2012-13 Full Year Result - ALS Global › - › media › files › asx... · 2012-13 Full Year Result ... opinions or conclusions as to future matters may prove to be incorrect,

RIGHT S O L U T I O N S | RIGHT PARTNER

2012-13 Full Year Result

Investor Presentation

May 2013

Greg Kilmister – CEO

Paul McPhee – Group General Manager Energy Division

• This presentation has been prepared by ALS Limited, (ALS or the Company). It contains general information

about the Company’s activities as at the date of the presentation. It is information given in summary form and

does not purport to be complete. The distribution of this presentation in jurisdictions outside Australia may be

restricted by law, and you should observe any such restrictions.

• This presentation is not, and nothing in it should be construed as, an offer, invitation or recommendation in

respect of securities, or an offer, invitation or recommendation to sell, or a solicitation of an offer to buy,

securities in any jurisdiction. Neither this document nor anything in it shall form the basis of any contract or

commitment. This presentation 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 investor. All

investors should consider such factors in consultation with a professional advisor of their choosing when

deciding if an investment is appropriate.

• The Company has prepared this presentation based on information available to it, including information

derived from public sources that have not been independently verified. No representation or warranty, express

or implied, is provided in relation to the fairness, accuracy, correctness, completeness or reliability of the

information, opinions or conclusions expressed herein.

• This presentation includes forward-looking statements within the meaning of securities laws. Any forward-

looking statements involve known and unknown risks and uncertainties, many of which are outside the control

of the Company and its representatives. Forward-looking statements may also be based on estimates and

assumptions with respect to future business decisions, which are subject to change. Any statements,

assumptions, opinions or conclusions as to future matters may prove to be incorrect, and actual results,

performance or achievement may vary materially from any projections and forward-looking statements.

• Due care and attention should be undertaken when considering and analysing the financial performance of the

Company.

• All references to dollars are to Australian currency unless otherwise stated.

IMPORTANT NOTICE AND DISCLAIMER

2

Full year FY13

(AUD$mn)

FY12

(AUD$mn)

Change

(%)

Revenue 1,499.3 1,405.6 +6.7%

EBITDA1 406.0 373.8 +8.6%

EBITDA2 from continuing operations 385.8 364.9 +5.7%

EBIT1

(underlying) 350.3 327.6 +6.9%

NPAT1 (underlying) 237.9 222.4 +6.9%

Gain on sale of discontinued

operations 5.7 -

Impairment (16.1) -

NPAT (including capital gain and impairment loss) 227.3 222.4 +2.2%

EPS1 (underlying - basic – cents per share) 69.53 65.90 +5.5%

Dividend (cents per share) 48 45 +6.7%

1 Excludes gain on sale of discontinued operations and impairment loss

2 EBITDA from continuing operations post the sale of the Chemical Division (Deltrex and Panamex)

March 2013 Full Year

3

Historical Trend – Five Year Journey

772

920

826

1,108

1,406

1,499

0

200

400

600

800

1,000

1,200

1,400

1,600

FY08 FY09 FY10 FY11 FY12 FY13

AUD $m

Revenue

CAGR 24.6%

72

106

75

132

222

238

0

50

100

150

200

250


AUD $m

Underlying After

Tax Profit

CAGR 27.0%

$0.27

$0.39

$0.26

$0.41

$0.66

$0.70

$0.00

$0.10

$0.20

$0.30

$0.40

$0.50

$0.60

$0.70


AUD

Underlying

Earnings Per Share

CAGR 24.0%

4

Foreign Currency Revenues

AUD

47%

USD

21%

CAD

15%

EURO

5%

GBP

3%

Krona

3%

ZAR

3%

Asia

3%

FY2013 revenue

AUD $1.499 billion

Average Exchange Rate

FY2013 FY2012 Change

USD 1.0323 1.0540 -2.1%

CAD 1.0354 1.0437 -0.8%

EURO 0.8016 0.7614 +5.3%

GBP 0.6536 0.6570 -0.5%

SEK 6.8819 6.8549 +0.4%

ZAR 8.8238 7.8107 +13.0%

SGD 1.2806 1.3158 -2.7%

Note: Krona includes SEK, NOK, DKK & FMM

Asia includes HKD, SGD, THB, MYR, IDR, CYN & TWD

5

ALS (laboratories) Revenue Growth

• Organic Growth +3.5%

• Acquired Growth +8.8%

• Currency Impact -0.2%

Reported Growth +12.1% 0

200

400

600

800

1000

1200

1400

1600

Reven

ue (A

UD

$m

n)

