Weir Group Plc · LSE:WEIR
Weir — The Weir Group — H1 2006 Earnings Presentation
26 slides from Weir's earnings presentation, Aug 17, 2006
Slide 1: 2006 Interim Results
Excellent The Weir Group PLC Analysts Presentation Engineering London, 17 August 2006 Solutions 2006 Interim Results
Slide 2: Agenda
The Weir Group PLC Excellent Engineering Solutions Agenda Introduction & financial highlights Sir Robert Smith Financial review Keith Cochrane Input and operational review Mark Selway Outlook Mark Selway Questions and answers All 2
Slide 3: Interim Financial Highlights 2006
The Weir Group PLC Excellent Engineering Solutions Interim Financial Highlights 2006 Group Results H1 2006 - Continuing Operations 2006 Variance £m % Consolidated Order Input (1) 606.4m Up 32% Revenue 438.2m Up 24% Operating profit (2) 38.0m Up 44% Profit before tax (3) 37.2m Up 50% Earnings per sha
Slide 4: 2006 Interim Results
Excellent The Weir Group PLC Analysts Presentation Excellent The Weir Group PLC Engineering London, 17 August 2006 Engineering Solutions Solutions 2006 Interim Results
Slide 5: Consolidated Income Statement
The Weir Group PLC Excellent Engineering Solutions Consolidated Income Statement Continuing Operations H1 2006 H1 2005 £m £m Revenue – Continuing Operations 438.2 354.1 Profit from Continuing Operations 38.0 26.4 Restructuring Costs (1.8) (18.0) Operating Profit 36.2 8.4 Net Interest (3.2) (1.9) Oth
Slide 6: Revenue Up £84m
The Weir Group PLC Excellent Engineering Solutions Revenue Up £84m Continuing Operations H1 2006 H1 2005 £m £m (1) Engineering Products 283.0 238.5 +19% (1) Engineering Services 106.9 97.6 +9% (1) Defence, Nuclear & Gas 48.3 31.0 +56% 438.2 367.1 +19% Foreign Exchange - (13.0) Group Operations 438.2
Slide 7: Operating Profit Up £11.6m
The Weir Group PLC Excellent Engineering Solutions (1) Operating Profit Up £11.6m H1 H1 H1 H1 Continuing Operations 2006 2005 Variance 2006 2005 £m £m £m % % Engineering Products (2) 26.7 17.1 +9.6 9.5 7.2 Engineering Services (2) 6.2 6.5 -0.3 5.8 6.7 Defence, Nuclear & Gas (2) 4.1 3.2 +0.9 8.4 10.2
Slide 8: Other Finance Income – Retirement Benefits
The Weir Group PLC Excellent Engineering Solutions Other Finance Income – Retirement Benefits H1 H1 2006 2005 Expected return on plan assets: - opening plan asset value (£m) 598 502 - expected long term rate of return (%) 6.1 6.4 - expected return (£m) A 36.5 32.1 Interest cost on plan liabilities:
Slide 9: Taxation
The Weir Group PLC Excellent Engineering Solutions Taxation Profit Before Tax Tax Rate £m £m % Excluding restructuring costs: - before joint ventures / associates 32.4 (8.5) 26 - joint ventures / associates 6.4 (1.6) 25 38.8 (10.1) 26 Restructuring costs (1.8) 0.5 30 37.0 (9.6) 26 Joint ventures / a
Slide 10: Operating Cash Flow Up £37.4m
The Weir Group PLC Excellent Engineering Solutions Operating Cash Flow Up £37.4m H1 2006 H1 2005 £m £m Profit from continuing operations 38.0 26.4 Loss from discontinued operations - (0.8) Share of results of JV’s & Associates (4.8) (3.9) 33.2 21.7 Depreciation 9.9 8.2 Working capital 8.3 (17.6) Oth
Slide 11: Cash Flow
The Weir Group PLC Excellent Engineering Solutions Cash Flow H1 2006 H1 2005 £m £m Operating Cash Flow 51.5 14.1 Exceptional pension contributions - (2.0) Fundamental restructuring costs paid (5.1) (8.2) Income tax paid (4.6) (4.5) Net Interest (1.2) (1.8) Net Dividends paid (20.0) (19.3) Net Purcha
Slide 12: Balance Sheet
The Weir Group PLC Excellent Engineering Solutions Balance Sheet June 2006 Dec 2005 £m £m Goodwill 157.2 160.2 Non Goodwill Intangibles 27.3 27.3 Net Tangible Assets 230.0 241.5 Gross Pension Deficit (43.7) (61.6) Net Debt (64.8) (76.4) Net Assets 306.0 291.0 Shareholders’ Funds 306.0 291.0 12
Slide 13: Financial Summary
The Weir Group PLC Excellent Engineering Solutions Financial Summary Operating profit of £38.0m, up £11.6m (44%) Operating cash flow of £51.5m, up £37.4m EPS - Continuing Operations 13.9p (up 45%) Interim dividend 3.75p per ordinary share, up 6% Strong balance sheet 13
Slide 14: 2006 Interim Results
