Emeco Holdings Limited · ASX:EHL
Emeco — 1H FY2007 Earnings Presentation
25 slides from Emeco's earnings presentation, Feb 22, 2007
Slide 1: 1H07 Results Presentation
1HO07 Results Presentation 22 February 2007 ie mh
Slide 2: 1H07 Results — Analyst Presentation
1HO7 Results — Analyst Presentation V2 ® 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
Slide 3: Financial results, Business overview, Outlook
Financtal resulis INBSS OVErVIGW Bus Outlook [4 Page 3
Slide 4: Revenue up 45.0% to $251.6M
@ Revenue up 45.0% to $251.6M # Pro Forma EBITDA up 59.7% to $99.8M with margins up 3.7% to 39.7% Pro Forma EBITA up 54.0% to $61.3M with margins up 1.5% to 24.a% & Pro Forma EBIT up 74.7% to $59.4M with margins up 4.0% to 23.6% ® Pro Forma NPAT of $34,8M with margin of 13.8% @ Pro Forma EPS. of 5.5
Slide 5: National safety action plan
eh national safety action plan has been formulated to provide a timetable over the 2007/2008 calendar years for implementing enhancements to OH&S systems and procedures # Emeco has boosted its OH&S ‘capabi ity internally and i is focussing on ensuring staff receive appropriate training Emeco i is cu
Slide 6: Successful Completion of IPO providing funds for future growth
Successful Completion of IPO providing funds for future growth .$109M invested in Organic Growth YTD 2 small acquisitions completed - $24M Since the IPO, 5 step out sites Providing future growth and improved brand recognition established i in North : America Additional $57M procured and invested i i
Slide 7: Overview
OVErVIGW Susie. B Outlodk Guidance % Page 7
Slide 8: Growth continues to be driven by significant capital expenditure
A Growth continues to be driven by significant capital expenditure in rental machines and investment in inventory Te So ee z / ee Do oe Ly « . Financial Perforn ance - : : : : _ . Revenue . *- : : . 173.5 2B Bo 45.0% EBITDA a Mes 6250 99.8. -.- 59.7% EBITA (0300 5 : Oo BOB 61.3 os 54.0% EBIT om oS 3
Slide 9: Revenue, EBITDA and EBITA trends
& Ea & & & Es ££ £€ € 8 8 s ¢ ¢ 8238 § ¢ #8 ¢ 8 8 ~ EB e 4 2 a z a a g g 5 z EEN st — ° a . 3 F 3 a & 3 8 z gS wD 6 2 3 e@:2¢°e9e2e & $8 $3 @ 3 & CAGR 35.0% 360 250 200 150 100 Revenue 2405, 4HOS: 2HO6 THOT 1rOS EBITDA Margin ‘item Pro Forma EBITDA Pro Forma NPAT Pro Forma EBITA 40 26.0% 35 x 6 < Pa
Slide 10: Working capital has increased with additional investment
aS Working capital has increased wi and growth requirements Receivables 0. 57.3 i Lo Inventory ~ Sales Machines. 77.0. ~ Other. : eneeneen 32.9 Payables (33.4) h additional investment in mach y Le es ines and tyres to support future operating 100.0% a ae GC y oo ae 56.5% - 53.0% 66.6% 27.2% Working
Slide 11: Balance sheet capable of supporting growth
ae, Ue ee a oo Oe Jy) ye 7 h the successful completion of the IPO, Emeco’s balance sheet is now capable of supporting growth Co os Working Capital Rental Plant 71.1% Total Assets a 711.4 1,032.9.- “45.2% Net Assets .~ : 218.8 644.7 - oe 194.7% Net Debt. sl oe 431.9 309.6 Os - + 28.3% Gearing % (Net
Slide 12: Operating cash flows continue to grow and be re-invested
a & ce ee oy i ee a. ) o) a L Ses (a y , Lo j hr oD LI Ben Meee OF L y ye a Operating cash flows continue to grow and he re-invested into growth for the future 4HO6 Operating cash flow 1HO7 Operating cash flow 100 100 | aa. ANU ° | w o oO EBITDA Other Net SIB inventory EBITDA Other Net SIB ventory 5
Slide 13: Adverse currency movements dampened reported results
&. Adverse currency movements. since preparing the Director’ Ss forecast has dampened the ‘reported results as overseas operations, recorded i in USD, CAD and EURO, are translated into AUD y ‘Currency translation has dampened EBITDA by $1.3M and EBITA by $0.7M in 1HO7 ®: ‘Emeco adopts a natural hedg
