Wilson Bayly Holmes-Ovcon Limited · JSE:WBO
Wilson Bayly Holmes-Ovcon — FY2022 Earnings Presentation
41 slides from Wilson Bayly Holmes-Ovcon's earnings presentation, September 2022
Slide 1: Audited Results for the Year Ended June 2022
AUDITED RESULTS FOR THE YEAR ENDED JUNE 2022
Slide 2: Contents
CONTENTS 1 OPERATIONAL REVIEW 2 FINANCIAL REVIEW DISCLAIMER: THIS PRESENTATION IS BEING RECORDED. 3 ORDER BOOK, PIPELINE AND YOUR CONTINUED ATTENDANCE AT THE PRESENTATION CONFIRMS YOUR CONSENT OUTLOOK 2
Slide 3: Operational Review
OPERATIONAL REVIEW 1 ESG PERFORMANCE 2 BUILDING AND CIVIL ENGINEERING 3 ROADS AND EARTHWORKS 4 UNITED KINGDOM 3
Slide 4: ESG Performance
ESG PERFORMANCE FY2022 PERFORMANCE LOST TIME INJURY FREQUENCY RATIO (LTIFR) • ISO certifications maintained across all regions 1.2 • Record safety record achieved with an LTIFR of 0.30 (FY2021: 0.60) 0.91 • One fatality in South Africa (FY2021: 2) 0.9 • 98% of employees have been vaccinated against
Slide 5: Building and Civil Engineering
BUILDING AND 1 FY2022 PERFORMANCE 2 GEOGRAPHIC ANALYSIS CIVIL ENGINEERING 3 ORDER BOOK 5
Slide 6: Building and Civil Engineering: FY2022 Performance
BUILDING AND CIVIL ENGINEERING FY2022 PERFORMANCE • Overall revenue decreased by 5% 9 000 800 • FY2021 supported by deferred revenue from FY2020 7 900 7 498 7 338 7 302 • Operating profit up 7% 6 495 BUILDING 600 6 000 • Revenue decreased by 4% • Industrial buildings, distribution centres and data c
Slide 7: Building and Civil Engineering: Geographic Performance
BUILDING AND CIVIL ENGINEERING GEOGRAPHIC FOOTPRINT GEOGRAPHIC PERFORMANCE 9 000 7 368 7 181 REVENUE (Rm) 6 000 3 000 532 317 0 2022 2021 SOUTH AFRICA REST OF AFRICA 400 320 OPERATING PROFIT (Rm) 282 300 200 100 38 22 0 2022 2021 SOUTH AFRICA REST OF AFRICA 7
Slide 8: Building and Civil Engineering: Order Book Up 35%
BUILDING AND CIVIL ENGINEERING ORDER BOOK UP 35% 30 June 30 June % • Noticeable improvement in procurement activity over H2:2022 2022 2021 change • Award of several projects in excess of R1 billion provides strong South Africa 11 018 8 359 32 baseload of work into FY2024 Rest of Africa 522 198 164 •
Slide 9: Roads and Earthworks
ROADS AND 1 FY2022 PERFORMANCE 2 GEOGRAPHIC ANALYSIS EARTHWORKS 3 ORDER BOOK 9
Slide 10: Roads and Earthworks: FY2022 Performance
ROADS AND EARTHWORKS FY2022 PERFORMANCE SOUTH AFRICA 6 000 800 5 295 5 282 • Revenue and operating profit increased by 24% and 7% 5 258 4 980 respectively 4 713 • Strong uptick in mining infrastructure activity 600 • Lower volumes of new road construction offset 4 000 by the increase in mining infra
Slide 11: Roads and Earthworks: Geographic Performance
ROADS AND EARTHWORKS GEOGRAPHIC FOOTPRINT GEOGRAPHIC PERFORMANCE 4 000 3 086 2 838 2 420 3 000 REVENUE (Rm) 1 626 2 000 1 000 0 2022 2021 SOUTH AFRICA REST OF AFRICA 200 168 163 154 OPERATING PROFIT (Rm) 137 150 100 50 0 2022 2021 SOUTH AFRICA REST OF AFRICA 11
Slide 12: Roads and Earthworks: Order Book Up 48%
ROADS AND EARTHWORKS ORDER BOOK UP 48% 30 June 30 June % • Order book levels replenished 2022 2021 change - South African contribution up 37% with positive outlook South Africa 4 768 3 493 37 - Significant new awards in Ghana and Mozambique double order book Rest of Africa 1 632 819 99 in the rest o
Slide 13: United Kingdom
UNITED KINGDOM 1 FY2022 PERFORMANCE 2 GEOGRAPHIC ANALYSIS 3 ORDER BOOK 13
Slide 14: United Kingdom: FY2022 Performance
UNITED KINGDOM FY2022 PERFORMANCE BYRNE GROUP 8 000 800 • Revenue increased by 7% 6 452 • Lower activity within Byrne Bros. offset by recovery from Ellmers Construction 5 684 5 509 6 000 600 • Tough trading conditions persist with a backlog of £800m in unawarded tendered projects 4 210 • Priority gi
Slide 15: United Kingdom: Geographic Performance
UNITED KINGDOM GEOGRAPHIC FOOTPRINT GEOGRAPHIC PERFORMANCE 4 000 3 091 2 958 2 550 3 000 REVENUE (Rm) 2 000 1 119 1 000 0 2022 2021 BYRNE GROUP WBHO RUSSELLS 200 160 OPERATING PROFIT (Rm) 128 150 110 100 40 50 0 2022 2021 -50 BYRNE GROUP WBHO RUSSELLS WBHO UK 15
Slide 16: United Kingdom: Order Book Up 58%
