Slide 1: FY20 First-Half Results Presentation
SERVICE STREAM LIMITED FY20 First-Half Results Presentation Leigh Mackender Managing Director 5 February 2020
Slide 2: Contents
Contents 1 Company Profile 2 Performance Highlights 3 Financial Performance 4 Operational Performance 5 Group Strategy & Outlook 6 Historical Financial Performance Data 2
Slide 3: Company Profile
Company Profile Service Stream Limited (ASX:SSM) is a S&P/ASX200 company providing integrated end-to-end asset life-cycle services across essential infrastructure networks within the Telecommunications and Utilities sectors TELECOMMUNICATIONS UTILITIES Telecommunication network engineering, design &
Slide 4: Performance Highlights
Performance Highlights All profitability measures up on 1H19 (pcp) 1H20 EBITDA from Operations of $58.1m … up 50% on pcp Financial 13th consecutive HY of growth in EBITDA from Operations, albeit aided by AASB 16 EBITDA to OCFBIT conversion in line with expectation Interim dividend increase
Slide 5: Financial Performance
FINANCIAL \' |) ‘PERFORMANCE )\ | |
Slide 6: Financial Highlights
Financial Highlights Revenue: $497.8m Revenue up 43% on $348.0m in pcp Includes $147.3m from Comdain Infrastructure and strong growth from Fixed Communications EBITDA from Operations up 50% on $38.6m in pcp and up 6% on 2H19 EBITDA from Operations: $58.1m Before incurring non-operational cos
Slide 7: Key Financial Measures
Key Financial Measures All profitability measures up substantially on pcp Group Revenue ($m ) 504 498 Key financial measures $500 $400 348 FY20 FY19 339 $ million Change 294 1st Half 1st Half $300 241 261 214 217 222 197 Profitability: $200 Revenue 497.8 348.0 149.8 43% $100 EBITDA from Operations 5
Slide 8: Segment Results
Segment Results 1H20 reflects adoption of AASB 16 Leases and includes earnings from Comdain Infrastructure Segment results FY20 FY19 Group EBITDA from Operations % $ million Change 1st Half 1st Half 14.0% Telecommunications 297.9 298.1 (0.2) 12.0% 11.1% 10.8% 11.7% 10.6% 10.9% Utilities 199.2 51.3 1
Slide 9: Cashflow Results
Cashflow Results Operating Cashflow impacted by higher tax and dividend outflows as expected Group OCFBIT ($m ) $70 Cashflow results $60 57.1 53.3 $50 FY20 FY19 42.8 $ million Change $40 1st Half 1st Half 32.3 30.7 33.0 32.5 32.8 $30 26.4 Reported EBITDA 56.4 38.0 18.4 24.3 $20 +/- non-cash items &
Slide 10: Capital Management
Capital Management Maintaining a conservative approach to leverage Net Cash / (Net Debt) ($m) $100 Increased interim dividend (fully-franked) of 4.0 cps declared in line with $75 73.0 69.5 63.6 the Group’s progressive dividend policy. $50 44.1 49.9 41.1 37.7 Dividend payable 19 March 2020 with D
Slide 11: AASB16 Leases
AASB16 Leases P&L impact arising from adoption of AASB 16 is in line with previously disclosed expectations AASB 16 has been adopted with effect from 1 July 2019. 1H19 comparatives have not been re-stated, in line with the transitional arrangements permitted by the standard. AASB 16 impacted t
Slide 12: Operational Performance
OPERATIONAL PERFORMANCE 12
Slide 13: Safety Performance
Safety Performance Maintaining our focus on the safety of our people, our customers and the community Continued delivery of industry leading HSE performance as operations further grow and expand Performance continues to position business well, serving as a clear point of differentiation across o
Slide 14: Telecommunications
TELECOMMUNICATIONS 14
Slide 15: Telecommunications
Telecommunications Telecommunication network engineering, design & construction, maintenance and operations Telecommunications Revenue in line with pcp, with increase in Fixed Communications $350 Revenue ($m) offset by decrease in Network Construction nbn D&C works as $300 290.7 298.1 290.9 297.9
Slide 16: Telecommunications
