full-year 2011 results presentation full-year results … · 2017-08-10 · • risk management •...
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Full-Year 2011 Results PresentationFull-Year Results PresentationMonday, 15 August 2011Sofitel Wentworth, Sydney
OverviewRichard Leupen, Managing Director & CEO
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Group Highlights
• Strong focus on risk management• Securing and executing projects on acceptable
trading terms• Building greater recurring revenue streams
Business Discipline Delivering
• Diversified revenue streams driving profit• Strong financial discipline• Partnering with blue-chip customers and
government
Our Business model driving results
• Stable order book at $8.2 billion underpins future operations
• Assessing numerous growth opportunities• Solid bidding pipeline and preferred tenders
Growth Continuing
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Financial Highlights
Operating revenue, EBIT, Tax, NPAT & EPS in this presentation refer to underlying results. A reconciliation to reported results is detailed on slide 14.
Operating revenue
Operating cash flow
NPAT
EPS
Capex
Gearing
DPS
$4.6b - up 5%
38¢ fully franked
13% flexibility for growth
$150.6m
$158.5m - up 10%
99¢ - up 8%
$47m low capital intensity
Underlying NPAT $164.4m – up 9%
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New Contract Wins & Extensions
• Western Downs to Halys powerlineconstruction in QLD
• North Auckland and North lsland Grid Upgrade
UGL Infrastructure
• OSCar 3 extension • 2 x 5-year locomotive maintenance service
agreements with major iron ore customers• Supply of 450 bogie frames to GE • Supply of over 60 locomotives
UGL Rail
• Four year extension for maintenance at BP Kwinana refinery
• Maintenance renewals and new projects with QAL and Worsley
• Long term maintenance works for Wesfarmer’s and BMA’s coal projects
UGL Resources
• Financial close of Singapore Sports Hub • FM agreement with Toyota• FM for Ivy League University
UGL Services
$4.1b in New Wins and Extensions
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Revenue & Profit Growth(underlying results)
Operating Revenue ($m) Net profit after tax ($m)
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EPS & DPS Growth(underlying results)
Earnings per share (¢) Dividends per share (¢)
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Drivers for Growth
Sustainable Earnings
Market Leadership
RiskManagement
FinancialStrength
BusinessPositioning
Sector Focus
• Balanced recurring revenues• Long term capital works alliances• Diverse earnings streams• Strong order book• Solid opportunity pipeline
• Balanced trading terms• Robust systems and processes• Alliance and cost-plus contracts• Blue-chip and government clients
• People• Safety• Technology partnerships • Intellectual property • Outstanding customer service
• Oil and Gas• Minerals• Transport and rail engineering• Infrastructure and
the environment• Property management
• Strong balance sheet• Low capital intensity• Robust cash flow• Flexibility to grow
• Exposure to long term growth trends• Significant market opportunities• Strong technical component• World class technology
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Safety
*rolling 12-month average
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10
15
20
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Jun-04 Jun-05 Jun-06 Jun-07 Jun-08 Jun-09 Jun-10 Jun-11
Freq
uenc
y ra
te p
er m
illio
n m
an h
ours
wor
ked* Lost time injury frequency rate (LTIFR)
Total recordable case frequency rate (TRCFR)
LTIFR Excluding US
TRCFR Excluding US
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Our People
Employee numbers* Breakdown by division
2,434 5%2,621 6%5,861 13%
35,017 75%278 1%58 0%
*includes contractors
Total46,269
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Divisional Overview
UGL Infrastructure
• Power generation and transmission growing• Strengthened presence in power sector – two major wins in Queensland and NZ• Improved margin performance • Bidding activity stable in key sectors
• Power generation and transmission growing• Strengthened presence in power sector – two major wins in Queensland and NZ• Improved margin performance • Bidding activity stable in key sectors
UGL Rail
• Margin growth• Oscar 3 performing well • Ongoing improvement in MTM Melbourne train franchise • Strengthened presence in minerals
• Margin growth• Oscar 3 performing well • Ongoing improvement in MTM Melbourne train franchise • Strengthened presence in minerals
UGLResources
• Building pipeline of maintenance projects • Strengthened presence in oil and gas sector • Turnaround in performance of major construction projects • Expanded presence in minerals sector
• Building pipeline of maintenance projects • Strengthened presence in oil and gas sector • Turnaround in performance of major construction projects • Expanded presence in minerals sector
UGLServices
• Stable revenue and earnings contribution • Turnaround of US Corporate Real Estate Services business continues • Ongoing improvement in Australia & NZ business • International expansion continues – Middle East and China
• Stable revenue and earnings contribution • Turnaround of US Corporate Real Estate Services business continues • Ongoing improvement in Australia & NZ business • International expansion continues – Middle East and China
Financial AnalysisRobert Bonaccorso, Chief Financial Officer
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Results Overview(underlying results)
Constant currency: translating results in AUD dollars at the exchange rate applicable during the prior corresponding period.
