For personal use only COFFEY INTERNATIONAL LIMITED Investor - - PowerPoint PPT Presentation

COFFEY INTERNATIONAL LIMITED Investor Presentation 14 October 2009

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Agenda

• Company overview
• Financial update
• Service lines and projects
• Site tour
• Strategy

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Company Overview

Roger Olds, Managing Director Roger Olds, Managing Director

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Company overview

• A diversified professional services firm
• Delivering projects globally in

– engineering / environment / mining / international development

• 8 specialist service lines differentiates us from multi-discipline engineers
• Providing services in 4 key sectors

– Infrastructure, Resources, Government and Property

• Operating across 4 regions in 80+ countries

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• Operating across 4 regions in 80+ countries

– Asia Pacific, Americas, Europe & Middle East, and Africa

• ~4,000 employees worldwide
• FY09 revenue $808.7m with 5 year CAGR of 48%
• FY09 EBITDA* $56.0m with 5 year CAGR of 34%

* Pre share- based payments and vendor earn-out expenses (“pre SBP & VEO”)

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Building a global company

2000

• Revenue:

2003

• Revenue:

$110.9m

• EBITDA:

$9.4m

• Employees:

2004 – 2008

• Grows

revenue from $131.3m in 2004 to $558.6m in 2008

• Grows

EBITDA* from $12.3m in 2004 to 2009

• Revenue:

$808.7m

• EBITDA:

$56.0m

• Employees:

~4,000

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1959 Coffey established by founder David Coffey 1990

• Revenue:

$22.8m

• EBITDA:

$6.3m

• Employees:

~150

• Coffey lists
• n the ASX
• Revenue:

$66.0m

• EBITDA: $5.8m
• Coffey acquires

SAGRIC International and expands presence in International Development market

• Employees:

~600

• Coffey joins

the Standard & Poor’s ASX 300 in September 2004 to $49.8m in 2008

• Coffey

acquires 30 companies

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Financial Update

Urs Meyerhans, Group Executive Finance & CFO Urs Meyerhans, Group Executive Finance & CFO

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Financial snapshot

182.0 298.3

500 600 700 800 900

Revenue ($M)

558.6 808.7 29.1 49.8 56.0

30 40 50 60

Operating EBITDA* ($M)

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141.0 210.9 281.9 376.6 510.4 29.0 41.0 80.8

100 200 300 400 FY05 FY06 FY07 FY08 FY09 Fee Revenue Reimburseables

170.0 251.9 362.7 17.5 24.2

10 20 30 FY05 FY06 FY07 FY08 FY09 Operating EBITDA*

* pre SBP & VEO

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Financial snapshot

15.8 16.5 9.3 13.9 14.5

10 12 14 16 18

Earnings Per Share (Basic) (CPS)

10.5 13.0 15.0 16.0 13.0

10 12 14 16 18

Dividends Per Share (CPS)

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2 4 6 8 FY05 FY06 FY07 FY08 FY09 Earnings Per Share (Basic) 2 4 6 8 FY05 FY06 FY07 FY08 FY09 Dividends Per Share

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Financial snapshot

• Net debt remaining static despite

turnover growth

• Cash and debt capacity of $107m

available

• Gearing ratio at 32.7% with which

Balance Sheet ($m) June 2009 June 2008 Total Cash (including non-current cash deposits) 52.3 52.6 USD denominated debt (A$ equivalent) 31.3 26.3 CAD denominated debt (A$ equivalent) 9.7 9.1 GBP denominated debt (A$ equivalent) 2.3

• AUD$ denominated debt

100.0 106.6 Lease liability & bank overdraft 1.8 2.5

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• Gearing ratio at 32.7% with which

we are comfortable

• Debt maturity in February 2012

Total Debt 145.1 144.5 Net Debt 92.8 91.9 Total facilities 209.0 200.0 Equity 191.1 196.1 Net Debt to (Equity + Net Debt) 32.7% 31.9% Interest Cover (Operating EBITDA pre VEO & SBP) 4.6 6.3

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Financial update

• First quarter of FY10 is building on recovery in Q4 of FY09

– Up on same period last year due to strength in all divisions

• Financial performance

– Consulting

• Overall businesses are performing well
• Activity across oil & gas and infrastructure sectors is improving, however our mining business

continues to be impacted while the industry recovers.