Telecommunications Telecommunication network engineering, design & construction, maintenance and operations Strong demand for nbn customer activations coupled with retained market share leading to a 46% increase on pcp activation volumes. nbn service assurance volumes continue to increase as the
Slide 17: Utilities
UTILITIES 17
Slide 18: Utilities
Utilities Utility network engineering, design & construction, maintenance and operations Utilities Revenue up $147.8m (+288%) on pcp primarily due to the inclusion $250 Revenue ($m) of Comdain Infrastructure following its acquisition in Jan-19: 213.0 199.2 $200 $150 - Metering Services, New Energy
Slide 19: Utilities
Utilities Utility network engineering, design & construction, maintenance and operations Comdain Infrastructure’s new 2+3 year agreement with South East Water in Victoria for the renewal of water and wastewater infrastructure has mobilised and is performing well. Comdain Infrastructure has comme
Slide 20: Group Strategy & Outlook
ry tye id GROUP STRATEGY & P OUTLOOK =< i) Vay |
Slide 21: Comdain Infrastructure Integration
Comdain Infrastructure Integration Integrating Comdain Infrastructure into the wider Service Stream following the acquisition in 2019 The integration program continues to progress well under the direction of an Integration Steering Committee and small integration team. Focus during the most rece
Slide 22: FY20 Outlook
FY20 Outlook The Group expects: – EBITDA from Operations for 2H20 to be in line with that reported for 1H20, subject to a continuation of prevailing market conditions; with – a stronger revenue contribution in 2H20 from Wireless, Comdain Infrastructure and nbn maintenance activities on the back of
Slide 23: Historical Financial Performance Data
HISTORICAL FINANCIAL PERFORMANCE DATA
Slide 24: Appendix 1: Profit & Loss
Appendix 1 PROFIT & LOSS $ million 1H15 2H15 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20 FY15 FY16 FY17 FY18 FY19 Telecommunications $156.81 $177.86 $180.10 $179.69 $194.59 $217.83 $244.44 $290.74 $298.07 $290.87 $297.90 $334.67 $359.78 $412.41 $535.18 $588.94 Utilities $40.93 $36.34 $38.19 $43.76
Slide 25: Appendix 2: Reconciliation of Statutory to Adjusted Profitability Measures
Appendix 2 RECONCILIATION OF STATUTORY TO ADJUSTED PROFITABILITY MEASURES $ million 1H15 2H15 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20 FY15 FY16 FY17 FY18 FY19 Reported EBITDA $10.66 $14.73 $15.68 $20.14 $21.09 $27.26 $32.05 $35.25 $38.03 $51.51 $56.43 $25.39 $35.82 $48.35 $67.30 $89.54 add-back
Slide 26: Appendix 3: Segment Results
Appendix 3 SEGMENT RESULTS $ million TELECOMMUNICATIONS 1H15 2H15 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20 FY15 FY16 FY17 FY18 FY19 nbn Activation & Assurance $43.27 $54.32 $61.63 $57.81 $66.80 $79.54 $109.94 $108.11 $124.37 $151.69 $176.95 $97.60 $119.45 $146.33 $218.05 $276.06 nbn Minor Projec
Slide 27: Appendix 4: Cash Flow
Appendix 4 CASH FLOW $ million 1H15 2H15 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20 FY15 FY16 FY17 FY18 FY19 Reported EBITDA $10.66 $14.73 $15.68 $20.14 $21.09 $27.26 $32.05 $35.25 $38.03 $51.51 $56.43 $25.39 $35.82 $48.35 $67.30 $89.54 +/- non-cash items & change in w/capital ($8.97) $17.53 $15.0
Slide 28: Appendix 5: Capital Expenditure
Appendix 5 CAPITAL EXPENDITURE $ million 1H15 2H15 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20 FY15 FY16 FY17 FY18 FY19 Leasehold Improvements $0.30 $0.06 $0.25 $0.65 $0.22 $0.11 $0.08 $0.20 $0.45 $0.10 $0.22 $0.36 $0.90 $0.33 $0.28 $0.55 Motor Vehicles $0.10 $0.32 $0.11 $0.03 $0.10 $0.00 $0.00 $0.
Slide 29: Disclaimer
Disclaimer Important information for Investors This presentation has been prepared by Service Stream Limited (SSM). Whilst the information in this presentation has been prepared in good faith and with reasonable care, no representation or warranty, express or implied, is made as to the accuracy or r
Slide 30: Service Stream Limited
Service Stream Limited ABN: 46 072 369 870 Level 4, 357 Collins Street Melbourne, Victoria 3000 WWW.SERVICESTREAM.COM.AU