Excellent The Weir Group PLC Analysts Presentation Engineering London, 17 August 2006 Solutions 2006 Interim Results
Slide 15: Order Input by Division - Continuing Operations
The Weir Group PLC Excellent Engineering Solutions Order Input by Division - Continuing Operations (1) Consolidated H1 2006 H1 2005 Variance £m £m % Engineering Products 365.0 276.2 +32% Engineering Services 137.9 105.4 +31% Defence, Nuclear & Gas 103.5 77.9 +33% Total 606.4 459.5 +32% Engineering P
Slide 16: Order input by geographic location
The Weir Group PLC Excellent Engineering Solutions Order input by geographic location (1) (Continuing Operations) H1 2006 H1 2005 Variance £m £m % United Kingdom 80.5 70.3 +15% Australia 45.9 46.5 -1% Indo Pacific 101.8 86.8 +17% Americas 198.4 158.2 +25% Europe & FSU 107.4 37.8 +184% Middle East /
Slide 17: Order input by sector
The Weir Group PLC Excellent Engineering Solutions Order input by sector (1) (Continuing operations) H1 H1 Variance 2006 First Half 2006 2005 % Input £m £m Naval & marine General Minerals processing 167.2 133.9 +25% 17% industrial Water & 13% Oil & gas 129.8 80.4 +61% waste water 5% Power generation
Slide 18: Engineering Products Division
The Weir Group PLC Excellent Engineering Solutions Engineering Products Division Financial Financial Highlights Highlights Input Input by by Sector Sector Division Division Minerals, Minerals, Clear Clear Liquid Liquid & & Valves Valves H1 2006 H1 2005 Var Consolidated £m £m % Water Minerals Mineral
Slide 19: Engineering Products Division: Minerals – H1 2006 performance
The Weir Group PLC Excellent ORDER INPUT Engineering Solutions Weir Engineering Products Division £207.1m Up 20% Minerals – H1 2006 performance Sector Summary 150 100 £m 50 0 Minerals Gen Ind Power Oil Other Guangxi alumina mine Mining H1 2006 145.3 23.0 19.3 16.2 3.3 China in Poland H1 2005 118.8 2
Slide 20: Engineering Products Division: Clear Liquid – H1 2006 performance
The Weir Group PLC Excellent ORDER INPUT Engineering Solutions Weir Engineering Products Division £118.4m Up 58% Clear Liquid – H1 2006 performance 60 Sector Summary 40 £m 20 0 Oil Power Water Gen Ind Minerals Other 54.5 20.8 19.0 14.5 8.6 1.0 Restructuring of Relocation H1 2006 28.9 5.9 18.2 13.2 6
Slide 21: Engineering Products Division: Valves – H1 2006 performance
The Weir Group PLC Excellent ORDER INPUT Engineering Solutions Weir Engineering Products Division £39.5m Up 37% Valves – H1 2006 performance 25 Sector Summary 20 15 £m 10 5 0 Power Oil & Gas Gen Ind Other New factory, Elland, UK Valves H1 2006 23.2 9.1 6.8 0.4 Huddersfield product H1 2005 18.1 5.9 4
Slide 22: Engineering Services Division H1 2006 performance
The Weir Group PLC Excellent ORDER INPUT Engineering Solutions Weir Engineering Services Division £137.9m H1 2006 performance Up 31% 50 Sector Summary H1 2006 H1 2005 Variance 40 30 £m £m % £m 20 Consolidated 10 0 Order input 137.9 105.4 +31% Oil General Power Minerals Water Naval Revenue 106.9 97.6
Slide 23: Defence, Nuclear & Gas Division H1 2006 performance
The Weir Group PLC Excellent ORDER INPUT Engineering Solutions Weir Defence, Nuclear & Gas Division £103.5m Up 33% H1 2006 performance 100 Sector Summary H1 2006 H1 2005 Variance 75 £m £m % Consolidated £m 50 25 Order input 103.5 77.9 +33% 0 Revenue 48.3 31.0 +56% Naval & marine Power Oil Other Oper
Slide 24: H1 2006 Weir Group Scorecard
The Weir Group PLC Excellent Engineering Solutions H1 2006 Weir Group Scorecard 9 Financial Highlights - H1 2006 Input growth in all Divisions £m Order Input 606.4m Up 32% Revenue 438.2m Up 24% 9 Revenue, profit and cash generation Op Profit 38.0m Up 44% Op cash flow 51.5m Up £37.4m improvement 9 We
Slide 25: Outlook
The Weir Group PLC Excellent Engineering Solutions Outlook Engineering Products Division – expected to deliver growth in revenue and profits when compared to the second half of 2005: Minerals – another good year anticipated, supported by consistently strong commodity markets and large-scale projec
Slide 26: 2006 Interim Results
Excellent The Weir Group PLC Analysts Presentation Engineering London, 17 August 2006 Solutions 2006 Interim Results