[PPT] - HMS Group 3m 2014 IFRS Results Conference call presentation June PowerPoint Presentation

SLIDE 1

HMS Group

3m 2014 IFRS Results

Conference call presentation

June 2014

SLIDE 2

Financial results Business & Outlook Appendix

2

SLIDE 3

Financial highlights

HMS Group Financial Highlights

1 Hereinafter, read EBITDA as EBITDA adjusted, Net income as Profit for the period / year, EBITDA margin as EBITDA adjusted margin 2 EBIT LTM / average capital employed

3

The data excludes SKMN results due to its disposal in 3Q 2013

1Q’14 1Q’13 Change 1Q’14 4Q’13 Change 6,080 6,895

12%

Revenue 6,080 9,171

34%

1,491 1,507

1%

Gross profit 1,491 2,538

41%

777 700 11% EBITDA¹ 777 1,586

51%

207 249

17%

Operating profit 207 848

76%
311
75

315% Profit (loss)¹

311

309

200%

12,857 15,195

15%

Total debt 12,857 12,687 1% 11,156 14,150

21%

Net debt 11,156 11,102 0% 5,316 5,449

2%

EBITDA LTM¹ 5,316 5,238 1% 2.10 2.60

19%

Net debt / EBITDA LTM¹ 2.10 2.12

1%

24.5% 21.9% 267 bps Gross margin 24.5% 27.7%

315 bps

12.8% 10.2% 232 bps EBITDA margin¹ 12.8% 17.3%

451 bps

3.4% 3.6%

21 bps

Operating margin 3.4% 9.2%

584 bps
5.1%
1.1%
403bps

Profit margin¹

5.1%

3.4%

858 bps

13.5% 14.4%

90 bps

ROCE² 13.5% 13.8%

30 bps
2.4%

0.1%

250 bps

ROE

2.4%

2.5%

490 bps

*The data excludes SKMN results

EBITDA performance, 1Q 2012 – 1Q 2014 Revenue performance, 1Q 2012 – 1Q 2014

6 715 6 801 8 088 9 856 6 895 7883 8409 9171 6080 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Revenue, Rub mn Линейная ( Revenue, Rub mn) 1 346 1 000 1 649 2 106 700 1400 1553 1586 777 20,0% 14,7% 20,4% 21,4% 10,1% 17,8% 18,5% 17,3% 12,8% 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 EBITDA, Rub mn EBITDA margin

SLIDE 4 5 276 4 810 5 221 6 101 5 449 5 854 5 758 5 238 5 316 20,6% 18,5% 18,6% 19,4% 17,3% 16,2% 16,2% 16,2% 16,9% 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 EBITDA LTM, Rub mn EBITDA margin 25 591 25 985 28 068 31 460 31 549 32 722 33 043 32 358 31 543 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Revenue LTM, Rub mn Линейная ( Revenue LTM, Rub mn) 6 715 6 801 8 088 9 856 6 895 7883 8409 9171 6080 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Revenue, Rub mn

EBITDA LTM performance, 1Q 2012 – 1Q 2014 Revenue LTM performance, 1Q 2012 – 1Q 2014

Financial Highlights: LTM vs Quarterly

Revenue quarterly performance, 1Q 2012 – 1Q 2014

The data excludes SKMN results due to its disposal in December 2013 1 346 1 000 1 671 2 262 700 1400 1595 1586 777 20,0% 14,7% 20,5% 19,4% 10,1% 17,8% 19,0% 17,3% 12,8% 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 EBITDA, Rub mn EBITDA margin

EBITDA quarterly performance, 1Q 2012 – 1Q 2014

CAGR +1.6%

4

SLIDE 5 207 +45

309
263

+12

311

Operating profit Finance income Interest expenses FX loss Income tax Loss for the period Rub-denominated loan between NEM and HMS Finance Rub 110mn Euro-denomianated loan of Neftemash Rub 106mn Other loans Rub 47 mn Rub mn 3m2014 3m2013 change Gross profit 1 491 1 507

15

EBITDA 777 700 77 Depreciation

359
296
63

Non-monetary items

119
102
17

Other income and expense

92
53
38

Operating Profit 207 249

42

Finance Income 45 42 3 Finance costs

576
335
241

Interest expenses

309
345

36 Foreign exchange gain/loss

263

10

273

Income tax 12

29

42 Loss for the period

311
75
236

5

Analysis of Profit Decline

Loss for the period bridge Comments

The Group’s performance in 1Q 2014 was negatively affected by:



Growth in depreciation was the key factor behind operating profit decline yoy. In 2H 2013, the Group acquired NIITK and NNGP, which all together contributed Rub 49mn in total depreciation costs



Increase of finance costs was the key factor behind net profit decline yoy. FX loss in 1Q 2014 amounted to Rub 263mn as a result of revaluation of intra-group debts between subsidiaries and the Group’s external FX liabilities.

