A STOR A STOR STORY SO FAR STORY SO FAR Y SO FAR SO FAR Brian - - PowerPoint PPT Presentation

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Nov 06, 2023 204 likes •464 views

A STOR A STOR STORY SO FAR STORY SO FAR Y SO FAR SO FAR Brian Bruce Brian Bruce Non-Negotiable Commitment to Sustainable Globalising Murray & Roberts Globalising Murray & Roberts Earnings Growth and Value Creation Non-Negotiable

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A STOR STORY SO FAR SO FAR A STOR STORY SO FAR SO FAR Y

Brian Bruce Brian Bruce

Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

Globalising Murray & Roberts

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SLIDE 2

Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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SOUTH AFRICA AND MURRAY & ROBERTS SOUTH AFRICA AND MURRAY & ROBERTS

“Darkest Africa” Colonisation “Winds of Change” Uhuru & Apartheid Berlin Wall Globalisation Democracy Berlin Wall Tiananmen Square February 2000

South Africa - a Global Nation in Africa

Murray & Roberts a Global Company in South Africa

Democracy

Murray & Roberts - a Global Company in South Africa

Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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LEADERS WHO BUILT MURRAY & ROBERTS LEADERS WHO BUILT MURRAY & ROBERTS

1902 TO 1980 1902 TO 1980 Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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STRATEGIES THAT ALMOST DESTROYED IT STRATEGIES THAT ALMOST DESTROYED IT

1980 TO 2000 1980 TO 2000

8,000 10,000 12,000 14,000 400 600

80 90 100

2,000 4,000 6,000 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 200

60 70 Turnover Attributable

7000 8000

30 40 50

1000 2000 3000 4000 5000 6000 7000

10 20

1000 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

Shareholders Funds Market Capitalisation 1980 1985 1990 1995 2000

Contracting Materials Industrial

Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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REBUILDING MURRAY & ROBERTS REBUILDING MURRAY & ROBERTS

2000 TO 2006 2000 TO 2006

1800 2000 2200 1000 1200 1400 1600

+ 650% = 45% pa

400 600 800

= 45% pa

200

2000 June 2001 June 2002 June 2003 June 2004 June 2005 June Share Price

Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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QUANTUM PHYSICS AND CHAOS QUANTUM PHYSICS AND CHAOS QUANTUM PHYSICS AND CHAOS QUANTUM PHYSICS AND CHAOS

THE LORENZ ATTRACTOR THE LORENZ ATTRACTOR Globalising Murray & Roberts

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STRANGE ATTRACTOR IN QUANTUM PHYSICS STRANGE ATTRACTOR IN QUANTUM PHYSICS

RISK ENVIRONMENT RISK ENVIRONMENT

We explored and defined the “Strange Attractor” for Murray & Roberts. This concept from Chaos Theory defines the nature of a repetitive pattern of systems behaviour. A genetic behavioural fingerprint A genetic behavioural fingerprint. If an identified behaviour is repetitively destructive, as it has been in Murray & Roberts in recent years, y y , then by identifying its characteristic we can genetically redesign our “Corporate DNA” for a different future.

Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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MURRAY & ROBERTS ATTRACTOR MURRAY & ROBERTS ATTRACTOR

Market Value Alloy Wheels Succession Standard Headleases Net Asset Value C lt Dorts Elgin Net Asset Value Vulnerability Carlton Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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ACOMODADOR OR GIVING UP POINT ACOMODADOR OR GIVING-UP POINT An event in our experience that is primarily responsible for us failing to progress, e.g.

  • a trauma;
  • a particularly bitter defeat;
  • a performance disappointment;
  • even a victory we did not quite understand.

These can make cowards of us and prevent us from moving on.

Paulo Coelho Paulo Coelho

Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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CHANGING LEADERSHIP GENETICS CHANGING LEADERSHIP GENETICS

?

Market Value Alloy Wheels Succession GLOBALISATION

?

Standard Headleases GAUTRAIN Net Asset Value C lt Dorts Elgin CLOUGH Net Asset Value Vulnerability Carlton Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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BEST IN CLASS BENCHMARKING BEST-IN-CLASS BENCHMARKING

A Central Theme across all sectors within Engineering & Construction.

  • Globalisation remains an illusive ideal;

M j l i i i d i k/ d h ll

  • Many major players are experiencing increased risk/reward challenges;

and

  • A rapidly changing investment and risk environment;

and that S i fi i l f i ibl

  • Superior financial performance is possible;
  • A range of business models can deliver superior results;
  • Best-in-class companies typically exhibit both revenue and value growth.

Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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GLOBAL CONSOLIDATION MODEL GLOBAL CONSOLIDATION MODEL

St 2 St 3 CR3 1 HHI 2 Defense Electr . Cigarette Autom . Controls 80% 90% 100% Stage 1 Opening Stage 2 Scale Stage 3 Focus Stage 4 Alliances 0,7 CR3 1 HHI 2 Defense Electr . Cigarette Autom . Controls 80% 90% 100% 0,7

Source: VBG Database, A.T. Kearney Analysis

Soft drinks Shoe Mfrs. Distillers Shipbuilding

  • Mil. & Comm. Aircraft Mfrs.
  • Aero. Engines & Parts

Truck & Trailer Mfrs. Games & Toys Confectionary 50% 60% 70% 80% Maximum 0,1 Soft drinks Shoe Mfrs. Distillers Shipbuilding

  • Mil. & Comm. Aircraft Mfrs.
  • Aero. Engines & Parts

Truck & Trailer Mfrs. Games & Toys Confectionary 50% 60% 70% 80% Maximum 0,1 Games & Toys Rubber & Tire Mfrs. Automotive Mfrs.

  • Divers. Food

Steel Producer integrated Logistic Brewers Apparel Store Chains Restaurants & Fast Food Automotive Supplier

  • Divers. Chemicals

Drugs Airlines Telekom Railroad 20% 30% 40% 50% Æ 45% National Regional Food Stores

Engineering & Contracting

Games & Toys Rubber & Tire Mfrs. Automotive Mfrs.

  • Divers. Food

Steel Producer integrated Logistic Brewers Apparel Store Chains Restaurants & Fast Food Automotive Supplier

  • Divers. Chemicals

Drugs Airlines Telekom Railroad 20% 30% 40% 50% Æ 45% National Regional Food Stores, Department Store Chains Years Banks Insurance Utilities (Electric Power & Gas) 0% 10% %

  • 5

5 10 15 20 Minimum 0,01 Retailer Diversified Construction

g

Years Banks Insurance Utilities (Electric 0% 10% %

  • 5

5 10 15 20 Minimum 0,01 Retailer

Diversified Construction

Footnote:

  • CR3: Market share of the three biggest in relation to the overall market size in the VBG-Database
  • HH1: Hirschman-Herfindahl Index equal to the sum of the squared market share of all companies.

Correlation of HH1 and CR3 is > 90% HH1 - Axis is logarithmic scale

Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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STRATEGIC CONVERSION STRATEGIC CONVERSION STRATEGIC CONVERSION STRATEGIC CONVERSION

Unitrans sold for R935m Clough Non-core Retailing Strategic Natural Resources buy Resources Cementation

Cementation and Clough operate within the strategic focus of the Group and are expected to deliver attributable earnings from the 2007 financial year in line with h t ld h b t d h d th G i d i t d i U it what could have been expected had the Group remained invested in Unitrans Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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GLOBAL BUSINESS MODEL GLOBAL BUSINESS MODEL GLOBAL BUSINESS MODEL GLOBAL BUSINESS MODEL

Mining & Minerals Mining & Minerals Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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GLOBAL MINING & MINERALS GLOBAL MINING & MINERALS GLOBAL MINING & MINERALS GLOBAL MINING & MINERALS

THE CEMENTATION CO AFRICA LIMITED

  • Acquired 1 July 2004
  • De-listed from the JSE Limited
  • Merged with Murray & Roberts RUC
  • Empowered 1 January 2005 with

20% sold to AKA Capital CEMENTATION CANADA INC

  • Murray & Roberts International
  • Deepest mine outside RSA
  • Deepest mine outside RSA

Murray & Roberts Cementation Cementation Canada RUC A t li RUC Australia Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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GLOBAL BUSINESS MODEL GLOBAL BUSINESS MODEL GLOBAL BUSINESS MODEL GLOBAL BUSINESS MODEL

Oil & Gas Oil & Gas Globalising Murray & Roberts

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GLOBAL OIL & GAS GLOBAL OIL & GAS

CLOUGH LIMITED

GLOBAL OIL & GAS GLOBAL OIL & GAS

CLOUGH LIMITED

  • Based in Perth West Australia
  • Similar development history to

M & R b t Murray & Roberts

  • Petrosea in Jakarta Indonesia
  • Australia, Indonesia, Thailand, India,

Pakistan Saudi Arabia and Caribbean Pakistan, Saudi Arabia and Caribbean

  • 29,3% stake & share partnership Nov 2004
  • Pre-acquisition issue : BassGas Dispute
  • 46 1% + 3 0% & de facto control Nov 2005
  • 46,1% + 3,0% & de facto control Nov 2005