– International Development

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• Continues to win major projects
• Recent $100m win in Philippines and extension win to Iraq project

– Project Management

• Continues to benefit from building the education revolution
• Financial position

– Strong cash flow with working capital days improving on last year – Balance sheet continues to remain solid through reduced net debt

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Service Lines & Projects

Roger Olds, Managing Director Roger Olds, Managing Director

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Our services and sectors

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Consulting division

• Geotechnics
• Environments & Natural Systems (now combined)
• Mining
• Information
• Rail
• Commercial Advisory

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• A specialist ground engineering

consultancy offering geotechnical analysis and design, site investigation, groundwater, geophysics

• Around 600 staff (FTE)

17%

Revenue contribution FY09

• Offices throughout Australia, New

Zealand, Canada and the United Kingdom

• Key clients include: Leighton

Companies; BHP Billiton; Lihir Gold; Chevron; Toronto Transit Commission; Inpex Browse Limited; Qld Main Roads; Network Rail UK

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17%

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Ballina Bypass Project Coffey Geotechnics’ specialist ground engineering knowledge is enabling the highway to be built on one of the deepest patches of soft soil in Australia.

• Location: New South Wales, Australia
• Sector: Infrastructure - roads
• Client: Roads and Traffic Authority, NSW
• Project time period: 2007 - 2012
• Total size of project: $550 million
• Total size of project: $550 million
• Services provided by Coffey:

– Detailed geotechnical investigations and geological interpretations – Design of various state-of-the-art ground improvement techniques for stabilising soft soil beneath embankments to balance the requirements of the project with respect to time, cost, functionality and risk – Assessment of potential instability and design of stabilising measures for deep cuttings – Foundation design analysis for over 24 bridges – On-site geotechnical supervision and advice during construction

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• A leading specialist consultancy in geo-

environmental solutions, environmental and social impact assessment , workplace health and safety, and sustainable engineering

• Around 530 staff (FTE)

14%

Revenue contribution FY09

• Offices in Australia, New Zealand, PNG

& USA

• Key clients include: Fortescue Metals;

Thiess John Holland; Chevron; Mobil; Rio Tinto; Caltex; Shell; Defence; Telstra; Sydney Airport; LA School Board, Exxon; Oxiana;

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Mobil Oil Remediation Work Coffey Environments provides contaminated land consulting services for Mobil, assisting Mobil to manage and control their risk and liability (or potential liability)

• Location: Australia
• Sector: Oil & gas
• Client: Mobil Oil Australia Pty Ltd
• Client: Mobil Oil Australia Pty Ltd
• Project time period: 2002 onwards
• Total size of project: in excess of 300 sites,

across six (6) Australian States including Service Stations, Airports, Terminals, Depots, EOM SA Refinery, Divestment sites and Vacant land.

• Services provided by Coffey: Preliminary

investigations, intrusive investigations, additional intrusive investigations, remedial action plans, remediation and on-going management plans

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PNG LNG Project The project footprint spans three provinces in Papua New Guinea, includes gas production and processing facilities, an LNG facility and supporting marine infrastructure, and over 700 km of gas pipeline through terrestrial tropical forests and marine environments.

• Location: Papua New Guinea
• Sector: Oil & gas
• Client: ExxonMobil Development Company trading as
• Client: ExxonMobil Development Company trading as

Esso Highlands Limited and Esso Australia Limited

• Project time period: 2004 onwards
• Total size of project: US$15 billion
• Services provided by Coffey: Lead environmental and

social consultant to ExxonMobil for environmental impact studies, including:

– provision of expert environmental and social advisory services; – government, NGO and stakeholder consultation; – project direction and management of multi-disciplinary environmental and social impact assessment studies culminating in the preparation of an environmental impact statement to meet Papua New Guinea and international environmental guidelines of project financial lenders.

