Macmahon Holdings Limited · ASX:MAH
Macmahon — FY2024 Earnings Presentation
33 slides from Macmahon's earnings presentation, Aug 20, 2024
Slide 1: Macmahon Full Year Results
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Slide 2: FY24 Financial Highlights
FY24 Financial Highlights Record underlying operating earnings delivered Revenue Underlying EBITDA1 Underlying EBIT(A)1 Underlying NPAT(A)1 (Record) (Record) (Record) $2.0bn 7% $351.7m 14% $140.3m 20% $91.9m 36% 17.3% margin 6.9% margin Statutory NPAT $53.2m Underlying Operating Cash Flow 2
Slide 3: Guidance and Earnings Growth Performance
Guidance and Earnings Growth Performance Achieved guidance for 8th consecutive year Revenue ($m) Underlying EBIT(A) ($m) 2,031 1,906 140 1,698 117 1,380 1,351 101 92 95 1,103 75 710 42 369 Guidance Guidance Guidance Guidance Guidance Guidance Guidance– Guidance 1,300– 1,300 – 1,600 – 1,800 – Guidanc
Slide 4: FY24 Key Highlights
FY24 Key Highlights Execution of existing contracts while managing industry headwinds and securing highly filtered new work Surface Mining Underground Civil Infrastructure Corporate • Greenbushes steady state • FY24 revenue at 26% of group • Acquired 100% of Decmil • Successfully attracted talent to
Slide 5: Key Projects
Key Projects Diversified client portfolio CLIENT END (UNLESS EST. MINE COST CLIENT PROJECT COMMODITY SINCE EXTENDED) END DATE1 CURVE1 Tropicana, WA Gold 2012 Life of mine 2033 Q4 Telfer, WA Gold 2016 Life of mine 2025 Q4 Byerwen, QLD Met Coal 2017 June 2025 2069 Q1 Batu Hijau, Indonesia Copper / Gol
Slide 6: Revenue Diversification
Revenue Diversification Continued improvement in business revenue mix By Commodity By Region By Client 4% 7% 2% 7% 3%3% 3% 19% 3% 8% 4% 5% FY24 FY24 FY24 12% Revenue Revenue 6% Revenue 56% 25% 6% 10% 7% 93% 8% 9% Gold Met Coal Copper/Gold Lithium Other Australia Southeast Asia AngloGold QCoal Red 5
Slide 7: Safety & People
Safety & People Investing in our people and continued safety improvement Safety & Wellbeing Injury Frequency Rates & Workforce • TRIFR decreased from 3.94 in FY23 to 3.64 in FY24 • Expansion of Critical Risk Management Program 9,676 • Roll out of the Macmahon Winning Way leadership training 8,368 7,
Slide 8: Sustainability
Sustainability Evolving commitment and enhancing contribution Sustainability Land rehabilitated Tyre Recycling Environment Baselining our FY24 GHG emissions Framework Program Environmental (tonnes per CO2-e) 120 hectares in established and three- 232 tonnes Footprint Australia year roadmap Scope 1:
Slide 9: FY24 Strategy Execution
| | MACMAHON FY24 Strategy Execution
Slide 10: Expanding into Lower Capital Intensity Services
Expanding into Lower Capital Intensity Services Executing filtered tender pipeline to progress towards long term targets Pro-Forma1 FY18 Revenue Mix FY24 Revenue Mix FY24 Revenue Mix 7% 3% Our Target 19% 26% 7% $710m $2.0bn $2.5bn 53% 9% 65% 21% 90% Revenue Mix Pro-Forma2 FY18 Pipeline FY24 Tender P
Slide 11: Disciplined Strategy Execution has Delivered Consistent Growth
Disciplined Strategy Execution has Delivered Consistent Growth Successful growth track record through both organic initiatives and acquisitions Macmahon’s M&A Track Record Total Revenue and Business Unit Contribution ($ million)1 Adds significant scale and capability to civil 2024 2,500.0 infrastruc
Slide 12: Acquisition of Decmil (ASX:DCG)
Acquisition of Decmil (ASX:DCG) Accelerates expansion and diversification into civil infrastructure On 15 August 2024, Macmahon implemented the Schemes of Arrangements to acquire 100% of Decmil (ASX:DCG), an ASX-listed provider of civil construction and infrastructure solutions in Australia Key Loca
Slide 13: FY24 Results
| | MACMAHON FY24 Results
Slide 14: Financial Performance
Financial Performance Revenue ($m) Underlying EBIT(A) ($m) 2,031 1,906 140 1,698 117 1,380 1,351 96 101 92 1,103 75 710 42 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY18 FY19 FY20 FY21 FY22 FY23 FY24 Underlying EBITDA ($m) Underlying EBIT(A) Margin 352 7.1% 6.9% 6.8% 6.6% 309 6.1% 291 5.8% 5.9% 239 250 181
Slide 15: Capital Management
Capital Management Underlying EBITDA cash conversion and ROACE Underlying Operating Cash Flow1 ($m) Return on Average Capital (ROACE)2 108% 350 99% 17.2% 17.2% 92% 93% 3 100.0% 16.5% 86% 86% 15.6% 15.4% 14.5% 300 70% 306 301 80.0% 13.9% 250 269 270 60.0% 40.0% 200 218 20.0% 150 0.0% 100 127 102 -20.