SLIDE 6 1,894 1,446 297 168 15.7% 11.6% 1Q'13 1Q'14 Revenue OG equipment, Rub mn EBITDA OG equipment, Rub mn EBITDA margin OG equipment, % 3,320 3,477 401 513 12.1% 14.8% 1Q'13 1Q'14 Revenue Pumps, Rub mn EBITDA Pumps, Rub mn EBITDA margin Pumps, % 931 862 49 144 5.3% 16.7% 1Q'13 1Q'14 Revenue EPC, Rub mn EBITDA EPC, Rub mn EBITDA margin EPC, % 751 294

44
54
5.9%
18.4%

1Q'13 1Q'14 Revenue Compressors, Rub mn EBITDA Compressors, Rub mn EBITDA margin Compressors, % Revenue -24% EBITDA -43%

Oil & gas equipment

Revenue & EBITDA Contribution by Segments

6

Industrial pumps

Revenue +5% EBITDA +28%

Compressors EPC

Revenue -61% EBITDA -22%  The decrease in the segment’s performance reflects quarterly volatility of business  The recently signed large-scale contract is under research and design stage and hasn’t yet supported the segment’s results Revenue -7% EBITDA +197%  Increase in the segment’s profitability is attributable to larger share of large-scale projects in 1Q 2014 vs 1Q 2013  In the reporting period HMS Group recognized a part of revenue under ESPO, Turkmenia and Zapolyarye-Purpe large-scale projects  Decrease in revenue and EBITDA was a result of quarterly volatility of business as well as contract mix  The segment improved its profitability yoy due to strong results in both sub-segments  Growth of profitability was related to mix of projects and costs minimization initiatives

SLIDE 7 Source: Company data

Customer base development

Revenue contribution by Top clients, 1Q’14 vs 1Q’13 Comments

Others 46% Gazprom 8% Gazpromneft 4% Rosneft 21% Others 46% Gazpromneft 13% Transneft 13% Rosneft 8% Gasprom 8% Surgutneftegaz 4% Transneft 8% Lukoil 3% Revenue RUB 6,895mn Revenue RUB 6,080mn Surgutneftegaz 9%

1Q 2013 1Q 2014

Lukoil 5% 

Well-diversified client base of 4,000-6,000 names, stable growth

f revenue coming from small-to-mid clients with annual

purchases below Rub 200 mn



Strong and stable base of “Blue-chip” clients, which includes the largest oil & gas and energy companies in Russia



HMS Group may have different Top-3 customers for each period, depending on the particular project mix



Prevailing installed base in the key segments ensures recurring business growth

During 3m 2014, HMS Group sold products and services to almost 3,000 unique clients, including VOIC, trade companies, dealers and individual entrepreneurs

7

Turkmenia 6%

SLIDE 8 1Q'14 1Q'13 change Cost of sales 4,588 5,389

15%

% of revenue 75.5% 78.2% Supplies and raw materials 2,274 2,313

2%

% of revenue 37.4% 33.5% Labour costs 1,511 1,421 6% % of revenue 24.9% 20.6% Cost of goods sold 138 638

78%

% of revenue 2,3% 9,3% Other expenses 665 1 016

35%

% of revenue 10,9% 14,7% 1Q'14 1Q'13 change Distribution and transportation expenses 306 285 7% % of revenue 5.0% 4.1% Transportation expenses 111 92 21% % of revenue 1.8% 1.3% Labour costs 121 113 7% % of revenue 2.0% 1.6% Insurance 10 8 25% % of revenue 0.2% 0.1% Other expenses 64 72

13%

% of revenue 1.0% 1.0% 1Q'14 1Q'13 change General & administrative expenses 905 923

