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Transcript of For personal use only - Australian Securities Exchange · Engineering Consulting | Project Delivery...
ASX code - LCM
FY15 interim results investor briefing 26 February 2015 * Project during construction
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Performance summary 1H15 against previous corresponding period (pcp)
• Financial results in line with guidance
• Transition program of strategic growth initiatives
and cost reductions has delivered sustainable
cost savings
• Increase in scale and diversity of Hydrocarbons
customers, contributing 65% of total revenue
(FY14: 57%)
• Solid work-in-hand providing visibility through to
the end of the financial year
• Strong conversion of earnings to cash reflected in
strong balance sheet and net cash position
• Workforce of 580 people (FY14: 610)
• Dividend payout ratio of 57%
$69.3m Revenue
1H14: $67.3m
$4.4m Statutory NPAT
1H14: $2.1m
3.5c Interim dividend
1H14: 2.0c
$6.3m EBITDA
1H14: $3.0m
6.2c Basic EPS
1H14: 3.0c
$22.9m Net cash position
1H14: $9.2m
^Refer to end note on page 20
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Financial summary 1H15
• Revenue of $69.3m, up from $67.3m pcp
• Labour revenue consistent with pcp
• Marginal increase in total revenue over pcp
due to increase in procurement activities
• EBITDA of $6.3m, up 110% from $3.0m in pcp
• EBITDA margin 9.1% (4.5% pcp)
• Sustained reduction in overhead expenses
($20.6 million in the current period compared
to $23.8 million in pcp)
Revenue ($m) EBITDA ($m)
1H 2H
55.3
42.5
FY11
56.1
67.0
FY12
65.3
64.3
FY13
67.3
60.6
FY14
69.3
FY15
4.5
0.3
FY11
4.3
7.0
FY12
7.5
6.6
FY13
3.0
3.6
FY14
6.3
FY15
1H 2H
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Financial summary 1H15 (continued)
• NPAT of $4.4m, up 110% from $2.1m in pcp
• Includes $0.5m of income tax credits
expected from research and development
incentives (FY14: $0.5m)
• Benefits from R&D incentives are expected
to continue throughout FY15
• Basic earnings per share of 6.2 cents (3.0 pcp)
• Interim dividend of 3.5 cents per share (2.0c pcp)
• Partially franked to 50% due to reduced
corporate tax paid resulting from R&D
incentives and instalment timing
• Reflects payout ratio of 57%
• Share buy-back program has acquired 1.7m
shares for total consideration of $1.2m as at
24 February 2015
NPAT ($m) DPS & EPS (cents per share)
1H 2H
4.2
0.4
FY11
4.7
6.0
FY12
5.6
5.5
FY13
5.6
-0.6
FY14
4.4
FY15
3.25
1.25
FY11
6.90
0.70
3.50
6.90
9.00
5.00
FY12
4.50
8.50
8.10
4.50
FY13
2.00 3.00
4.20
3.50
3.50
FY14 FY15
DPS 1H EPS 1H DPS 2H EPS 2H
6.20
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5
Our business
We remain focused
on enhancing the
value and performance
of assets.
Our skill set extends
across all phases of
the asset and project
lifecycle.
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• Our hydrocarbons business incorporates a range of sub-segments. While the market dynamics differ
within each of these sub-segments, LogiCamms’ services in all of these markets have a common focus
on enhancing existing assets and operational performance.
• Our focus on asset performance and brownfield work limits our exposure to the significant decrease in
new capital investment.
• A summary of the hydrocarbon sub-segments currently supported by LogiCamms is as follows:
- Unconventional oil & gas - services to the coal seam gas and shale gas fields
- Conventional oil & gas - onshore processing facilities, pipelines, and compressor stations but also
includes offshore topside, downstream (LNG, refining & petrochemical) facilities and natural gas
infrastructure
• Asset Performance Services - optimise the efficiency and value of plant, process and those people
working in the sector, particularly through our Competency Training and Assurance services
Our business (continued)
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• Pipelines, particularly gas transmission, represent a growing part of the hydrocarbons portfolio for
LogiCamms and are a specific strategic focus.
- The Company’s major contract with Epic Energy to provide Engineering, Procurement and
Construction (EPC) services for the Moomba to Adelaide gas pipeline (MAP) is progressing to
plan with completion scheduled for June 2015.
• Demand for the Company’s Asset Performance Services has increased in New Zealand as the
hydrocarbons market transitions to focus on managing operating costs and efficiencies.
- Our New Zealand team has cemented its role as the oil & gas centre of excellence for the
LogiCamms group with over 40% of the workload of the New Zealand business now associated
with projects in Australia.
• LogiCamms’ long established presence in the Pilbara region helped to secure a recent contract
extension with Samsung C&T as well expand engineering and construction management projects for
the iron ore operators.
- The contract with Samsung C&T to provide control system engineering and procurement services
for the Roy Hill iron ore mine in Western Australia has been extended.
