Slide 1: FY2017 full year results
FY2017 full year results For personal use only David Singleton, Chief Executive Officer 28 August 2017 Greg Jason, Chief Financial Officer
Slide 2: FY2017 Highlights
FY2017 Highlights 14 For personal use only 2017 Revenue $1.31 billion 10 Ships Delivered Ships under Construction 2 x New Shipyards PPB-R + Aulong 4,691 Sustainment Programs FY2017 Vessel Programs 10 Employees 7 9 5 Ferries ordered in last 18 months 2
Slide 3: FY2017 Financials
FY2017 Financials For personal use only SHIPS SYSTEMS SUPPORT 3
Slide 4: Earnings in line with guidance
Earnings in line with guidance For personal use only Significant return to profitability underpinned by $m FY2017 FY2016 Change USA shipbuilding margin. Revenue $ 1,310.1 $ 1,340.0 $ (29.8) Underlying EBIT exceeded July 2016 guidance. EBITDA 77.1 (91.0) 168.0 Accounting for irregular tax items
Slide 5: Underlying NPAT breakdown
Underlying NPAT breakdown For personal use only $m After tax impact of legal settlement $(9.2) m EBIT - Underlying $ 58.7 Irregular tax outcome primarily driven by not recognising tax losses for the Australian consolidated tax Group: Net Finance Costs $ (5.7) o Australian Tax group includes Aust
Slide 6: Segment breakdown
Segment breakdown For personal use only $m Concept Ships Systems Support Other Total Revenue $ 849.0 $ 200.1 $ 123.0 $ - $ 1,172.1 USA EBIT 57.6 4.6 16.3 (2.4) 76.1 EBIT Margin % 6.8% 2.3% 13.3% - 6.5% Revenue $ 49.5 $ - $ 64.2 $ - $ 113.7 Australia EBIT 0.6 - (2.7) - (2.1) EBIT Margin % 1.2% - (4.2
Slide 7: Cash and debt
Cash and debt For personal use only $m FY2017 FY2016 Change Positive H2 operating cash flow Cashflow H1 H2 Total Total o Working capital movements in USA Operating $ (43.8) $ 6.0 $ (37.9) $ 102.1 $ (140.0) during H1 Investing Investing: Sustaining (2.8) (7.9) (10.7) (7.0) (3.8) o Typical sustain
Slide 8: Net cash / (debt) – subject to volatility in working capital
Net cash / (debt) – subject to volatility in working capital For personal use only Net Cash $19 m excluding A$ M CCPB 9 & 10 residual buyback guarantee Jun 2016 $100 $52 M Dec 2015 $31 M $50 Dec 2016 Dec 2014 Jun 2015 $13 M Cash $7 M $(4) M $0 (Debt) ($50) Dec 2013 Dec 2012 Dec 2016 $(100) M $(101)
Slide 9: FY2017 operational performance
FY2017 operational performance For personal use only SHIPS SYSTEMS SUPPORT 9
Slide 10: USA operations
USA operations For personal use only Shipbuilding margin improvement VESSEL PROGRAMS: Littoral Combat Ship (~$6.4 bn program) o Turnaround developing well and confidence continues to grow. o LCS 10 delivered in the year. o Awarded LCS 28 through a competitive tender. − Vessel pricing reflects cu
Slide 11: Australia operations
Australia operations For personal use only Shipbuilding as per guidance – at front-end design phase on two significant vessel programs throughout year but construction volume to increase in FY2018. o Pacific Patrol Boat (~$305 m, 19-ship program) − Strategically important; in line with budget and
Slide 12: Philippines operations
Philippines operations For personal use only Re-organised management team delivered profit turnaround in H2 FY2017, delivering: o Two 30 m ferries valued at $13 m and one 57 m offshore crew transfer boat at ~$26 m. o $16 m, 50 m ferry in July 2017. o $22 m, 56 m high-speed passenger ferry for FRS
Slide 13: Strategy and Outlook
Strategy and Outlook For personal use only 50 m Ferry for Seaspovill of South Korea on launch day 13
Slide 14: Strategy
Strategy For personal use only Retain Strengthen our current market leading positions our product portfolio and operational productivity Diversify Scale by growing our global sustainment footprint by capturing Australian Defence opportunities SHIPS SYSTEMS SUPPORT 14
Slide 15: Outlook
Outlook For personal use only FY18 guidance Defence Commercial • Revenue of ≥$1.3 billion (FX • Good opportunity for award of • Export opportunities from dependent). additional LCS. Australian and Philippines • Improved US shipbuilding • OPV for Australia being bid now, shipyards at record levels ma
Slide 16: Appendix: Update on major vessel programs
Appendix Update on major vessel programs For personal use only SHIPS SYSTEMS SUPPORT 16
Slide 17: Austal remains strongly positioned in US
Austal remains strongly positioned in US For personal use only Force structure review proposes to increase US Navy by 30% to Support business for LCS Austal won LCS competition and 355 ships. If enacted should growing and exceeded $100m therefore expects further orders support all US shipyards reven
