North American Construction Group Ltd. · TSX:NOA
North American Construction — Q1 2024 Earnings Presentation
24 slides from North American Construction's earnings presentation, May 2, 2024
Slide 1: Q1 2024 Earnings Presentation
Q1 2024 EARNINGS PRESENTATION May 2, 2024
Slide 2: Forward-looking statements & non-GAAP financial measures
Forward-looking statements & NOA TSX - NYSE non-GAAP financial measures This presentation contains forward-looking information which reflects the current plans This presentation presents certain non-GAAP financial measures because and expectations of North American Construction Group Ltd. (the “Comp
Slide 3: "Everyone Gets Home Safe"
Exposure Hours 1 NOA TSX - NYSE “Everyone Gets Home Safe” 4.2 4.8 4.9 4.9 5.1 3.4 3.4 Continuous focus on improving HSE performance 2.7 for ourselves, our environment, our customers, 2.3 2.1 and the communities we work in 1.6 • Q1 safety performance includes employee hours from Canada, Australia, an
Slide 4: Q1 2024 Accomplishments
NOA TSX - NYSE Q1 2024 Accomplishments • Strong results in Australia driven by effective contributions from the Middlemount and Carmichael operations • $500 million five-year contract extension with metallurgical coal producer in Queensland, Australia • Integration team established in Australia with
Slide 5: Equipment Utilization
NOA TSX - NYSE Equipment Utilization1 90% Target for Australia 75% 80% Target for Canada 70% Q1 2024 60% 52% 50% 40% 30% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2021 2021 2021 2021 2022 2022 2022 2022 2023 2023 2023 2023 2024 Canada Australia Fleet utilization in Canada heavily impacted by remobiliza
Slide 6: 2024 Q1 Financial Overview
2024 QI FINANCIAL OVERVIEW ©) aateican CONSTRUCTION GROUR
Slide 7: 2024 Q1 Performance
NOA 2024 Q1 Performance TSX - NYSE $346M $93M 27.0% $3.0B Combined Adjusted Adjusted Contractual revenue1 EBITDA1 EBITDA margin1 backlog1 • Record Q1 adjusted EBTIDA1 of $93.3 million, exceeding the 2023 metric by 10% $120 Adjusted EBITDA1 Q1 2024 • Strong quarter at MacKellar, results driven by Mid
Slide 8: Combined Results
NOA TSX - NYSE Combined Results (figures in millions of Canadian dollarss) Q1 2024 Q1 2023 Variance Wholly-owned entities $297 $244 $53 Share of amounts from investments $49 $78 ($29) TOTAL COMBINED REVENUE1 $346 $322 $24 Combined gross profit1 $62 18.0% $56 17.3% $6 Q1 2024 Revenue from wholly owne
Slide 9: Adjusted EBITDA and EPS
NOA TSX - NYSE Adjusted EBITDA1 and EPS 1 (figures in millio ns o f Canadian do llars, except per share amo unts) Q1 2024 Q1 2023 Variance Adjusted EBITDA1,3 $93 27.0% $85 26.3% $8 Adjusted EBIT1,3 $45 13.0% $43 13.4% $2 Adjusted EPS1 $0.78 $0.96 ($0.18) General & administrative expenses2 $11 3.8% $
Slide 10: Cash Provided by Operating Activities
NOA TSX - NYSE Cash Provided by Operating Activities (figures in millio ns o f Canadian do llars unless o therwise stated) Q1 2024 Q1 2023 Variance Cash provided by operations prior to WC1 $74 $66 $8 Net changes in non-cash working capital (62) (34) (28) Cash provided by operating activities $12 $32
Slide 11: Balance Sheet
NOA TSX - NYSE Balance Sheet (figures in millions of Canadian dollars unless otherwise stated) March 31, 2024 December 31, 2023 December 31, 2022 Cash $80 $89 $69 Total capital liquidity 1 236 293 212 Property, plant & equipment 1,165 1,143 646 Total assets 1,580 1,546 980 Senior debt 1,2 $613 1.6x
Slide 12: 2024 Outlook
me 2024 OUTLOOK AMERICAN CONSTRUCTION GROUP.
