James Fisher And Sons Plc · LSE:FSJ
James Fisher And Sons — Investor Day (November 2016)
49 slides from James Fisher And Sons's investor day presentation, Nov 22, 2016
Slide 1: Capital Markets Day – 22 November 2016
Markets James Fisher and Sons plc Day – 22 Capital Markets Day – 22 November 2016 Novem16 © James Fisher and Sons plc - 2016
Slide 2: Welcome and Agenda
Welcome Agenda Nick Henry Stuart Kilpatrick Giovanni Corbetta Richard Burmeister Group CEO Group CFO JFD CEO JFMS CEO 14.30 Introduction Nick Henry / Stuart Kilpatrick 14.45 JFD Giovanni Corbetta 15.25 JFD Q&A 15.45 Break 16.00 JF Marine Services Richard Burmeister 16.40 JF Marine Services Q&A 16.55
Slide 3: IMS – November 2016
IMS – 22 November 2016 • Q3 revenue strongly ahead of comparative • Organic growth • 2 acquisitions • Sterling weakness • Marine Support, Specialist Technical & Tankships ahead • Ship to ship services strong • Specialist Technical progress despite delays in nuclear decommissioning • Offshore Oil 6%
Slide 4: Who we are
Who we are: UK’s leading Marine Established 1847 UK listed 1952 Service Company Revenue 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 150 200 250 300 350 400 450 500 Underlying PBT - Market cap – c. £800m Revenue - £438m £41m © James Fisher and Sons plc - 2016 4
Slide 5: Clear, consistent strategy
Clear, consistent strategy • Entrepreneurially led businesses with leading market positions in operational niches • Leverage UK skills to the global Marine Services market o targeting immature markets • Integration of niche services into wider service offering • Focus on operational excellence o ope
Slide 6: Our businesses
Our businesses James Fisher and Sons plc Marine Support Offshore Oil Specialist Technical Tankships Revenue Profit Assets 15% 8% 12% 18% 41% 44% 40% 29% 30% 34% 14% 15% Marine Support Offshore Oil Specialist Technical Tankships © James Fisher and Sons plc - 2016 6
Slide 7: Where we are
Where we are: Revenue by destination Locations 2015 24% 45% 14% 17% UK Asia Pacific Europe Middle East, Africa & The Americas © James Fisher and Sons plc - 2016 7
Slide 8: Earnings per share track record
Earnings per share track record 75 65 CAGR 12% 55 45 pence per share 35 25 15 © James Fisher and Sons plc - 2016 8
Slide 9: Dividend track record
Dividend track record pence per share CAGR last 10 years - 11% 25 20 15 10 5 0 • 21 consecutive years of dividend increase © James Fisher and Sons plc - 2016 9
Slide 10: Cash Conversion
Cash Conversion 70 140% 60 120% Ten year average 105% 50 100% 40 80% 30 60% 20 40% 10 20% 0 0% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Operating profit Operating cash flow Cash conversion • Operating cash flow > operating profit in 7 of last 10 years © James Fisher and Sons plc - 2016 10
Slide 11: ROCE
ROCE 25% 20% 17% 15% 14% 10% 5% 0% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 ROCE (pre tax) ROCE (post tax) 10 year Average (pre tax) 10 year Average (post tax) © James Fisher and Sons plc - 2016 11
Slide 12: Organic Growth
Organic Growth Cumulative growth in underlying operating profit of Specialist Technical, Offshore Oil & Marine Support 90% Acquisitions 80% Organic 70% 60% 50% 40% 30% 20% 10% 0% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 • 60%-70% organic growth since 2006 • 2015 reduced by Offshore Oil down
Slide 13: Deep dive on Specialist Technical
Deep dive on Specialist Technical Two businesses • JFD (2/3 of revenue) • Specialist submarine rescue, hyperbaric facilities and diving and subsea equipment • JF Nuclear (1/3 of revenue) • Nuclear decommissioning Acquired Acquired Acquired Divex NHC Lexmar 2016 140 120 100 80 60 40 20 0 2009 2010 20
Slide 14: Specialist Technical Division - 2015
Specialist Technical Division - 2015 • 30% of Group Revenue • 31% of Underlying Profit • 800 employees Revenue by Geography Revenue by Sector Revenue by Company 12% UK 36% Nuclear 36% 64% Continental Europe Defence Nuclear 27% Asia Pacific Oil & Gas JFD Rest of World Commercial 26% © James Fisher an
Slide 15: JFD
Markets James Fisher and Sons plc Day – 22 JFD Novem16 Capital Markets Day – 22 November 2016
Slide 16: JFD
JFD Submarine Rescue Services Saturation Diving Systems Hyperbaric Rescue Services Swimmer Delivery Vehicles Military & Commercial diving equipment Testing & Training • “Multi-niches” Company • Operating Model: from supplier of equipment to provider of services • Leverage on expertise (best in class
