Aj Lucas Group Limited · ASX:AJL
Aj Lucas — Investor Presentation (March 2009)
23 slides from Aj Lucas's investor presentation, Mar 16, 2009
Slide 1: AJ Lucas Group Limited – Right Place, Right Time
For personal use only AJ Lucas Group Limited Right Place, Right Time
Slide 2: AJ Lucas Group
AJ Lucas Group For personal use only y Specialist engineering, infrastructure services provider y Developer of energy assets; particularly coal seam methane and shale gas assets y Developer of water solutions and water projects Water & Energy Resources Food Wastewater
Slide 3: Key Metrics
Key Metrics For personal use only y Sector focus: • Energy • Water & Wastewater • Coal • Public Infrastructure y Balanced business focusing on: • Maintainability and quality of earnings stream • High margins and profits • High degree of technical input and expertise y Working with principals – corpo
Slide 4: Strategy
Strategy For personal use only y Market leadership in chosen sectors y Niche businesses y Differentiate through innovation y Integrated business – shared overhead platform y Leverage off intellectual capital: • To provide integrated service and “capture” clients • Generate entrepreneurial opportunit
Slide 5: Activities
Activities For personal use only y Drilling • Underground • Exploration • Production • Trenchless technology • Geotechnical • Well services • Engineering services y Construction & Infrastructure • Pipelines • Compressor stations • Construction and civil • Major projects y Operations & Maintenance •
Slide 6: Drilling Services
Drilling Services For personal use only y Focus on energy – coal seam gas and coal. No minerals exposure y Acknowledged industry leader y Balanced portfolio of drilling and oil & gas services y Full service, integrated business model 2005/ 2006/ 2007/ 1st Half 2006 2007 2008 2009 y Revenue ($m) 50.9
Slide 7: Drilling Division: Growth
Drilling Division: Growth For personal use only Rig Growth y Largest fleet of 70 60 No. of Rigs drilling rigs on 50 Australia’s eastern 40 30 seaboard – 88 in all 20 10 0 06 8 7 08 -0 -0 n- n- ec n Ju Ju Ju D Exploration Production UIS HDD Well Services Drilling Employee Growth y Very strong growth
Slide 8: Drilling Services
Drilling Services For personal use only y Strong geographical presence – operations throughout NSW and QLD y Very strong client base – only the majors y Strong technical focus – emphasis on engineering, innovation and productivity y Business model allows cross-fertilisation of skill sets and resourc
Slide 9: Drilling Client Base
For personal use only Drilling Client Base
Slide 10: Construction & Infrastructure
Construction & Infrastructure For personal use only y Focus on pipelines, specialist civil engineering and construction y Emphasis on oil and gas, water and wastewater and public infrastructure y Public sector priority driving demand together with private sector requirements y Strong focus on engine
Slide 11: Recent / Current Projects
Recent / Current Projects For personal use only PROJECT NAME VALUE CLIENT Western Corridor Water Recycled Project – Eastern $550m Qld Government Pipeline Alliance Bonaparte Gas Pipeline – 296kms 16” pipeline from $96m EPC for APA Group Wadeye to Baan Baan Springs Perth Desalination Plant No.2 – Phas
Slide 12: Operations & Maintenance Services
Operations & Maintenance Services For personal use only y Knowledge and understanding of the assets generated from other divisions, complementary activity y Strong existing client base: • Moomba to Sydney pipeline sleeving – 10 years • Sydney Opera House – 11 years y Stable recurring income stream y
Slide 13: Quality Clients
Quality Clients For personal use only Civil Oil & Gas Water & Wastewater Coal CSG Construction y APA Group y Queensland Government y BMA-BHP y Arrow Energy y Hyundai Billiton Mitsubishi Alliance y Santos y Sydney Water y Anglo y AGL y Sydney City Council y Epic Energy y Hunter Water y BHP y Santos y
Slide 14: Financial Performance
Financial Performance For personal use only 2007/ 1st Half 2008 2009 y Strong revenue growth Revenue $424.3m $292.8m ¾ Mitchell Drilling 4 months contribution Underlying EBITDA $44.5m $29.9m ¾ Bonaparte pipeline completed Underlying EBIT $26.0m $18.5m Underlying EBIT y Margins 6.1% 6.3% Margin ¾ Dri
Slide 15: Balance Sheet
Balance Sheet For personal use only Jun 08 Dec 08 y $42m debt repaid since balance date. Bank debt now Total assets $229.9m $637.7m $72m Total liabilities $164.7m $368.1m y Cash now at $215m y Asset finance of $35m backed Net Assets $65.2m $269.6m by 3-5 year contracts with major corporates Cash $16
Slide 16: Key Business Objectives
Key Business Objectives For personal use only y People • Continue to improve safety performance • Significant investment in training & development y Markets • Focused on continuing leadership in our niche market segments • Ongoing development of O&M business strategy • Pursue regional infrastructure
Slide 17: Three Year Objective
Three Year Objective For personal use only Business raison Target Nature of activity d’etre financial metrics y Underground Balanced portfolio ROC: 31% y Exploration focused on coal Employees: 1,000 y Production mining and coal seam Blended Margin: 23% Drilling gas production y HDD y Workovers y Wel
Slide 18: Energy Assets
Energy Assets For personal use only y Two investments realised in December 2008 and January 2009 for $293.5m y Gloucester Basin: Total MPO and AJL investment – $28.5m approx - sale price $370m y Two more investments to be realised in 2010 y Additional assets being created, mainly offshore y World cl
Slide 19: Water Assets
Water Assets For personal use only y Business Plan refined and team assembled y Projects identified, technologies obtained / identified y Legislative regime changing, opportunities emerging for private sector to be involved in water ownership y Water is an increasingly valuable asset – in a market w
Slide 20: New Water & Wastewater Solutions
New Water & Wastewater Solutions For personal use only Municipal wastewater Coal seam gas Sewer mining Recycled water water Stormwater / Grey / Black Treatment technologies • Membrane technologies • Alternative biological treatments • New processes • Research & development Growing demand for water s
Slide 21: Outlook
Outlook For personal use only y Business model is sustainable • Client base • Overhead structure • Engineering / technical basis • Market sectors (particularly CSG, oil & gas, water & wastewater) y Continued growth in core sectors notwithstanding economic climate y Government spending on infrastruct
Slide 22: Outlook
Outlook For personal use only y Platform and corporate architecture being established for next phase of business growth and development y Strong balance sheet (to be strengthened with further asset sales) to take advantage of opportunities y Emphasis on management, training and personnel development
Slide 23: For personal use only
For personal use only This presentation has been compiled by AJ Lucas Group Limited from sources it believes to be reliable. However it is not warranted as to its completeness or accuracy. This presentation is not an offer to sell or a solicitation to buy any securities. As it is prepared for genera