Slide 1: PBG Group’s presentation
PBG Group’s presentation Warsaw, March 6, 2012 1
Slide 2: Agenda
Agenda Information on the PBG Group I PBG Group’s strategy II Financial results for 4Q2011 III 2
Slide 3: We are a leading provider of specialty construction & engineering services in Poland
We are a leading provider of specialty construction & engineering services in Poland Group’s backlog of order is PLN 5,93 bn (as at January 1, 2012) Environmental and Oil and Gas Power 1 Water Roads Infrastructure Key Construction Natural gas and Power generation Sports infrastructure, Reservoirs, d
Slide 4: We have a high margin business model
We have a high margin business model Gross profit breakdown LTM4Q2011 (PLNmm) Gross profit LTM4Q2011: PLN 416mm 48 141 84 50 71 Natural gas, crude oil&fuels Power engineering Industrial & res. Construction Water Road construction Gross margin by segment LTM4Q 2011 Gross margin benchamarking LTM4Q201
Slide 5: After years of underinvestment, a large-scale capex program is underway in the Power sector
After years of underinvestment, a large-scale capex program is underway in the Power sector Projected Gross Electricity demand in Poland (TWh) Age of power generation units in Poland Turbine sets Boilers 250 50% 47% 200 217 40% 44% 195 150 169 30% 32% 31% 153 100 20% 50 10% 8% 11% 10% 5% 5% 7% 0 0%
Slide 6: We are optimally positioned to capitalize on the modernization of Polish Power sector
We are optimally positioned to capitalize on the modernization of Polish Power sector Power construction (percentage of LTM4Q2011 gross profit 17% RAFAKO Rafako is the undisputed leader of the power market sector in Poland coupled by strong international presence One of the only four European co
Slide 7: We are the leading contractor of the national Natural Gas, Crude Oil & Fuels infrastructure modernization program
We are the leading contractor of the national Natural Gas, Crude Oil & Fuels infrastructure modernization program Natural gas, crude oil & fuels 34% percentage of LTM4Q2011 gross profit The leader in large scale projects in the high margin natural gas, crude oil & Leading fuels sector position in
Slide 8: We are selectively pursuing high margin opportunities in the Water segment
We are selectively pursuing high margin opportunities in the Water segment Water 20% percentage of LTM4Q2011 gross profit Key considerations PBG experience in executing landmark projects PBG’s extensive expertise due to its presence Water treatment plant in the sector since 1949 in Krakow Limi
Slide 9: We focus on specialist contracts from the industrial and residential construction segment
We focus on a specialist contracts from the industrial and residential construction segment Industrial and residential construction percentage of LTM4Q2011 gross profit 12% Key considerations PBG experience in executing landmark projects PBG’s leading position – constructed 3 stadiums for Nation
Slide 10: We are reducing our exposure to the non-strategic Roads business
We are reducing our exposure to the non-strategic Roads business 12% Road construction percentage of LTM4Q2011 gross profit Key considerations PBG experience in executing landmark projects Roads are non-core area of focus for PBG Highly competitive segment, particularly for Construction of A1
Slide 11: PBG Group's order book
PBG Group's order book Key information Order book (PLNm) Our core segments of the Group account for over 50% of the 7 000 order book The order book represents 1.6x of revenue 6 000 It is expected that the Opole contract will add PLN 3.2bn to the 5 000 5 930 order book, raising its value to 2.4
Slide 12: We have a proven operating track record
We have a proven operating track record Within the last 4 years we have signed contracts for total value of PLN 20.9bn Track record of on-time completions, 99% since 2007 Excellent Tender success rate1 of ~33% and ~15% in our core markets of operating natural gas, crdue oil & fuels and power e
Slide 13: Structure of the PBG Group
Structure of the PBG Group GAS, OIL AND EPC SERVICES GENERAL CONSTRUCTION, RESIDENTIAL POWER ENGINEERING ENVIRONMENTAL ROAD CONSTRUCTION FOREIGN OPERATIONS CONSTRUCTION PROTECTION, HYDRO- ENGINEERING 100.00% 100.00% 100.00% 66.00% 63.05% PBG UKRAINA 99.99% 64.84% 98.49% 100.00% 100.00% AGGREGATE QUA
Slide 14: Agenda
Agenda Information on the PBG Group I PBG Group’s strategy II Financial results for 4Q2011 III 14
Slide 15: PBG Group’s strategy