Slide 17: JFD revenue by activity and geography
JFD Revenue by Activity - 2015 Revenue by Geography 11% 50% 23% 37% UK Projects Australia Services Rest of Asia 38% Pacific OEM Spares & Products Other 28% 14% • Singapore based Lexmar acquired in August 2016 © James Fisher and Sons plc - 2016 17
Slide 18: Revenue by activity
Revenue by activity 2015 • Dive Systems 14% 42% Dive Systems ₋ Saturation Diving Defence Projects & SDV • Submarine Rescue 14% Testing & Training • Testing & training Sub Rescue • Commercial and Defence Products Commercial Products • Defence Projects and Swimmer Delivery Vehicle Defence Products 19%
Slide 19: Saturation Diving Systems
Saturation Diving Systems Divers have a compressed lifeboat for emergency evacuation Divers are deployed on seabed using a compressed diving bell Divers live in compressed chambers at the working depth © James Fisher and Sons plc - 2016 19
Slide 20: Saturation Diving Systems
Saturation Diving Systems PORTABLE SYSTEMS • Small and compact • Installed on vessel’s deck BUILT IN SYSTEMS • Easy to install and remove • Larger capacity (divers/efficiency) • Suitable to many vessels • Specific design and built • Limited use (weather limitation) • Extended use © James Fisher and
Slide 21: DSVs' Built
Saturation Diving Systems 16 DSV becoming old/dismissed Capacity needs to be reinstated + market growth 14 DSVs’ Built 12 10 8 6 4 2 0 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 • Approx. one third of DSVs’ built-in systems are JFD • Approx. two third h
Slide 22: JFD – Dive Systems APAC Focus
JFD – Dive Systems APAC Focus Shanghai Salvage 500 SAT System © James Fisher and Sons plc - 2016 22
Slide 23: Submarine Rescue
Submarine Rescue Escape Survey Full Rescue Decompression © James Fisher and Sons plc - 2016 23
Slide 24: Submarine Rescue
Submarine Rescue • NATO (Royal Navy, French Navy, Norwegian Navy) – 2015 – 5 year agreement • Singapore Navy – 2008 – Delivery of Rescue Vehicle system and 25 year agreement • Australian Navy – 2015 – Rescue Vehicle provided and 5+5 year agreement • South Korean Navy – 2008 – Delivery of Rescue Vehi
Slide 25: Submarine Rescue
Submarine Rescue © James Fisher and Sons plc - 2016 25
Slide 26: Submarine Rescue Exercise Black Carillion 2016
Submarine Rescue SUBMARINE RESCUE EXERCISE BLACK CARILLION 2016 © James Fisher and Sons plc - 2016 26
Slide 27: Swimmer Delivery Vehicles
Swimmer Delivery Vehicles • Swedish Navy – Seal Carriers • Bahrain Navy – Torpedo Seals • A Navy – Closed SDV Prototype © James Fisher and Sons plc - 2016 27
Slide 28: JFD – Products: Closed Circuit Rebreathers
JFD – Products Closed Circuit Rebreathers • Commercial Market SLS** used since 1986 – 30min@120m (400m max) COBRA (new) – 45min @ 120m (450m max) • Defence Market Enforcer: 3h – 24m Excursion: 6h – 24m Shadow Stealth CDLSE Shadow Enforcer CDLSE*: 5h – 120m Excursion * Clearance Diver’s Lif
Slide 29: JFD – Products: Original Equipment Manufacturer (OEM)
JFD – Products Original Equipment Manufacturer (OEM) • Gas Recovery Systems: Electric Gasmizer Diver Gas Recovery System Gaspure Chamber Gas Recovery System Helipure Membrane Gas Separation Systems • Environmental Conditioning Systems: Habitat Conditioning Unit Chiller System Heater Syst
Slide 30: JFD – Products: Self Propelled Hyperbaric Lifeboats
JFD – Products Self Propelled Hyperbaric Lifeboats (SPHL) • 12 man • 18 man • 24 man • Up to 500m water depth © James Fisher and Sons plc - 2016 30
Slide 31: National Hyperbaric Centre
National Hyperbaric Centre Diving operations simulation Hyperbaric Rescue Hyperbaric Testing Class Training Practical Training © James Fisher and Sons plc - 2016 31
Slide 32: JFD – Global Hyperbaric Rescue
JFD – Global Hyperbaric Rescue Global Reach Service * HRF – Hyperbaric Rescue Facility © James Fisher and Sons plc - 2016 32
Slide 33: JFD – Opportunities
JFD – Opportunities OEM Products/Services Illustrative project size (Annual) Growth Opportunity Saturation Dive Systems £20m-£30m £2m-£6m Services APAC Region/China Oil Price Rebreathers - Military £6m-£9m US Navy - Commercial £0.5m-£1m Cobra, Services, Oil Price Submarine Rescue £30m-£40m £12m-£20m
Slide 34: JFD – Quality of Earnings
