Maas Group Holdings Ltd. · ASX:MGH
Maas — H1 2024 Earnings Presentation
39 slides from Maas's earnings presentation, Feb 15, 2024
Slide 1: 1H24 Results Presentation
For personal use only 1H24 RESULTS PRESENTATION ~1,900 44 17 ~550 ~8,000 ~$852m 3 team quarries1 concrete assets residential commercial manufacturing members plants for hire lots2 property GDV3 plants 1 Includes both operational and non-operational quarry assets as well as the 3 additional quarries
Slide 2: Presenters
PRESENTERS For personal use only BUSINESS STRATEGY & PERFORMANCE 3 – 13 BUSINESS UNIT REVIEWS 14 - 22 Wes Maas GROUP FINANCIAL RESULTS & REVIEW 24 – 31 CEO & Managing Director KEY MESSAGES 32 QUESTIONS 34 APPENDICES 36 – 39 Craig Bellamy Chief Financial Officer 2
Slide 3: Strongly positioned to deliver attractive returns through the cycle
STRONGLY POSITIONED TO DELIVER ATTRACTIVE RETURNS THROUGH THE CYCLE INVESTMENT FRAMEWORK For personal use only Disciplined focus on return on capital employed (ROCE) ENABLED BY STRATEGIC FUNDAMENTALS Established and growing tangible Aligned founder-led team focused Proven track record of organic ass
Slide 4: Company values
For personal use only TRUST TEAMWORK only earned through action focused on safety and solutions COMMITMENT LEADERSHIP deliver on commitments to customers the courage to strive for excellence CANDOUR OWNERSHIP transparent conversations to get it right empowered to get it right and be accountable for
Slide 5: Maas continues to grow its operations and asset portfolio
MAAS CONTINUES TO GROW For personal use only ITS OPERATIONS AND ASSET PORTFOLIO FOCUSED ON THE EAST COAST OF AUSTRALIA. Key Maas Office / Hub Solar projects Quarry Battery storage projects Concrete Plant Wind projects Newell Highway Pumped hydro projects Inland Rail National Highway Major Railway Re
Slide 6: Strategic investments in the Victorian construction materials market
Bairnsdale For personal use only Key Dandy Quarry Newly Acquired Quarry Dandy Concrete Plant Strategic investments made in the attractive Victorian Construction Materials market • 3 hard rock quarries acquired 6 February 2024 for an initial cash payment of $40.0m1 with a further $30.0m cash to be pa
Slide 7: Record 1H result – strong growth, high cash conversion
RECORD 1H RESULT – STRONG GROWTH, HIGH CASH CONVERSION For personal use only Underlying Revenue2 Underlying EBITDA Underlying EBIT Cashflow Conversion3 $469.3M $97.1M $71.2 110% Increase of 32%, solid pipeline Increase of 47% on pcp, record Increase of 56% on pcp, with Up from 89% (1H23) for 2H24 ha
Slide 8: 20+ years of growth, notable acceleration since listing
For personal use only Maas Group Holdings Construction Materials Civil Construction & Hire Maas Group Holdings Underlying EBITDA ($M) Underlying EBITDA ($M) Underlying EBITDA ($M) Underlying NPAT ($M) 36.4 38.8 38.5 97.1 30 66.1 24.7 25.3 17.5 40.1 16.3 15.7 16.6 11.4 14.3 30.2 30.4 9.9 9.5 6.7 1H20
Slide 9: Safety performance
• Our focus is on decreasing injuries across all our Business Units. We have implemented a Safety Activity Calendar across the Company to refocus our For personal use only businesses on proactive safety management. • We remain committed to creating a safety culture that empowers our people to look a
Slide 10: Reducing environmental and climate related impacts
Maas is committed to, and maturing on, its journey to reduce environmental and climate related impacts Outlook For personal use only The Group acknowledges the growing demands of our stakeholders in ESG, and the potential risks and opportunities posed to our business, and the broader sector, as a re
Slide 11: People and community
31% For personal use only ~1,900 FEMALE 72 REPRESENTATION APPRENTICESHIP TEAMMATES IN SENIOR TRADE POSITIONS EXECUTIVE Highlights • Ongoing commitment to ‘growing our own’ through supported external training and development opportunities as well as the MGH leadership development program • In H124 we
Slide 12: Priorities
PRIORITIES For personal use only • Safety – after a very substantial improvement in safety through FY23 the rate of injury (LTIFR) has increased in 1H24 and a top priority for the business is to refocus and ensure everything possible is being done to again reduce the incidences of workplace injury.
