Southern Cross Electrical Engineering Limited · ASX:SXE
Southern Cross Electrical Engineering — Goldman Sachs Emerging Leaders Conference 2025
43 slides from Southern Cross Electrical Engineering's conference presentation, Apr 2, 2025
Slide 1: Goldman Sachs Emerging Leaders Conference
Goldman Sachs Emerging Leaders Conference For personal use only 2 April 2025
Slide 2: Part 1: SCEE Group
For personal use only Part 1: SCEE Group 2
Slide 3: Introduction to SCEE
Introduction to SCEE Leading national electrical, instrumentation, …built by design through operational excellence and a communications, security, fire, and maintenance disciplined M&A strategy group… Historically focused on resources and industrial work, but now also diversified into infrastructure
Slide 4: SCEE's strategy
SCEE’s strategy SCEE Group primarily sees itself as an electrical contractor diversified across the infrastructure, commercial, and resources sectors • Our growth strategy continues to be to deepen our presence in those sectors and broaden our geographic diversity through expanding our core competen
Slide 5: Financial performance
For personal use only Financial performance 5
Slide 6: Record half year revenue, profit and cash
Record half year revenue, profit and cash Record half year revenue $397.4m (H1 FY24: $255.5m) up 55.5% on pcp Infrastructure comprised 63.3% of revenue as largest sector (40.6% of revenue in pcp) For personal use only Record half year EBITDA $27.1m (H1 FY24: $17.1m) up 58.5% on pcp * Record half yea
Slide 7: Record half year revenue and profit
Record half year revenue and profit Record half year revenue $397.4m (H1 FY24: $255.5m) up 55.5% on Summary financials: prior corresponding period Revenue split by sector: Infrastructure $251.7m (PCP: $103.8m), H1 FY25 H1 FY24 % Commercial $79.9m (PCP: $78.9m), and Resources $65.8m (PCP: For persona
Slide 8: Strong balance sheet
Strong balance sheet Cash increased in year to a record $114.8m (30 June 2024: $84.1m) Balance sheet summary: Remain debt free For personal use only Bank guarantee and surety bond facilities capacity increased from Dec 24 Jun 24 $100.0m to a record $150.0m in May $m $m Record $112.5m of bank guarant
Slide 9: Record cash
Record cash Significant cash flows in the period included: • Record pay-out in a half year of $12.7m of fully franked dividends • Tax payment of $16.0m in half effectively “catching up” on payments of only $3.7m income tax paid in previous half • Deferred consideration payment of $1.0m for acquisiti
Slide 10: Operations and outlook
For personal use only Operations and outlook 10
Slide 11: Operational highlights and outlook
Operational highlights and outlook Lost Time Injury (“LTI”) free for fifth consecutive half-year (H1 FY25: 1.6m manhours LTI-free) Workforce at circa 1,700 direct employees For personal use only Collie Battery Energy Storage System at peak levels of activity, progressing well and to schedule Western
Slide 12: Three structural tailwinds
For personal use only Three structural tailwinds 12
Slide 13: Infrastructure
Infrastructure Infrastructure very wide sector for SCEE across federal and state government and private investment in Data Centres, renewables and energy, transport (including airports, rail, For personal use only road and ports), health and aged care, defence, education, agriculture, water, and oth
Slide 14: Infrastructure (cont.)
Infrastructure (cont.) Outside of Data Centres, renewables and hospitals, other strong infrastructure opportunities for SCEE include: • Western Sydney International Airport and Aerotropolis - SCEE’s largest For personal use only revenue contributor in FY24, the terminal project for Multiplex is now
Slide 15: Data Centres
Data Centres Data Centres are electrically dense with electrical work comprising the largest component of construction costs. SCEE businesses have worked on Data Centres for over twenty For personal use only years and the sector is now showing exponential growth • Data Centres have grown in size, th
Slide 16: Electrification
Electrification Australia is undergoing an energy transition requiring electrification of many activities in coming decades. SCEE has multiple exposures to these developments The transition will require: For personal use only • Transforming Australia’s electricity supply to run mainly on non-carbon
Slide 17: Electrification (cont.)