JFD – Quality of Earnings • Projects lead to growing recurring base of: • Services • Spares and product sales © James Fisher and Sons plc - 2016 34
Slide 35: Deep dive on Marine Support
Deep dive on Marine Support Ship to Ship Transfers Testing Services Mass Flow Excavation Marine products Marine Services Marine Support 200 180 160 140 120 100 80 60 2009 2010 2011 2012 2013 2014 2015 Revenue (£m) © James Fisher and Sons plc - 2016 35
Slide 36: Marine Support Division - 2015
Marine Support Division - 2015 • 44% of Group Revenue • 42% of Underlying Profit • 1,100 employees Revenue by Geography Revenue by Sector Revenue by Service 5% 9% UK 10% 24% 21% STS 12% STS 24% Europe 13% Oil & Gas Products Marine Asia Pacific 4% Marine Services 12% Ports & Terminals Middle East Tes
Slide 37: Marine Services
Markets James Fisher and Sons plc Day – 22 Marine Services Novem16 Capital Markets Day – 22 November 2016
Slide 38: Offshore Renewables Market Size (Europe) 2017-2019
Offshore Renewables Market Size (Europe) 2017-2019 13% 46% UK 12% Germany Denmark 13% Other 46% 30% 12% UK Germany Existing 11,000MW’s 13% Denmark (1,800 Turbines) 30% Other 12% 46% UK Germany Potential 9,700MW’s Denmark (1,600 Turbines) Other 30% Total 20,700MW’s (3,400 Turbines) © James Fisher and
Slide 39: Offshore Renewables Market Size (Europe) 2017-2019
Offshore Renewables Market Size (Europe) 2017-2019 4% 12.7% 11% 45.9% 11.5% UK Offshore Wind Germany Tidal Denmark Other Wave 29.9% 85% • €13.3bn of approved finance • £11bn of finance approved • €11.0bn of expected finance • £9bn of finance expected Source – EWEA-Offshore-Statistics-Report-2015 © J
Slide 40: Projected Offshore Wind Market Growth (Europe)
Offshore Renewables Projected Offshore Wind Market Growth (Europe) © James Fisher and Sons plc - 2016 40
Slide 41: Offshore Wind Major Opportunities
Offshore Renewables Offshore Wind Major Opportunities • RWE Galloper Integrated Services £35m • EDPR Moray Firth Integrated Services £50m • RWE Triton Knoll Integrated Services £50m • SPR East Anglia 1 Integrated Services £70m • Vattenfall Norfolk Vanguard Integrated Services £70m © James Fisher and
Slide 42: Round 3 Projects
Offshore Renewables Round 3 Projects Turbines MW Commences Beatrice 84 588 2017 East Anglia ONE 102 714 2017 Galloper 56 336 2017 Walney Extension East 47 329 2017 Walney Extension West 40 330 2017 Hornsea Project One 171 1200 2018 Neart Na Gaoithe 64 448 2018 Triton Knoll 112 900 2019 © James Fishe
Slide 43: Tidal & Wave Energy Major Opportunities
Offshore Renewables Tidal & Wave Energy Major Opportunities Meygen Phase 1a Integrated Services £5m Meygen - Phase 1b Integrated Services £10m Open Hydro Marine Support £10m Energie Ras Blanchard Integrated Services £15m Wave Hub Cable & Marine Services £4.5m Sabella Turbine Removal & Replacement £2
Slide 44: Offshore Renewables O&M Capabilities
Offshore Renewables O&M Capabilities • Marine Coordination (OWMS) • Marine Economic Risk Management (MERMAID) • Total range of Topsides Maintenance Services • Oil Exchange & Management Services • OFTO Management & Operational Services • Subsea Inspection and IRM © James Fisher and Sons plc - 2016 44
Slide 45: Rationale for James Fisher
Offshore Renewables Rationale for James Fisher 1. Niche capabilities & services 2. Wide range of services and de-risking ability 3. UK plc offering strategic UK content and local knowledge 4. Differentiators OWMS, MERMAID significant “in house” Content 5. Ability to react to rapid industry consolida
Slide 46: Offshore Wind Management System (OWMS)
Offshore Renewables Offshore Wind Management System (OWMS) © James Fisher and Sons plc - 2016 46
Slide 47: Offshore Renewables Our Capabilities
Offshore Renewables Our Capabilities © James Fisher and Sons plc - 2016 47
Slide 48: Financial position
Financial position 100 Gearing 80 60 • Modest gearing 40 • Strong cash conversion track record 20 75 39 30 31 43 • Working capital:sales 0 • Positive trend 2011 2012 2013 2014 2015 • Larger projects impact 20% working capital : sales • Bond/guarantee requirements 15% • India DSRV stretch of £19m in
Slide 49: Outlook
Outlook • Niche businesses with strong market position in offshore, marine and nuclear sectors • Strong growth potential in JFD and Marine Services • Positioned for any upturn in Offshore Oil • Bolt-on acquisitions • Well placed to provide growth in shareholder value © James Fisher and Sons plc - 20