Southern Cross Electrical Engineering Limited · ASX:SXE
Southern Cross Electrical Engineering — Shareholder Meeting (October 2012)
41 slides from Southern Cross Electrical Engineering's shareholder meeting presentation, Oct 29, 2012
Slide 1: AGM Presentation - 29 October 2012
For personal use only SOUTHERN CROSS ELECTRICAL ENGINEERING AGM Presentation - 29 October 2012 Simon High – Managing Director/CEO
Slide 2: About SCEE
ABOUT SCEE For personal use only Our key clients: One of Australia’s leading providers of specialised E&I services Focused on oil & gas and resource sectors Founded in Western Australia in 1978 2012 revenue $220 million 800 employees worldwide (700 based in Australia) Eight years LTI free in Austral
Slide 3: What We Do
WHAT WE DO For personal use only Delivering life-of-project support through our three operating divisions SCEE INFRASTRUCTURE Activities Design and construction of high voltage power line distribution, switchyards and substations Key Sectors: CSG/LNG, Minerals and Metals, Coal SCEE CONSTRUCTION Acti
Slide 4: FY12 – Year in Review
For personal use only FY12 –YEAR IN REVIEW
Slide 5: Sino - Karratha, WA
SINO - KARRATHA, WA For personal use only Peak workforce – 250 Status – ongoing
Slide 6: Dampier Incremental Expansion - WA
DAMPIER INCREMENTAL EXPANSION -WA For personal use only Peak workforce – 38 Status – wrap-up phase
Slide 7: Cadia East - Orange, NSW
CADIA EAST - ORANGE, NSW Peak workforce – 143 For personal use only Status – complete
Slide 8: Lake Vermont Coal Expansion - QLD
LAKE VERMONT COAL EXPANSION - QLD Peak workforce – 95 For personal use only Status – wrap-up phase
Slide 9: QCLNG Upstream Early Works - QLD
QCLNG UPSTREAM EARLY WORKS - QLD For personal use only Peak workforce – 120 Status – wrap-up phase
Slide 10: Antapaccay - Peru
ANTAPACCAY - PERU For personal use only Peak workforce – 254 Status – wrap-up phase
Slide 11: Pueblo Viejo - Dominican Republic
PUEBLO VIEJO - DOMINICAN REPUBLIC For personal use only Peak workforce – 310 Status – complete
Slide 12: Coastal Waters - Bungaroo Valley, WA
COASTAL WATERS - BUNGAROO VALLEY, WA For personal use only Peak workforce – 25 Status – on-going
Slide 13: Rio Tinto Operations - NWS, WA
RIO TINTO OPERATIONS - NWS, WA For personal use only Peak workforce – 18 Status – on-going
Slide 14: Cape Lambert Overhead Lines - WA
CAPE LAMBERT OVERHEAD LINES - WA For personal use only
Slide 15: FY Highlights
FY 12 HIGHLIGHTS For personal use only • Revenue increased 116% to $220.0m (2011 - $101.8m) • Profit after tax of $13.7m (2011 – loss of $1.7m) • Earnings per share 8.5cps (2011 – loss of 1.3cps) • Dividend declared of 2.25c per share fully franked (2011 - no dividend) • Cash at 30 June 2012 $31.5m
Slide 16: Health and Safety
HEALTH AND SAFETY For personal use only SCEE’s Australian operations are eight years LTI free Numerous H&S certificates and awards: • 2011 Worley Parsons Regional Managing Directors • HSE Excellence Award, Australia and New Zealand (Pluto Project) • 2010 & 2011 State NECA award winner for the Pluto
Slide 17: Financial Performance
FINANCIAL PERFORMANCE For personal use only Growth and return to profitability Year Year ending 30 ending 30 % June 2012 June 2011 Change $m $m Revenue 220.0 101.8 116% EBIT 19.4 (1.1) NA Profit after tax 13.7 (1.7) NA Earnings per share 8.50 cps (1.28) cps NA Dividends per share declared 2.
