Atkinsrealis Group Inc. · TSX:ATRL
Atkinsrealis — Q2 2023 Earnings Presentation
21 slides from Atkinsrealis's earnings presentation, Aug 3, 2023
Slide 1: Q2 Conference Call Presentation
Q2 CONFERENCE CALL PRESENTATION August 3, 2023 Hinkley Point C, Somerset, UK1
Slide 2: Forward-Looking Statements and Non-IFRS Financial Measures
Forward-Looking Statements, Forward-Looking Financial Information and Outlook Reference in this presentation, and hereafter, to the “Company” or to “SNC-Lavalin” means, as the context may require, SNC-Lavalin Group Inc. and all or some of its subsidiaries or joint arrangements or associates, or SNC-
Slide 3: Strong Q2 Results
Strong Q2 Results › Continued success from our “Pivoting to Growth” strategy › SNCL Services revenues and Segment Adjusted EBIT increased significantly year-over-year by 21.8% (17.7% organic revenue growth*) and 14.6%, respectively › SNCL Services organic revenue growth* outlook for full year 2023 r
Slide 4: SNCL Services Backlog
SNCL Services Backlog Historic Jeddah, Saudi Arabia In $M 12,358 +9% 12,079 11,834 11,664 11,306 Jun 30, 2022 Sep 30, 2022 Dec 31, 2022 Mar 31, 2023 Jun 30, 2023 Q2 KEY WINS › Awarded US Florida’s Turnpike Enterprise Engineering Services Contract › Contracted over four years to provide Right-of-Way
Slide 5: Engineering Services
Engineering Services Organic revenue growth* REVENUES ($M) BACKLOG ($M) 25.1% +22% 1,466 5,092 1,129 4,158 Q2 2022 Q2 2023 Jun 30, 2022 Jun 30, 2023 PROFITABILITY ($M) Segment Adjusted EBIT Segment Adjusted EBITDA** (% of segment revenues) (% of segment net revenues*) 13.7% 8.5% 15.0% 8.5% 124 155 1
Slide 6: Engineering Services Q2 Key Highlights
Engineering Services Q2 Key Highlights UK & Europe › Positive outlook with Transportation, Defence and Water opportunities continuing to dominate new wins and future pipeline › Sale of Scandinavian business announced in July, targeting completion in the fall of 2023 › Key wins include a Strategic De
Slide 7: Nuclear
Nuclear Bruce Power Station Organic revenue growth* Ontario, Canada REVENUES ($M) BACKLOG ($M) 10.9% +38% 251 1,117 221 808 Q2 2022 Q2 2023 Jun 30, 2022 Jun 30, 2023 SEGMENT ADJUSTED EBIT ($M) (% of segment revenues) 14.7% 13.1% 33 33 Q2 2022 Q2 2023 *Organic revenue growth is a non-IFRS ratio. Plea
Slide 8: Nuclear Q2 Key Highlights
Nuclear Q2 Key Highlights Spherical Tokamak for Energy Production (STEP), West Burton, UK New Builds › Positioning the CANDU® technology for the announced proposal by Ontario Energy Minister to expand the Bruce Power Station › Ongoing discussions on Romania’s Cernavoda CANDU® C3 & C4 new reactors ›
Slide 9: O&M and Linxon
O&M and Linxon Organic revenue contraction* Revenues ($M) Segment Adjusted EBIT ($M) Q2 Key Highlights (% of segment revenues) › REM South Shore segment now in operations (6.8)% 10.9% › Preparation well advanced in readiness for Eglinton and Trillium moving into operations 8.0% O&M › Developing oppo
Slide 10: LSTK Projects and Capital
LSTK Projects and Capital Revenues ($M) Segment Adjusted EBIT ($M) Q2 Key Highlights › Ontario projects’ commissioning and testing on -13 track › REM project progressing well with South Shore -37 portion opened July 31, 2023 LSTK Projects 249 › Continuing to pursue all claims receivables 144 › Backl
Slide 11: Financial Performance
FINANCIAL PERFORMANCE 11
Slide 12: Q2 Selected Financial Metrics
Q2 Selected Financial Metrics SNCL Services (in M$, except otherwise indicated) Q2 2023 Q2 2022 Change Engineering Services O&M Nuclear Linxon Revenues PS&PM 2,102 1,858 13% REVENUES ($M) Capital 29 14 107% 1,959 Total Revenues 2,132 1,872 14% 1,608 Segment Adjusted EBIT – Total 178 120 48% Corporat
Slide 13: Leverage and DSO
Leverage and DSO* NET LIMITED RECOURSE & RECOURSE DEBT TO ADJUSTED EBITDA DAYS SALES OUTSTANDING (DSO)* FROM THE ENGINEERING RATIO** RECONCILIATION SERVICES SEGMENT (in M$, except otherwise indicated) June 30, 2023 Limited recourse debt 400 Recourse debt 1,828 Cash and cash equivalents (553) 65 62 6
Slide 14: Free Cash Flow
Free Cash Flow* Six months ended (in M$) Q2 2023 June 30, 2023 Segment Adjusted EBITDA* from SNCL Services 203 392 Change in working capital and other items from SNCL Services (133) (229) Net cash generated from operating activities - SNCL Services** 70 164 Income taxes paid (19) (46) Interest paid
Slide 15: Conclusion
CONCLUSION » SNC+LAVALIN
Slide 16: Conclusion
Conclusion › Strong revenue and operating profit generation in the first half of the year, as we continue to execute our “Pivoting to Growth” strategy › Strongly positioned with a leading presence across core markets of Canada, the US and the UK › Unique competitive differentiators and ability to fu
Slide 17: Questions & Answers
QUESTIONS & ANSWERS 17
Slide 18: Appendix
APPENDIX 18
Slide 19: 2023 Outlook
2023 Outlook 2023 Target 2022 Actual Between 12% and 15% SNCL Services organic revenue growth* 6.8% (raised) SNCL Services Segment Adjusted EBIT to segment revenue ratio Between 8% and 10% 8.7% Segment Adjusted EBITDA to segment net revenue ratio* - Engineering Services Between 14% and 16% 14.6% Cor
Slide 20: Financial Targets (2022-2024)
Financial Targets (2022-2024)1 2022-2024 Target 2022 Actual SNCL Services organic revenue growth* (annually) Between 4% and 6% 6.8% SNCL Services Segment Adjusted EBIT to segment revenue ratio (annually) Between 8% and 10% 8.7% Engineering Services Between 8% and 10% 8.5% Nuclear Between 13% and 15%
Slide 21: Endnotes
Endnotes (See also the cautionary statement regarding non-IFRS financial measures and ratios, supplementary financial measures and non-financial information at slide 2 of this presentation.) 1. Organic revenue growth (contraction) is a non-IFRS ratio comparing organic revenue, itself a non-IFRS fina