Business SummaryWorleyParsons Limited (WOR) delivers projects, provides expertise inengineering, procurement and construction and offers a range of consultingand advisory services to the hydrocarbons, mineral, metals, chemicals andinfrastructure sectors.

Hydrocarbons: WOR provides engineering and project managementservices to hydrocarbons customers for upstream, midstream anddownstream facilities located onshore, offshore and in deep-water worldwide.

Minerals, Metals & Chemicals: The division provides engineering andproject services to the minerals, metals and chemicals industries. WOR hascapabilities in base metals, coal, chemicals, ferrous metals, alumina,aluminium and iron ore. Services include Conceptual and feasibility studies,Front End Engineering Design, Project optimization and value engineering,Due diligence services, Environmental assessment and solutions, Tailingsengineering, and Pit to port.

Infrastructure: The Infrastructure business supports the Company'sresource and energy sector projects and offers infrastructure solutions forurban markets. Its service offering covers environmental and restorationservices, development of water gathering and processing facilities, rail andport assets, power generation and transmission. It supports the customersacross the asset life-cycle, from pre-feasibility, delivery, through to assetmanagement, operation and maintenance. Its primary delivery markets are:Resource Infrastructure and Urban Infrastructure.

Latest ResearchSwings back to growth with positive signs on outlook

Slight NPAT beat but was lower quality — 1H18 NPAT of $78.2m (+37YoY) was above Citi of $72.9m; however, EBIT was slightly below ourexpectations

($132.9m or +12.7% YoY vs Citi $141.6m) due to lower than expected

Hydrocarbons margins (9.2% vs. 10.3% Citi) which offset margin beatsfrom

Minerals and Metals (7.6% vs. Citi 6.2%) and Infrastructure (7.2% vs. Citi4.0%) and inline revenue performance (with the AFW UK acquisitionintegration progressing

ahead of mgmt expectations).

For more information see research 22 Feb 2018.

GICS - Energy

WorleyParsons Limited

ASX Code: WOR Price: $16.35 12 Mth Target Price: $17.50 Rating: Buy

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Snapshot

DateMarket Cap.Shares on issue12 Month High12 Month Low

6 May 2018$4,462m272.9m$16.67$10.45

RatingRating12 Mth Target Price

Capital GainGross Yield

Implied Total Return

Buy$17.507.2%2.5%9.6%

Investment FundamentalsFYE 30 Jun 2017A 2018F 2019F 2020F

Profit $m 123.0 183.0 240.0 280.0Profit (norm)* $m 123.0 183.0 240.0 280.0

EPS* ¢ 49.0 66.0 87.0 102.0EPS Growth % -19.7 34.7 31.8 17.2P/E* x 33.3 24.7 18.8 16.0P/E Relative % 0.0 0.0 0.0 0.0

DPS ¢ 0.0 30.0 40.0 56.0Yield % 0.0 1.8 2.4 3.4Franking % 0.0 0.0 0.0 0.0* Adjusted for goodwill and unusual itemsSource: Based on Citi estimates

Share Price Chart

Total Return on $10,000 Investment

Profit & Loss ($M)2013A 2014A 2015A 2016A 2017A

Sales Revenue 8,826 9,560 8,747 7,775 5,204Total Revenue ex. Int. 8,826 9,577 8,751 7,781 5,214EBITDA 629 562 466 409 392Depreciation & Amort. -102 -110 -110 -90 -81Goodwill Amortisation -- -- -- -- --EBIT 527 452 356 319 311Net Interest -53 -60 -55 -60 -69Profit Before Tax 474 393 300 259 242Income Tax -129 -110 -86 -20 -5Outside Equity Int. -22 -20 -16 -25 -23Profit after Tax 322 263 199 213 215Significant Items after Tax -- -14 -254 -190 -182Reported Profit after Tax 322 249 -55 24 34Preferred Dividends -- -- -- -- --

Cash Flow ($M)2013A 2014A 2015A 2016A 2017A

Receipts from Customers 8,467 9,633 9,010 8,113 5,802Funds from Operations 621 667 444 304 122Net Operating Cashflow 444 550 251 192 79Capex -78 -54 -89 -70 -45Acquisitions & Investments -269 -51 -102 -25 -19Sale of Invest. & Subsid. -- -- -- 14 1Net Investing Cashflow -347 -104 -189 -80 -62Proceeds from Issues -- -- -- -- --Dividends Paid -245 -226 -237 -78 -22Net Financing Cashflow -39 -392 -88 -105 -134Net Increase Cash 57 54 -25 7 -117Cash at Beginning 247 320 368 381 373Exchange Rate Adjust. 15 -6 38 -15 -11Cash at End 320 368 381 373 244

Ratios and Substantial Shareholders2013A 2014A 2015A 2016A 2017A

Profitability RatiosEBITDA Margin % 7.13 5.88 5.32 5.26 7.53EBIT Margin % 5.97 4.73 4.07 4.10 5.98Net Profit Margin % 3.65 2.76 2.27 2.74 4.14Return on Equity % 14.92 12.07 9.85 11.32 11.49Return on Assets % 7.20 6.12 4.57 5.20 6.29

Debt/Safety RatiosNet Debt/Equity % 33.69 23.35 42.33 46.08 46.91Interest Cover x 9.87 7.59 6.42 5.31 4.52

Top 5 Substantial ShareholdersDar AI-Handasah Consultants Shair and Partners Holdings Ltd 19.9%John Grill and associated companies 10.2%T. Rowe Price Associates, Inc. 6.3%

Balance Sheet ($M)2013A 2014A 2015A 2016A 2017A

Cash & Equivalent 320 366 382 373 226Receivables 2,093 2,077 2,143 1,879 1,294Inventories -- -- -- -- --Other Current Assets 109 89 175 133 220Current Assets 2,522 2,563 2,700 2,385 1,739Prop. Plant & Equipment 140 116 107 73 52Intangibles 2,050 2,029 2,090 2,077 2,003Other Non-Current Assets 136 89 175 133 248Non-Current Assets 2,562 2,487 2,601 2,636 2,520Total Assets 5,084 5,050 5,301 5,021 4,259Interest Bearing Debt 1,059 876 1,236 1,239 1,103Other Liabilities 1,833 1,989 2,048 1,902 1,288Total Liabilities 2,892 2,865 3,284 3,141 2,391Net Assets 2,193 2,185 2,018 1,880 1,868Share Capital 1,238 1,240 1,255 1,265 1,268Reserves -178 -196 -111 -223 -270Retained Earnings 1,098 1,138 873 842 876Outside Equity Int. 34 3 1 -4 -5Total Shareholders Equity 2,193 2,185 2,018 1,880 1,868

Current Analyst Recommendations *

* Source: Morningstar. This chart shows the spread of recommendations from thosebroker analyst's in Australia with research coverage of this stock.

Principals & DirectorsPrincipals

Company Secretary Nuala O'Leary

Directors

Mr Christopher (Chris) Michael Haynes(Non-Executive Director)Mr Erich Fraunschiel(Non-Executive Director)Ms Catherine Brighid Livingstone(Non-Executive Director)Mr Andrew Wood(Chief Executive Officer,Executive Director)Mr John Micheal Grill(Non-Executive Chairman,Non-ExecutiveDirector)Mr Thomas Joseph Gorman(Non-Executive Director)Ms Wang Xiao Bin(Non-Executive Director)Ms Anne Louise Templeman-Jones(Non-Executive Director)

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WorleyParsons Limited

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