2%

% of revenue 14.9% 13.4% Labour costs 597 624

4%

% of revenue 9.8% 9.1% Depreciation & amortization 46 47

2%

% of revenue 0.8% 0.7% Taxes and duties 44 43 2% % of revenue 0.7% 0.6% Other expenses 218 208 5% % of revenue 3.6% 3.0%

Cost Analysis

8

Cost of sales Comments Distribution & transportation expenses General & administrative expenses

General and administrative costs declined by 2% yoy comprising 15% and 13% of revenue in the reporting periods respectively Labour costs showed a 4% decrease Depreciation and amortization, tax and duties and other expenses remained almost flat yoy both in absolute and relative numbers Cost of sales declined by 15% Main components of cost of sales – supplies and raw materials combined with COGS – accounted for 40% and 43%

f revenue in 1Q’14 and 1Q’13 respectively

Labour costs grew both in absolute numbers and as a percentage of revenue due to acquisition of NIITK and NNGP Distribution and transportation expenses were up 7% yoy and accounted for 5.0% of the revenue in 1Q’14 The share of transportation costs grew from 1.3% to 1.8% of revenue due to execution of Turkmenia project The increase of transportation costs was the major factor behind growth of total distribution and transportation expenses

Totals may differ as a result of rounding

SLIDE 9

Working capital Cash flow performance 1Q’14 vs 1Q’13, Rub mn Capital expenditures2 1Q’14 vs 1Q’13



Operating cash flow turned positive and amounted to Rub 144 mn



Free cash flow was neutral



Working capital1 decreased by 42% yoy due to optimisation of payables and receivables, payments received under executed large contracts and prepayments under new contracts



Working capital amounted to 16% of revenue LTM versus 21% of revenue in 1Q’13



Organic capex2 decreased to Rub 0.2bn from Rub 0.3bn in previous period



Capex declined as a result of completion of the investment programme in industrial pumps business segment



D&A grew by 21% yoy due to acquisition of NIITK and NNGP in the second half of 2013



Capex-to-Depreciation-and-Amortization ratio decreased to 0.6x from 1.1x

CAPEX & Working Capital

Source: Company data

9

¹Working capital formula – see slide 16 ²Capital expenditures=Organic CAPEX = Purchase of PPE + Purchase of intangible assets

Comments

incl. continued operations

1Q’13 1Q’14 change Operating cash flow

1,541

144 Investing cash flow 854 160 Free cash flow

2,395
16

Financing cash flow 2,094 142 Cash and cash equivalents 1,045 1,701

21%

f revenue

16%

f revenue

336 219 296 359 1,1x 0,6x 1Q'13 1Q'14 Organic capex, Rub mn Depreciation & amortization, Rub mn Capex to D&A ratio, x 6,751

1,350

+34 +119

356

5,198 WC 1Q'13 Inventories change Receivables change &

ther adj.

Deposits change Payables &

ther adj.

WC 1Q'14

SLIDE 10 855 3,148 5,001 1,303 2,152 322 2,806 2014E 2015E 2016E 2017E 2018E 2019E Debt to be repaid, Rub mn Undrawn credit lines, Rub mn

10

Financial Position

Source: Company data

Net debt to EBITDA ratio Comments

Total debt decreased by 15% yoy to Rub 12.9bn
Net debt decreased by 21% yoy due to working capital optimization
Net Debt to EBITDA ratio decreased from 2.6x to 2.1x
Available liquidity of Rub 4.0bn fully covers 2014E repayments
Average interest rate was 9.6% on 16 May 2014 for all loans,

including FX-denominated and 10.2% for Rub-denominated only

In March 2014, Standard and Poor’s Rating Services affirmed HMS’

“B” long-term credit rating (outlook “Stable”) and removed from CreditWatch Negative, it had placed in October 2013

In May 2014, HMS Group refinanced its loans in the total amount of

almost Rub 1bn

Long-term debt 66% Source: Company data as of 16 May, 2014 Floating rate 7.8% Fixed rate 92.2% Short-term debt 34% Credits in Rub 86.7% Euro 11.9% Others 1.4%

Low currency and maturity risks

S&P corporate credit rating: B Outlook: stable Upgrade on March 2014

Comfortable repayment schedule

Cash 1,171 Source: Company data as of 16 May, 2014 Available liquidity 4.0 Rub bn 2,574 3,413 4,551 4,288 4,809 12,064 11,102 14,150 11,156 1.81 2.08 2.41 1.22 0.87 1.98 2.12 2.60 2.10 2007 2008 2009 2010 2011 2012 2013 1Q'13 1Q'14 Net Debt, Rub mn Net Debt to EBITDA ratio