UNITED KINGDOM ORDER BOOK UP 58% 30 June 30 June % • Improved procurement activity over H2:2022 2022 2021 change • Growth centred within the Byrne Group with some delayed projects Byrne Group 3 541 1 659 68 finally being awarded Russell – WBHO 729 1 040 (30) • Healthy baseload of work within Byrne B
Slide 17: Financial Review
FINANCIAL REVIEW 1 AUDIT OPINION 2 FINANCIAL PERFORMANCE - DISCONTINUED OPERATIONS - CONTINUING OPERATIONS 3 KEY FINANCIAL INDICATORS 4 FINANCIAL POSITION 17
Slide 18: Qualified Audit Opinion
FINANCIAL REVIEW QUALIFIED AUDIT OPINION • The decision to exit Australia was difficult but without doubt the correct commercial decision. The consequence of this decision resulted in the audit qualification • The summary consolidated financial statements for the year ended 30 June 2022 as well as t
Slide 19: Financial Performance
FINANCIAL PERFORMANCE Re-presented Rm 2022 2021 Revenue 17 240 19 464 Operating profit before non-trading items 859 930 Share-based payments expense (45) (40) Impairments of goodwill - (21) Deemed loss on disposal of associate - (8) Share of profits from interests in associates and joint ventures 10
Slide 20: Discontinued Operations: Historical Performance
DISCONTINUED OPERATIONS HISTORICAL PERFORMANCE • Australia has contributed approximately 60% of Group revenue since 2018 24 657 30 000 21 941 21 714 • Operating profit contribution on average of 20% prior to 2020 19 464 18 869 18 423 17 240 16 617 • Operating losses and ultimate derecognition of Aus
Slide 21: Discontinued Operations: Current Position
DISCONTINUED OPERATIONS CURRENT POSITION • All guarantees called to date have been settled from internal cash resources • Extensive negotiations with clients, sureties and the administrator over the last 6 months • Deed of Company Arrangement (DOCA) approved by Australian creditors on 30 June 2022 -
Slide 22: Discontinued Operations
DISCONTINUED OPERATIONS Rm 2022 2021 Loss from discontinued operations Revenue 7 827 18 868 Operating loss (1 046) (412) Impairments of goodwill (524) - Share of profits from interests in associates and joint ventures 12 33 Net finance income (1) 6 Loss before tax (1 559) (373) Derecognition of defe
Slide 23: Costs to Settle Guarantee Obligations
DISCONTINUED OPERATIONS AUDm 2022 Costs to settle guarantee obligations Called guarantees and costs to recover guarantees 96 WRU cost to final completion and defects 20 Deed subject to State approval WRU contingency fund (in place for 1 year) 10 Deed subject to State approval DOCA contribution 9 TOT
Slide 24: Financial Performance: Continuing Operations
FINANCIAL PERFORMANCE CONTINUING OPERATIONS • FY2019 performance 25 000 2 000 - 1st time consolidation of UK entities 19 464 • FY2020 performance 18 423 20 000 17 240 - African operations lost two months of activity to Covid-19 16 617 1 500 - Offset by 14% growth within UK operations 13 087 15 000 •
Slide 25: Consolidated Contribution by Geography – Continuing Operations
CONSOLIDATED CONTRIBUTION BY GEOGRAPHY – CONTINUING OPERATIONS Re-presented 2022 2021 REVENUE 2022 2021 % change South Africa 11 055 10 900 1 24% 28% Rest of Africa 1 975 3 055 (36) 11% 56% United Kingdom 4 210 5 509 (24) 64% 16% Total 17 240 19 464 (11) Represented 2022 2021 OPERATING PROFIT 2022 2
Slide 26: Key Financial Indicators
KEY FINANCIAL INDICATORS Re-presented 2022 2021 Target / growth Revenue from continuing operations (decline)/growth (%) (11) 18 >10 Segment operating margin from continuing operations (%) 5.0 4.8 4.0 - 6.5 revised Cash and cash equivalents (Rm) 3 339 3 885 (14%) Earnings per share from continuing op
Slide 27: Financial Position: Property, Plant and Equipment
FINANCIAL POSITION Re-presented Property, plant and equipment (Rm) 2022 2021 Property, plant and equipment 1 563 1 482 • The Group employs a plant replacement policy aimed at ensuring an optimal size and age of its fleet Right of use assets (IFRS 16) 230 276 • Capex restricted to critical replacemen
Slide 28: Financial Position: Associates and Joint Ventures