Our business (continued)
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Representative Clients
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• LogiCamms has entered an agreement to acquire Monarc Environmental, effective 1 March 2015. The
acquisition is not expected to make a material contribution to LogiCamms’ FY15 earnings.
• Monarc Environmental is a 23-person specialist environmental consultancy, which compliments
LogiCamms’ strategy through long term relationships with pipeline operators, public sector authorities
and the infrastructure market (particularly power utilities). Key clients include APA, Jemena and
CitiPower/Powercor.
• Monarc provides LogiCamms with:
- Increased specialisation in front-end technical consulting capability, specifically in environmental
management
- Improved access to infrastructure markets with a strong focus on linear infrastructure: pipelines,
energy and utilities sectors in particular
- An established Victorian presence with active projects around Australia
Strategic acquisition
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Strategy & Outlook
• Based on an encouraging first half, and visibility through to the end of FY15, the Company has
reaffirmed its full year guidance of achieving revenue in the order of $140 million and EBITDA margin of
8% to 10%.
• LogiCamms continued to increase the scale and diversity of its services into hydrocarbons markets with
approximately 65% of revenue in 1H FY15 derived from this sector (1H FY14 55%). With an increasing
portfolio of hydrocarbon clients, LogiCamms operates in support of existing (brownfield) oil & gas
assets across Australia and New Zealand. Pipelines, particularly gas transmission, represent a growing
part of the hydrocarbons portfolio for LogiCamms and are a specific strategic focus.
• The Minerals & Metals and Infrastructure sectors remain important markets for the business.
LogiCamms remains focused on improving the performance of our customers’ assets in a challenging
market.
• As well documented in the public domain global energy and resource markets are under significant
pressure and this is likely to continue for the foreseeable future. This environment provides an
opportunity for LogiCamms to work with our customers to reduce costs and improve asset productivity
through innovation.
• The outlook into FY16 is difficult to predict in light of prevailing market conditions. However, with a
strong financial position and a long term strategy orientated towards enhancing the value and
performance of assets, growth remains available to LogiCamms.
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Appendices
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LogiCamms at a glance
LogiCamms is a professional
engineering and consulting
services company across
Australia and New Zealand.
Key industries:
• Hydrocarbons
• Minerals and metals
• Infrastructure
Our purpose is to enhance the
value and performance of
assets.
580 people
8 offices
65% revenue from hydrocarbons
customers in H1FY15
2007 year listed on ASX F
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Description of Services Control Systems Pipelines EPC & EPCM
Engineering Consulting & Sustaining Capital Projects
Value Creation
Leading integrator of major control systems
Multiple technology vendors
Functional safety experts
Pipeline design & install
Gas Gathering field development
Auto-generation software tools
Flowline & electrical design integration
Scalable EPC and EPCM delivery from a consultant
Accelerated models
Established partnerships with constructors & vendors
Focus on innovation
Transferable and scalable design
In-house specialists
High value engineering
Key Contracts
• Samsung C&T, Roy Hill mine control system, WA
• Wiggins Island Coal Export Terminal, QLD
• Jemena
• APA, Mondara Gas Facility
• Tasmanian Gas Pipeline
• Epic Energy, EPC projects for Moomba to Adelaide Pipeline, SA
• BW Offshore, EPC boiler module, NZ
• Ballance Agri-Nutrients, NZ
• Oil field development study, WA
• Methanex New Zealand, engineering consulting and sustaining capital projects
• Origin Energy & Santos upstream, QLD
Work snapshot – engineering & projects
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Description of Services Maintenance system development Shutdowns / turnarounds Asset integrity and asset support
Value Creation
Seamless start-up support for
greenfield projects
Long term asset performance
strategies
Effective change management skill
set
Specialist project management
expertise
Cost, schedule and safety focus
Maintain and optimise integrity of
operating facilities
24-hour on- and off-site support
Key Contracts
• Chevron Australia, Gorgon LNG
maintenance system, WA
• Origin Energy maintenance
system, QLD
• Various mine sites, QLD
• ConocoPhillips, Darwin LNG
shutdowns
• Ballance Agri-Nutrients, plant
turnaround, NZ
• BW Offshore FPSO shutdown
project, NZ
• ConocoPhillips, Bayu-Undan
• Oil Search, asset integrity
campaign, Papua New Guinea
Work snapshot – asset performance
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Description of Services
Training and development solutions
Competency assurance management systems
Professional and technical training courses
Value Creation
Workforce readiness and development
Specialised and custom training packages
E-learning packages
Internal management of
workforce competency
Learning and development framework
Training manuals and procedures
Verification of Competencies (VOCs)