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• A global specialist consultancy

providing a wide range of technical services and products to all sectors

• f the international mining industry
• Around 400 staff (FTE)
• Offices located throughout

Revenue contribution FY09

Australasia, Southern and Western Africa, South America and Canada

• Key clients include: BHP Billiton;

Gindalbie Metals; Rio Tinto; Newcrest; African Minerals; Xstrata

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8%

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Mt Karara Iron Ore

• Location: Western Australia, Australia
• Sector: Mining
• Client: Gindalbie Metals
• Project time period: 2004 onwards
• Total size of project: $1.8 billion

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• Total size of project: $1.8 billion
• Services provided by Coffey: Mineral

resource estimates; drilling programme review, geotechnical studies, mining studies – pre feasibility studies and definitive feasibility studies, environmental studies and EIS, mining contract drafting, tendering and assessment

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• An industry-leading specialist in

scientific testing solutions, working on projects across a large number of sectors and industries including government, civil infrastructure, land development and resources

• Around 350 staff (FTE)

Revenue contribution FY09

• Around 350 staff (FTE)
• Offices throughout Australia and NZ
• Key clients include: Chevron;

Leighton Companies; Roads &Traffic Authority (NSW); Inpex

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5%

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Coopernook to Herons Creek (Pacific highway) 33 km of concrete dual carriageway generally following the existing Highway alignment. Bypasses of the villages of Johns River, Moorlands & Kew. 2 new twin bridges, duplication of 5 existing bridges & 3 new bridges over the new upgrade that tie in with the 3 by passes.

• Location: New South Wales, Australia
• Sector: Infrastructure - roads

Client: :

• Client: : Thiess Contractors Pty Ltd
• Project time period: January 2008 to February 2010
• Total size of project: $550 million
• Services provided by Coffey:
• Establish an on-site NATA accredited laboratory staffing

up to 40 technicians with the capability to undertake Quality Assurance testing on all construction materials required for use on the project.

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• Specialist engineering consultants

providing modelling, design, management and implementation services to the rail industry

• Offices in Melbourne, Sydney and

Auckland

• Around 70 staff (FTE)

Revenue contribution FY09

• Around 70 staff (FTE)
• Key clients include: Victrack; Dept
• f Transport (Victoria); Dept of

Infrastructure, Energy & Resources (Tasmania)

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2%

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Level crossing upgrade program The Department of Transport has an annual level crossing upgrade program which aims to improve safety at crossings by upgrading controls from passive (signage only) to active crossings with boom barriers and/or flashing lights. The program is delivered by VicTrack in liaison with VicRoads and rail

• perators. The order in which level crossings are upgraded is risk based with

guidance from ALCAM assessments of all sites.

• Location: Victoria, Australia
• Sector: Transport - rail
• Client: VicTrack
• Client: VicTrack
• Project time period: 2006 onwards
• Total size of project: $75 million
• Services provided by Coffey: Over the last 2.5 years Coffey Rail has

delivered the initial design and interface services for the upgrade of

• ver 150 of the state’s most critical urban and regional Level Crossings

for VicTrack. The services required to deliver these upgrade designs has included: – Infrastructure evaluation and reporting; – Stakeholder consultation (Councils, VLine, Connex, VicRoads, ARTC, Telstra, Water, Gas and Electricity Supply Authorities ) – Risk assessment; – Signalling concept design; and – Track, civil and drainage detailed design.

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• Providers of project procurement and

strategic advice to public and private sector clients. Advisory services spanning financial, economic, transactional and organisational

• Around 45 staff (FTE)

2%

Revenue contribution FY09

• Offices in Melbourne and Brisbane
• Key clients include local, state and

national government departments and agencies, private sector clients such as the AFL, NRL, FFA and several sporting

• rganisations; horse racing clubs (e.g.

AJC, Racing Victoria)

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WaterSecure Operations Transition The transition of WaterSecure from project delivery to a fully

• perational water authority following the development of the

Western Corridor Recycled Water Project and the Gold Coast Desalination Plant.