Slide 13: Asset recycling program
• During 1H24, 3 Commercial property assets were sold along with a range of plant and equipment that yielded For personal use only $2.6m in excess of book values. • Currently in advanced negotiations on a number of commercial properties • Confident Asset recycling target of $70m will be achieved ASS
Slide 14: Business unit overview
BUSINESS UNIT OVERVIEW INDUSTRIAL OPERATING SEGMENTS REAL ESTATE OPERATING SEGMENTS For personal use only CONSTRUCTION CIVIL CONSTRUCTION MANUFACTURING RESIDENTIAL COMMERCIAL MATERIALS & HIRE & EQUIPMENT SALES REAL ESTATE REAL ESTATE • Quarries • Equipment Hire • Equipment sales & • Residential • Co
Slide 15: Construction Materials
For personal use only QUARRIES CONCRETE ASPHALT LOGISTICS GEO-TECH 15
Slide 16: Construction Materials 1H24 highlights
1H24 HIGHLIGHTS BUSINESS UNIT PERFORMANCE • Revenue increased significantly on 1H23 driven by strong CONSTRUCTION MATERIALS performance of businesses acquired in FY23 coupled with 9% organic growth • EBITDA growth in 1H24 of 108% driven by strong contributions from Dandy and Austek alongside 23% org
Slide 17: Civil Construction and Hire
For personal use only CIVIL CONSTRUCTION EQUIPMENT HIRE ELECTRICAL TRANSMISSION & DISTRIBUTION 17
Slide 18: Civil Construction and Hire 1H24 highlights
BUSINESS UNIT PERFORMANCE 1H24 HIGHLIGHTS CIVIL CONSTRUCTION AND HIRE • Revenue increased on 1H24 driven by organic business growth of 4% • After a weather impacted 1H23, EBITDA increased by 29% with For personal use only $ Million (Underlying) 1H23 1H24 Movement growth in renewable energy projects
Slide 19: Residential
For personal use only RESIDENTIAL DEVELOPMENT HOME BUILDING BUILD-TO-RENT LAND LEASE 19
Slide 20: Residential Real Estate 1H24 highlights
1H24 HIGHLIGHTS BUSINESS UNIT PERFORMANCE • Revenue reduced on 1H23 driven by a reduction in external land settlements (1H23: 55 vs 1H24: 34) RESIDENTIAL REAL ESTATE • EBITDA increased by 124% driven by an englobo sale representing the effective sale of 60 future lots • Fair value gain (BTR) of $0.5
Slide 21: Commercial
For personal use only COMMERCIAL DEVELOPMENT COMMERCIAL CONSTRUCTION BUILDING MATERIALS LEASING 21
Slide 22: Commercial Real Estate 1H24 highlights
BUSINESS UNIT PERFORMANCE COMMERCIAL REAL ESTATE 1H24 HIGHLIGHTS • Revenue increased on 1H23 driven by strong growth from Commercial Construction For personal use only $ Million (Underlying) 1H23 1H24 Movement • EBITDA decreased by 22% driven by a reduction in fair value Revenue 59.0 72.7 23% gain o
Slide 23: Craig Bellamy, Chief Financial Officer
For personal use only Craig Bellamy Chief Financial Officer 23
Slide 24: Group income statement summary
$ Million 1H23 1H24 • Revenue growth of 32%, driven by existing businesses and businesses acquired Revenue 353.5 463.4 in FY23. Key drivers of the increase: For personal use only Other Revenue 1.7 5.9 • Increased quarry and concrete volumes driving quarry, concrete and transport sales (increase of $
Slide 25: Expenses driven by acquired and organic revenue growth
Expenses driven by acquired and organic revenue growth at improved margins over pcp For personal use only $ Million 1H23 1H24 Increase % • Operating expenses increased by 24%, driven by: Revenue 355.2 469.3 32% • $68.8m increase in expenses from businesses acquired in 2H23 & 1H24 Materials & consuma
Slide 26: Cash flow
$ million 1H23 1H24 • Operating Cash Flow (pre-land inventory, FV gains, interest & tax) for 1H24 EBITDA 66.1 97.1 is $96.8m, representing a cash conversion of EBITDA ratio of 110% driven by For personal use only Fair value gains (FV gains) (15.5) (8.8) strong working capital management across the g
Slide 27: Underlying cashflow by segment