SLIDE 11

Financial results Business & Outlook Appendix

11

SLIDE 12 14,842 16,082 19,922 23,505 1Q'11 1Q'12 1Q'13 1Q'14 ESPO 6 056 1 377 1 053 394 Other pumps 5 231 9 072 10 621 10 411 O&G equipment 1 131 3 071 3 496 7 938 Compressors 2 671 2 207 EPC: project and design 1 551 1 274 1 609 1 615 EPC: construction 1 829 1 288 472 939

+96% +9%

3,529 6,932 7,579 6,692 1Q'11 1Q'12 1Q'13 1Q'14 ESPO Other pumps 2 004 3 393 3 324 4 128 O&G equipment 819 2 666 1 775 2 099 Compressors 1 265 263 EPC: project and design 543 365 1 114 202 EPC: construction 163 508 102

12%

Backlog & Order Intake

Source: Company’s data, Management accounts

12

Backlog for 1Q in 2011-2014 Order intake for 1Q in 2011-2014

The data excludes the results of SKMN due to its disposal in 2013 The results of RVKP and NRS are included in Other pumps

+18% +24% +8%

69%

2%

24% 226%

33%

18% n/a n/a

79%
33%

205%

82%

212%

80%
100%
77%
24%
63%

73% 17%

2%

172% 14% 127% n/a n/a

17%
18%

26% 0%

30%
63%

99%

SLIDE 13

13

Q&A

SLIDE 14

Contacts

14

Company address: 7 Chayanova Str. Moscow 125047 Russia Investor Relations Phone +7 (495) 730-66-01 ir@hms.ru http://grouphms.com/shareholders_and_investors/ Vera Timoshenko, Head of Investor Relations timoshenko@hms.ru HMS Hydraulic Machines & Systems Group Plc is listed on the London Stock Exchange (Main market, IOB): Identifier Number Number of shares outstanding ISIN US40425X2099 117,163,427 Ticker HMSG Bloomberg HMSG LI Reuters HMSGq.L

SLIDE 15

Financial results Business & Outlook Appendix

15

SLIDE 16

Calculations and Formulas

16



All figures in millions of Russian Rubles, unless otherwise stated



Management of the Group assesses the performance of operating segments based on a measure of adjusted EBITDA, which is derived from the consolidated financial statements prepared in accordance with IFRS



EBITDA is defined as operating profit/loss adjusted for other operating income/expenses, depreciation and amortization, impairment of assets, provision for obsolete inventory, provision for impairment of accounts receivable, unused vacation allowance, defined benefits scheme expense, warranty provision, provision for legal claims, provision for VAT and other taxes receivable, other provisions, excess of fair value of net assets acquired over the cost of acquisition. This measurement basis excludes the effects of non-recurring income and expenses on the results of the

perating segments



EBIT is calculated as Gross margin minus Distribution & transportation expenses minus General & administrative expenses minus Other operating expenses



Total debt is calculated as Long-term borrowings plus Short-term borrowings



Net debt is calculated as Total debt minus Cash & cash equivalents at the end of the period



Working capital is calculated as Inventories plus Trade and other receivables, excluding Short-term loans issued, Bank deposits and Promissory notes receivable, plus Current income tax receivable minus Trade and other payables minus Short-term provisions for liabilities and charges minus Current income tax payable minus Other taxes payable. In 2011, Working capital was adjusted for working capital of acquired DGHM (Rub 309 mn)



ROE is calculated as Total equity period average divided by Profit for the year



ROCE is calculated as EBIT LTM divided by Average Capital Employed (Total debt + Total equity)



Backlog is calculated as the preceding backlog plus new or additional customer orders booked during the reporting period, less amounts of contract value booked as revenue under ‘‘Russian GAAP’’ on an unconsolidated basis under the relevant contracts, plus or minus adjustments made in the judgment of the Group’s management. The Group may also make certain adjustments to bookings to reflect amendment, expiry or termination of contracts, cancellation of orders, changes in price terms under contracts or orders, or other factors affecting the amount of potential revenue which the Group believes may be recognized under such contracts. The Group’s backlog estimates are not an indication of potential revenues. Actual revenues and other measures of financial performance under IFRS may differ materially from any estimate of backlog, and changes in backlog between periods may have limited or no correlation to changes in revenue or any other measure of financial performance under IFRS

