Coffey International Limited FY2013 Full Year Results Presentation - - PowerPoint PPT Presentation
Coffey International Limited FY2013 Full Year Results Presentation August 12, 2013 Agenda Financial performance Business performance Looking ahead Presenters Urs Meyerhans John Douglas Finance Director Managing Director Coffey FY13
Coffey International Limited
FY2013 Full Year Results Presentation August 12, 2013
Agenda
12 August 2013 Coffey FY13 Results Presentation 2
Urs Meyerhans Finance Director John Douglas Managing Director
Financial performance Business performance Looking ahead
Presenters
Results in line with May update
Update³ $m Results $m Reported EBITDA¹ 18 -19 18.6 Restructuring costs 9 -10 10.2 Underlying EBITDA² 27 - 29 28.8 International Development 16 - 17 18.0
3
1 EBITDA Earnings Before Interest, Tax, Depreciation and Amortisation
² Underlying EBITDA - EBITDA (Earning Before Interest, tax, Depreciation and Amortisation) before restructure costs, impairment and vendor earn-out ³ Results guidance provided in our May 2013 Trading Update
12 August 2013 Coffey FY13 Results Presentation
Tough times – robust and responsive strategy
12 August 2013 Coffey FY13 Results Presentation 4
5
A robust portfolio strategy
Significant divestments Focused portfolio
2011
closed – September 2011
reduced overhead
* Specialist Training Australia
Australia Offshore
80% 20%
Management 70% 30%
Development 30% 70%
Continuous debt reduction
6 12 August 2013 Coffey FY13 Results Presentation
$121.2m $32.3m $66.0m $39.7m $58.0m $28.8m
Net debt Underlying EBITDA Net debt Underlying EBITDA Net debt Underlying EBITDA
Net debt/ EBITDA = 1.7 Net debt/ EBITDA = 2.0 Net debt/ EBITDA = 3.8 FY2011 FY2012 FY2013
7
12 August 2013 Coffey FY13 Results Presentation
Positive operating cash flow
8 12 August 2013 Coffey FY13 Results Presentation
* Total restructuring cost of $10.2m of which $4.0m cash outflow will incur in FY2014 $15.9m ($4.9m) $21.8m $18.1m $6.2m FY2010 FY2011 FY2012 FY2013 Operating cash flow Internally funded restructure costs*
Improved working capital position
9 12 August 2013 Coffey FY13 Results Presentation (66.0) 28.8 (6.2) 10.7 (3.4) (11.8) (7.5) (3.2) 0.6 (58.0) Net debt at 30 June 2012 Underlying EBITDA Restructure costs paid Working capital improvement Other balance sheet movements Interest & tax Capital spend USD debt revaluation Net FX & other Net debt at 30 June 2013 $'m
Net operating cash inflow $18.1m
Significant debt reduction – facilities extended for 3 years
10 12 August 2013 Coffey FY13 Results Presentation
Facility headroom
$149.0m Facility limit $121.2m Net debt $66.0m Net debt 30 June 2011 30 June 2012 $28.2m Headroom $45.3m Headroom $36.0m Headroom $58.0m Net debt $124.7m Facility limit 30 June 2013 $150.8m Gross debt $103.7m Gross debt $88.7m Gross debt $179.0m Facility limit
Reasonable results in a tough Geosciences market
11 12 August 2013 Coffey FY13 Results Presentation
FY12 FY13 ($m) ($m) Total revenue 678.1 688.4 2% Fee revenue 421.5 411.0 (2%) Underlying EBITDA1 39.7 28.8 (28%) Underlying EBITDA from continuing businesses2 36.8 28.8 (22%) Restructuring costs (1.2) (10.2) Vendor earn-out (1.6) 0.0 Impairment (37.4) 0.0 EBITDA3 (0.5) 18.6 EBIT (9.6) 9.2 NPAT attributable to members of Coffey International Limited (34.5) (1.0) EPS (Basic - cents per share) (16.3) (0.4)
Change FY13 V FY12
1 Underlying EBITDA - EBITDA (Earning Before Interest, tax, Depreciation and Amortisation) before
restructure costs, impairment and vendor earn-out. Please refer to the EBITDA reconciliation in the appendix.
