Aecon Group Inc. · TSX:ARE
Aecon — Investor Presentation (January 2009)
21 slides from Aecon's investor presentation, Jan 9, 2009
Slide 1: January 9, 2009
January 9, 2009 building things that matter
Slide 2: Overview
Overview $550 million Market Capital $5.69 - $21.68 52 Week 50.9 million Share 450,000 Average V $0.20 / share Annual Di 6 – 7% of o/s Management Own Significant Ownership Commitment ~ 30% of staff Employee Own 2
Slide 3: History
History Started in 1910 as Foundation Co. of Canada Largest Public Construction & Infrastructure Co. in Canada Total current workforce ~ 5,000 Landmark Projects • CN Tower, Toronto • Toronto & Montreal Airports • St. Lawrence Seaway • Hwy 407 ETR, Toronto • Cross Israel Highway • Nuclear Pla
Slide 4: Strong Growth and Profitability
Strong Growth and Profitability TTM to Sept. 30 2007 TTM to Sept. 30 2008 Revenue $1.35 billion $1.76 billion Revenues up 30% EBITDA $70 million $113 million EBITDA up 60% EBT $37 million $80 million EBT doubled NIAT $36 million $61 million NIAT up 69% Backlog $1.27 billion $1.50 billion Backlog at
Slide 5: Trailing Twelve Months EBITDA
Trailing Twelve Months EBITDA 120.0 112.6 110.0 94.7 100.0 90.0 82.7 82.3 80.0 EBITDA 71.0 performance 70.0 64.8 since current 60.0 strategy deployed in 50.0 47.7 late 2005 40.0 36.5 30.0 27.0 20.0 17.1 16.1 13.9 10.0 - Q4 2005 Q1 2006 Q2-2006 Q3 2006 Q4 2006 Q1 2007 Q2 2007 Q3 2007 Q4 2007 Q1 2008
Slide 6: Strategic Plan
Strategic Plan Invest in our people – foster a learning culture Recognised as one of the 10 Best Employers in Canada Focus on our core business Canada Transportation, Energy, and Social Infrastructure Singles & Doubles Drive for more interdependent relationships Focus on margin growt
Slide 7: Market Context – Construction Growth in Canada
Market Context – Construction Growth in Canada CAGR 5.0% * Source: Global Insights Canada 3rd in Non-residential world construction construction growth growth accelerating 7
Slide 8: Market Context – Transportation Infrastructure
Market Context – Transportation Infrastructure 59% of Canada‟s civil infrastructure is over 40 yrs old 28% of Canada‟s civil infrastructure is Over 80 years old Infrastructure Deficit >$100 billion 8
Slide 9: Market Context – Power Generation
Market Context – Power Generation Electricity Supply / Demand in Ontario, 2007 - 2027 45000 40000 35000 30000 megawatt capacity OPA estimates $60B 25000 required to build new generation capacity 20000 within next 20 years 15000 10000 5000 0 Installed Capacity Planned New Capacity Projected Peak Dema
Slide 10: Market Context – Oilsands Investment
Market Context – Oilsands Investment capex in oilsands will dip in ‟09 from record highs, but long term outlook remains strong 10
Slide 11: Market Context – Social Infrastructure
Market Context – Social Infrastructure Ontario • 15 New Hospital projects under construction through Infrastructure Ontario in under 3 years Hospitals • $5 Billion to be spent by 2010 • Over $10 Billion being spent to build and renew Ontario schools and universities in Ontario by 2010 Schools & Univ
Slide 12: Infrastructure Segment
Infrastructure Segment • • Very strong competitive position • Focus on: - Vertical integration - ‘Supplier of choice’ work - Alberta expansion Dominant Ont. road builder Largest Ont. utilities contractor Over 1B tonnes of aggregate reserves • Strong backlog and Vertically integrated margin p
Slide 13: Industrial Segment
Industrial Segment • Strong market in Ontario power sector • Backlog and new EOR product positive for IST Industrial construction, mostly in oil & gas, • Focus on driving margins and power and nuclear sectors managed growth Largest specialty pipe fabricator in Canada Module assembly for Oil Sa
Slide 14: Buildings Segment
Buildings Segment • Strong turnaround in GTA market • Backlog now strong and results improving Healthcare • Increasing focus on: Institutional (universities & public buildings) - Healthcare Commercial buildings - Education Airports - Program work Retail & multi-unit residential 14
Slide 15: Concessions Segment
Concessions Segment Cross Israel Highway Quito International Airport • US$1.2B „DDBFO‟ project (Aecon 25%) • US$600mm „DDBFO‟ project • 30 yr concession / 72% traffic guarantee • 35 yr concession - Aecon 45% ($33mm) • Traffic ramp-up on target • Aecon 50% of construction JV • BV: $32mm / Analyst val
Slide 16: Segment and Seasonal Distribution
Segment and Seasonal Distribution Revenue (TTM) 800 700 Seasonality 600 $ millions 500 400 $1.40 300 $1.20 200 100 $1.00 0 Infrastructure Industrial Buildings Concessions $0.80 $0.60 Operating Profit (TTM ) 70 65 $0.40 60 55 50 $0.20 45 40 35 30 $0.00 25 20 15 -$0.20 10 5 Q1 Q2 Q3 Q4 2007 0 16
Slide 17: Financial Highlights
Financial Highlights Balance Sheet Highlights ($ millions) Sept ’08 Dec ’07 Consolidated Consolidated Cash (& equiv. incl. restricted) 252 169 Working Capital 259 163 Total Assets 1,099 911 Equity 357 225 Bank Indebtedness 7 7 Non-recourse project debt 101 73 Other long term debt 57 77 Convertible D
Slide 18: Backlog Revenue
Backlog Revenue $000,000 Total Backlog 1600 1400 Backlog revenue 1200 (and margin) strong 1000 800 600 Backlog Duration < 12 months 77% 400 12-24 months 19% 200 > 24 months 5% 0 ` 2004 2005 2006 2007 2008 18
Slide 19: Growth Drivers
Growth Drivers Transport Power Oil Social Infra Generation Sands Infra Access to Skilled Labour Proven Specialized Expertise Reputation for Safety, Quality and Value Financial Capacity Effective Internal Controls Vertical Integration Cross Divisional S
Slide 20: Summary and Outlook
Summary and Outlook Results confirm we‟re on right strategic path Key markets proving strong and durable Strong margins and revenue growth driving increased profits Backlog of $1.5 billion continues to have strong margin profile All indications bode well for continued strong financial results 20
Slide 21: building things that matter
building things that matter