Slide 18: Project Performance
PROJECT PERFORMANCE For personal use only Growth trajectory 6 months to Dec 2010 Jun 2011 Dec 2011 Jun 2012 $m $m $m $m Revenue 47.3 54.5 84.2 135.8 Gross profit 2.3 13.9 17.8 25.6 Gross profit margin 4.9% 25.5% 21.1% 18.9% Profit after tax (4.8) 3.1 5.1 8.6 Profit after tax margin (10.1)% 5.7% 6.1%
Slide 19: Cash Flow Analysis
CASH FLOW ANALYSIS For personal use only Return to cash generation 60 5.0 5.0 Highlights: 50 (11.0) (11.3) • Returned to net cash inflow 22.4 (6.2) in FY 2012 40 (6.0) (0.9) 22.2 (2.9) (0.9) • Cash spend of $9.7m on $m 30 assets, mainly project plant and equipment 20 • Offset by proceeds from sale 2
Slide 20: Looking Forward with SCEE
For personal use only LOOKING FORWARD WITH SCEE
Slide 21: Strategic Objective
STRATEGIC OBJECTIVE For personal use only SCEE objectives Be recognised as a Tier 1 Electrical and Installation construction and operational support contractor in selected resources sectors: • Minerals and metals (gold, copper, uranium, etc.) • Iron Ore • CSG • LNG • Coal Full life cycle focus : • E
Slide 22: Minerals and Metals
MINERALS AND METALS For personal use only Market Outlook • Gold continues to provide steady workload • Tropicana Pipeline of Work • Cadia Extension, Boddington Expansion • Opportunities in Africa
Slide 23: Iron Ore
IRON ORE For personal use only Market Outlook • Strong base from existing and new projects • Rio Tinto 353 mtpa • Sino Iron • Scope for further growth from current projects and tenders Pipeline of Work • Rio Tinto Expansion, BHP Billiton Sustaining Capital, Sino Iron, Roy Hill, MAGJV Southdown
Slide 24: CSG
CSG For personal use only Market Outlook • Well positioned for future work in the sector having completed QGC Early Works • Expect the market to have a long life cycle • Long term strategic objective to be leading CSG E&I contractor Pipeline of Work • QCLNG Upstream Facilities • Arrow Upstream Facil
Slide 25: LNG
LNG For personal use only Market Outlook • From 2013 and onwards onshore LNG projects will provide unprecedented growth • SCEE positioning itself to capitalise on these opportunities Pipeline of Work • Projects with FID: • Wheatstone/Ichthys/QCLNG/GLNG/APLNG/Gorgon (1,2&3) • Projects in FEED: • Brow
Slide 26: Coal
COAL For personal use only Market Outlook • Successfully entered the market, completing first project • Sector subdued in the short term • Well positioned for future coal price recovery Pipeline of Work • BMA Caval Ridge, Whitehaven Maules Creek, Xstrata Wandoan
Slide 27: Order Book
ORDER BOOK Order book now $220m For personal use only Ongoing Works: 250 • MCCM - Sino Iron • Rio - Cape Lambert 33kv overhead line 200 • Rio - Yandi transmission lines 60 • Rio - Coastal Waters transmission lines 150 Contracts awarded post 30 June 2012 as expected: $m • Rio – Yandi transmission lin
Slide 28: Recent Contract Awards: Rio Tinto mtpa expansion
RECENT CONTRACT AWARDS For personal use only Rio Tinto – 353 mtpa expansion • Cape Lambert Port B Scope • Contract value of approximately $100m • Awarded under existing framework agreement • Preferred contractor status for 5 years • Work to commence immediately and conclude September 2013
Slide 29: Recent Contract Awards: Tropicana gold project
RECENT CONTRACT AWARDS For personal use only Tropicana gold project • Joint venture between Anglogold and Independence • Electrical, instrumentation, communication and process control plant infrastructure package • Contract value in excess of $40m • Forecast completion date May 2013
Slide 30: Recent Contract Awards: Rio Tinto Yandi Transmission Lines
RECENT CONTRACT AWARDS For personal use only Rio Tinto – Yandi Transmission Lines • Second portion of the Yandi sustaining project • Design, supply and construct 330kV distribution overhead lines • Second phase value in excess of $29m • Forecast completion date January 2014
Slide 31: Foundations for Growth
For personal use only FOUNDATIONS FOR GROWTH
Slide 32: Financial Strength
FINANCIAL STRENGTH For personal use only Poised to continue sustainable growth • Negligible debt • Strong cash position and balance sheet • Increased plant and equipment investment • Banking and bonding capacity increased to $60m
Slide 33: Growing Workforce
GROWING WORKFORCE For personal use only Staffing for success Employee numbers • Workforce more than doubled in 2012 • Continue to increase in line with growth strategy 1500 • Recruitment and training are key focus 914 412 447 2010 2011 2012 2013 forecast Apprentice numbers • Apprentice program has h
Slide 34: Skilled Workforce
SKILLED WORKFORCE For personal use only Training and Development • Dedicated training managers, facilities and training management systems • Leadership and mentoring program • Purpose built training facilities • High long-term skilled staff retention enables greater on the job mentoring support
Slide 35: Indigenous Relations
INDIGENOUS RELATIONS For personal use only Indigenous traineeships program • Aim to provide meaningful and long term employment opportunities for Indigenous Australians • Structured career pathways include warehousing, business administration and electrical apprenticeships • Program commenced in 201
Slide 36: Systems Development
SYSTEMS DEVELOPMENT For personal use only Business intelligence
Slide 37: Operational Support and Maintenance
OPERATIONAL SUPPORT AND MAINTENANCE For personal use only Building recurring revenues • Assistance with shutdowns and plant upgrades • Growing a re-current revenue base to provide a level of stability in revenues • A growing focus for management – dedicated management team now in place
Slide 38: Expanding Regional Presence
EXPANDING REGIONAL PRESENCE For personal use only Efficiencies for projects and mobilisations • Established a Rockhampton regional operation • Considering other regional locations
Slide 39: Conclusions
CONCLUSIONS For personal use only • Solid progress in a transformational year • Return to dividend payments on the back of healthy financial result and outlook • Softening in current market conditions but three to five year outlook extremely positive • Continue to build internal capacity to support
Slide 40: Disclaimer
DISCLAIMER For personal use only Some of the information contained in this presentation contains “forward-looking statements” which may not directly or exclusively relate to historical facts. These forward-looking statements reflect Southern Cross Electrical Engineering Limited’s current intentions,
Slide 41: Questions
For personal use only QUESTIONS
Southern Cross Electrical Engineering — Shareholder Meeting (October 2012) on 6ix