Slide 18: Significant milestones in the last months
Significant milestones in the last 6 months For personal use only • Ceremonial keel laying of • Delivery of second Cape first Pacific Patrol Boat Class Patrol Boat to RAN • Delivery of first high speed • 6th Austal designed and passenger ferry to South built LCS USS Omaha Korea completes acceptance
Slide 19: Pipeline
Pipeline For personal use only • Expect further LCS orders in FY2018 & FY2019 at 1 United States normalised profit levels. Defence • US Frigate selection FY2020. • Further EPF orders not visible yet. • Competing steel vessels for the 2 Australia RAN’s fleet renewal programs; Defence OPV (order end C
Slide 20: Offshore Patrol Vessels (OPV) contract for Royal Australian Navy
Offshore Patrol Vessels (OPV) contract for Royal Australian Navy For personal use only Part of Royal Australia Navy re-equipping program, contract value circa $3 billion (c $1bn vessels plus support) over 12 years. Austal 1 of 3 contenders. 60-80m steel patrol vessels, circa 2,000 tonnes. o Foll
Slide 21: Frigate contract for Royal Australian Navy
Frigate contract for Royal Australian Navy For personal use only 9 Frigates to be built in existing site in South Australia commencing 2020 at circa 1 per year. 3 foreign designs being considered from Navantia (Spain), Fincantieri (Italy) and BAE Systems (UK). Initial contract value circa $10
Slide 22: Commercial pipeline at strongest level since before 2008
Commercial pipeline at strongest level since before 2008 For personal use only Six ferries sold in CY2016 exceeds five previous years combined. CY2017 could exceed this. Current fast ferry bidding pipeline now the strongest since before 2008. Philippines needs throughput in excess of $50 milli
Slide 23: US Navy – Littoral Combat Ship
US Navy – Littoral Combat Ship For personal use only 11 ship contract awarded as prime contractor, worth approximately US$4.8 billion o LCS 6, 8 & 10 delivered o LCS 12 expect delivery this CY o LCS 14 expect delivery this CY o LCS 16 expect delivery this FY o LCS 18, 20 & 22 under construction o
Slide 24: US Navy – LCS program continues to mature
US Navy – LCS program continues to mature For personal use only Physical shock trials completed in July 2016, no significant issues identified, analysis by US Navy continues. Ship modification program stabilising focus is on reducing costs of implementation vessel by vessel. FY2017 shipbuildin
Slide 25: US Navy – Expeditionary Fast Transport
US Navy – Expeditionary Fast Transport For personal use only 12 ship award to Austal valued at US$2.2 billion (fully funded), securing work through to CY2022. Program progressing well – matured into a phase of efficient production and predictable delivery. o EPF 8 – delivered in FY2017 o EPF 9 –
Slide 26: Australian Government – Pacific Patrol Boat
Australian Government – Pacific Patrol Boat For personal use only 19 x 37 m Patrol Boats to be provided by Australia to 12 Pacific Island Nations. Contract value $305 million includes 5 years support awarded May 2016. Building Cairns base to deliver support. Austal’s first steel ship program e
Slide 27: Systems and Support
Systems and Support For personal use only Austal has invested extensively in sustainment capability in USA, Australia and overseas with new people, facilities and systems. EBIT increasing to circa 15% of group total. USA: o Revenue expected to exceed $100 million for the first time in FY2017. Fu
Slide 28: Military Export vessel pipeline reasonable although limited to Middle East
Military Export vessel pipeline reasonable although limited to Middle East For personal use only Austal has been down selected in 2 overseas contracts and is actively engaged in one other major campaign in Middle East Nature of contracts makes predicting actual contractual order intake timing di
Slide 29: Current order book
Current order book For personal use only Order book of $3.0 billion at 30 June 2017 secures revenue through into CY2022, including: o 12 Littoral Combat Ships for US Navy 12 funded, with 3 delivered o 12 Expeditionary Fast Transports vessels for US Navy 12 funded, with 8 delivered o 6 Commercial v
Slide 30: Disclaimer
Disclaimer For personal use only David Singleton, Chief Executive Officer Telephone: +61 8 9410 1111 For further information visit www.austal.com Disclaimer This presentation and any oral presentation accompanying it has been prepared by Austal Limited (“Austal”). It should not be considered as an o