Notes to the presentation and formulas used for some figures’ calculations

SLIDE 17

17

Statement of Financial Position

Note 31 March 2014 31 December 2013 ASSETS Non-current assets: Property, plant and equipment 5 13,867,874 14,215,280 Other intangible assets 6 1,370,966 1,447,716 Goodwill 7 5,205,277 5,145,730 Investments in associates 8 112,212 127,423 Deferred income tax assets 192,983 199,132 Other long-term receivables 12 314,891 375,123 Total non-current assets 21,064,203 21,510,404 Current assets: Inventories 10 6,119,768 5,476,236 Trade and other receivables and other financial assets 11 9,613,602 9,438,936 Current income tax receivable 176,587 122,805 Cash and cash equivalents 9 1,701,267 1,584,222 Restricted cash 9 7,413 8,055 Total current assets 17,618,637 16,630,254 TOTAL ASSETS 38,682,840 38,140,658 EQUITY AND LIABILITIES EQUITY Share capital 20 48,329 48,329 Share premium 20 3,523,535 3,523,535 Treasury shares 20 (201,205) (201,205) Other reserves (191,585) (191,585) Currency translation reserve (398,435) (170,541) Retained earnings 6,379,885 6,692,152 Equity attributable to the shareholders of the Company 9,160,524 9,700,685 Non-controlling interest 3,515,441 3,543,343 TOTAL EQUITY 12,675,965 13,244,028 LIABILITIES Non-current liabilities: Long-term borrowings 13 8,476,633 11,521,956 Finance lease liability 1,521 1,799 Deferred income tax liability 1,722,649 1,807,980 Pension liability 435,462 442,326 Provisions for liabilities and charges 19 59,850 58,450 Other long-term payables 18 389,315 372,643 Total non-current liabilities 11,085,430 14,205,154 Current liabilities: Trade and other payables 16 9,539,689 8,079,792 Short-term borrowings 13 4,380,482 1,164,640 Provisions for liabilities and charges 19 175,022 200,997 Finance lease liability 8,780 9,489 Pension liability 68,405 69,869 Current income tax payable 14,250 212,434 Other taxes payable 17 734,817 954,255 Total current liabilities 14,921,445 10,691,476 TOTAL LIABILITIES 26,006,875 24,896,630 TOTAL EQUITY AND LIABILITIES 38,682,840 38,140,658

SLIDE 18

18

Statement of Comprehensive Income

Note Three months ended 31 March 2014 Three months ended 31 March 2013 Continuing operations Revenue 22 6,079,781 6,895,392 Cost of sales 23 (4,588,329) (5,388,507) Gross profit 1,491,452 1,506,885 Distribution and transportation expenses 24 (305,578) (285,302) General and administrative expenses 25 (904,839) (922,537) Other operating expenses, net 26 (73,910) (50,187) Operating profit 207,125 248,859 Finance income 27 45,295 41,511 Finance costs 28 (576,235) (335,486) Share of results of associates 8 318 (601) Loss before income tax (323,497) (45,717) Income tax benefit/(expense) 21 12,813 (28,872) Loss for the period from continuing operations (310,684) (74,589) Discontinued operations Profit for the period from discontinued operations

92,568

(Loss)/profit for the period (310,684) 17,979 (Loss)/profit attributable to: Shareholders of the Company (299,465) 276 Non-controlling interest (11,219) 17,703 (Loss)/profit for the period (310,684) 17,979 Items that may be reclassified subsequently to profit or loss Currency translation differences (276,072) 38,481 Currency translation differences of associates 8 15,529 1,173 Total items that may be reclassified subsequently to profit or loss (260,543) 39,654 Other comprehensive (loss)/income for the period (260,543) 39,654 Total comprehensive (loss)/income for the period (571,227) 57,633 Total comprehensive (loss)/income attributable to: Shareholders of the Company (527,359) 25,145 Non-controlling interest (43,868) 32,488 Total comprehensive (loss)/income for the period (571,227) 57,633 Basic and diluted earnings per ordinary share for loss/(profit) attributable to the ordinary shareholders (RR per share) 20 (2.52) 0.00 From continuing operations (2.52) (0.68) From discontinued operations

