Slide 1: Aecon Group Inc. Investor Presentation
AECON GROUP INC. (TSX:ARE) INVESTOR PRESENTATION November 1, 2018
Slide 2: Forward-Looking Information
Forward-Looking Information The information in this presentation includes certain forward-looking statements. Although these forward-looking statements are based on currently available competitive, financial and economic data and operating plans, they are subject to risks and uncertainties. In addit
Slide 3: Resilient Business Model with Three Diverse Segments
Resilient Business Model with Three Diverse Segments INFRASTRUCTURE INDUSTRIAL^ CONCESSIONS 37%* 57%* 6%* Rail & Transit Nuclear Project Development Roads, Bridges and Tunnels Gas Pipelines & Stations Public-Private Partnerships Hydroelectric Power Generation & Renewables Project Finance Water Treat
Slide 4: Record Backlog with Growing Recurring Revenue
Record Backlog with Growing Recurring Revenue * Recurring Revenue is not included in backlog and is, therefore, revenue over and above work to be performed from contracts in backlog
Slide 5: Record Backlog and Robust Pipeline of Opportunities
Record Backlog and Robust Pipeline of Opportunities $8.0 2.3x 2.3x 2.5x $7.0 Metrolinx Regional Express Rail Annacis WWTP Tunnel BC ON (RER) Pre-Works 2.0x $6.0 1.7x West Calgary Ring Road North AB Confederation LRT Phase 2 ON 1.5x Keystone XL Pipeline (Canada) AB Highway 401 HOT Lanes ON $5.0 1.5x
Slide 6: Long-Term Projects & Concessions Provide Stability
Long-Term Projects & Concessions Provide Stability Project Timeline (starting from end of Q3 2018) Sep/2018 Sep/2023 Sep/2028 Sep/2033 Sep/2038 Sep/2043 Sep/2048 Sep/2053 Waterloo LRT Construction completed in 2017; equity stake and 30 year concession post construction Eglinton LRT Construction star
Slide 7: Valuable Contribution from Bermuda Concession
Valuable Contribution from Bermuda Concession August 2018 Traffic Statistics 30 Year Concession to redevelop, operate and maintain Aug 16 Aug 17 Aug 18 % Change the existing and redeveloped L.F. Wade International YTD YTD YTD 18 vs 17 Airport in Bermuda Air Visitors 141,398 159,314 169,871 6.6% (Lei
Slide 8: Q3 2018 Financial Results - Reported
Q3 2018 Financial Results - Reported $ Millions Three Months Ended Trailing Twelve Months Ended (except EPS, $ per share) Sep 30* Sep 30* 2018 2017 Change+ 2018 2017 Change+ Revenue 1,020 760 34% 3,003 2,966 1% Gross Profit 125.1 99.3 26% 348.6 323.4 8% Gross Margin % 12.3% 13.1% 80bps 11.6% 10.9% 7
Slide 9: Balance Sheet and Capital Structure
Balance Sheet and Capital Structure BALANCE SHEET ($M) DEBT TO ADJUSTED EBITDA*^+ 3.0x Sep 30, 2.7x 2018 2.5x 2.3x** Cash^ 695.9 1.9x 2.0x 2.0x 2.0x 2.0x Working Capital 22.4 1.5x 1.2x Long-Term Debt 1.0x 1.0x 0.9x 0.9x - Finance Leases 76.4 0.5x 0.6x 0.5x - Equipment & Other Asset Loans 46.3 0.3x 0
Slide 10: Outlook
Outlook Revenue and Adjusted EBITDA Growth Expected through 2019 and Beyond $7.0 billion backlog at Sep 30, 2018 with a robust pipeline of opportunities ahead Subsequent to quarter end, Coastal GasLink Pipeline project ($526 million) was awarded to a 50/50 Aecon JV Infrastructure bidding activ
Slide 11: Appendix
APPENDIX ACCON
Slide 12: Q3 2018 Financial Results – Adjusted
Q3 2018 Financial Results – Adjusted $ Millions Three Months Ended Trailing Twelve Months Ended (except EPS, $ per share) Sep 30* Sep 30* 2018 2017 Change+ 2018 2017 Change+ Revenue 1,020 760 34% 3,003 2,966 1% Gross Profit 125.1 99.3 26% 348.6 323.4 8% Gross Margin % 12.3% 13.1% 80bps 11.6% 10.9% 7
Slide 13: Q3 2018 TTM Reconciliation
Q3 2018 TTM Reconciliation On a pro-forma basis reflecting the adjustments above Q3 2018 TTM Earnings per share (Diluted) would have increased to $0.98 from $0.83 ^ See notes on slide 12 for detail of one-time adjustments to results
Slide 14: Revenue and Adj. EBITDA Margin by Segment
Revenue and Adj. EBITDA Margin by Segment ^ See slide 13 for Q3 2018 TTM Reconciliation, and notes on slide 5 for detail of one-time adjustments to results * Also includes Concessions and inter segment eliminations
Slide 15: Infrastructure Q3 2018 Results
Infrastructure Q3 2018 Results THIRD QUARTER* TRAILING TWELVE MONTHS* Revenue ($M) Revenue up by $128M, or 41%, year-over-year Revenue ($M) +41% $440 $65M in major projects east due to increased activity on light rail $1,173 +20% transit projects and the Bermuda Airport project $979 $312 $40M in maj
Slide 16: Industrial Q3 2018 Results
Industrial Q3 2018 Results THIRD QUARTER* TRAILING TWELVE MONTHS* Revenue ($M) Revenue up by $129M, or 30%, year-over-year Revenue ($M) $566 -9% +30% $90M in contract mining and field construction projects in Western $437 $1,974 Canada $1,797 $63M in utilities due to increased gas and electricity di
Slide 17: Concessions Q3 2018 Results
Concessions Q3 2018 Results Revenue up by $38M period-over-period Higher construction activities from Bermuda International Airport Redevelopment Project $43M of construction revenue related to Bermuda is eliminated on consolidation in the quarter Adjusted EBITDA up $4.4M period-over-period In
Slide 18: Cash Position
Cash Position FREE CASH FLOW ($M) KEY DRIVERS FOR FREE CASH FLOW MOMENTUM Q3 2018 Y/E TTM 2017 Working capital improvement in 2018 YTD due to significant advance payments on a number of new Adjusted EBITDA 192.5 156.5 major projects Cash Interest Expense (net) (40.6) (22.7) Cash interest up due to i
Slide 19: Capital Markets Overview
Capital Markets Overview ANALYST COVERAGE Price as of October 31, 2018 $18.93 Firm Analyst Telephone AltaCorp Capital Chris Murray (647) 776-8246 Shares Outstanding 59.9 Million Canaccord Genuity Yuri Lynk (514) 844-3708 Avg. Daily Share Volume 0.7 Million ($11.5 Million) CIBC Capital Markets Jacob
Slide 20: ACCON
ACCON ADAM BORGATTI Senior Vice President, Corporate Development & Investor Relations 416.297.2610 | aborgatti@aecon.com VANCOUVER 1055 Dunsmuir Street, Suite 2124 Vancouver, BC V7X 1G4 CALGARY 110-9" Avenue SW, Suite 300 Calgary, AB T2P 011 aecon.com PARAG DATTA Director, Corporate Development & In