Innovate Corp. · NYSE:VATE
Innovate — HC2 Holdings — Investor Presentation (November 2018)
30 slides from Innovate's investor presentation, Nov 13, 2018
Slide 1: HC2 Holdings, Inc. Investor Presentation
HC2 HOLDINGS, INC. Investor Presentation © HC2 Holdings, Inc. 2018 November 2018
Slide 2: HC2's Diversified Portfolio
HC2’s Diversified Portfolio Core Financial Core Operating Subsidiaries Services Subsidiaries Construction: Marine Services: Energy: Telecommunications: Insurance: DBM GLOBAL (SCHUFF) GMSL ANG PTGI ICS CIG One of the largest steel Leading provider of subsea Premier distributor of natural In
Slide 3: Significant Value Creation
Significant Value Creation Since inception in 2014, HC2: – Increased market capitalization from ~$46 million to ~$240 million and increased revenues from ~$230 million to ~$1.6 billion – Received ~$200 million in total dividends, distributions, tax share and asset management fees from subsidiaries
Slide 4: GrayWolf Industrial Inc. Strategic Rationale
GrayWolf Industrial Inc. (“GrayWolf”) Strategic Rationale: GrayWolf Industrial provides DBM Global with an entry into the heavy maintenance and repair industry, diversifying its revenue stream from large commercial construction projects while capitalizing on strong customer relationships with prim
Slide 5: PTGi International Carrier Services
PTGi International Carrier Services (“PTGi ICS”) Business Description: International wholesale telecom service company providing voice and data call termination to the telecom industry worldwide Provides transit and termination of telephone calls through its own global network of next-generation
Slide 6: Continental Insurance Group Business Description
Continental Insurance Group Business Description: The formation of Continental Insurance Group (“CIG”) in April 2015 to invest in the insurance sector is consistent with HC2’s overall strategy of taking advantage of dislocated and undervalued operating businesses Through CIG, HC2 intends to buil
Slide 7: Pansend Life Sciences Segment
Pansend HC2’s Pansend Life Sciences Segment Is Focused on the Development of Innovative Healthcare Technologies and Products Recently completed sale to Janssen Biotech, Inc. (Johnson & Johnson) for up to $1.04 billion (2Q18); $8m total investment 76% equity ownership of company focused on immuno
Slide 8: Pansend: BeneVir / Janssen Acquisition Summary
Pansend: BeneVir / Janssen Acquisition Summary BeneVir: BeneVir was a portfolio company of Pansend, our Life Sciences segment – Focused on the development of a patent-protected oncolytic virus, BV-2711, for the treatment of solid cancer tumors Pansend was the owner of all of BeneVir's outstandin
Slide 9: HC2 Broadcasting Holdings Inc.
HC2 Broadcasting Holdings Inc. Business Description* Broadcast Television Stations: Key Metrics** HC2 Broadcasting Holdings Inc., a subsidiary of HC2 Holdings, has Operational Stations: 164 strategically acquired broadcast assets across the United States – Full-Power Stations: 14 HC2’s broadca
Slide 10: Segment Financial Summary ($m)
Segment Financial Summary ($m) Q3 2018 Q3 2017 YTD 2018 YTD 2017 Core Operating Subsidiaries Construction $16.0 $16.8 $41.5 $36.5 Marine Services 7.9 8.8 25.8 28.8 Energy 1.0 0.3 4.7 2.5 Telecom 1.5 1.5 3.9 5.3 Total Core Operating $26.3 $27.3 $75.8 $73.0 Adjusted Early Stage and Other Holdings EBIT
