Macmahon Holdings Limited · ASX:MAH
Macmahon — FY2018 Earnings Presentation
23 slides from Macmahon's earnings presentation, Aug 24, 2018
Slide 1: Full Year Results
MACMAHON Fae e YEAR RESULTS
Slide 2: 2018 Highlights
2018 HIGHLIGHTS Significant turnaround in financial performance • FY18 Revenue of $710.3m, up 98% on FY17 • FY18 EBIT1 of $41.2m (in-line with guidance), vs EBIT loss in FY17 • FY18 EBITDA1 of $118.9m, up 274% on FY17 • FY18 NPAT of $31.3m and basic EPS of 1.53cps from continuing operations • FY18
Slide 3: Financial Performance
FINANCIAL PERFORMANCE MACMAHON – Full Year Results to 30 June 2018 3
Slide 4: Key Contracts
KEY CONTRACTS Project / Location Commodity / Comments Client Type • Alliance life-of-mine contract Tropicana WA Gold • Achieved reduction in unit cost by ~37% from 2015 AngloGold Ashanti / Australia Open-pit • Phase 1 of Long Island expansion approved in Dec 17 Independence Group • Strong relationsh
Slide 5: People
PEOPLE • Employee base almost doubled, largely due to the successful transition at Batu Hijau • Successful integration of TMM workforce and ramp up of workforce at Byerwen, Mount Morgans, Endeavour and Tujuh Bukit • Roll out of Short-term Incentive Plan for staff and Long Term Incentive Plan for key
Slide 6: Safety
SAFETY • Improvement in safety performance remains a key focus • No permanent disabling injuries or fatalities recorded • 85% of Projects were LTI Free; 67% of Projects were Recordable Injury Free • Mental and Physical Health program roll out • Successfully completed to new 2015 ISO 9001 Quality Sta
Slide 7: Income – Strong 2H
INCOME – STRONG 2H $ Millions FY17 1H18 2H18 FY18 Change Sales revenue1 359.6 270.0 440.3 710.3 +98% 2 EBITDA 31.8 46.1 72.8 118.9 +274% EBITDA margin 8.8% 17.1% 16.5% 16.7% +789bps EBIT2 (1.7) 9.9 31.3 41.2 +$42.9m EBIT margin (0.5%) 3.7% 7.1% 5.8% +626bps Net finance costs (0.1) (0.7) (1.7) (2.4)
Slide 8: Cash Flow – Significant Growth
CASH FLOW – SIGNIFICANT GROWTH $ Millions FY17 1H18 2H18 FY18 EBITDA 31.8 46.1 72.8 118.9 Interest and tax (0.1) 9.4 (5.5) 3.9 Working capital and other (1.5) (32.7) 15.7 (17.0) Net operating cash flow 30.2 22.8 83.0 105.8 Proceeds from sale of assets 12.6 0.6 2.5 3.1 Capital expenditure (cash) (34.
Slide 9: Balance Sheet – Net Cash
BALANCE SHEET – NET CASH $ Millions FY17 1H18 FY18 Cash 62.9 70.2 109.6 Receivables 53.4 120.3 152.3 Inventories 32.1 31.8 42.0 Property, plant and equipment 122.7 310.8 380.1 Other assets 23.9 24.5 39.3 Total assets 295.0 557.6 723.3 Payables 74.0 112.1 175.0 Borrowings 8.8 42.3 106.3 Other liabili
Slide 10: Record Order Book ~$5.4 Billion
RECORD ORDER BOOK ~$5.4 BILLION • In addition to Batu Hijau, new work and extensions of ~$1.1bn secured over FY18; bidding discipline maintained • Record order book at 30 June 2018 with work in hand of ~$5.4bn, up 9% on FY17 • Provides solid platform • Current revenue run rate at $1bn MACMAHON – Ful
Slide 11: Healthy Tender Pipeline $7 Billion+
HEALTHY TENDER PIPELINE $7 BILLION+ • 18 opportunities worth $7bn+, split evenly between Australia and Southeast Asia • Organic tender pipeline $5bn+ (70%) sits with current clients • New client tender pipeline $2bn+ • Split between gold, base metals and coal MACMAHON – Full Year Results to 30 June
Slide 12: Potential Revenue Growth
POTENTIAL REVENUE GROWTH • Note: the figures in this graph are indicative only and should not be treated as guidance MACMAHON – Full Year Results to 30 June 2018 12
Slide 13: FY19 Outlook & Strategy
FY19 OUTLOOK & STRATEGY Positive outlook supported by: Record order book of $5.4bn FY19 work in hand of $1bn Significant $7bn+ tender pipeline Robust balance sheet Greater scale, diversity and improving market conditions Earnings guidance for FY191 • Expected Revenue of $950m - $1,050m (at
Slide 14: Appendix
APPENDIX MACMAHON – Full Year Results to 30 June 2018 14
Slide 15: Corporate Overview
CORPORATE OVERVIEW Capital Structure Share Price Share price (23 August 2018) $0.235 Fully paid ordinary shares (m) 2155 Market Capitalisation $506.4m Cash $109.6m Debt $106.2m Enterprise Value $503.0m Directors and Senior Management Jim Walker Non-executive Chairman Vyril Vella Non-executive Direct
Slide 16: FY18 Revenue Breakdown
FY18 REVENUE BREAKDOWN MACMAHON – Full Year Results to 30 June 2018 16
Slide 17: Our Services
OUR SERVICES • Mine development Mining infrastructure • Mine planning & analysis • Service and maintain • Mine production • Overburden stripping • Mine management equipment • Raise drilling • Bulk earthworks • Drill and blast • Rebuild components and • Cablebolting • Road design & construction • Bul
Slide 18: Our Equipment
OUR EQUIPMENT Dump Trucks Excavators and Loaders Drill Rigs 243 101 14 MACMAHON – Full Year Results to 30 June 2018 18
Slide 19: Map of Operations
MAP OF OPERATIONS MACMAHON – Full Year Results to 30 June 2018 19
Slide 20: Indonesia
INDONESIA Ranked 11 out of 89 countries GDP current (US $Bn) - Large growing economy 100 8th - Australia 90 1000 80 11th - Indonesia 800 70 60 600 50 40 400 30 20 200 10 0 0 1975 1989 2003 2017 Source: Resource Governance Institute 2017 RGI Source: World Bank • Indonesia has a long successful mining
Slide 21: Reconciliation of Non-IFRS Financial Information
RECONCILIATION OF NON-IFRS FINANCIAL INFORMATION $ Millions 2017 2018 Profit / (loss) for the year (as reported) (22.8) 33.2 Add back: Loss from discontinued operations (net of tax) 17.3 Less: Profit from discontinued operations (net of tax) (1.9) Net profit / (loss) after tax from continuing operat
Slide 22: Important Notice and Disclaimer
IMPORTANT NOTICE AND DISCLAIMER Disclaimer as to forward looking statements The directors of Macmahon consider that they References to “Macmahon”, “the Company”, “the have used reasonable care in preparing forward Group” or “the Macmahon Group” may be This presentation contains forward looking looki
Slide 23: Thank You
THANK YOU For further information contact: Chris Chong Investor Relations and Corporate Development cchong@macmahon.com.au Mick Finnegan CEO mfinnegan@macmahon.com.au Giles Everist CFO geverist@macmahon.om.au www.macmahon.com.au Insert pic MACMAHON – Full Year Results to 30 June 2018 23