Emeco Holdings Limited · ASX:EHL
Emeco — Macquarie Capital Emerging Leaders Conference (October 2008)
21 slides from Emeco's conference presentation, Oct 14, 2008
Slide 1: Emeco Holdings Limited – Macquarie Capital Emerging Leaders Conference
Emeco Holdings Limited Macquarie Capital Emerging Leaders Conference For personal use only
Slide 2: Disclaimer
Disclaimer For personal use only This presentation may contain forward looking statements that are subject to a range of risk factors and uncertainties. Whilst these statements are considered to be based on reasonable assumptions, the statements themselves and the assumptions upon which they are bas
Slide 3: Agenda
Agenda For personal use only 1. Business Overview 2. Financials 3. Strategic Outlook 4. Summary
Slide 4: Emeco's Global Business Model
Emeco’s Global Business Model For personal use only EUR CAD INDO Rental Global Customers Rental Network USA AUS Parts Asset Parts Procurement Customers Maintenance Maintenance Sales Sales Customers Customers Emeco Products & Services End user groups
Slide 5: Renting with Emeco
Renting with Emeco For personal use only Companies rent from Emeco to increase capital & operational efficiencies and achieve lower costs per hour Reasons Customer Constraint Long lead times for new equipment Availability Limited network/expertise to purchase second hand machines Fluctuations
Slide 6: Emeco's Competitive Advantages
Emeco’s Competitive Advantages For personal use only Emeco continues to differentiate its products & services, offering superior flexibility and value-add to its customers operations Manufacturer EMECO Other Independent Aligned Rental Companies Dealers Provide machinery from a variety of manufacture
Slide 7: Diversification
Diversification For personal use only Emeco is strategically diversified across customers and commodities Rental Revenue by Commodity Rental Revenue by Customer Customer Type Civil Other 8% Remainder Top 5 100% 8% 42% 25% 90% 80% Coal 70% Zinc 37% 60% 11% 50% 40% 30% Top 6-10 Oil 20% 15% 10% 10% 0%
Slide 8: Agenda
Agenda For personal use only 1. Highlights 2. Financials 3. Strategic Outlook 4. Summary
Slide 9: 2008 Financial Overview
2008 Financial Overview For personal use only Operating revenues increased by 11.4% on 2007 to $617.9m EBITDA increased by 3.0% to $213.5m NPAT decreased by 9.6% to $67.5m1 (2H08 NPAT increased by +21.4% on 1H08) International business performance improvements in Indonesia, US & Canada in 2H08 Succe
Slide 10: Performance trends
Performance trends For personal use only Positive growth in fleet utilisation across all 85 % Global Rental Utilisation businesses globally by $ value Improving utilisation with stable cost 80 % structure expected to improve margins in FY09 75 % Improving ROFEs from 2H08 into FY09 70 % by units thro
Slide 11: Balance sheet and gearing
Balance sheet and gearing For personal use only Funding certainty, strong cashflow and conservative gearing leaves Emeco well positioned Successfully refinanced senior bank Change debt facility from $515m to $630m A$m Jun-07 Dec-07 Jun-08 h/h (%) including $595m 3 year senior Working capital 1 110.2
Slide 12: Operating cash flow
Operating cash flow For personal use only Emeco continues to generate significant free cashflow 12 months: A$m FY07 FY08 Net maintenance capex comprising EBITDA 207.3 213.5 equipment replacement & major overhauls Working capital (80.0) (1.5) lumpy but should trend towards FX/Other 8.0 (7.6) Interest
Slide 13: Agenda
Agenda For personal use only 1. Highlights 2. Financials 3. Strategic Outlook 4. Summary
Slide 14: Organic growth opportunities
Organic growth opportunities For personal use only Emeco’s primary markets are forecast to continue growing at between 3–10% p/a over the medium term Australian Coal Australian Gold Australian Coal Australian Iron Ore 350 550 450 500 400 CAGR – 6% CAGR – 3% CAGR – 10% 450 300 350 400 MT MT MT 350 30
Slide 15: Current market conditions
Current market conditions Renting with Emeco For personal use only Emeco’s outlook and earnings momentum remains positive Australia • Significant activity in coal, iron ore and gold markets are translating to strong fleet utilisation • Limited availability of new equipment is driving higher utilisat
Slide 16: Current market conditions
Current market conditions Renting with Emeco For personal use only Emeco’s outlook and earnings momentum remain positive United States • Appalachian coal prices have increased 100% over past six months translating to increased activity • US business infrastructure now well established to capitalise
Slide 17: Strategic outlook
Strategic outlook For personal use only Strategic growth Strategic focus delivering continued improvements in ROFE and utilisation levels whilst capturing any compelling growth opportunities that may arise Uncertainty of funding sources from debt and equity markets for our customers is translating i
Slide 18: Strategic outlook
Strategic outlook For personal use only Organisational capabilities Continued integration of global business units and standardisation of Emeco systems and processes Enhancement of global procurement and asset management team to optimise global fleet Ongoing development of management team depth and
Slide 19: Agenda
Agenda For personal use only 1. Highlights 2. Financials 3. Strategic Outlook 4. Summary
Slide 20: Summary
Summary For personal use only Emeco is leveraged to mining volumes rather than commodity prices Whilst remaining diversified there is significant and increasing exposure to coal and iron ore Global fleet utilisation recovered in 2H08 and currently remains strong Cashflow generation from installed as
Slide 21: Questions?
For personal use only Questions ?
Emeco Holdings — Macquarie Capital Emerging Leaders Conference (October 2008) on 6ix