Slide 16: Underlying Profit and Loss
Underlying Profit and Loss $ Millions FY23 FY24 Change Continued improvements in revenue and underlying earnings Revenue 1,906.2 2,031.3 6.6% • Revenue increased by 6.6% with the commencement at Greenbushes, acquisition Underlying EBITDA 1 308.7 351.7 13.9% of key Pit N Portal contracts and orga
Slide 17: Cash Flow and Capex
Cash Flow and Capex Underlying Interest Net Capex Free Cash Operating Cash & Tax $200.7m Flow Flow $301.0m $25.8m $74.5m Operating Cash flow • Strong underlying operating cash flow of $301 million delivered driving reduction of net debt to $147 million • EBITDA cash conversion of 85.9% due to timing
Slide 18: Balance Sheet
Balance Sheet $ Millions FY23 FY24 Cash 218 195 • Strong financial discipline during high growth phase Receivables 378 428 ‒ Net Debt / EBITDA of 0.42x is below internal threshold of <1.0x Inventories 92 105 ‒ Gearing at 18.8% is below internal threshold of <30%, down from 24.9% in FY23 Financial as
Slide 19: Priorities and Outlook
Priorities and Outlook
Slide 20: Our Strategic Priorities
Our Strategic Priorities Building a sustainable diversified scalable business Improve Invest Expand Diversify Margins & execution Relevance & competitive advantage Growth in current markets New business growth • Continuous improvement in • Grow and develop our team to • Grow our underground portfoli
Slide 21: Decmil FY25 Outlook
Decmil FY25 Outlook Legacy projects largely settled and commercial risk substantially resolved Retained strong and experienced Tier 1 senior management team, setting the business up for sustainable growth Established new office in NSW to strengthen east coast presence Teaming with Tier 1 and 2 civil
Slide 22: Order Book $4.6bn & Tender Pipeline $21.4bn
Order Book1 $4.6bn & Tender Pipeline $21.4bn Order Book Run Off ($m) Tender Pipeline • $2.0bn of FY25 revenue secured 22% • $4.6bn order book secured as at 30 June 2024 which represents approx. 2.3x FY25 secured 35% revenue • $21.4bn3 Order book includes Decmil secured work in hand and excludes shor
Slide 23: Tender Pipeline $21.4bn reflects focus on winning capital light work
Tender Pipeline $21.4bn reflects focus on winning capital light work Project start >> FY25 FY26 FY27+ Preferred Contractor Tender Early Stage Bubble size representative of total estimated contract value 30 June 2024 Full Year Results Surface Underground Civil Infrastructure 23
Slide 24: FY25 Priorities & Guidance
FY25 Priorities & Guidance FY25 PRIORITIES FY25 GUIDANCE • No life changing events, reduction in TRIFR • Continuing to drive operational improvements and increase margins • Progress capital light strategy with a focus on successful Decmil integration Revenue Underlying EBIT(A) • Remain focussed on i
Slide 25: Capital Allocation Policy to Balance Growth and Shareholder Returns
Capital Allocation Policy to Balance Growth and Shareholder Returns Our Priorities Our Record Maintain resilient Maintain Financial Strength Investment in Growth Return Cash to Shareholders balance sheet, ensure Continue to reduce gearing and net debt Targeting low capital growth in Increased divide
Slide 26: Thank You
Thank You CONTACT Mick Finnegan CEO & MD mfinnegan@macmahon.com.au Ursula Lummis CFO ulummis@macmahon.com.au Donald James CCO djames1@macmahon.com.au www.macmahon.com.au 30 June 2024 Full Year Results 26
Slide 27: Appendix
Appendix
Slide 28: Corporate Overview
Corporate Overview Capital Structure Macmahon Share Price Share Price1 (ASX:MAH) $0.285 0.35 Fully paid ordinary shares (m) 2,155 0.30 Market Capitalisation1 $614m 0.25 Cash (30 June 24) $195m 0.20 Net Debt (30 June 24) $147m 0.15 Enterprise Value $566m 0.10 Net Tangible Assets per share (30 June ‘2
Slide 29: Board of Directors
Board of Directors HAMISH TYRWHITT MICHAEL FINNEGAN DHARMENDRA CHANDRAN Independent, Non-Executive Chair Managing Director Independent, Non-Executive Director and Chief Executive Officer DAVID GIBBS – AMNT Nominee DENISE McCOMISH GRAHAME WHITE Non-Independent, Non-Executive Director Independent, Non
Slide 30: Map of Operations
Map of Operations1 30 June 2024 Full Year Results 1. Excludes Decmil operations 30
Slide 31: Cash Flow
Cash Flow $ Millions FY23 FY24 1 Underlying EBITDA 308.7 351.7 Movement in receivables (60.3) (90.5) Movement in inventory (2.3) (8.4) Movement in payables and provisions 60.0 56.2 Cash payments for SaaS customisation costs (2.9) (1.2) Gains of PPE sales treated as revenue - (6.8) Other - (1.1) Net
Slide 32: Reconciliation of Non-IFRS Financial Information
Reconciliation of Non-IFRS Financial Information $ Millions FY23 FY24 Profit for the year (as reported) 57.7 53.2 Add back: • LTI share based payment expense 0.9 2.1 • Corporate development costs and earn-out related to previous acquisitions 0.7 3.2 • Customer contracts amortisation (A) 5.1 0.4 • Sa
Slide 33: Important Notice and Disclaimer
Important Notice and Disclaimer Disclaimer as to forward looking statements The forward looking statements in this presentation reflect views Non-IFRS Financial Information held only as at the date of this presentation. This presentation contains forward looking statements, including This presentati