Slide 13: Operational Priorities for 2024
Operational Priorities for 2024 1 2 Integrate & grow MacKellar with Win large-scale mining or ERP and stronger systems & civil construction project processes in place for H2 2024 Qualify for major earthworks infrastructure tender 3 4 Achieve fleet utilization Re-establish operational targets, ex
Slide 14: Bid Pipeline
NOA TSX - NYSE Bid Pipeline ESTIMATED PROJECT COMMENCEMENT 2024 2025 2026+ TIMING Projects in the active procurement process Q1 2024 Potential contract extensions Upcoming bid opportunities Diversified resources & infrastructure BID PIPELINE1 CONTAINS OVER $10 BILLION OF SPECIFIC SCOPES OF WORK • Si
Slide 15: Contractual backlog over $3.0 billion
NOA TSX - NYSE Contractual backlog1 over $3.0 billion Quarterly increase of $300 million as awards significantly outpaced scopes completed MINING, RESOURCE & CIVIL CANADIAN OIL SANDS REGION QUEENSLAND & WESTERN AUSTRALIA • Strategic partnerships with Backlog provides stability & benefits Metallurg
Slide 16: 2024 Outlook
Revenue, EBITDA & EPS unchanged from NOA TSX - NYSE 2024 Outlook operational targets set in late 2023 • Line of sight based on contracts in No change from outlook provided in March 2024 • place and upcoming busy season Certain fleet being mobilized to Australia to maximize usage KEY METRICS Combin
Slide 17: Disciplined Capital Allocation
NOA Disciplined Capital Allocation TSX - NYSE Net Debt Leverage1,2 Focus for 2024 2.4x 2.2x Debt repayment Acquisitions 1.8x 1.7x 1.5x 1.5x Lowering leverage Assessing bolt-on viewed as prudent use acquisitions & of capital transformative targets 2019 2020 2021 2022 2023 2024E Q1 2024 $160-$185m Ran
Slide 18: Supplemental Information
SUPPLEMENTAL NORTH INFORMATION ek
Slide 19: 2024 Sustainability Report
NOA TSX - NYSE 2024 Sustainability Report • 3% decrease in scope 1 emissions intensity from baseline • Committed to reducing scope 1 emissions intensity by 10% by 2025 and be net zero by 2050 Q1 2024 • Integral part of core business process to provide safe and healthy working conditions for employee
Slide 20: Company Overview
Head office & maintenance facilities in Acheson, Alberta NOA TSX - NYSE Company Overview MacKellar Group – Corporate office & maintenance facilities Sites with significant current operations Fleet of ~1,200 heavy equipment assets • Backed by support equipment & infrastructure Current workforce of ~4
Slide 21: North American Construction Group
NOA North American Construction Group TSX - NYSE Australian contractor of civil earthmoving, mining services, and large-scale equipment rentals Provider of fully-maintained high-quality heavy equipment in Western Australia LARGE SCALE Majority Inuit-owned contract mining, heavy civil LOW-COST OP
Slide 22: Diversified Business
NOA TSX - NYSE Diversified Business Canadian oil sands region 5% 5% 5% Civil construction & project management 35% Q1 2024 Queensland metallurgical coal 15% Queensland thermal coal Western Australia Equipment & component sales 20% 15% Canadian resources 1 See Slide 2 or Q1 2024 Financial Report for
Slide 23: Long-Term Contracts
NOA TSX - NYSE Long-Term Contracts Owner Contract1,2 Regional Heavy Civil MUA 2027 2059 Various Earthworks with term Imperial Oil MSA 2027 2060 Kearl Mine Limited with term Fargo- Moorhead Flood Metro Flood Design & Construction - 2027 O&M - 2056 Diversion Project Diversion Authority build Wyoming t
Slide 24: Heavy Equipment Fleet
NOA TSX - NYSE Heavy Equipment Fleet • As at March 31, 2024, 1,162 mobile heavy equipment assets provide operational flexibility • Managed on an individual asset basis and deployed with sole objective of maximum operating utilization • ~300 assets operated within the Nuna Group of Companies • New re
North American Construction Group — Q1 2024 Earnings Presentation on 6ix