FINANCIAL POSITION Share of profits Interests in associates Country Effective Carrying Re-presented and joint ventures (Rm) Industry of operation % amount 2022 2021 Concession investments: Gigajoule International Gas supply Mozambique 26.6 240 38 32 Gigajoule Power Power Mozambique 13.0 132 44 19 Di
Slide 29: Financial Position: Associates and Joint Ventures (continued)
FINANCIAL POSITION Share of profits Interests in associates Country Effective Carrying Re-presented and joint ventures (Rm) Industry of operation % amount 2022 2021 Property developments: Catchu Trading Property development South Africa 50 55 - - The Rubik Property development South Africa 20 23 - -
Slide 30: Financial Position: Tax
FINANCIAL POSITION Represented Tax (Rm) 2022 2021 Net deferred tax asset 508 423 Deferred tax asset consists of: Net current tax asset 53 75 • Tax losses of R43m (2021: R31m) • Timing differences of R464m (2021: R392m) United Represented • R322m deferred tax asset impaired in Australia Tax expense (
Slide 31: Financial Position: Long-term Liabilities
FINANCIAL POSITION Re-presented Long-term liabilities (Rm) 2022 2021 Property development funding 106 112 • Property development funding raised in respect of student accommodation building in Pretoria Asset-based finance 104 99 - Sale agreement concluded subsequent Lease liabilities (IFRS 16) 243 34
Slide 32: Financial Position: Cash and Cash Equivalents
FINANCIAL POSITION Cash and cash equivalents (Rm) 2022 2021 South Africa 1 111 1 544 • Strong cash generation form continuing operations supported funding commitments into Australia Africa 1 004 987 • Decrease in South African cash balances United Kingdom 1 224 1 354 of only R400m commendable consid
Slide 33: Financial Position: Cash Flow Bridge
FINANCIAL POSITION 8 000 176 189 1 094 344 158 5 681 102 156 237 6 000 4 000 3 339 3 115 2 000 - Cash & cash Foreign currency Operating profit Working capital Net finance and Taxation Dividend Cash flows from Cash flows from Cash flows from Cash & cash equivalents translation effect adjusted for non
Slide 34: Order Book, Pipeline and Outlook
ORDER BOOK, PIPELINE AND 1 CONSOLIDATED ORDER BOOK 2 PROJECT PIPELINE OUTLOOK 3 OUTLOOK 34
Slide 35: Consolidated Order Book
CONSOLIDATED ORDER BOOK GROUP ORDER BOOK UP 43% 30 June 30 June Beyond • Strong growth across all divisions and key regions 2021 2022 2023 2023 • Market conditions remain competitive however short- South Africa 11 853 15 786 10 180 5 606 and medium term pipeline is strong across multiple sectors Res
Slide 36: Project Pipeline: Building and Civil Engineering
PROJECT PIPELINE Building and civil engineering (Rm) South Africa Rest of Africa Total Commercial and mixed-use developments 9 325 850 10 175 8% Residential 10 450 - 10 450 Industrial buildings and warehousing 4 130 520 4 650 Data centres 4 356 600 4 956 92% Hotels, healthcare and education 3 116 1
Slide 37: Project Pipeline: Roads and Earthworks
PROJECT PIPELINE Roads and earthworks (Rm) South Africa Rest of Africa Total Roadwork 38 325 900 39 225 Mining infrastructure 5 550 8 415 13 965 29% Energy infrastructure 2 895 7 275 10 170 Water infrastructure 6 300 5 000 11 300 71% Total 53 070 21 590 74 660 Public 46 170 16 590 51 170 SOUTH AFRIC
Slide 38: Project Pipeline: United Kingdom and Summary
PROJECT PIPELINE United Kingdom Rm Byrne Group 31 820 Russell-WBHO 8 500 Total 40 320 Summary Rm Building and civil engineering 49 996 Roads and earthworks 74 660 United Kingdom 40 320 Total 164 976 38
Slide 39: Outlook
OUTLOOK • High degree of certainty obtained from imminent finalisation of Australian exit • Order books for African operations at record levels • Replenished order book and solid pipeline set foundation for new chapter and re-strengthening of the balance sheet • Diversification into new African terr
Slide 40: Disclaimer
DISCLAIMER Certain statements contained within this presentation may be classified as forward-looking statements. Words, including but not limited to, “believe”, “anticipate”, “expect”, “seek”, “intend”, “estimate”, “project”, “plan”, or “predict” are used to identify such statements. Forward-lookin
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