Austin Engineering Limited · ASX:ANG
Austin Engineering — Shareholder Meeting (November 2015)
21 slides from Austin Engineering's shareholder meeting presentation, Nov 27, 2015
Slide 1: AGM – Company Presentation
Austin Engineering Ltd For personal use only AGM – Company Presentation
Slide 2: Agenda
For personal use only Agenda • Commencement of meeting at 10:30am • Chairman’s address • Managing Director’s address and presentation • Questions on Managing Director’s address and presentation • AGM formalities • Close and opportunity to meet over refreshments
Slide 3: Key Items
Key Items 1. Continued improvement in safety For personal use only – Global LTIFR for FY15 of 2.9 demonstrated further improvement on the FY14 result of 3.3 2. Profitability maintained in a challenging environment – Revenue and normalised* EBITDA ($15.0m) for the year was in line with statutory EBIT
Slide 4: Safety
Safety 12 For personal use only 10 8 6 FY14 FY15 4 2 0 No. of LTI's LTIFR • A continued focus on zero harm has yielded improved safety results in FY15 • The Global LTIFR (Lost Time Injury Frequency Rate) for FY15 was 2.9 which is an improvement from 3.3 recorded for FY14
Slide 5: Financials – FY15
Financials – FY15 FY14 FY15 For personal use only $m $m Revenue 209.9 210.4 Margins maintained in Gross Margin % 35% 36% subdued environment Normalised EBITDA 15.2 15.0 Depreciation (10.5) (11.0) Amortisation / Impairment (0.9) (42.0) One-off due to soft Interest Income 0.1 1.3 trading, non-cash Int
Slide 6: Current Trading
For personal use only Current Trading Largest Businesses by Revenue Business unit Region Trading vs. Budget Perth Australia p Westech USA q Chile South America q COR Cooling Australia p Site Services (formerly Pilbara Australia p Hire) Indonesia Asia q
Slide 7: FY16 Guidance
FY16 Guidance • 1H16 trading has been soft For personal use only • Market still subdued as customers defer capex • Revenue ahead of PCP • EBITDA %’s are under pressure • FY16 normalised* EBITDA expected to be between $14m to $16m • Mining sector capex recovery taking longer than expected • Continue
Slide 8: Debt Management Strategy
Debt Management Strategy The company is assessing all options to manage its debt For personal use only 1 Steps taken thus far • $51.6m capital raising was successfully executed in July • $31.6m rights issue • $20.0m subordinated loan • Substantive reduction of $47.2m in senior debt 2 Current process
Slide 9: Operational Review – Australia
Operational Review Australia For personal use only • West Australian manufacturing has a good base-load of work until March 16. Additionally this business is currently engaged in substantial tender activity for additional work from major clients • Austin Site Services (formerly Pilbara Hire) also ha
Slide 10: Operational Review – Indonesia
Operational Review Indonesia For personal use only • The first half of FY16 has seen a slow start with limited projects completed after an excellent FY15 • A number of recent project wins will allow the second half to commence with a steady start • We have been advised that our client, who supplied
Slide 11: Operational Review – Americas (USA)
Operational Review Americas USA For personal use only • USA operation has had a poor start to the new financial year • There are currently a substantial amount of open tenders (USD 62m) we have participated in which are awaiting approval from the various client corporate offices • December (month) w
Slide 12: Operational Review – Americas (Colombia, Peru)
Operational Review Americas (con’t) Colombia For personal use only • The site contract for Prodeco is continuing and discussions on the 3 year contract have now escalated to include additional projects (one additional project involving 12-22 people has already commenced and is to be added to the con
Slide 13: Operational Review – Americas (Chile)
Operational Review Americas (con’t) For personal use only Chile • Delays in contracted shutdowns in Chile has shifted revenue to the second half for Servigrut • The base contracts Servigrut holds, which extend over 3-5 years, provide an excellent foundation • Calama holds 4 base maintenance contract
Slide 14: Outlook – Current Environment
Outlook Current Environment For personal use only • Commodity prices are near multi year lows • Production levels consistent or increasing in some cases • The continued reduction in CAPEX budgets has led to our customers increasing their OPEX budgets significantly which has increased repair/maintena
Slide 15: Outlook – Austin Engineering
Outlook Austin Engineering For personal use only • Supplies consumable products (ongoing need) • Maintenance / repairs now forming a significant part of the Companies revenue (multi year contracts) • Once onsite, Austin is able to provide engineering solutions which generate productivity and efficie
Slide 16: Outlook – Austin Engineering
Outlook Austin Engineering For personal use only • The current restructuring as well as the quality of Austin’s customers, products and staff leave the Company very well positioned for future growth • Production levels dictate that the high levels of current equipment will have to be replaced. The d
Slide 17: Outlook – Austin Engineering
Outlook Austin Engineering For personal use only • The Australian operations collectively are performing well • Indonesian operation forecasting strong second half • USA operation forecasting improved order intake • We believe the company has strong defences to the plaintiffs' assertions in the pate
Slide 18: Outlook – Austin Engineering
Outlook Austin Engineering For personal use only • The company’s base loading is intact but the additional variable revenue associated with these contracts is being delayed • The reduction of the company senior syndicated debt is a major focus of the company • Full year forecast normalised EBITDA is
Slide 19: Austin's Principal Products
For personal use only Austin’s Principal Products Off-highway Buckets Water tanks Service modules dump truck bodies Tyre handlers Ancillary Industrial cooling and heat attachments transfer systems (COR Cooling)
Slide 20: Austin Principal Services
For personal use only Austin Principal Services Equipment Specialised Painting and repair and fabrication blasting maintenance Specialised On-site maintenance and shutdown machining and services (Austin Engineering Site Services) line boring
Slide 21: Austin Brands
Austin Brands The Austin Engineering brand encompasses design and manufacture of mining and earthmoving For personal use only equipment, along with the provision of support services, from four Australian operations (Brisbane, Hunter Valley, Mackay, Perth), an Indonesian operation and Peruvian operat
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