Electrification (cont.) Transition of Australia’s electricity supply requires investment in renewables supported by battery storage and grid reconfiguration SCEE well-credentialled to participate in this thematic having constructed For personal use only multiple solar farms, wind farms and Battery E
Slide 18: Investment proposition
For personal use only Investment proposition 18
Slide 19: Diversified across markets and operations
Diversified across markets and operations Order Book by Sector Order Book by Geography Revenue breakdown $m $m by Sector FY17-FY24 • Order book up 22% on pcp • 60% of order book on East $m • Infrastructure 70% of order book Coast For personal use only H1 H1 H1 H1 FY24 FY25 FY24 FY25 670 670 35 80 55
Slide 20: Long-term blue-chip client base
Long-term blue-chip client base Seven selected clients – Woolworths, Coles, BHP, Rio These seven clients have long-standing and deep Tinto, Multiplex, CPB and Built – have consistently relationships with SCEE spanning decades and most provided over 45% on average of revenues over the last across mul
Slide 21: Growth of recurring revenue
Growth of recurring revenue Strong track record of recurring revenue growth - FY24 Wide range of recurring works under services, recurring revenue was over 33% of total annual revenue maintenance, sustaining capital, and framework agreements, including: Recurring Revenues ($m) For personal use only
Slide 22: Strong shareholder returns and financial position
Strong shareholder returns and financial position Shareholder returns over last eight years Strong cash position to support continued growth (2.5cps franked interim dividend to be paid 9 April 2025 at 31 December 2024: Increased 150% over prior year interim dividend) $m For personal use only Dividen
Slide 23: Track record of successful acquisitions
Track record of successful acquisitions Completed value-accretive acquisitions of Datatel in 2016, Revenue contribution of acquisition in first full year of Heyday in 2017, Trivantage Group in 2020, MDE Group in consolidation 2024, and Force Fire in 2025 Actively exploring range of further acquisiti
Slide 24: Part 2: Acquisition of Force Fire Holdings
For personal use only Part 2 :Acquisition of Force Fire Holdings 24
Slide 25: Acquisition overview
Acquisition overview • SCEE has entered into a Share Purchase Agreement to acquire 100% of Force Fire Holdings Pty Ltd (“Force Fire”) for consideration of up to $53.5m on a cash-free debt-free basis made up as follows: – $36.3m cash payable to all vendors (Anacacia's private equity fund 54.6%, other
Slide 26: Acquisition overview (continued)
Acquisition overview (continued) • Expansion into highly attractive fire safety solutions market is a natural adjacency to SCEE’s current capabilities and provides a platform into broader non-discretionary technical building services • The business significantly enhances SCEE’s ability to address op
Slide 27: Strategic rationale
Strategic rationale The acquisition of Force Fire is consistent with SCEE’s strategy to add adjacent and complementary capabilities, and increase exposure to services and maintenance style works and recurring revenues SCEE’s core electrical competence is complemented by its communications, security
Slide 28: Overview of Force Fire
For personal use only Overview of Force Fire 28
Slide 29: Overview of Force Fire
Overview of Force Fire Force Fire is a leading provider of critical, mandated and non-deferrable fire safety solutions with a 25-year track record of delivery Business Overview Highlights For personal use only Attractive non-discretionary, Capital-light operating model critical technical services Fo
Slide 30: Diversified revenue profile
Diversified revenue profile Force Fire has a diverse revenue mix across projects, minor works and maintenance/services work with a high level of repeat clients FY24A Projects Revenue by Sector (1) FY24A Revenue by Type (2) For personal use only Other Maintenance 13% Industrial 15% Projects buildings
Slide 31: Comprehensive capabilities suite
Comprehensive capabilities suite Force Fire delivers fire safety solutions across projects, minor works and maintenance/services capabilities Projects and Minor Works Snapshot of Past & Current Projects For personal use only • Projects involve design and installation services for a broad range of fi
Slide 32: Strong executive team
Strong executive team Force Fire is led by a highly experienced executive team who will remain with the business following acquisition Michael Dirckze Bryan Starkey Paul Richetti Chief Executive Officer Chief Financial Officer Director For personal use only • Joined Force Fire in 2020 • Joined Force
Slide 33: Fire safety market outlook
Fire safety market outlook Fire protection solutions are a critical and non-discretionary technical service offering poised to benefit from long- term macroeconomic and regulatory tailwinds Long-term demand for Fire Solutions (A$bn)(1) Attractive Industry Dynamics For personal use only CAGR ~2.1% 4.
Slide 34: Combined Group profile
For personal use only Combined Group profile 34
Slide 35: Increased sector and geographic diversification
Increased sector and geographic diversification A combination with Force Fire strengthens SCEE’s exposure to the attractive commercial and industrial buildings sector while also building immediate scale in a naturally adjacent and aligned capability FY24A SCEE Standalone FY24A Pro Forma Combined Gro
Slide 36: Combined opportunities with SCEE
Combined opportunities with SCEE This acquisition is likely to generate significant benefits for SCEE • Cross-selling opportunities to provide fire safety solutions to SCEE’s existing client base and vice versa For personal use only • Potential to leverage SCEE’s relationships and established proces
Slide 37: Conclusion
For personal use only Conclusion 37
Slide 38: Conclusion
Conclusion Record half year revenue $397.4m (H1 FY24: $255.5m) up 55.5% on pcp Record half year EBITDA $27.1m, EBIT $23.2m and NPAT $16.2m all up on pcp * For personal use only Record cash $114.8m (30 June 2024: $84.1m) up 36.5% on record prior period end Interim Dividend 2.5 cps declared and fully
Slide 39: Appendices
For personal use only Appendices 39
Slide 40: Appendix – IFRS reconciliation
Appendix 1 – IFRS reconciliation SCEE’s results are reported under International H1 FY25 H1 FY24 Financial Reporting Standards (IFRS). SCEE discloses certain non-IFRS measures that are not prepared in $m $m accordance with IFRS. The non-IFRS measures should For personal use only only be considered i
Slide 41: Appendix - detailed transaction terms
Appendix 2 - detailed transaction terms • Acquisition of 100% of Force Fire Holdings Pty Ltd Acquisition • Due diligence finalised • Completion is expected to occur on 1 April 2025 Up to a total of $53.5m payable on a cash-free debt-free basis as follows: For personal use only 1. Upfront Cash Consid
Slide 42: Corporate summary
Corporate summary Capital Structure Shareholders at 7 February 2025 For personal use only ASX Code SXE Thorney Investments 14.4% Share Price (17 February 2025) $1.535 Other Institutions in Top 30 Shareholders 23.2% No. of ordinary shares (17 February 2025) 264.3m Frank Tomasi 16.9% Market Capitalisa
Slide 43: Disclaimer
Disclaimer Some of the information contained in this presentation contains “forward-looking statements” which may not directly or exclusively relate to historical facts. These forward-looking statements reflect the current intentions, plans, expectations, assumptions and beliefs of Southern Cross El
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