$m FY11 FY10 Change ConstantCurrency
Operating revenue 4,583.6 4,359.1 5% 8%
EBIT 249.4 229.3 9% 12%
EBIT margin 5.4% 5.3%
NPAT 164.4 151.1 9% 11%
NPAT margin 3.6% 3.5%
EPS 99.0 91.7 8% 10%
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Reconciliation to Underlying Results
$m FY11 FY10 Change
Consolidated revenue 4,290.1 4,191.5 98.6Add: Revenue from joint ventures & associates 298.5 172.1 126.4Less: Interest income (5.0) (4.5) (0.5)Total segment revenue 4,583.6 4,359.1 224.5
EBIT 236.6 216.6 20.0Add: Amortisation of acquired intangibles 9.8 11.0 (1.2)Add: Tax on equity accounted income 3.0 1.7 1.3Underlying EBIT 249.4 229.3 20.1
Tax (57.1) (52.3) (4.8)Less: Tax on amortisation of acquired intangibles (3.9) (4.4) 0.5Less: Tax on equity accounted income (3.0) (1.7) (1.3)Underlying tax (64.0) (58.4) (5.6)
NPAT (attributable to owners of the company) 158.5 144.5 14.0Add: Amortisation of acquired intangibles (after tax) 5.9 6.6 (0.7)Underlying NPAT 164.4 151.1 13.3
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Operational Report - Infrastructure
• Sales close to record levels
• Solid margin growth
• Preferred on $400m
$m FY11 FY10 Change
EBIT $m
Sales - $m 1,065.6 1,096.0 (3%)
EBIT - $m 83.3 78.9 6%
EBIT / Sales 7.8% 7.2%
Order book - $b 1.6 2.1 (25%)
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Operational Report - Rail
• Strong locomotive sales driving growth
• FY10 - Oscar arbitration
• Tender conversion rate strong
$m FY11 FY10 Change
EBIT $m
Sales - $m 1,249.6 1,135.8 10%
EBIT - $m 84.8 55.2 53%
EBIT / Sales 6.8% 4.9%
Order book - $b 2.8 3.1 (10%)
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Operational Report - Resources
• Growth driven by key projects
• Pluto impacting year on year EBIT
• Improved performance of major projects in second half
$m FY11 FY10 Change
EBIT $m
Sales - $m 959.0 785.9 22%
EBIT - $m 44.0 59.4 (26%)
EBIT / Sales 4.6% 7.6%
Order book - $b 1.0 1.0 -
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Operational Report - Services
• FX impacting results
• Continued turnaround in US Corporate Real Estate business
• Strong performance from ANZ operations
$m FY11 FY10 Change
EBIT $m
Sales - $m 1,328.9 1,361.9 (2%)
EBIT - $m 76.5 71.5 7%
EBIT / Sales 5.8% 5.2%
Order book - $b 2.8 2.8 -
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Operating Cash Flow
• Mobilisation fees impacting FY11 cash flow
• New projects driving working capital growth
• Cash Management remains core discipline
• DSO 28 days
Note: Cash Realisation = Operating cash flow / NPAT add back depreciation and amortisation
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Financial Position
• Strong financial position
• Average term 4.2 years
• No refinancing obligations until 2012
• Capacity $164m
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Financial Position
• Low Gearing
• Gearing at 19% excluding FX impact
$m FY11 FY10
Net debt 178 234
Net debt to net debt plus equity 13.2% 16.8%
Interest cover (rolling 12 months) 14.0x 11.0x
Net debt to EBITDA 0.6x 0.8x
Total assets 2,409 2,505
OutlookRichard Leupen, Managing Director & CEO
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Order Book • Reported $8.2b• Constant Currency $8.4b
Order Book
Historic growth ($m) Order book excludes significant value
Preferred tender status $1.0b• Property services• Rolling stock and maintenance• Power Generation
Options in existing contracts $2.8b• Rail maintenance• Property services• Locomotive orders
Recurring maintenance $5.2b• Historic renewal rate 90-95%• Value over five years• Excludes fixed term contracts
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Pipeline
Weighted and Qualified ($m) Status
Note: Weighted & Qualified – excludes any opportunities with a go-get less than 25%
FY08 FY09 FY10 FY11
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By year ($m)
Order Book Breakdown
By type By division
Alliance style projects $1.2b
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Divisional Outlook
• Pipeline of new business opportunities in power, water and transport