Slide 14: EBITA and EBITDA ROFE in line with prospectus forecasts
; , i | 7 ESCM Saye EG , - , | _ 1 - / LL ne : BN ee dunia 50% 200 40% 180 @ EBITA and EBITDA ROFE’s currently in line hs ‘ with Prospectus Forecasts at 28.4% and 30% ; 160 9 q 174% 20% osc otc 140 10% 120 0% 100 B - * a @ Marginal decline in ROFE’s due to: 80 60 - Increased deployment lags due main
Slide 15: Outlook
Outlook 4 Page 15
Slide 16: #1 market share in Australia and Indonesia
ERE ee CD a / Sf at Sine ae i ; 7 ) #1 market share in Australia and Indonesia and a growing presence in Canada, USA and Europe Australia Indonesia Canada USA Europe 531 He Ho o— o— ° — — > Number of machines Number of machines Number of machines Number of machines Number of machines 261 8 Brisbane
Slide 17: Utilisation rates remain high in Australia
Utilisation rates have remained high in Australia whilst there has been a shift in customers from small contractors to large miners ae 41HO7 FYO6 100.0% 80.0% 20.0%, 0.0%, 100.0% 80.0% 60.0% 20.0% 2.0% Total Small Large Small Total Large g@eMiner «Contractor gg Other wOther # Contractor @ Miner 100.
Slide 18: Longer initial term contracts with shift in customers
2 Longer initial term contracts are being entered into with the shift in customers, whilst maintaining customer diversity 31 March 06 31 December 06 FY06 1HO07 20 20 Top 8 2 ° weTop 6-10 5 10 z 10 Wop 11-20 = : Rerreinder ° 8 Average Intlat Average iitai Average Stay te Contract Date Contract Date A
Slide 19: EBITDA contribution by region and sector
enemy Ee Le ae Ba Q Si ON LO Ce oC q ‘ ancy a y WD Lo oe 5 ee) Rost of World 12% i ss oe es a Emece Management i Includes conventional olf and gas, oll sands and infrastructure related to the production of off fram the oll sands. EBITDA Contribution exctudas Corporate costs Page 19
Slide 20: Rental penetration to drive further growth
Le Management expects development of the rental market and changing attitudes to rental to drive further rental penetration and provides another avenue for growth 100% 80% 5 60% 5 40% - ~ ie 0% - Australia Indonesia Canada USA a Emeco Base @ Remaining Base Source: Menagoment estimates based on the n
Slide 21: Financial results, Business overview
ee a [ Migs BES Financial results $ B usiness overview Page 21
Slide 22: Global demand for commodities expected to remain strong
Global demand for. commodities is expected to remain strong, encouraging large capital expenditure programs to expand supply. Expanding supply continues to. offer Emeco opportunities to provide miners/contractors a flexible, cost effective rental alternative for expansion into FY08 and beyond : @Ong
Slide 23: Growth from organic and step-out opportunities
Going forward, Emeco expects growth to come from both organic growth and three distinct areas of step-out opportunities a a 7 e Growth in earth moved is expected fo continue in the mining industry served by! Emeco J in Australia, Indonesia and Canada “Key drivers of rental behaviour are expected to
Slide 24: Growth capital expenditure
i y 250 Acquisition Grow th Organic Grow th Maintenance a 5G 100 150 200 Capital ($M itlions} urchased Deployed iy Committed & 2HO7. capex is currently forecast to.be less than 1HO7 : Additional organic and acquisition growth capex may be invested during 2HO7 as opportunities arise ~ a ‘Other than a
Slide 25: Reported earnings impacted by currency translation
ue ®. Reported earnings are likely to continue to be impacted by adverse currency translation compared to the - prospectus forecast - . : : @ Despite adverse currency translation and challenges facing management, Emeco is on target to meet - Prospectus Forecast os . . es oo : Except for acquisitions