Sgh Limited · ASX:SGH
Sgh — Seven Group Holdings — FY2019 Earnings Presentation
29 slides from Sgh's earnings presentation, Aug 21, 2019
Slide 1: Leading the Way Forward
LEADING THE WAY FORWARD Results for the year ended 30 June 2019 21 August 2019
Slide 2: Group Overview
Full Year Results Presentation Seven Group Holdings 2 21 August 2019 GROUP OVERVIEW Our objective is to grow shareholder returns by ensuring our businesses continue to perform and deliver market-leading positions
Slide 3: Group Overview: Businesses and Markets
Full Year Results Presentation Seven Group Holdings 3 21 August 2019 GROUP OVERVIEW BUSINESSES AND MARKETS Mining production Industrial Industrial Energy Media • We provide equipment solutions to the world’s services services investments largest miners, supporting record production volumes and drivi
Slide 4: Group Overview: People, Safety and Culture
Full Year Results Presentation Seven Group Holdings 4 21 August 2019 GROUP OVERVIEW PEOPLE, SAFETY AND CULTURE Our people are our greatest asset and keeping them safe is LTIFR TRIFR our top priority • Expanded our safety commitment through leadership programs FY19 FY18 FY19 FY18 – WesTrac’s “Built B
Slide 5: Group Overview: Highlights
Full Year Results Presentation Seven Group Holdings 5 21 August 2019 GROUP OVERVIEW HIGHLIGHTS Strong financial results with EBIT up 40% to $695m • Trading revenue of $4.1bn up 27% with growth across all businesses • EBIT up $198m on pcp delivered through WesTrac ($83m), Coates Hire ($54m) and Beach
Slide 6: Group Overview: Key Financials
Full Year Results Presentation Seven Group Holdings 6 21 August 2019 GROUP OVERVIEW KEY FINANCIALS Underlying Results ($m) – continuing operations FY19 FY18 % Change Trading revenue 4,084.0 3,207.9 27% Earnings before interest and tax1 695.1 496.9 40% Underlying net profit after tax1 478.9 321.9 49%
Slide 7: Group Financials
Full Year Results Presentation Seven Group Holdings 7 21 August 2019 GROUP FINANCIALS Our financial results reflect the level of operating performance achieved and our continued focus on driving efficiencies and cash flow
Slide 8: Financials: Profit and Loss
Full Year Results Presentation Seven Group Holdings 8 21 August 2019 FINANCIALS PROFIT AND LOSS $m FY19 FY18 Change % Revenue 4,084.0 3,207.9 27% Other income 53.5 65.1 (18)% Share of results from equity accounted investees 210.2 144.1 46% Trading revenue and other income 4,347.7 3,417.1 27% Expense
Slide 9: Financials: Significant Items
Full Year Results Presentation Seven Group Holdings 9 21 August 2019 FINANCIALS SIGNIFICANT ITEMS $m FY19 FY18 Share of equity accounted investees' significant items (230.4) (17.4) (Impairment) / impairment reversal – SWM equity (57.5) 28.6 Other items 28.9 62.3 Significant Items – EBIT (259.0) 73.5
Slide 10: Financials: Earnings Summary
Full Year Results Presentation Seven Group Holdings 10 21 August 2019 FINANCIALS EARNINGS SUMMARY Total Coates Allight Invest- $m WesTrac Energy Media Other Group Hire Sykes ments Trading revenue 4,084.0 3,041.3 956.5 77.6 6.5 - 2.1 - Statutory EBIT 436.1 285.6 183.6 1.3 159.2 (224.6) 21.4 9.6 Add u
Slide 11: Financials: Cash Flow
Full Year Results Presentation Seven Group Holdings 11 21 August 2019 FINANCIALS CASH FLOW $m FY19 FY18 Underlying EBIT 695.1 496.9 Add: depreciation and amortisation 200.1 145.8 Underlying EBITDA 895.2 642.7 Operating cash flow 410.6 253.1 Add: interest and other costs of finance paid 85.6 83.4 Net
Slide 12: Financials: Balance Sheet
Full Year Results Presentation Seven Group Holdings 12 21 August 2019 FINANCIALS BALANCE SHEET As at As at • Additional inventory investment of $103m $m Change % mainly in WesTrac including $73m in new 30 Jun 19 30 Jun 18 Trade and other receivables 574.7 585.8 (2)% machines and $63m in parts to sup
Slide 13: Financials: Capital Management
Full Year Results Presentation Seven Group Holdings 13 21 August 2019 FINANCIALS CAPITAL MANAGEMENT Capital structure optimised and strengthened • TELYS4 conversion to ordinary shares well supported by all investors and simplifies the capital structure • Free float increased from 34% to 39% and new
Slide 14: Financials: AASB 16 Leases
Full Year Results Presentation Seven Group Holdings 14 21 August 2019 FINANCIALS AASB 16 LEASES Adoption of AASB 16 Estimated impact as at 1 July 2019 $m • SGH will adopt AASB 16 under the full retrospective approach with effect from 1 July 2019, resulting in a material impact on the Balance Sheet b
Slide 15: Business Review: WesTrac
