Slide 1: Verticon Group Limited Results Presentation
VERTICON GROUP LIMITED Results Presentation for period ending 30 June 2005 Mark Kevin, Managing Director Peter Cooper, Chief Financial Officer Denis Tomasel, Executive Director August 2005 1
Slide 2: Verticon Recap
Verticon Recap » Consolidated two tower crane companies » Raised $50m to buy the businesses and listed 17 December 2004 » Strategy is to consolidate tower crane and hoist sector » Expand presence in mobile crane sector with view to consolidation 2
Slide 3: FY05 Results
FY05 Results Prospectus Vs Actual » FY05 Revenue $25.1m Vs $24.3m ↓ 3% Statutory Result » FY05 EBITDA $8.5m Vs $8.0m ↓ 6% » NPAT $4.9m Vs $4.5m ↓ 8% Vs Prospectus » EPS (stat) 15.24 Vs 9.01 » EPS (op period) 15.24 Vs 13.08 (1) Proforma Results » FY05 Revenue $43.5m ↑ 23% » FY05 EBITDA $14.2m ↑ 10% V
Slide 4: FY05 Results
FY05 Results Actual Prospectus Revenue – hire $8.6m $9.2m – labour $9.6m $10.4m Seca – equip $0.9m $0.8m Total Revenue $19.1m $20.4m EBITDA $7.7m $7.3m Revenue – hire $2.6m $3.9m Econ – labour $1.0m $0.7m – equip $1.4m $0.0m Total Revenue $5.0m $4.6m EBITDA $1.4m $2.1m 4
Slide 5: Key Drivers of Results - Victoria
Key Drivers of Results - Victoria » Hire contracts did not materialise » Jobs did not start on time (slippage) » Poor operations in Victorian business » Action taken to rectify Replaced management Acquired in expertise that was lacking (GFB) Consolidated operations 5
Slide 6: Key Drivers of Results - Victoria
Key Drivers of Results - Victoria » Beginning to win new customers Becton LU Simon Multiplex 6
Slide 7: Key Drivers of Results - Qld
Key Drivers of Results - Qld » Seca performed to target Maintained all existing customers Expanded fleet Achieved targets despite acquisition distraction Slippage occurred 7
Slide 8: Key Drivers of Results - Group
Key Drivers of Results - Group » Established equipment sales presence Sales to builders who want to own equipment (cranes & hoists) » Utilised technical expertise embedded in each division across the group » Maintained private company culture in public company 8
Slide 9: FY05 Highlights
FY05 Highlights » EBIT/Funds Employed 13.2% (annualised) » Acquired Victorian tower crane business from Eltrax » Acquired specialist fabrication and rigging business – GFB Engineering » Purchased 11 tower cranes and 1 hoist » Reduced average age of fleet (13 years to 12 years) » Entered New Zealand
Slide 10: FY05 Highlights (cont)
FY05 Highlights (cont) » Significant work undertaken to secure a foothold in Sydney (6 cranes currently in Sydney) » Extending Victorian coverage into WA & SA » Expanding Queensland operations into far North Queensland 10
Slide 11: Operations
Operations Verticon Verticon Seca Verticon Queensland Victoria » Cranes 63 » Cranes 16 » Hoists 29 » Hoists 2 » Employees 173 » Employees 28 » Market Share 65% » Market Share 25% » Utilisation » Utilisation June 05 74% June 05 50% Aug 05 75% Aug 05 71% 11
Slide 12: Business Model
Business Model » Consolidate tower crane and hoist industry by acquisition » Increase fleet utilisation by being exposed to different geographical markets » Continue organic growth » Develop alliances with major builders » Move into mobile crane sector (infrastructure opportunities) » Uplift from pr
Slide 13: Revenue Analysis
Revenue Analysis Revenue by Sector Revenue by State 73.2% 83.0% 11.6% 2.9% 4.6% 10.6% 14.1% Commercial Infrastructure Queensland New South Wales Victoria Hotels Residential 13
Slide 14: Statutory Result
Statutory Result Operating period 13 December 2004 to 30 June 2005 ($million) Prospectus Actual Var REVENUE 25.1 24.3 ↓ 3.1% EBITDA 8.5 8.0 ↓ 5.9% NPAT 4.9 4.5 ↓ 8.2% EBITDA/SALES 33.9% 32.9% DIVIDEND 4.0 4.5 ↑ 12.5% • Seca on track • Management issues – Econ • Econ contracts not achieved ($1.2 m re
Slide 15: Proforma Result (2)
Proforma Result (2) Period 1 July 2004 to 30 June 2005 ($million) Prospectus H1 H2 Total Revenue 45.6 20.3 22.9 43.2 EBITDA 16.3 7.0 7.8 14.8 EBITDA/SALES% 35.7% 34.4% 34.1% 34.3% • Revenue up 13% in second half • Seca revenues continue to grow • Econ contracts not achieved (0.6% EBITDA/Sales) (2) U
Slide 16: Summary Operating Cash Flows
Summary Operating Cash Flows Operating period 13 December 2004 to 30 June 2005 ($million) Prospectus Actual Change EBITDA 8.5 8.0 ↓ 6% Net capital expenditure (5.3) (3.1) ↓ 42% Movement in other operating net assets (8.3) (9.4) ↑ 13% Operating Cash Flow (5.1) (4.5) ↑ 12% Net borrowing costs (0.2) (0
Slide 17: Summary Balance Sheet
Summary Balance Sheet As at 30 June 2005 ($ million) Prospectus Actual Working capital 6.1 7.4 Property, plant and equipment 45.2 48.6 Intangibles 5.2 6.1 Other (0.2) (2.0) Total Assets Employed 56.3 60.1 Net debt 4.2 7.3 Equity 52.1 52.8 Total Funds Employed 56.3 60.1 • 3 small acquisitions $4m deb
Slide 18: Final Dividend
Final Dividend » Final dividend of 4.5 cents per share 4.0 cents prospectus forecast Record date: 6 October Payment date: 21 October » 100% franking for Australian shareholders 18
Slide 19: Industry Activity Going Forward
Industry Activity Going Forward » Predicted increase in office and infrastructure projects already commenced » Residential construction in Victoria being substituted for office development » Activity in all sectors in Queensland remains strong » NSW also strong with activity in hotels and office con
Slide 20: Trading Update and Outlook
Trading Update and Outlook » Going forward Largest tower crane fleet in Australia Queensland division expanding Victorian division going forward on strong base Will achieve national coverage Sourcing new equipment – cranes and hoists Winning new customers » Initial guidance is for Earnin
Slide 21: Questions?
Questions? 21
Slide 22: Appendix – EPS Calculation
Appendix – EPS Calculation Operating Period EPS » Operating period 13 December 04 to 30 June 05 = 200 days » NPAT for same period = $4,485,807 » Annualised NPAT = $8,186,598 » Shares on issue at 30 June 2005 = 62,599,679 » Implied EPS = 13.08 cents 22