High voltage operations
Hazardous areas
Project management
On- and off-site delivery
Key Contracts
• Origin Energy
• BHP Billiton
• Chevron Australia
• ConocoPhillips Australia
• Arrow Energy
• QGC
• Oil Search
• SIMTARS
• Newcrest
• Oil Search
• Woodside
• Fluor
• Origin
• BHP
Work snapshot – training & assurance
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Financial summary FY15
1H15 1H14 1H14 Comparison 2H14 Comparison
A$m
Statutory Results
6 Months to 31 Dec 2014
Statutory Results
6 Months to 31 Dec 2013
Change Statutory Results
6 Months to 30 June 2014
Revenue $69.3m $67.3m 3.0% $60.6m
Gross Profit Gross Profit %
$25.2m 36.3%
$25.7m 38.2%
-1.9% $23.8m 39.3%
EBITDA EBITDA %
$6.3m 9.1%
$3.0m 4.5%
110% $3.7m 6.1%
EBIT
EBIT %
$5.3m 7.6%
$2.0m 3.0%
115% $2.5m 4.1%
NPAT Attrib to Members NPAT Margin (%)
$4.4m 6.3%
$2.1m 3.2%
110% $2.9m 4.8%
Operating Cash Flow
$14.0m $0.5m 2700% $5.1m
EPS (cents per share)
6.2 3.0 107% 4.2
DPS (cents per share)
3.5 2.0 75% 3.5 For
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Balance sheet (June 2014) – key items
Balance Sheet Item
Balance A$m Comparison to 30 June 2014
Comments
Cash $22.9m $12.2m
• Continued focus on active working capital management • 1H15 includes approximately $5.0m in project committed funds received in advance
from customers • 1H14 includes large outflows for ongoing investment in systems, dividends, and taxes
Current Receivables & Work In Progress
$29.3m $29.1m • Key focus area of collecting debtors and billing work in progress • Days sales in debtors/WIP has improved on prior periods and is within target range of
less than 70 days
Current Trade and other Payables
$13.0m $7.9m • Composition of payables in 1H15 includes some large project commitments and
reclassification of ITL earn-out accrual to current liabilities • Otherwise, composition consistent with prior periods
Cash on hand –
30 June 2014
Net operating
receipts &
payments
12.9
14.5
Taxes
(Aus & NZ)
0.5
Ongoing
systems
development
0.4
Dividends paid
to shareholders
2.5
Share buy back
program
0.7 0.4
Other net cash
flows
Cash on hand –
31 December
2014
22.9
0
5
10
15
20
25
30
$’0
00
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• The purpose of this presentation is to provide general information about LogiCamms Limited (Company). It is not recommended that any person makes any investment decision in relation to the Company based solely on this presentation. This presentation does not contain all information which would be material to the making of a decision in relation to the Company. Any investor should make its own independent assessment and determination as to the Company’s prospects prior to making any investment decision, and should not rely on the information in this presentation for that purpose.
• This presentation does not involve or imply a recommendation or a statement of opinion in respect of whether to buy, sell or hold securities in the Company.
• This presentation contains certain statements which may constitute “forward-looking statements”. Such statements are only predictions and are subject to inherent risks and uncertainties which could cause actual values, results, performance or achievements to differ materially from those expressed, implied or projected in any forward-looking statements. No representation or warranty, express or implied, is made by the Company that the matters stated in this presentation will be achieved or prove to be correct.
• Except for statutory liability which cannot be excluded, the Company, its officers, employees and advisers expressly disclaim any responsibility for the accuracy or completeness of the material contained in this presentation and exclude all liability whatsoever (including in negligence) for any loss or damage which may be suffered by any person as a consequence of any information in this presentation or any error or omission therefrom. The Company accepts no responsibility to update any person regarding any inaccuracy, omission or change in information in this presentation or any other information made available to a person nor any obligation to furnish the person with any further information.
End Notes ^ Earnings Before Interest Tax Depreciation and Amortisation. The reference to EBITDA is unaudited and unreviewed however is based on amounts extracted from the reviewed financial statements and reconciles to the profile before and after income tax as reported in the Condensed Consolidated Income Statement contained within the Company’s Financial Report and Appendix 4D for FY15 as follows:
The presentation of EBITDA is intended to provide a measure of the Group’s performance before the impact of non-cash expense items such as depreciation and net finance income.
TRIFR = the Total Recordable Injury Frequency Rate is a rolling 12 month average measure of safety performance.
Disclaimer & notes
31 December 2014 31 December 2013
Net Profit Before Tax
$5.4m $2.2m
Net finance income ($0.1m) ($0.1m)
Depreciation $1.0m $0.9m
EBITDA $6.3m $3.0m
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Further information
Registered Office
433 Boundary Street
Spring Hill, Brisbane
Queensland, Australia 4000
Tel. +61 7 3058 7000
Investor Relations
Matthew Adamo
Managing Director
Tel. +61 7 3058 7205
Our Values
Web www.logicamms.com.au
Media Enquiries
Alasdair Jeffrey
Rowland
Tel. +61 7 3229 4499
Paul Bowker
Chief Financial Officer
Tel. +61 7 3058 7205
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