UNDERLYING CASHFLOW BY SEGMENT Construction Civil Construction Residential Commercial Corporate & For personal use only $ million Manufacturing Group Materials & Hire Real Estate Real Estate Eliminations EBITDA 36.4 38.8 11.2 15.6 1.6 (6.4) 97.1 Fair value gains - - (0.5) (8.3) - - (8.8) EBITDA excl
Slide 28: 1H24 capital investments
1H24 Capital Investments $ million • Acquisitions for 1H24 include Wade Quarry Services (Construction Materials) and Geotech Construction materials acquisitions1 10.5 Lab in Victoria (Construction Materials). For personal use only Total acquisitions1 10.5 • Commercial land acquisitions of $27.1m inc
Slide 29: Net debt and banking facilities
Net Debt as at 31 December 20231 Banking Facilities as at 31 December 2023 $ Million 31 December 2023 $ Million Limit Drawn Undrawn For personal use only Borrowings Cash Advance Facility 365.0 352.2 12.8 Current 48.3 Asset Finance Facility 165.0 146.9 18.1 Non-current 499.6 Multi-option Facility 4 7
Slide 30: Balance sheet
Balance Sheet1 • Property, plant and equipment increased by $10.3m from 30 June 2023 driven by the 31 December acquisition of Wade Quarry Services $ million 30 June 2023 2023 For personal use only • Investments increased by $47.1m from 30 June 2023 driven by commercial land Assets acquisitions of $2
Slide 31: Capital employed by segment
Capital Employed by Segment Capital Balance 31 Balance 30 Business Working Land Underlying 1H24 1H23 For personal use only $ million Other1 Employed December June 2023 Acquisitions capital Inventory EBIT ROCE2 ROCE2 During 1H24 2023 Civil Construction & Hire 273.5 - (9.0) - 4.7 (4.3) 269.2 28.7 21%
Slide 32: Key messages
For personal use only • Record six month result underpinned by solid organic growth • Cashflow conversion of 110% driven by working capital discipline • Reaffirm FY24 guidance of underlying EBITDA range of $190m-$210m • Reaffirm the capital recycling program is on track to achieve targeted $70m proc
Slide 33: Disclaimer
DISCLAIMER Important information The purpose of this presentation is to provide general information about MAAS Group Holdings Ltd (Maas or the Company) and its subsidiaries and business. The information in this presentation is current as at 15 February 2024. It is in summary form and is not necessar
Slide 34: Questions
For personal use only & 34
Slide 35: For personal use only
For personal use only
Slide 36: Historical financial performance
HISTORICAL FINANCIAL PERFORMANCE Revenue ($m)1 EBITDA ($m)1 EBIT ($m)1 For personal use only 600.0 120.0 80.0 70.0 500.0 100.0 60.0 400.0 80.0 50.0 300.0 60.0 40.0 74.5 67.5 71.2 469.3 97.0 97.1 439.6 85.0 30.0 200.0 361.4 40.0 323.3 66.1 45.5 20.0 36.6 100.0 215.8 20.0 45.5 40.1 25.9 26.7 148.9 30.
Slide 37: Revenue, EBITDA and EBIT by segment
Strong growth from Construction Materials, Civil Construction and Hire and Residential Real Estate For personal use only Revenue ($m) EBITDA ($m) EBIT ($m) 600 120 90 497.1 103.6 78.2 80 0.2 500 100 1.6 11.8 70 15.1 15.6 388.3 71.9 400 80 75.4 11.2 60 55.2 15.2 41.1 11.2 2.9 2.6 61.2 50 300 60 19.9
Slide 38: Statutory to pro forma NPAT reconciliation
Statutory Net Profit after Tax (NPAT) Reconciliation of Statutory to Pro forma NPAT For personal use only $ Million 1H23 1H24 $ Million 1H23 1H24 Revenue 353.5 474.3 Statutory NPAT attributable to owners of MGH 23.7 33.9 Other Revenue 1.7 6.2 Pre-acquisition NPAT - - Revenue 355.2 480.5 Share based
Slide 39: Land inventory movement
Land Inventory movement • Residential land multi-year lag between englobo acquisition to land settlements as estates are developed. Land settlements to date made $ million Residential Commercial Elimination Group from land acquired pre-April 2021. For personal use only Opening Land Inventory 128.9 4