Emeco Holdings Limited · ASX:EHL
Emeco — FY2024 Earnings Presentation
30 slides from Emeco's earnings presentation, Aug 22, 2024
Slide 1: Emeco Holdings Limited FY24 Results
Emeco Holdings Limited FY24 Results 22 August 2024
Slide 2: Important Notices and Disclaimers
IMPORTANT NOTICES AND DISCLAIMERS Reliance on third party information The information and views expressed in this Presentation were prepared by Emeco Holdings Ltd (the Company) and may contain information that has been derived from publicly available sources that have not been independently verified
Slide 3: Agenda
AGENDA BUSINESS HIGHLIGHTS 4 OPERATIONAL OVERVIEW 5 - 10 PRESENTERS FINANCIAL RESULTS 11 - 15 STRATEGY & SUSTAINABILITY 16 - 21 Ian Testrow FY25 PRIORITIES & OUTLOOK 22 - 24 CEO and Managing Director APPENDICES Theresa Mlikota Chief Financial Officer - REVENUE ANALYSIS 26 - RECONCILIATIONS – STATUTO
Slide 4: FY24 Business Highlights
FY24 BUSINESS HIGHLIGHTS Significant growth in earnings, returns and cash flow generation Financial Operating NPAT Revenue The group achieved results in line with expectations with significant growth in all earnings and return metrics: 17% 6% 2024 2024 – Margin growth is driven by increase in high
Slide 5: Operational Overview
OPERATIONAL OVERVIEW 5
Slide 6: Safety
SAFETY Safety remains a key focus, with TRIFR improving to 2.8 Safety 3.2 1 2.8 2.1 1.9 0.3 0.0 0.0 0.0 FY21 FY22 FY23 FY24 TRIFR LTIFR Emeco remains committed to maintaining a strong track record of improving safety and will continue to monitor and make improvements as part of our broader Health,
Slide 7: Segment Results
SEGMENT RESULTS Strong earnings growth across all segments Business Highlights Surface Rental Surface Rental Revenue EBIT EBITDA Strong revenue and earnings growth driven by ongoing demand 10% 13% 11% for gold and bulk commodities, contract rise and fall 2024 $545M 2024 $156M 2024 $288M adjustment
Slide 8: Surface Rental
SURFACE RENTAL Surface Rental remains the driving force behind improved earnings and returns for the Group Revenue Highlights Revenue 10% Financial 2024 $545M Australia’s largest provider of open cut rental Solid revenue and earnings growth driven by ongoing 2023 $495M equipment and value-added se
Slide 9: Underground
UNDERGROUND Business simplification and reset now driving improved earnings and returns through underground rental model Revenue Revenue Highlights 50% 2024 $112M Financial 2023 $224M Australia largest underground hard-rock rental Strategic simplification of business model saw reduced revenue foll
Slide 10: Force
FORCE Our Force workshops are our competitive advantage – delivering cost-efficient rebuilt equipment for our rental businesses External ExternalRevenue Revenue Highlights 6% 2024 $166M Financial Mining equipment maintenance and rebuild External revenue growth of 6% driven by increased 2023 $157M
Slide 11: Financial Results
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Slide 12: Operating Profit and Loss
OPERATING PROFIT AND LOSS Strong margin and earnings growth driven by improved revenue mix and better cost and contract management. FY25 returns expected to improve again on the back of FY24 growth capex programme, now fully deployed FY24 Operating Financial Performance1,2 Commentary Strong margin
Slide 13: Cash Flow
CASH FLOW Strong growth in operating free cash flow, $35 million higher than pcp at ~$87 million. Cash conversion of 93% Overview FY24 Cash Flow ($m) Strong cash conversion of 93%. Op. Free Cash Flow $35 million higher than PCP, at $87 million, reflecting strong EBITDA growth and cash flow conve
Slide 14: Balance Sheet
BALANCE SHEET Balance sheet remains strong with leverage at 1.0x1 – providing flexibility for the pursuit of growth, debt reduction or other capital management opportunities Summary balance sheet Overview $m 30 June 2023 30 June 2024 Growth capex programme focused on Surface rental fleet, with ~20
Slide 15: Debt Maturity Profile and Liquidity