• Location: Queensland, Australia
• Sector: Water
• Client: South East Queensland Manufactured Water

Authority trading as WaterSecure Authority trading as WaterSecure

• Project time period: July 2008 – December 2009
• Total size of project: $3.7 billion
• Services provided by Coffey:

– Developing processes to ensuring all assets to be transferred to WaterSecure meet full functionality and performance requirements; – Support and advice to WaterSecure's Chief Operating Officer

• n risk and risk management in relation to operational assets

– Development of reporting process on operational performance and regulatory compliance – Assistance and support in relation to the integration of Western Corridor Recycled Water Pty Ltd and the SureSmart Water into WaterSecure

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International development division

• One global operation
• Coffey International Development
• Incorporating MSI in the USA and STA in Middle East

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• Specialists in social infrastructure

development, helping donor

• rganisations deliver governance

systems, public services and business models to developing and emerging markets

• Around 1,450 staff & contractors (FTE)

Revenue contribution FY09

• Around 1,450 staff & contractors (FTE)
• Offices in Australia, Vietnam,

Philippines, PNG, Indonesia, UAE, Poland, UK and USA

• Key clients include: USAID, AusAID,

UKAID, Asian Development Bank,, UN, World Bank, EU

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42%

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Iraq Projects

• Location: Iraq
• Sector: International development
• Clients: USAID, AusAID, DFID
• Project time period: Tatweer, USAID: 2006 -2011; Iraq Partnership

Facility, AusAID: 2003-2011; Investment initiatives in Basra, DFID: 2008 to 2010

• Total size of project: The total value of contracts currently in Iraq

across our main clients (DFID, AusAID, USAID) reaches more than A$440 million. Detail: Tatweer (USAID): A$387m; UK work (DFID): A$440 million. Detail: Tatweer (USAID): A$387m; UK work (DFID): A$33m; IPF (AusAID): A$20m

• Services provided by Coffey:

– The Tatweer project helps the Government of Iraq (GOI) rebuild its civil service and provides its people with food, medicine, power and a better future. – The Iraq Partnership Facility is providing policy and technical support for Iraqi ministries and key international agencies involved in reconstruction efforts, with a focus on agriculture and good governance such as human rights, economic policy and legal frameworks. – Coffey has managed many of the UK Department for International Development’s (DFID’s) development programs in Iraq’s southern city of Basra, including establishing the Basra Development Commission and its economic plan, helping to prepare Basra Airport for transfer to Iraqi control and improving electricity and power generation.

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Project Management division

• Coffey Projects

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• Providers of specialist project

management and construction management services

• Around 400 staff (FTE)
• Operations throughout Australia, New

Zealand, South Africa, Middle East and

10%

Revenue contribution FY09

South East Asia

• Key clients include: Chevron; ING Real

Estate; Standard Bank, Nedbank, Cairns Airport Authority Transpower (NZ); Dept of Defence; Ministry of Transport; SEQld Water; NSW Health Infrastructure, Sydney University, Vodacom

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Royal Randwick Racecourse – Australian Jockey Club The Australian Jockey Club (AJC) is seeking to redevelop Royal Randwick Racecourse with a focus on the spectator precinct.

• Location: New South Wales, Australia
• Sector: Property – sport & leisure
• Client: Australian Jockey Club (AJC)
• Project time period: Stage 1 – June 2007 to November 2009
• Total size of project: $35 million total budget $100 million
• Services provided by Coffey: This project involved services from
• Services provided by Coffey: This project involved services from

Commercial Advisory, Projects, Geotechnics and Environments: – Commercial Advisory: feasibility study on the registered club building – Coffey Projects: Project managed the completion of the Day Stalls, Alison Road Busway, High Street Connection, Oak Drive Taxiway, Swab Building, the relocation of 350 horses from Randwick to Warwick Farm for World Youth Day 2008 and preparation works for World Youth Day – Coffey Geotechnics: gave specialist advice on the race track from World Youth Day (rehabilitation of track after World Youth Day). – Coffey Environments – Completed general environmental study

• n how AJC can improve operations and increase sustainability

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Site tour

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Strategy – ‘Launching Global Coffey’

Roger Olds, Managing Director Roger Olds, Managing Director

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Our 3 year plan is built on our Strategic Imperatives

We want to:

• Be a united Coffey team executing the strategy
• Develop a culture of one Coffey
• Be agile, innovative and aspirational
• Grow organically
• Leverage existing equity and debt capacity

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• Leverage existing equity and debt capacity
• Create more efficiency to enhance profitability
• Deliver improvements in working capital and cash flow

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The R³ Principle

• Right People

– The people who live our Vision, Promise and Behaviours

• Right Things

– Taking personal responsibility – Leading in every action – ‘Being’ the Coffey future – A global team approach; winning together

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– A global team approach; winning together