Clough Oil & Gas Clough Murray & Roberts Petrosea Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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NATURE OF LOCAL CONSTRUCTION ECONOMY NATURE OF LOCAL CONSTRUCTION ECONOMY

SOUTH AFRICAN GFCF as a % of GDP

30.0% 22.0% 24.0% 26.0% 28.0%

GFCF % GDP

14 0% 16.0% 18.0% 20.0% 10.0% 12.0% 14.0% 1947 1950 1953 1956 1959 1962 1965 1968 1971 1974 1977 1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013 2 2 2 2 2

Globalising Murray & Roberts

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GLOBAL BUSINESS MODEL GLOBAL BUSINESS MODEL GLOBAL BUSINESS MODEL GLOBAL BUSINESS MODEL

Engineering & Construction Engineering & Construction Globalising Murray & Roberts

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LOCAL ENGINEERING & CONSTRUCTION LOCAL ENGINEERING & CONSTRUCTION LOCAL ENGINEERING & CONSTRUCTION LOCAL ENGINEERING & CONSTRUCTION

OCON BRICK

  • 80% acquired 1 August 2005
  • 350 million bricks per annum
  • Building Materials Strategy

CONCOR LIMITED

  • Scheme of Arrangement sanction Feb 2006
  • Subject to Competition approval
  • Extends domestic market reach

M i t i id tit d d

  • Maintain identity and empowered

Concor Technicrete O B i k Ocon Brick Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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FUTURE PROJECTS FUTURE PROJECTS SOUTH AFRICA SOUTH AFRICA FUTURE PROJECTS FUTURE PROJECTS – – SOUTH AFRICA SOUTH AFRICA

BEDFORD BEDFORD SQUARE SQUARE

Project Description : Mixed use development of 145 000m2, comprising of apartments/parkade, retail, cinemas, hotel &

  • ffices.

Location : Bedfordview Total Value : US$ 100 m Completion : July 2007

GAUTRAIN GAUTRAIN

Project Description : Ist Rapid Rail system initiative on the African Continent. Distance 80km as intermodal transport system incorporating Park & Ride and bus facilities.

(Consumer) (Consumer)

p y Murray & Roberts : 100%

GAUTRAIN GAUTRAIN RAPID RAIL RAPID RAIL (Transport) (Transport)

4th largest construction project globally Location : Intercity link JHB International, JHB CBD & Tshwane CBD Total Value : US$ 3,0 bn Completion : 2010 Partners : Bombardier, Bouygues, SPG Murray & Roberts : 25% Concession : 45% Construction : 27% Operations

PBMR PBMR NUCLEAR NUCLEAR

Project Description : Phase 1 scoping exercise. Phase 2 demonstration project (full scale single unit reactor) Location : Koeberg, Cape Town Total Value : US$ 2 2 bn Murray & Roberts : 25% Concession : 45% Construction : 27% Operations

NUCLEAR NUCLEAR (Energy) (Energy)

Total Value : US$ 2.2 bn Completion : Phase 1 : November 2005 ; Phase 2 : 2012 Partner : SNC Lavalin Murray & Roberts : 50%

Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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BROAD BROAD BASED EMPOWERMENT BASED EMPOWERMENT BROAD BROAD-BASED EMPOWERMENT BASED EMPOWERMENT

BEE PARTNERSHIP STRATEGY BEE PARTNERSHIP STRATEGY

Murray & Roberts Holdings Ltd AKA Capital has 20% shareholding in Murray & Roberts Employee & Community

  • wnership in 10%
  • rdinary share capital of

Murray & Roberts Ltd y Cementation J&J Group has a 30% participation in UCW Lehumu Women’s y p Murray & Roberts Various public & private pension funds > 50% In aggregate this counts Murray & Roberts Ltd Lehumu Women s Investments has 26% shareholding in Tolcon Lehumu Intended that 20% of In aggregate, this counts for more than 15% empowerment equity in Murray & Roberts Group Operating Companies Major Projects Several project specific partnerships % Concor will be empowered Other partnerships planned

Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation

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THANK YOU THANK YOU

Globalising Murray & Roberts

Non-Negotiable Commitment to Sustainable Earnings Growth and Value Creation