DEBT MATURITY PROFILE AND LIQUIDITY Committed and undrawn facilities provide flexibility to pursue growth Drawn debt maturity at 30 June 2024 Liquidity $ million $m 30 June 2023 30 June 2024 300 AMTN AUD Notes1 250.0 250.0 Term facilities – RCF2 250 95.0 95.0 (excludes bank guarantee facilities) 200
Slide 16: Strategy and Sustainability
STRATEGY AND SUSTAINABILITY 16
Slide 17: Our Scale and Competitive Advantage
OUR SCALE AND COMPETITIVE ADVANTAGE Our mid-life rebuild model and onsite service capability, combined with our asset management and condition monitoring technologies are our competitive advantage. Delivered through our national footprint of workshops and field service units, Emeco provides industry
Slide 18: Our Scale and Competitive Advantage
OUR SCALE AND COMPETITIVE ADVANTAGE Emeco is Australia’s largest provider of rental equipment and workshop and maintenance services to the mining industry. Our scale and national footprint provide us with a diverse portfolio of earnings, with 240 projects and 200 customers across a range of commodit
Slide 19: Emeco's Strategy
EMECO’S STRATEGY Emeco’s three strategic pillars ensure a sustainable and resilient business and the creation of long-term value for shareholders Be Australia’s Maintain a Exercise disciplined 01 02 03 lowest cost, highest quality, technology- balanced and capital driven mining diversified portfolio
Slide 20: Targeting 20% ROC and Improved Cash Generation
TARGETING 20% ROC AND IMPROVED CASH GENERATION Business improvement initiatives targeting 20% ROC over next 2 years are underway. Return on Capital1 drivers % Free Cash Flow $million (before growth capex)2 20% 140 15% FY25 improvement FY25/26 improvement 87 FY26 improvement FY24 ROC Annualised Procu
Slide 21: Environmental, Social & Governance
ENVIRONMENTAL, SOCIAL & GOVERNANCE At Emeco, we strive to be a sustainable business that delivers creative solutions for our customers, a family feel for our people, support for our local communities and value for our investors Overview Inaugural ESG Strategy, approved by the Board in February 202
Slide 22: FY25 Priorities and Outlook
FY25 PRIORITIES AND OUTLOOK 22
Slide 23: FY25 Priorities and Outlook
FY25 PRIORITIES AND OUTLOOK Demand outlook remains robust with FY25 earnings and return growth expected from improved cost and contract management and FY24 growth capex programme Business Priorities Mine Production Outlook Core Business 1200 Demand outlook for FY25 remains positive with strong ear
Slide 24: Emeco Investment Highlights
EMECO INVESTMENT HIGHLIGHTS 1 2 3 Australia’s largest mining Focused on delivering strong Scale and asset management equipment rental provider with returns and free cash flow expertise provide cost and national footprint generation quality advantage 4 5 6 Diversified by customer, project Strong bala
Slide 25: Appendix: Additional Information
APPENDIX: ADDITIONAL INFORMATION 25
Slide 26: Revenue Analysis
REVENUE ANALYSIS Revenue by commodity Revenue by geography Revenue by type Revenue by customer – Top 10 Customer 1 FY24 FY24 FY24 FY24 Customer 2 Customer 3 8% 3% 13% Gold WA Customer 4 14% 20% Rental 26% Met Coal 32% 14% Customer 5 11% Iron Ore QLD Customer 6 Underground 8% Nickel NSW 14% 10% Custo
Slide 27: Reconciliations: Statutory to Non-IFRS Disclosure
RECONCILIATIONS STATUTORY TO NON-IFRS DISCLOSURE 27
Slide 28: Reconciliations – Statutory to Non-IFRS Disclosure
RECONCILIATIONS – STATUTORY TO NON-IFRS DISCLOSURE FY23 FY24 Statutory to operating reconciliation Statutory to operating reconciliation $m NPAT EBIT EBITDA $m NPAT EBIT EBITDA Statutory 41.3 79.1 225.9 Statutory 52.7 101.4 273.0 Tangible asset impairment 1.0 1.0 - Tangible asset impairment (exit PN
Slide 29: Reconciliations – Statutory to Non-IFRS Disclosure
RECONCILIATIONS – STATUTORY TO NON-IFRS DISCLOSURE Cash flow reconciliation Net debt and leverage reconciliation $m FY23 FY24 $m 30 June 2023 30 June 2024 Operating EBITDA 250.4 280.5 AUD secured notes 250.0 250.0 Working capital (18.2) (14.2) Revolving credit facility - 30.0 Net financing costs (25
Slide 30: Thank You
THANK YOU Investor enquiries: Theresa Mlikota Chief Financial Officer Investor.relations@emecogroup.com emecogroup.com