 11% Infrastructure & Hydrocarbons Minerals & Electrification & Energy Storage Defence Metals projects. • Process & Hydrocarbon project portfolio - 37% Gas Market Transition projects. • Minerals & Mining pr
Slide 24: Project Highlights
Project Highlights Hydrogen to Green Energy Evolution Hub Ammonia RAM Study (EEH) – Pre-Feasibility Study Long Duration Battery Broadlands Biogas Energy Storage Concept Upgrade Design Studies New Seawater Desalination Safeguards Mechanism Plant Project In South and Australian Carbon Australia Credit
Slide 25: Conclusion
Conclusion • Verbrec has addressed many of the issues that were previously impacting the organisation: • No further material impacts of Discontinued Operations expected in H2 FY2024. • The poor performing legacy projects are finalised and closed. • Verbrec is well placed to prioritise improvement in