2 Comparative period includes discontinued businesses 2 EBITDA Earnings Before Interest, Tax, Depreciation and Amortisation
$36.8m $29.5m ($0.3m) $14.8m $28.8m $17.1m ($1.8m) $18.3m
Coffey Continuing Businesses Geosciences Project Management International Development FY2012 FY2013
Resilient profits – responsive management
12 12 August 2013 Coffey FY13 Results Presentation
Underlying EBITDA Coffey continuing businesses Geosciences Project Management International Development $10.2m $7.3m $2.5m $0.3m Restructuring costs incurred in FY2013*
* Restructuring costs of $1.9m reported in H1 with $8.3m incurred in late H2 FY2013.
Reduced fixed costs
13 12 August 2013 Coffey FY13 Results Presentation
* $5.6m in termination costs for chargeable staff removed $22.4m of salary from the business in line with current revenue. ** Total of 275 employees made redundant in FY2013
($m) Restructure costs Annualised savings Geosciences Project Management International Development Market adjustment (revenue) Chargeable staff* 5.6** 22.4 17.5 4.3 0.6 Fixed cost reduction Overhead staff 2.2** 5.7 3.8 1.3 0.6 Occupancy costs 2.4 4.3 2.4 1.9 0.0 Total fixed costs 4.6 10.0 6.2 3.2 0.6 Total 10.2
Reduced interest and tax expense
14 12 August 2013 Coffey FY13 Results Presentation
FY12 FY13 ($m) ($m) EBITDA (0.5) 18.6 Depreciation and amortisation (9.1) (9.4) Interest (14.8) (10.0) Profit before taxation and minority interests (24.4) (0.8) Taxation (9.8) (0.1) Minority interests (0.3) (0.1) NPAT (34.5) (1.0)
$12.9m $10.7m $7.6m $2.5m $2.5m $2.4m $1.6m $15.4m $14.8m $10.0m FY2011 FY2012 FY2013 Market rate interest ** Fixed rate > Market * Accounting Market rate interest ** Fixed rate > Market *
Reducing interest costs
15 12 August 2013 Coffey FY13 Results Presentation
* Represents the incremental interest currently paid as our fixed rate of interest is above market rates. Swap matures February 2014. ** Represents our total interest expense at current variable market rates.
Interest expense
Interest rate swap matures February 2014
16
12 August 2013 Coffey FY13 Results Presentation
In tougher times safety and security is still our first priority
17 12 August 2013 Coffey FY13 Results Presentation Photo Credit: D3/ACSOR
0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13
LTIFR External Benchmark
Safety discipline remains strong
18 12 August 2013 Coffey FY13 Results Presentation
Coffey LITFR* 12 month rolling average June 2010 – June 2013
*LTIFR = Lost Time Injury Frequency Rate.
Flatter and more responsive organisational structure
19 12 August 2013 Coffey FY13 Results Presentation
Managing Director Finance Director Human Resources Marketing & Communications John Douglas Urs Meyerhans Rebelle Moriarty Chantalle Meijer Geosciences Africa Geosciences South America Geosciences Canada Chris Fredericks Craig McCloskey Robert Simpson Geosciences Geotechnics & Mining Geosciences Environmental Services Geosciences Testing Project Management International Development Sukumar Pathmanandavel
Rob Morris
Michael Renehan Richard Biesheuvel Glen Simpson
35% 20% Dec 10 Jun 11 Dec 11 Jun 12 Dec 12 Jun 13
Feb 11
Staff turnover continues to fall
20 12 August 2013 Coffey FY13 Results Presentation
February 2011 to June 2013
Brand refresh enhances cross-selling and reduces costs
21 12 August 2013 Coffey FY13 Results Presentation
Changed behaviours will drive improved results
22 12 August 2013 Coffey FY13 Results Presentation