Slide 11: Third Quarter 2018 Highlights
Third Quarter 2018 Highlights 3Q18 Adjusted EBITDA $16.0m vs. $16.8m for 3Q17; YTD18 Adjusted EBITDA $41.5m vs. $36.5m for YTD17 $615m reported backlog; $632m backlog taking into consideration awarded, but not yet signed contracts; Acquiring GrayWolf Industrial, a specialty maintenance, repair
Slide 12: Third Quarter 2018 Highlights (con't)
Third Quarter 2018 Highlights (con’t) Completed Acquisition of Humana’s ~$2.4 billion long-term care insurance business – (Closed 8/9/18) 3Q18 Pretax Insurance AOI ($11.3) million vs. $17.0 million 3Q17 YTD18 Pretax Insurance AOI ($8.7) million vs. $20.6 million YTD17 As of September 30, 201
Slide 13: 2018 Focus and Priorities – Update
2018 Focus and Priorities – Update Monetization / Value Creation Within Diverse HC2 Portfolio – Sold BeneVir to Janssen Biotech (Johnson & Johnson) for up to $1.04 billion [2Q18] – Closed on the acquisition of Humana’s $2.4 billion long-term care insurance business; Combined Total Adjusted Capit
Slide 14: Segment Financial Summary ($m)
Segment Financial Summary ($m) Q3 2018 Q2 2018 Q1 2018 FY 2017 Q4 2017 Q3 2017 Q2 2017 Q1 2017 FY 2016 Core Operating Subsidiaries Construction $16.0 $15.5 $10.0 $51.6 $15.1 $16.8 $11.1 $8.6 $59.9 Marine Services 7.9 20.4 (2.4) 44.0 15.3 8.8 3.6 16.3 41.2 Energy 1.0 3.0 0.7 2.9 0.4 0.3 1.0 1.2 2.5 T
Slide 15: s
Reconciliations
Slide 16: Net Revenue Last Twelve Months Ended September 30, 2018
Reconciliation of Net Revenue Last Twelve Months Ended September 30, 2018 (in thousands) Net revenue Twelve Months Ended Nine Months Ended Latest Twelve Months December 31, September 30, September 30, September 30, 2017 2017 2018 2018 Construction $ 578,989 $ 403,325 $ 531,209 $ 706,873 Marine Servi
Slide 17: Adjusted EBITDA Last Twelve Months Ended September 30, 2018
Reconciliation of Adjusted EBITDA Last Twelve Months Ended September 30, 2018 (in thousands) Adjusted EBITDA Twelve Months Ended Nine Months Ended Latest Twelve Months December 31, September 30, September 30, September 30, 2017 2017 2018 2018 Construction $ 51,588 $ 36,476 $ 41,453 $ 56,565 Marine S
Slide 18: Adjusted EBITDA Three Months Ended September 30, 2018
Reconciliation of U.S. GAAP Net Income (Loss) to Adjusted EBITDA Three Months Ended September 30, 2018 (in thousands) Three Months Ended September 30, 2018 Core Operating Subsidiaries Early Stage & Other Non- Life Other & operating Total HC2 Construction Marine Energy Telecom Sciences Broadcasting E
Slide 19: Adjusted EBITDA Three Months Ended September 30, 2017
Reconciliation of U.S. GAAP Net Income (Loss) to Adjusted EBITDA Three Months Ended September 30, 2017 (in thousands) Three Months Ended September 30, 2017 Core Operating Subsidiaries Early Stage & Other Non- Life Other & operating Total HC2 Construction Marine Energy Telecom Sciences Broadcasting E
Slide 20: Adjusted EBITDA Nine Months Ended September 30, 2018
Reconciliation of U.S. GAAP Net Income (Loss) to Adjusted EBITDA Nine Months Ended September 30, 2018 (in thousands) Nine Months Ended September 30, 2018 Core Operating Subsidiaries Early Stage & Other Non- Life Other & operating Total HC2 Construction Marine Energy Telecom Sciences Broadcasting Eli
Slide 21: Adjusted EBITDA Nine Months Ended September 30, 2017