PBG Group’s strategy PBG'S STRATEGIC PLANS FOCUS ON HIGH-MARGIN CORE SEGMENTS, ON STRENGTHENING THE LEADERSHIP, AND ON DELEVERAGING Placing RAFAKO S.A. as the leader of the PBG Group's power engineering segment Strategic cooperation with major players on the global power engineering market Expan
Slide 16: Significant Potential Contracts
Significant Potential Contracts NO CONTRACT ACTIVITY SETTLEMENT INVESTOR BUDGET Construction of power unit for Północ Power Północ Power 1. Power engineering 3 Q 2012 PLN 12 bn Plant Plant Modernization of boilers’ combustion system 2. Power engineering 2 Q 2012 ENEA PLN 6 bn in Kozienice II Constru
Slide 17: Highlights
Highlights 1 Perspectives of development on the power engineering market in Poland 2 Established market leader position on the markets with strategic meaning and experience in execution of key projects for the Polish economy 3 Experienced management team with strong expertise in construction and eng
Slide 18: Agenda
Agenda Information on the PBG Group I PBG Group’s strategy II Financial results for 4Q2011 III 18
Slide 19: Key financial ratios for 2011
Key financial ratios for 2011 Revenue Gross profit EBITDA PLNm PLNm PLNm 12.5% 11.1% 12.2% 10.6% A 36% yoy revenue growth, driven mainly by the highway and sports stadium construction projects, as well as consolidation of Energomontaż Południe (as of July 1st 2011) and Rafako (as of November 2011)
Slide 20: PBG Group’s financial position – Q1-Q4 2011 income statement
PBG Group’s financial position – Q1-Q4 2011 income statement Commentary Financial performance Revenue growth was driven by the PLN ’000 Q1-Q4 2011 Q1-Q4 2010 y-o-y change Other income execution of highway and stadium Revenue 3,733 829 2,740,311 +36 Q1-Q4 Q1-Q4 PLN ’000 2011 2010 construction contr
Slide 21: PBG Group’s financial position – Q4 2011 income statement
PBG Group’s financial position – Q4 2011 income statement Commentary Financial performance Revenue growth was driven by the PLN ’000 Q4 2011 Q4 2010 y-o-y change execution of road construction Revenue 1,353,331 855,257 +58 contracts (PLN 1.1bn vs. PLN 299m) and Cost 1,193,062 744,534 +60 Other inc
Slide 22: PBG Group’s assets – statement of financial position
PBG Group’s assets – statement of financial position Statement of financial position High liquidity in all years. Decline in 2011 caused by high demand PLNm 2008 2009 2010 Q4 2011 for working capital relating to road and stadium construction Non-current assets 902 1,018 1,594 2,242 projects, as well
Slide 23: PBG Group’s economic standing – Cash flows
PBG Group’s economic standing – Cash flows Cash flows PLN 271m profit before tax – highest in the last four years. PLNm 2008 2009 2010 4Q 2011 Profit before tax 214 260 234 271 Strong need in 2011 owing to four Adjustments and 108 184 68 81 large road construction projects other and completion of Eu
Slide 24: PBG’s stand-alone performance – Q1-Q4 2011 income statement
PBG’s stand-alone performance – Q1-Q4 2011 income statement Commentary Financial performance PLN ’000 Q1-Q4 2011 Q1-Q4 2010 y-o-y change Other income Revenue grew by 9% year on year, Revenue 1,001,914 918,230 +9 Q1-Q4 Q1-Q4 primarily as a result of the execution PLN ’000 2011 2010 of projects in t
Slide 25: PBG’s stand-alone performance – Q4 2011 income statement
PBG’s stand-alone performance – Q4 2011 income statement Commentary Financial performance PLN ’000 Q4 2011 Q4 2010 y-o-y change Revenue fell by 18% year on Revenue 316,342 384,342 -18 year as a result of the execution Cost 275,362 310,653 -11 Other income of projects in the gas and PLN ’000 Q4 201
Slide 26: PBG Group’s financial performance in Q1-Q4 2011 and Q1-Q4 10, by segments
PBG Group’s financial performance in Q1-Q4 2011 and Q1-Q4 2010, by segments Gaz Gas,ziemny i ropa naftowa oil and fuels Woda Water Budownictwo przemysłowe Industrial and residential i mieszkaniowe construction Drogi Roads Budownictwo energetyczne Power engineering Inne Other 23% 11% 1% 30% 14% 21% I
Slide 27: PBG Group’s financial highlights (PLN ‘000)
PBG Group’s financial highlights (PLN ‘000) REVENUE NET PROFIT 124% 103% OPERATING PROFIT - EBIT OPERATING MARGIN 129% 27
Slide 28: Disclaimer
Disclaimer This presentation was prepared by PBG S.A. Data and information contained in the slides are for information purposes only and do not constitute full financial analysis. For a detailed description of PBG's operations and financial situation, please refer to current and periodic reports ava