Three businesses exposed to diversified revenue streams
Infrastructure Mining Oil & Gas Government Property Private Property
23
Project Management Geosciences International Development
USA Australia United Kingdom
$13.7m $9.8m $2.2m $118.3m $128.7m $148.4m $152.9m $154.0m $24.1m $24.1m $22.4m $17.9m $14.6m $157.3m $172.3m $170.2m $189.0m $159.9m $313.4m $334.9m $343.3m $359.8m $328.5m H2 2011 H1 2012 H2 2012 H1 2013 H2 2013 Geosciences Project Management International Development Other*
Our business
24 12 August 2013 Coffey FY13 Results Presentation
Total revenue by segment
* Discontinued businesses
49% 4% 47%
25 12 August 2013 Coffey FY13 Results Presentation
Coffey headcount
Employee numbers reflect current market conditions
* 30 more redundancies scheduled in H1 FY2014. All notified and provisioned ** International Development includes 1,300 contractors 350 340 310 280 220 1,600 1,612 1,600 1,700 1,700 200 200 200 170 150 1,650 1,800 1,950 1,920 1,700 3,800 3,952 4,060 4,070 3,770 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Geosciences Project Management* International Development** Corporate & Functional shared services
APAC 81% New Zealand 5% Americas 10% Africa 2% Europe & Middle East 2%
$348.9m $91.0m $257.9m Total revenue Reimbursable revenue Fee revenue
Geosciences – still Australian centric
26 12 August 2013 Coffey FY13 Results Presentation
Fee revenue FY2013 by geography Sources of revenue FY2013
$257.9m
Geosciences – diversified industries
27
Fee revenue by industry
12 August 2013 Coffey FY13 Results Presentation
$4.9m $3.5m $8.2m $5.8m $11.3m $9.7m $8.3m $8.2m $14.7m $15.0m $16.1m $12.3m $26.8m $28.1m $15.6m $19.4m $26.8m $22.1m $39.3m $37.4m $42.0m $42.9m $37.5m $30.1m $38.6m $39.8m $51.9m $49.5m $46.3m $45.8m $117.9m $117.0m $132.4m $132.6m $137.9m $120.0m Infrastructure Mining Oil & Gas Commercial property Other
25% 19% 10% 8% 38% H1 2011 H2 2011 H1 2012 H2 2012 H1 2013 H2 2013
Fee revenue over time by industry
PNG LNG Project, Exxon Mobil, Papua New Guinea - Coffey conducted
and compiled the environmental impact assessment for the PNG LNG Project. The Project’s environmental impact statement (EIS) was approved in 2009 by the PNG Department of Environment and Conservation (DEC). The PNG LNG Project is an integrated development that includes natural gas production and processing facilities, onshore and offshore pipelines and liquefaction facilities. The PNG LNG Project is operated by Esso Highlands Limited, a subsidiary of Exxon Mobil Corporation, in co-venture with Oil Search Limited, National Petroleum Company PNG Limited, Santos Limited, JX Nippon Oil and Gas Exploration Corporation, Mineral Resources Development Company Limited and Petromin PNG Holdings Limited, and their affiliates.
Photo: PNG Highlands
Geosciences - projects
12 August 2013 28
Sydney, Australia Basement and pile foundation designs for the high rise
CBD, entertainment precinct, and residential accommodation for Sydney. The $6.0 billion Barangaroo project – which is on a former ports site – is the largest urban redevelopment in Sydney.
Photo: Barangaroo Development Authority
Christchurch, New Zealand – Detailed geotechnical consultancy for repairs
and reconstruction of damaged buildings, land and infrastructure across Christchurch following the devastating earthquakes in 2011. Work is contracted through to 2014. Project Management for the new bus interchange in the central city. Approx. 100 Coffey experts are working in Christchurch.