0.68

SLIDE 19

19

Cash Flows Statement

Note Three months ended 31 March 2014 Three months ended 31 March 2013* Cash flows from operating activities Profit before income tax (323,497) (45,717) Adjustments for: Depreciation and amortisation 5, 6 359,131 295,615 Loss from disposal of property, plant and equipment and intangible assets 26 3,807 7,109 Finance income 27 (45,295) (41,511) Finance costs 28 576,235 335,486 Pension expenses 14 15,178 16,760 Warranty provision 23 (4,530) 3,259 Provision for tax risks 25

(13,728)

Provision for impairment of accounts receivable 25 14,982 14,332 Provision for obsolete inventories 23 (4,277) (7,666) Provision for VAT receivable

42

Foreign exchange gain, net 26 (50,454) (6,072) Provision for legal claims 26 (20,056) (3,909) Share of results of associates 8 (318) 601 Net monetary effect on non-operating items (22,307) 2,942 Write-off of receivables

1,707

Operating cash flows before working capital changes 498,599 559,250 (Increase)/decrease in inventories (860,042) 62,215 Increase in trade and other receivables (336,400) (1,075,935) (Decrease)/increase in other taxes payable (183,048) 170,323 Increase/(decrease) in accounts payable and accrued liabilities 1,795,009 (667,457) Restricted cash 9 642 933 Cash generated from/(used in) operations 914,760 (950,671) Income tax paid (311,244) (108,540) Interest paid (459,314) (394,170) Net cash generated from/(used in) operating activities – continuing operations 144,202 (1,453,381) Net cash generated from operating activities – discontinued operations

(87,323)

Net cash generated from/(used in) operating activities 144,202 (1,540,704) Cash flows from investing activities Repayment of loans advanced 16,795 6,900 Loans advanced (9,076) (216,647) Loans provided to discontinued operations

(319,729)

Proceeds from sale of property, plant and equipment and intangible assets 41,238 18,482 Interest received 9,551 29,521 Dividends received 716 240 Purchase of property, plant and equipment (211,295) (309,812) Acquisition of intangible assets (7,540) (25,722) Net cash used in investing activities – continuing operations (159,611) (816,767) Net cash used in investing activities – discontinued operations

(37,593)

Net cash used in investing activities (159,611) (854,360) Cash flows from financing activities Repayments of borrowings (1,749,087) (4,310,827) Proceeds from borrowings 1,893,069 6,341,864 Payment for finance lease (1,926) (1,736) Buy back of issued shares 20

(54,457)

Dividends paid to non-controlling shareholders of subsidiaries (182) (615) Net cash from financing activities – continuing operations 141,874 1,974,229 Net cash from financing activities – discontinued operations

119,729

Net cash from financing activities 141,874 2,093,958 Net increase/(decrease) in cash and cash equivalents – continuing operations 126,465 (295,919) Net (decrease) in cash and cash equivalents – discontinued operations

(5,187)

Effect of exchange rate changes on cash and cash equivalents and effect of translation to presentation currency (9,420) (279) Cash and cash equivalents at the beginning of the period 1,584,222 1,346,082 Cash and cash equivalents at the end of the period 1,701,267 1,044,697

SLIDE 20

The information contained herein has been prepared using information available to HMS Group (“HMS” or “Group” or “Company”) at the time of preparation of the presentation. External or other factors may have impacted on the business of HMS Group and the content of this presentation, since its preparation. In addition all relevant information about HMS Group may not be included in this presentation. No representation or warranty, expressed or implied, is made as to the accuracy, completeness or reliability of the information. Any forward looking information herein has been prepared on the basis of a number of assumptions which may prove to be incorrect. Forward looking statements, by the nature, involve risk and uncertainty and HMS Group cautions that actual results may differ materially from those expressed or implied in such statements. Reference should be made to the most recent Annual Report for a description of the major risk factors. This presentation should not be relied upon as a recommendation or forecast by HMS Group, which does not undertake an obligation to release any revision to these statements. This presentation does not constitute or form part of any advertisement of securities, any offer or invitation to sell or issue or any solicitation of any offer to purchase or subscribe for, any shares in HMS Group, nor shall it or any part of it nor the fact of its presentation or distribution form the basis of, or be relied on in connection with, any contract or investment decision.

Disclaimer

20