Full Year Results Presentation Seven Group Holdings 15 21 August 2019 BUSINESS REVIEW WESTRAC Leader in helping customers to drive efficiency by partnering on product support and technology solutions
Slide 16: Industrial Services: WesTrac Highlights
Full Year Results Presentation Seven Group Holdings 16 21 August 2019 INDUSTRIAL SERVICES WESTRAC HIGHLIGHTS Growing demand for support through parts and rebuilds • Record 6.4m parts lines invoiced in WA and NSW as parts demand is driven by equipment life extension and ageing fleet • Miners are capt
Slide 17: Industrial Services: WesTrac Financials
Full Year Results Presentation Seven Group Holdings 17 21 August 2019 INDUSTRIAL SERVICES WESTRAC FINANCIALS Rise in equipment sales to completement parts growth • Revenue up 24% with strength across all categories – Product support revenue up $344m or 19%, driven by 11% increase in parts lines invo
Slide 18: Business Review: Coates Hire
Full Year Results Presentation Seven Group Holdings 18 21 August 2019 BUSINESS REVIEW COATES HIRE A key supplier of equipment to infrastructure and non-residential construction markets with a strong pipeline of projects ahead
Slide 19: Industrial Services: Coates Hire
Full Year Results Presentation Seven Group Holdings 19 21 August 2019 INDUSTRIAL SERVICES COATES HIRE Solid performance in a competitive market • NSW and VIC/SA businesses are delivering robust performance while WA market growth has accelerated – Manageable exposure to residential construction given
Slide 20: Industrial Services: Coates Hire
Full Year Results Presentation Seven Group Holdings 20 21 August 2019 INDUSTRIAL SERVICES COATES HIRE Stable revenue impacted by QLD weakness • Revenue down 2% given QLD impacted by project delays and benefit of Commonwealth Games in prior year • Time utilisation down to 55% but remains above five y
Slide 21: Business Review: Energy
Full Year Results Presentation Seven Group Holdings 21 21 August 2019 BUSINESS REVIEW ENERGY Portfolio of opportunities within Beach Energy and SGH Energy aimed at meeting the East Coast gas demand and new domestic LNG export opportunities
Slide 22: Energy: Beach Energy
Full Year Results Presentation Seven Group Holdings 22 21 August 2019 ENERGY BEACH ENERGY Record production and delivering as a low cost operator • Record full year production of 29.4 MMboe, up 55% on previous year • Operating costs reduced 4% in FY19, currently $9.3/Boe in 2H FY19 • High facility r
Slide 23: Energy: SGH Energy
Full Year Results Presentation Seven Group Holdings 23 21 August 2019 ENERGY SGH ENERGY Crux – strongly positioned to deliver returns $m FY19 FY18 • Crux forms an important part of Shell Australia’s gas portfolio Sale of oil, gas and condensate 6.5 5.9 – Identified as primary source of backfill gas
Slide 24: Business Review: Media
Full Year Results Presentation Seven Group Holdings 24 21 August 2019 BUSINESS REVIEW MEDIA Seven Network provides leadership through its mass audience reach across multiple platforms
Slide 25: Media: Seven West Media
Full Year Results Presentation Seven Group Holdings 25 21 August 2019 MEDIA SEVEN WEST MEDIA Growth in revenue share and ratings in a soft market $m FY19 FY18 • Most watched network, channel and multi-channel in FY19 with 38.8% revenue share in FY19, up 0.7% Share of associate NPAT – SWM 50.6 58.4 •
Slide 26: Investments: Listed Portfolio and Property
Full Year Results Presentation Seven Group Holdings 26 21 August 2019 INVESTMENTS LISTED PORTFOLIO AND PROPERTY Unlocking value of listed portfolio $m FY19 FY18 • Mark-to-market gain of $63m during the year Revenue 2.1 8.8 • Sell down of portfolio by $196 million, providing funds for reinvestment in
Slide 27: Group Outlook
Full Year Results Presentation Seven Group Holdings 27 21 August 2019 GROUP OUTLOOK Focused on how we can position the businesses to best drive value and realise their potential
Slide 28: Outlook FY20
Full Year Results Presentation Seven Group Holdings 28 21 August 2019 OUTLOOK FY20 Business Outlook Strong medium to long term outlook for mining production and infrastructure investment WesTrac and Coates Opportunities being created through new mining projects planned by major miners and growin
Slide 29: Group Overview: Disclaimer
Full Year Results Presentation Seven Group Holdings 29 21 August 2019 GROUP OVERVIEW DISCLAIMER Basis of preparation of slides • Included in this presentation is data prepared by the management of Seven Group Holdings Limited (“SGH”) and other associated entities and investments. This data is includ