-5.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0%

Minerals

Life Sciences

Energy

Industrial

Revenue Growth FY2013 Vs FY2012

Organic Acquired FX Movement

Revenue Growth - laboratories

6

Dividend

19 20 20

28

45

48

0

10

20

30

40

50

60


AUD

cents

Full Year Dividend per Share

20% CAGR

• Payout ratio 69%

• Franked to 50%

• Dividend Reinvestment Plan

retained at 5% discount

7

8

-

5

10

15

20

25

30

35

40

45

50

AU

D$

m

illio

n

Capex (excl properties) Depreciation

CAPEX increased to accelerate expansion of

non-geochemistry businesses and upgrade

more recent acquisitions to improve margins

CAPEX (excluding land & building purchases) and Depreciation

8

0

50

100

150

200

250

300

350

400

450

EBITDA Cash

Flow

EBITDA Cash

Flow

. EBITDA Cash

Flow

AUD$m

Cash Flow

Underlying EBITDA $406 mn +9%

Operating Cash Flow $367 mn +16%

CAPEX (excl. land & buildings) $80 mn +11%

FY11 FY12 FY13

Cash Flow and Funding

Mar-12 Mar-13

Statistics

Gearing Ratio Comfort 45% 28.5% 29.3%

Leverage (net debt / EBITDA) Max 3.00 0.99 1.02

EBITDA interest cover Min 3.75 23.9 20.7

Balance Sheet Measures ($ mn)

Total Equity 930 997

Net debt 370 413

0

50

100

150

200

250

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

AUD$m

Bank Debt -Drawn Bank Debt - Undrawn USPP Notes

Debt Maturity

34%

8%

5%

14%

18%

21%

9

-100% -50% 0% 50% 100% 150% 200% 250% 300% 350% 400%

Coffey

Macmahon

Boart Longyear

Transfield Services

Sedgman

Ausenco

Worley Parsons

Orica

Servcorp

Ausdrill

Clough

SGS

Monadelphous

ALS

Cardno

Core Laboratories

Intertek

Bureau Veritas

Eurofins

Total Shareholder Return (1st April 2010 to 31st March 2013)

Total Shareholder Return – last three year period

Source- Ernst & Young

10

6%

30%

13%

5%

4%

42%

Revenue

$1.34

billion

(AUD)

ALS - laboratory revenue & staff distribution

Staff (full time equivalents)

10,900

32%

9%

10%

11%

15%

23%

11

Revenue Growth + Margin Strength

10%

15%

20%

25%

30%

35%

0

300

600

900

1,200

1,500

2007 2008 2009 2010 2011 2012 2013

EBIT

DA

M

arg

in

ALS Lab

orato

ry Services R

even

ue

AU

D$

m

illio

n

ALS Financial Year Ending March

ALS Revenue

SGS

Intertek

Bureau Veritas

Eurofins

Core Labs

EBITDA Margin for Core Labs, SGS, Intertek, Bureau Veritas & Eurofins is for Calendar Year 2012 actual.

EBITDA Margin & Revenue for ALS excludes non-laboratory businesses but does include all ALS Limited corporate

expenses.

ALS

12

0

200

400

600

800

1000

1200

1400

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

AUD$m

Financial Year – ending March

Revenue

44%

4%

32%

5%

6%

9%

42%

4%

30%

6%

5%

13%

Revenue by Geography

FY12 Vs FY13

Australia

Asia

Nth America

Sth America

Africa

Europe

Diversification & Consistent Growth - laboratories

49%

31%

7%

13%

45%

34%

8%

13%

Revenue by Division

FY12 Vs FY13

Minerals

Life Sciences

Energy

Industrial

13

-

200

400

600

800

1,000

1,200

1,400

FY07 FY08 FY09 FY10 FY11 FY12 FY13

AU

D$

m

illio

ns

-

50

100

150

200

250

300

350

400

450

FY07 FY08 FY09 FY10 FY11 FY12 FY13

AU

D$

m

illio

ns

Growth of non-Minerals Divisions

Life Sciences Energy Industrial Minerals

Lab Services Revenue Lab Services EBITDA

The non-Minerals revenue of ALS lab services is now more than ALS’ entire lab services revenue prior to the