Photo: Coffey International
Coffey FY13 Results Presentation
Geosciences – margin uplift our biggest challenge
29 12 August 2013 Coffey FY13 Results Presentation
15% 8% 16% 9% 7% 12% 12% 10% 9% 4% H1 2009 H2 2009 H1 2010 H2 2010 H1 2011 H2 2011 H1 2012 H2 2012 H1 2013 H2 2013
Geosciences Underlying EBITDA margin % (EBITDA/ Fee revenue)
Project Management – a tri-nations strategy
30 12 August 2013 Coffey FY13 Results Presentation
Total revenue FY2013 by region Half yearly fee revenue by sector
Australia 69% New Zealand 21% Africa 10%
$15.7m $10.8m $10.2m $5.5m $4.8m $3.7m $10.8m $9.6m $9.1m $12.0m $10.5m $9.6m $26.5m $20.4m $19.3m $17.5m $15.4m $13.3m H1 2011 H2 2011 H1 2012 H2 2012 H1 2013 H2 2013 Government Private
$32.6m
$5.7m $5.7m $8.8m $9.9m $2.2m $2.4m $2.0m $2.3m $2.3m $1.8m $15.0m $18.9m $11.6m $12.9m $8.7m $8.4m $9.8m $10.0m $12.3m $15.6m $20.3m $22.1m $13.5m $21.4m $18.4m $15.3m $15.6m $15.7m $16.3m $17.6m $30.5m $33.6m $37.3m $37.8m $38.1m $28.7m $26.8m $29.1m $29.0m $29.5m $71.6m $80.3m $71.2m $82.0m $67.5m $54.8m $54.2m $57.1m $59.9m $64.5m H1 2009 H2 2009 H1 2010 H2 2010 H1 2011 H2 2011 H1 2012 H2 2012 H1 2013 H2 2013 USA Australia United Kingdom Other 31 12 August 2013 Coffey FY13 Results Presentation
International Development fee revenue by source geography
Impact of Tatweer Project
International Development – diversified quality clients
International Development projects
32
USAID Iraq - developed the Social Safety Net system for Iraq’s Ministry of Labor and Social Affairs, streamlining the process for Iraq’s poor and marginalized citizens to receive benefits. Savings to the Iraqi Government: more than US $20 million. AusAID Australia Awards scholarship program managing seven scholarship programs across the Asia-Pacific region on behalf of AusAID. These programs are critical in developing capacity and leadership skills so that individuals can contribute to development activities in their home countries and build people-to-people linkages at the individual, institutional and country levels throughout the region. DFID - evaluating the effectiveness, impact and value for money of a multi-year, multi-country Girls' Education Challenge Fund (GEC) –
commissioned.
12 August 2013 Coffey FY13 Results Presentation Dr Chhim Sotheara, an Australia Awards Cambodia Alumni recently received the Leitner Centre’s (New York) Annual Human Rights Award
33
12 August 2013 Coffey FY13 Results Presentation
Diversified revenue streams
34 12 August 2013 Coffey FY13 Results Presentation
12 month contracted fee revenue Geosciences
Infrastructure – Mining – Oil & Gas – Government property – Private property
Project Management
Government property Private property
International Development
Government Aid
30 June 2012 $101m $20m $90m 31 December 2012 $108m $18m $72m 30 June 2013 $100m $14m $73m
35
Reasons for optimism Challenges Corporate
decreasing
market
Geosciences
is improving competitiveness
improvement
Project Management
International Development
countries
Reasons for optimism - and challenges
12 August 2013 Coffey FY13 Results Presentation
Update schedule
36
management accounts
12 August 2013 Coffey FY13 Results Presentation
* Likely dates. Subject to confirmation
Tough times – robust and responsive strategy
12 August 2013 Coffey FY13 Results Presentation 37
38
12 August 2013 Coffey FY13 Results Presentation
P&L by segment
39 12 August 2013 Coffey FY13 Results Presentation
* Excludes Inter-segment sales