Reconciliation of U.S. GAAP Net Income (Loss) to Adjusted EBITDA Nine Months Ended September 30, 2017 (in thousands) Nine Months Ended September 30, 2017 Core Operating Subsidiaries Early Stage & Other Non- Life Other & operating Total HC2 Construction Marine Energy Telecom Sciences Broadcasting Eli
Slide 22: Adjusted EBITDA Three Months Ended June 30, 2018
Reconciliation of U.S. GAAP Net Income (Loss) to Adjusted EBITDA Three Months Ended June 30, 2018 (in thousands) Three Months Ended June 30, 2018 Core Operating Subsidiaries Early Stage & Other Non- Life Other & operating Total HC2 Construction Marine Energy Telecom Sciences Broadcasting Elimination
Slide 23: Adjusted EBITDA Three Months Ended March 31, 2018
Reconciliation of U.S. GAAP Net Income (Loss) to Adjusted EBITDA Three Months Ended March 31, 2018 (in thousands) Three Months Ended March 31, 2018 Core Operating Subsidiaries Early Stage & Other Non- Life Other & operating Total HC2 Construction Marine Energy Telecom Sciences Broadcasting Eliminati
Slide 24: Adjusted EBITDA Full Year Ended December 31, 2017
Reconciliation of U.S. GAAP Net Income (Loss) to Adjusted EBITDA Full Year Ended December 31, 2017 (in thousands) Year Ended December 31, 2017 Core Operating Subsidiaries Early Stage & Other Non- operating Total HC2 Life Other & Corporate Construction Marine Energy Telecom Sciences Broadcasting Elim
Slide 25: Adjusted EBITDA Three Months Ended December 31, 2017
Reconciliation of U.S. GAAP Net Income (Loss) to Adjusted EBITDA Three Months Ended December 31, 2017 (in thousands) Three Months Ended December 31, 2017 Core Operating Subsidiaries Early Stage & Other Non- operating Total HC2 Life Other & Corporate Construction Marine Energy Telecom Sciences Broadc
Slide 26: Adjusted EBITDA Three Months Ended June 30, 2017
Reconciliation of U.S. GAAP Net Income (Loss) to Adjusted EBITDA Three Months Ended June 30, 2017 (in thousands) Three Months Ended June 30, 2017 Core Operating Subsidiaries Early Stage & Other Non- operating Total HC2 Life Other & Corporate Construction Marine Energy Telecom Sciences Broadcasting E
Slide 27: Adjusted EBITDA Three Months Ended March 31, 2017
Reconciliation of U.S. GAAP Net Income (Loss) to Adjusted EBITDA Three Months Ended March 31, 2017 (in thousands) Three Months Ended March 31, 2017 Core Operating Subsidiaries Early Stage & Other Non- operating Total HC2 Life Other & Corporate Construction Marine Energy Telecom Sciences Broadcasting
Slide 28: Adjusted EBITDA Full Year Ended December 31, 2016
Reconciliation of U.S. GAAP Net Income (Loss) to Adjusted EBITDA Full Year Ended December 31, 2016 (in thousands) Year Ended December 31, 2016 Core Operating Subsidiaries Early Stage & Other Non- Life Other & operating Total HC2 Construction Marine Energy Telecom Sciences Elimination Corporate Net l
Slide 29: Insurance Adjusted Operating Income
Reconciliation of U.S. GAAP Net Income (Loss) to Insurance Adjusted Operating Income (in thousands) Adjusted Operating Income - Insurance ("Insurance AOI") YTD 2018 Q3 2018 Q2 2018 Q1 2018 FY 2017 Q4 2017 Q3 2017 Q2 2017 Q1 2017 FY 2016 Net Income (loss) - Insurance segment $ 142,878 $ 141,068 $ 565
Slide 30: HC2 Holdings, Inc. Contact
HC2 HOLDINGS, INC. A n d r e w G . B a c k m a n • i r @ h c 2 . c o m • 2 1 2 . 2 3 5 . 2 6 9 1 • 4 5 0 P a r k A v e n u e , 3 0 th F l o o r , N e w Y o r k , N Y 1 0 0 2 2 © HC2 Holdings, Inc. 2018 November 2018