Global Financial Crisis

Non-Mineral EBITDA margin

21% 24% 20% 24% 23% 25% 25%

14

Operating EBITDA Margin by Division

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

FY2009 FY2010 FY2011 FY2012 FY2013

EBIT

DA

M

arg

in

Minerals Life Sciences Energy Industrial

EBITDA margins exclude ALS Limited Corporate Costs

15

Overview

• Reverted from “expansion” to “control” as a result of

slowdown in the later part of the first half FY13

• Operating profit growth of geochemical businesses in

Europe and South America very strong

• Canadian metallurgy business revenue growth of 32%

pcp

• Inspection business restructured in Europe

• Mine Site Group established to focus on on-site

opportunities

• Completed the Iron Ore Technical Centre in Perth

• CoreviewerTM

web based imaging and mapping

capabilities integrated with third party mine planning

service providers

Outlook

• Hub & Spoke model to provide margin protection in

current downturn

• Focus on cost control and delivering client savings

• Santiago (Chile) metallurgy and hub lab operational

• Upgrade of West African facilities

• New “spoke” opportunities to feed hub laboratories

• Improved margins in Australian metallurgy business

• Geochemistry sample flow to remain under pressure

• Improved performance of Inspection business

2013 2012 Change

Revenue $608mn $591mn +3%

EBITDA $233mn $234mn -

EBIT $211mn $215mn -2%

EBIT Margin 34.7% 36.3% -16bps

Minerals Division

0

100

200

300

400

500

600

FY09 FY10 FY11 FY12 FY13

Revenue (A

UD

$m

n)

Geochemistry Metallurgy Inspection Other

CAGR 24.6%

16

Full Time Equivalents

17

0

1,000

2,000

3,000

4,000

5,000

6,000

Fu

ll T

im

e E

qu

ivalen

ts

Geochemistry Metallurgy

19% reduction 29% reduction

Overview

• Northern Hemisphere now 65% of divisional revenue

compared to 60% in FY12 – lower overall margin

• Food/Pharma revenue increased from $25mn to $60mn

• Successful acquisitions in Denmark, Turkey, United

Kingdom, South America

• USA underperformed compared to budget and FY12 but

improved in final quarter – strong focus on cost base

• Rationalised four Food/Pharma laboratories in Australia

to two

Outlook

• Acquisition of Reliance Group (Hong Kong and China) in

May 2013 provides small exposure to Consumer Product

testing market

• Slow market growth in more mature markets but

significant opportunity in South America

• New chemistry hub being built in United Kingdom

• Food sector remains very attractive

• USA market expected to recover slightly in CY13

• New laboratory in Beijing opened in May 2013

2013 2012 Change


EBITDA $113mn $96mn +18%

EBIT $89mn $78mn +14%

EBIT Margin 19.7% 21.7% -200bps

Life Sciences Division

0

100

200

300

400

500


Revenue (A

UD

$m

n)

Australia South America Asia North America Europe

CAGR 17.3%

18

Overview

• Another record year for the global coal business

• Very strong performance in Australia in Bore Core, Mine

Site & Superintending

• Focus on innovation and lower cost services

• New coal laboratory built in Mongolia

• Mobile coal laboratory established in Indonesia

• Operating margin in Canada increased by 610bps

• New LIMS (Coal8) rolled out to all Australian operations

Outlook

• Challenging year ahead

• Traditional client base focused on cost cutting and

reducing exploration spend

• Exports and production services remain strong

although under increasing price pressure

• Focus on productivity and cost management to continue

• ALS oil & gas services to gain traction

• Good scope/environment for acquisitive growth

2013 2012 Change


EBITDA $36.1mn $26.6mn +36%

EBIT $32.6mn $23.7mn +38%

EBIT Margin 31.1% 26.9% +420bps

Energy Division

0

20

40

60

80

100


Revenue (A

UD

$m

n)

Australia Asia South Africa North America

CAGR 14.3%

19

Overview

• Power Services (acquired October 2011) contributed

strongly to FY13 growth

• 10% organic growth in Tribology across all regions

• Escalating labour costs in Asset Care business in

Australia

• Client cost cutting led to flat year in Asset Care in

Australia

• Demand for advanced inspection services and in-service

plant inspection continued to grow

Outlook

• Retendering of several significant long term contracts is

a focus

• Continued ramp up of non-destructive testing services to

LNG projects in Queensland

• Osprey (Asset Care management system) to be rolled out

to all locations

• New generation Tribology LIMS to commence

development and be rolled out by 4th

quarter

• Continued focus on expansion outside of Australia

2013 2012 Change


EBITDA $35.3mn $28.8mn +23%

EBIT $30.6mn $24.5mn +25%

EBIT Margin 18.1% 16.0% +210bps

Industrial Division

0

40

80

120

160


Revenue (A

UD

$m

n)

Australia South America North America

20

Documents

2012-13 Full Year Result - ALS Global › - › media › files › asx... · 2012-13 Full Year Result ... opinions or conclusions as to future matters may prove to be incorrect,