• Right Support

– Caring management at hand – A clear career path and support to make it happen – Common systems shared globally

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Our 3 year plan has 6 strategies to take us into the future

• Strategy 1 – increasing competitiveness
• Strategy 2 – creating uncontested market space
• Strategy 3 – transformation
• Strategy 4 – exceptional service
• Strategy 5 – go to market
• Strategy 6 – organise our people

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• Strategy 6 – organise our people

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Strategy - summary

• We have got strong alignment around our 3 year strategy
• We have restructured the management in accordance with Strategy 6
• We went live with the new structure on 1 October
• We are working through re-allocation of staff over the next 3 months
• Our organic growth is going well; there is little acquisition revenue/profit

compared to last year, but performance is strong

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compared to last year, but performance is strong

• We are still following certain acquisition opportunities that we can fund from

existing debt with equity contribution.

• New functions are really stepping up and strongly supporting the

implementation of the strategy plan

• The overall outlook is positive

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Questions

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Appendix

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Global presence

Europe / Middle East (c. 230 FTE)

• Geotechnics
• International Development
• Projects
• Environments
• Mining

Asia Pacific (c. 2,460 FTE)

• Geotechnics
• Environments
• Information
• International Development
• Mining
• Natural Systems
• Peron / Stratcorp
• Rail
• Projects

Americas (c. 1,100 FTE)

• Environments
• International Development
• Mining
• Geotechnics
• Information

Africa (c. 55 FTE)

• Mining
• Projects

FTE = full-time equivalents

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High level balance sheet

(A$m) As at 30 June 2009 As at 30 June 2008 Cash & equivalents 40.6 52.6 Trade & other receivables 119.3 128.7 Current assets 196.3 203.4 Intangible assets 216.5 205.0 Non-current assets 273.1 240.7 Total assets 469.4 444.1

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Trade and other payables 61.8 54.9 Borrowings 1.1 1.0 Current liabilities 109.2 90.0 Borrowings 143.4 144.0 Non-current liabilities 169.1 158.0 Total liabilities 278.3 248.0 Net assets 191.1 196.1 Total equity 191.1 196.1

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A snapshot of Coffey over past 5 years

Metrics ($m) unless otherwise stated FY05 FY06 FY07 FY08 FY09 Revenue 170.0 251.9 362.7 558.6 808.7 Operating EBITDA (pre VEO & SBP) 17.5 24.2 29.1 49.8 56.0 Operating EBITA (pre VEO & SBP) 16.3 22.4 25.4 43.2 47.4 EBIT 15.4 20.6 18.4 35.0 41.1 NPAT (pre VEO & SBP) 11.2 13.4 14.4 22.9 22.8 NPAT (reported) 10.2 11.6 8.4 15.3 16.4 Operating EBITDA (pre VEO & SBP) (revenue) Margin 10.3% 9.6% 8.0% 8.9% 6.9%

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Operating EBITDA (pre VEO & SBP) (revenue) Margin 10.3% 9.6% 8.0% 8.9% 6.9% EPS (basic) (NPAT reported) 17.3 19.0 16.0 20.8 20.1 Net Debt 3.1 54.8 46.1 91.9 92.8 Equity 34.2 67.0 177.6 196.1 191.1 Net debt/equity 9.2% 81.8% 26.0% 46.9% 48.6% Net debt/capital 8.4% 45.0% 20.6% 31.9% 32.7% Interest cover (Operating EBITDA pre VEO & SBP) 19.4 7.6 6.0 6.3 4.6 Operating EBITDA / Capital (equity + net debt) 46.8% 19.9% 13.0% 17.3% 19.7%

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Disclaimer

The material in this presentation is a summary of the results of Coffey International Limited (Coffey) for the 12 months ended 30 June 2005, 2006, 2007, 2008, 2009 and an update on Coffey’s activities and is current at the date of preparation, 14 October 2009. Further details are provided in the Company’s full year accounts and results announcement released on 19 August 2009. No representation, express or implied, is made as to the fairness, accuracy, completeness or correctness of information contained in this presentation, including the accuracy, likelihood of achievement or reasonableness of any forecasts, prospects, returns 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 implied by such forward-looking statements.

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different from any future results or performance expressed or implied 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 relied 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 arising 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

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