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 Results Presentation 12 August 2013 2
Results in line with May update Update³ Results $m $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 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 Coffey FY13 Results Presentation 12 August 2013 3
Tough times – robust and responsive strategy • Safety disciplines are strong • A diversified portfolio strategy – stable International Development revenues offsetting a more volatile Geosciences business • Geosciences margins remain our greatest challenge and opportunity • International Development performing well • Fixed costs reduced significantly • Ongoing debt reduction • Staff turnover below target • A flatter and more responsive management structure • A refreshed brand facilitates cross-selling and efficiencies • Changed behaviours are driving a better business • Continuing to do great work for our clients Coffey FY13 Results Presentation 12 August 2013 4
A robust portfolio strategy Significant divestments Focused portfolio • LA Environments divested – June 2011 Australia Offshore • Commercial Advisory closed – July • Geosciences 80% 20% 2011 • Project 70% 30% Management • Middle East Project Management • closed – September 2011 International 30% 70% Development • Coffey Rail sold – February 2012 • Running off existing STA* contracts with reduced overhead * Specialist Training Australia 5
Continuous debt reduction Net debt/ EBITDA = 3.8 $121.2m Net debt/ Net debt/ EBITDA EBITDA = 2.0 = 1.7 $66.0m $58.0m $39.7m $32.3m $28.8m Net debt Underlying Net debt Underlying Net debt Underlying EBITDA EBITDA EBITDA FY2011 FY2012 FY2013 Coffey FY13 Results Presentation 12 August 2013 6
01 Financial performance Coffey FY13 Results Presentation 12 August 2013 7
Positive operating cash flow Internally funded $6.2m restructure costs* Operating $21.8m $18.1m cash flow $15.9m ($4.9m) FY2010 FY2011 FY2012 FY2013 * Total restructuring cost of $10.2m of which $4.0m cash outflow will incur in FY2014 Coffey FY13 Results Presentation 12 August 2013 8
Improved working capital position Working Other balance Net debt at Underlying Restructure capital sheet USD debt Net debt at 30 June 2012 EBITDA costs paid improvement movements Interest & tax Capital spend revaluation Net FX & other 30 June 2013 (58.0) (66.0) (3.4) 10.7 (6.2) (11.8) $'m 28.8 (7.5) (3.2) 0.6 Net operating cash inflow $18.1m Coffey FY13 Results Presentation 12 August 2013 9
Significant debt reduction – facilities extended for 3 years Facility headroom $179.0m Facility limit $149.0m Facility limit $124.7m $28.2m Facility Headroom limit $150.8m $45.3m Gross debt Headroom $36.0m Headroom $103.7m $88.7m Gross debt $121.2m Gross debt Net debt $66.0m $58.0m Net debt Net debt 30 June 2011 30 June 2013 30 June 2012 Coffey FY13 Results Presentation 12 August 2013 10
Reasonable results in a tough Geosciences market FY12 FY13 Change FY13 V FY12 ($m) ($m) Total revenue 678.1 688.4 2% Fee revenue 421.5 411.0 (2%) Underlying EBITDA 1 39.7 28.8 (28%) Underlying EBITDA from continuing businesses 2 36.8 28.8 (22%) Restructuring costs (1.2) (10.2) Vendor earn-out (1.6) 0.0 Impairment (37.4) 0.0 EBITDA 3 (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) 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 Coffey FY13 Results Presentation 12 August 2013 11
Resilient profits – responsive management Underlying EBITDA $36.8m $29.5m $28.8m $18.3m $17.1m $14.8m ($0.3m) ($1.8m) Coffey Continuing Businesses Geosciences Project Management International Development FY2012 FY2013 Restructuring costs incurred in FY2013* Coffey continuing International Geosciences Project Management businesses Development $10.2m $7.3m $2.5m $0.3m * Restructuring costs of $1.9m reported in H1 with $8.3m incurred in late H2 FY2013 . Coffey FY13 Results Presentation 12 August 2013 12
Reduced fixed costs Restructure Annualised Project International ($m) Geosciences costs savings Management 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 * $5.6m in termination costs for chargeable staff removed $22.4m of salary from the business in line with current revenue. ** Total of 275 employees made redundant in FY2013 Coffey FY13 Results Presentation 12 August 2013 13
Reduced interest and tax expense FY12 FY13 ($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) • No dividend will be declared. Coffey FY13 Results Presentation 12 August 2013 14
Reducing interest costs Interest expense $15.4m $14.8m $2.5m $1.6m $2.5m $10.0m Interest rate swap matures $2.4m February 2014 $12.9m $10.7m $7.6m FY2011 FY2012 FY2013 Market rate interest ** Fixed rate > Market * Accounting Market rate interest ** Fixed rate > Market * * 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. Coffey FY13 Results Presentation 12 August 2013 15
02 Business performance Coffey FY13 Results Presentation 12 August 2013 16
In tougher times safety and security is still our first priority Photo Credit: D3/ACSOR Coffey FY13 Results Presentation 12 August 2013 17
Safety discipline remains strong Coffey LITFR* 12 month rolling average June 2010 – June 2013 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 LTIFR External Benchmark *LTIFR = Lost Time Injury Frequency Rate. Coffey FY13 Results Presentation 12 August 2013 18
Flatter and more responsive organisational structure Marketing & Managing Finance Human Communications Director Director Resources John Douglas Urs Meyerhans Rebelle Moriarty Chantalle Meijer Geosciences Geosciences Geosciences Geosciences Geosciences Geosciences Project International Geotechnics & Environmental Africa South America Canada Testing Management Development Mining Services Sukumar Richard Chris Craig Robert Pathmanandavel Rob Morris Michael Renehan Biesheuvel Glen Simpson Fredericks McCloskey Simpson Coffey FY13 Results Presentation 12 August 2013 19
Staff turnover continues to fall 35% 20% Dec 10 Feb 11 Jun 11 Dec 11 Jun 12 Dec 12 Jun 13 February 2011 to June 2013 Coffey FY13 Results Presentation 12 August 2013 20
Brand refresh enhances cross-selling and reduces costs Coffey FY13 Results Presentation 12 August 2013 21
Changed behaviours will drive improved results Coffey FY13 Results Presentation 12 August 2013 22
Three businesses exposed to diversified revenue streams Geosciences International Development Project Management Government Private United Infrastructure Mining Oil & Gas USA Australia Property Property Kingdom 23
Our business Total revenue by segment $359.8m $343.3m $334.9m $328.5m $313.4m $189.0m $170.2m 49% $172.3m $159.9m $157.3m 4% $17.9m $14.6m $22.4m $24.1m $24.1m 47% $148.4m $152.9m $154.0m $118.3m $128.7m $9.8m $13.7m $2.2m H2 2011 H1 2012 H2 2012 H1 2013 H2 2013 Geosciences Project Management International Development Other* * Discontinued businesses Coffey FY13 Results Presentation 12 August 2013 24
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