H1 H2 FY H1 H2 FY H1 H2 FY H1 H2 FY ($m) ($m) ($m) ($m) ($m) ($m) ($m) ($m) ($m) ($m) ($m) ($m) Total Revenue 404.3 365.5 769.8 367.2 313.4 680.6 334.9 343.2 678.1 359.8 328.6 688.4 Geosciences* 180.6 157.8 338.4 159.1 157.3 316.3 172.3 170.2 342.5 189.0 159.9 348.9 Project Management* 49.6 36.0 85.7 38.0 24.1 62.1 24.1 22.4 46.5 17.9 14.7 32.6 International Development* 157.6 156.8 314.4 155.7 118.3 274.0 128.7 148.4 277.0 152.9 154.0 306.9 Other 16.4 14.9 31.3 14.4 13.7 28.1 9.8 2.2 12.0 0.0 0.0 0.0 Fee Revenue 241.0 234.7 475.7 222.6 201.0 423.6 212.5 209.0 421.5 213.2 197.8 411.0 Geosciences 126.7 111.9 238.5 117.9 117.0 234.9 132.4 132.6 265.0 137.9 120.0 257.9 Project Management 32.9 28.4 61.3 26.5 20.4 46.9 19.3 17.5 36.8 15.4 13.3 28.7 International Development 71.2 82.0 153.2 67.5 54.8 122.3 54.3 57.1 111.4 59.9 64.5 124.4 Other 10.3 12.4 22.7 10.7 8.9 19.6 6.5 1.8 8.3 0.0 0.0 0.0 Underlying EBITDA 30.5 17.5 47.9 15.6 16.7 32.3 23.0 16.7 39.7 17.8 11.0 28.8 Geosciences 19.8 9.7 29.5 8.2 14.5 22.7 16.3 13.2 29.5 12.1 5.0 17.1 Project Management 4.1 0.4 4.5 0.7 (0.6) 0.1 0.0 (0.3) (0.3) (0.8) (1.0) (1.8) International Development 10.0 10.4 20.5 10.4 5.0 15.4 8.0 6.8 14.8 8.9 9.4 18.3 Other 0.1 0.4 0.5 (0.2) 1.3 1.0 2.4 (0.5) 1.9 0.0 0.0 0.0 Corporate (3.6) (3.5) (7.1) (3.5) (3.5) (7.0) (3.7) (2.5) (6.2) (2.4) (2.4) (4.8) Margin % of Total Revenue 8% 5% 6% 4% 5% 5% 7% 5% 6% 5% 3% 4% Margin % of Fee Revenue 13% 7% 10% 7% 8% 8% 11% 8% 9% 8% 6% 7% 2010 2011 2012 2013
Financial results reconciliation
40
¹ Underlying EBITDA has been disclosed as it is a key measure used by the Chief Executive Officer (as Chief Operating Decision Maker) and management to monitor and assess the performance of the business. Underlying EBITDA is calculated as profit before net financing costs, depreciation, amortisation and taxation and excludes restructuring and impairment charges. FY2012 FY2013 Continuing Discontinuing Total Continuing Discontinuing Total ($m) ($m) ($m) ($m) ($m) ($m)
Net profit/(loss) for the year (37.0) 2.5 (34.5) (1.0) (1.0) Add back: Minority interests 0.3 0.3 0.1 0.1 Net interest expense 14.8 14.8 10.0 10.0 Income tax (expense)/benefit 9.4 0.3 9.7 0.1 0.1 Depreciation and amortisation 9.1 0.1 9.2 9.4 9.4 EBITDA (3.3) 2.9 (0.4) 18.6 18.6 Add back: Restructuring costs 1.2 1.2 10.2 10.2 Vendor earn-out 1.6 1.6 Impairment 37.4 37.4 Underlying EBITDA1 36.8 2.9 39.7 28.8 28.8
Disclaimer
41
The material in this presentation is a summary of the Full Year Results of Coffey International Limited (Coffey) for the 12 months ended 30 June 2013 and an update on Coffey’s activities and is current at the date of preparation, 12 August 2013. Further details are provided in the Company’s full year accounts and results announcement released on 12 August 2013. No representation, express or implied, is made as to the fairness, accuracy, completeness or correctness of information conta ined in this presentation, including the accuracy, likelihood of achievement or reasonableness of any forecasts, prospects, return s or statements in relation to future matters contained in the presentation (“forward-looking statements”). Such forward-looking statements are by their nature subject to significant uncertainties and contingencies and are based on a number of estimates and assumptions that are subject to change (and in many cases are outside the control of Coffey and its Directors) which may cause the actual results or performance of Coffey to be materially different from any future results or performance expressed or im plied by such forward-looking statements. This presentation provides information in summary form only and is not intended to be complete. It is not intended to be rel ied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor. Due care and consideration should be undertaken when considering and analysing Coffey’s financial performance. All references to dollars are to Australian Dollars unless otherwise stated. To the maximum extent permitted by law, neither Coffey nor its related corporations, Directors, employees or agents, nor any other person, accepts any liability, including, without limitation, any liability arising from fault or negligence, for any loss ar ising from the use of this presentation or its contents or otherwise arising in connection with it. This presentation should be read in conjunction with other publicly available material. Further information including historical results and a description of the activities of Coffey is available on our website, coffey.com
Photos owned by Coffey or Coffey employees and permission is provided.
12 August 2013 Coffey FY13 Results Presentation