Slide 1: Service Stream Reports Results for the Half Year Ended 31 December 2010
€ ervicestream Service Stroam Limited Level 1, 355 Spencer Street Tel 613.9677 8888 West Melbourne, VIC 3003 Fax 6139677 8800 PO Box 14570, ABN: 46.072-369-870 Melbourne, VIC 8001 www.servicestream com.att 22 February 2011 The Manager — Listings Australian Securities Exchange Limited Exchange Centre
Slide 2: December 2010 Half Year Results Presentation
For personal use only December 2010 Half Year Results Presentation
Slide 3: Agenda
2 Agenda For personal use only 1. Results overview 2. Financial review 3. Strategy & outlook
Slide 4: Results overview
3 For personal use only Results overview Graeme Sumner – Managing Director
Slide 5: Highlights: Financial
4 Highlights: Financial For personal use only • AMRS revenue up 154.4% due to $300.3m new environmental programs and Revenue up from $266.4m growth in metering services • A&AS revenues up 6.9% on the back $16.1m of new Western Region patches Underlying EBITDA up from $13.7m • Increase in EBITDA marg
Slide 6: Highlights: Customers
5 Highlights: Customers For personal use only • Contract wins and extensions • Victorian Advanced Metering Project – Further 750,000 meters over the next 2.5 years under phase 2 of roll out worth $40.0m • New 4 year contract with WA Gas Networks for metering services worth $8.0m • New 2 year contrac
Slide 7: Highlights: Operations
6 Highlights: Operations For personal use only • Health & Safety performance continued to improve • Lost Time Injury Frequency Rate reduced from 2.10 to 1.47 • Operational restructure completed • Large non-telco civil contracts exited • Operational structure rationalised • Support & risk management
Slide 8: Financial review
7 For personal use only Financial review Bob Grant – Chief Financial Officer
Slide 9: A strong financial performance across the board
A strong financial performance across the board 8 For personal use only Dec Dec Change Change $ million 2010 2009 $m % Revenue 300.3 266.4 33.9 12.7% Underlying EBITDA 16.1 13.7 2.4 17.5% Reported EBITDA 16.1 (5.1) 21.2 n/a EBIT 13.0 (8.6) 21.6 n/a NPAT 7.8 (8.6) 16.4 n/a Operating cash flow 2.3 (0.
Slide 10: Strategic rebalancing of revenue mix continues
9 Strategic rebalancing of revenue mix continues For personal use only $ million 340 7.9 27.6 330 7.0 320 5.4 45.6 310 4.4 300.3 300 290 280 270 266.4 260 250 Dec 09 Environmental Metering TCI & Infrastructure A&AS Discontinued Other Dec 10 Services Activities
Slide 11: Strong performance across all Specialist Field Services businesses
Strong performance across all Specialist Field Services 10 businesses For personal use only REVENUE UNDERLYING EBITDA EBITDA MARGIN % $ million Dec 2010 Dec 2009 Dec 2010 Dec 2009 Dec 2010 Dec 2009 SPECIALIST FIELD SERVICES 271.9 224.1 18.2 13.8 6.7% 6.2% - Communications 137.9 139.9 7.1 7.0 5.1% 5.
Slide 12: Cashflow marginally positive despite increased working capital
Cashflow marginally positive despite increased working 11 capital associated with revenue growth For personal use only Dec Dec $ million 2010 2009 Reported EBITDA 16.1 (5.1) Tax paid - (2.5) Net financing costs (2.6) (3.5) McCourt Dando provisioning - 15.8 Working capital movement (11.2) (5.6) Opera
Slide 13: Improved financing ratios will improve borrowing capacity
Improved financing ratios will improve borrowing 12 capacity For personal use only Amount As at 31 Dec 2010 ($ million) Facility Limit Amount Drawn Available Commercial bills 65.0 49.0 16.0 Overdraft 10.0 2.6 7.4 Finance leases 13.3 6.0 7.3 Net debt 88.3 57.6 30.7 Bank guarantees 10.0 8.0 2.0 Total
Slide 14: Income Tax opportunity
13 Income Tax opportunity For personal use only • In May 2010, amendments were made to the Income Tax law in respect of customer contracts held by entities when joining tax consolidation groups following their acquisition. • Service Stream has lodged a series of objections with the ATO with respect
Slide 15: Strategy & outlook
14 For personal use only Strategy & outlook Graeme Sumner – Managing Director
Slide 16: Service Stream will maintain three approaches to growth
15 Service Stream will maintain three approaches to growth For personal use only • Flexible, low cost services to the Telco and Utilities sector • Smart meter roll outs • Telstra A&AS contract • Leveraging our Telecommunications expertise • Mobile infrastructure • Syntheo Joint Venture to bid for an
Slide 17: Diversification of industry and customer base to continue
16 Diversification of industry and customer base to continue For personal use only Dec 2009 Dec 2010 Communications, Communications, 52% AMRS, 28% 45% AMRS, 13% Customer Care, 16% Customer Care, 10% TCI , 19% TCI , 17%
Slide 18: Market Opportunities Outweigh Risks
17 Market Opportunities Outweigh Risks For personal use only • National Broadband Network proceeding • Syntheo gives us capability to participate as a lead contractor • Telstra and other providers offer subcontracting opportunities • Mobile telephony market remains active • Mobile data demand increa
Slide 19: Financial Outlook
18 Financial Outlook For personal use only • Service Stream has lifted full year guidance • EBITDA guidance increased to $34.0m • NPAT of $16.1m 1 • Full year earnings improvement supported by • Increased residential solar system installations • Comparable H2 performance in fixed-line telecommunicat
Slide 20: Appendices
For personal use only Appendices 19
Slide 21: Balance sheet
20 Balance sheet For personal use only Dec Jun $ million 2010 2010 Receivables and WIP 132.6 120.5 Plant and equipment – WDV 10.3 13.2 Inventory 19.8 14.9 Other 11.7 8.9 Goodwill and other intangible assets 207.7 207.7 Total assets 382.2 365.1 Payables 66.8 59.0 Net debt 57.6 59.3 Provisions and oth
Slide 22: Cash flow statement
21 Cash flow statement For personal use only Dec Dec $ million 2010 2009 Receipts from customers 322.3 322.7 Payments to suppliers and employees (317.3) (317.6) Net interest and other finance costs (2.6) (3.5) Income tax paid (0.1) (2.5) Net cash used in operating activities 2.3 (0.9) Net capital ex
Slide 23: Group overview
22 Group overview For personal use only Service Stream is a field services organisation, delivering technical services and small projects predominantly to the telecommunications and utilities sectors. It is a niche provider of value added services & applications to government, utilities and public c
Slide 24: Group overview (continued)
23 Group overview (continued) For personal use only Business Segment CUSTOMER CARE SPECIALIST FIELD SERVICES TCI CUSTOMER CARE COMMUNICATIONS AMRS (Including Infrastructure Services) 51% 31% HY11 Segment Revenue Contributions 18% Business Offers a complete end to end Provides a range of network Spec
Slide 25: Important Notice – Disclaimer
24 For personal use only Important Notice – Disclaimer This presentation has been prepared by the management of Service Stream Limited (the ‘Company’) for the benefit of brokers, analysts and investors and not as specific advice to any particular party or person. Neither the Company, nor any of its