• Stable order book • All major projects performing well • Stable business performance expected to
continue
UGL Infrastructure
• Resources sector and general freight markets offer growth opportunities
• Locomotive sales remain strong• Growth in passenger rail investment in major
urban centres • Benefits of Texmaco investment will start to be
realised • Assessing new international markets for
passenger and freight
UGL Rail
Order Book
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Divisional Outlook
• Ongoing focus on oil and gas markets in Australia
• Building greater order book of maintenance related work
• Continued investment in minerals markets present growth opportunities
• US turnaround expected to deliver solid growth • Middle East has further expansion prospects • Australian, NZ and Asian businesses in excellent
shape • Outsourcing trend will gather pace
UGL Resources
UGL Services
Order Book
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Group Outlook
• Risk management • Sticking to our core sectors • Protecting future earnings by sensible bidding
practices • Building greater stability in order book
Stability and discipline
• Business model unchanged • Enviable financial position – low debt and low cost
base with no major capex• Governments and blue chips deliver multiple
earnings streams • Exposure to growth sectors
Growth drivers remain
• Order book is stable with further upside • Pipeline of bidding is robust and visible • Assessing additional growth opportunities in
our key sectors
Targeting growth in FY2012
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Important Notice
This presentation and any oral presentation accompanying it:
• is not an offer, invitation, inducement or recommendation to purchase or subscribe for any securities in UGL Limited (“UGL”) or to retain any securities currently held;
• is for information purposes only, is in summary form and does not purport to be complete;
• 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, potential investor or any other person. Such persons should consider seeking independent financial advice depending on their specific investment objectives, financial situation or needs when deciding if an investment is appropriate or varying any investment;
• may contain forward looking statements. Any forward looking statements are not guarantees of future performance. Any forward looking statements have been prepared on the basis of a number of assumptions which may prove to be incorrect or involve known and unknown risks, uncertainties and other factors, many of which are beyond the control of UGL, which may cause actual results, performance or achievements to differ materially from those expressed or implied in such statements. There can be no assurance that actual outcomes will not differ materially from these statements. Any forward looking statement reflects views held only as of the date of this presentation. Subject to any continuing obligations under applicable law or any relevant stock exchange listing rules, UGL does not undertake any obligation to publicly update or revise any of the forward looking statements or any change in events, conditions or circumstances on which any such statement is based.
No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions contained in this presentation and any oral presentation accompanying it. To the maximum extent permitted by law, UGL and its related bodies corporate, and their respective directors, officers, employees, agents and advisers, disclaim and exclude all liability (including, without limitation, any liability arising from fault or negligence) for any loss, damage, claim, demand, cost and expense of whatever nature arising in any way out of or in connection with this presentation and any oral presentation accompanying it, including any error or omission therefrom, or otherwise arising in connection with any reliance by any person on any part of this presentation and any oral presentation accompanying it.