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H1 2014 RESULTS – WorleyParsons Limited

WorleyParsons Limited · Feb 26, 2014 · 38 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. H1 2014 RESULTS – WorleyParsons Limited – slide 1
    Half year results 2014 Andrew Wood
  2. H1 2014 RESULTS – WorleyParsons Limited – slide 2
    Overview Earnings in line with guidance, strong cash flow Decline in earnings due to Australian market and WorleyParsonsCord Hydrocarbons revenue flat, EBIT down Growth in chemicals partially offset minerals and metals weakness…
  3. H1 2014 RESULTS – WorleyParsons Limited – slide 3
    Financial snapshot Underlying NPAT 1 of 100.7m, down 35%2 Aggregated revenue3 of 3,793m, down 2%2, down 10%2 on constant currency basis Operating cash flow up 84% to 230m Gearing ratio remains strong at 25%, lower end of target…
  4. H1 2014 RESULTS – WorleyParsons Limited – slide 4
    Performance remains good Total Recordable Case Frequency Rate (TRCFR) for HY14 was 0.12 (FY13: 0.13) We continue a number of programs across the Group including: Board and Executive Committee structured HSE site visit program…
  5. H1 2014 RESULTS – WorleyParsons Limited – slide 5
    Significant awards Hydrocarbons awards Minerals, Metals & Chemicals Shell Unconventional Oil awards and Gas Global Enterprise 10 13 Invista EPCM services for 40 Framework Agreement, global hexamethylene diamine Kuwait Oil…
  6. H1 2014 RESULTS – WorleyParsons Limited – slide 6
    Improve contracts WorleyParsons performance continues to be underpinned by our growing long term contract base 19 New Improve contracts awarded More than 290 Improve contracts globally 16 global/multi-region contracts 6
  7. H1 2014 RESULTS – WorleyParsons Limited – slide 7
    Strength in diversification 37,500 166 43 people offices countries 2.9m workshare hours 7
  8. H1 2014 RESULTS – WorleyParsons Limited – slide 8
    Half year results 2014 Simon Holt
  9. H1 2014 RESULTS – WorleyParsons Limited – slide 9
    Financial Profile Strong operating cash flow HY14 HY13 vs. HY13 Aggregated revenue1 (m) 3,793 3,879 (2)% Underlying EBIT (m) 178 252 (29)% Underlying EBIT margin 4.7% 6.5% (1.8)% Underlying Net Profit After Tax (m) 101 155…
  10. H1 2014 RESULTS – WorleyParsons Limited – slide 10
    Aggregated revenue by type Professional services down, construction revenue grows m HY14 HY13 vs. HY13 Aggregated revenue 3,793 3,879 (2)% Professional services 3,167 3,267 (3)% Construction and fabrication 482 444 9%…
  11. H1 2014 RESULTS – WorleyParsons Limited – slide 11
    Aggregated revenue by region HY2013 (m) HY2014 (m) 25% % of total aggregated revenue 20% 18% 17% 16% 15% 14% 962 11% 8% 8% 9% 688 7% 8% 7% 613 644 513 5% 5% 557 444 4% 767 3% 322 257 317 290 297 329 206 163 204…
  12. H1 2014 RESULTS – WorleyParsons Limited – slide 12
    Diversification in earnings Top 10 customers deliver 34% of the gross margin Top 10 projects deliver 15% of the gross margin Top 10 locations deliver 65% of the operating EBIT 12
  13. H1 2014 RESULTS – WorleyParsons Limited – slide 13
    Underlying Operating EBIT 15.7% HY2013 (m) HY2014 (m) % EBIT margin 12.7% 151 8.9% 11.9% 9.7% 11.9% 9.0% 15.8% 18.4% 11.5% 87 14.2% 68 10.6% 59 61 7.7% 66 51 58 51 47 4.3% 1.7% 41 5.7% 0.6% 31 5 9 25 (3.3)% 12 1…
  14. H1 2014 RESULTS – WorleyParsons Limited – slide 14
    CSG segment EBIT HY2013 (m) HY2014 (m) 448 373 258 251 77 37 16 69 62 51 Hydrocarbons Construction & Minerals, Metals & Infrastructure Total (ex construction & fabrication Chemicals fabrication) 14
  15. H1 2014 RESULTS – WorleyParsons Limited – slide 15
    Underlying NPAT (m) (48.5) (46.2) 12.8 28.4 4.1 12.4 (13.6) 155.1 2.4 (6.2) 100.7 15
  16. H1 2014 RESULTS – WorleyParsons Limited – slide 16
    EBIT result by segment (m) (29.3) (35.2) (11.2) (27.7) 28.3 448.1 373.0 HY13 Hydrocarbons Construction & Minerals, Infrastructure FX impact HY14 (excl. fabrication Metals & construction & Chemicals fabrication) 16
  17. H1 2014 RESULTS – WorleyParsons Limited – slide 17
    Margin profile EBIT % 8.6% 8.0% EBIT margin drop of 1.8% 7.2% 6.9% 9.0% 9.4% 7.1% 7.3% Primarily due to Australia, Cord, restructuring costs and one off 8.2% 7.3% TWPS benefit from prior year 6.6% 6.5% 4.7% FY10 FY11 FY12…
  18. H1 2014 RESULTS – WorleyParsons Limited – slide 18
    Hydrocarbons HY14 HY13 Revenue flat Aggregated revenue m 2,731.1 2,750.0 Segment margin down 1.4 % Professional services m 2,151.0 2,181.3 overall Construction and fabrication m 482.3 444.4 Procurement revenue with margin m 96.8…
  19. H1 2014 RESULTS – WorleyParsons Limited – slide 19
    Minerals, Metals & Chemicals HY14 HY13 Downturn in ANZ due to project Aggregated revenue m 571.1 583.2 cancellations and completions Professional services m 556.4 580.4 SSA EBIT growth driven by Procurement revenue with margin m 14.6…
  20. H1 2014 RESULTS – WorleyParsons Limited – slide 20
    Infrastructure HY14 HY13 General decline in ANZ Aggregated revenue m 490.4 545.5 10.7M TWPS one off in HY13 Professional services m 459.6 505.3 Procurement revenue with margin m 27.5 27.7 Downturn in Bulgaria Nuclear Other income m…
  21. H1 2014 RESULTS – WorleyParsons Limited – slide 21
    Cash flow Strong cash flow generation m HY14 HY13 vs. HY13 EBIT 178 252 (74) Depreciation and amortization 54 51 3 Interest and tax paid (54) (89) 35 Working capital/other 52 (89) 141 Net cash inflow from operating activities…
  22. H1 2014 RESULTS – WorleyParsons Limited – slide 22
    Gearing metrics Gearing at lower end of target range HY14 FY13 Gearing ratio % 25% 25% Facility utilisation % 54% 55% Average cost of debt % 5.5% 5.5% Average maturity (years) 4.2 3.8 Interest cover1 (times) 8.6x 10.6x Net…
  23. H1 2014 RESULTS – WorleyParsons Limited – slide 23
    Liquidity Financial capacity to support growth Liquidity summary m HY14 FY13 vs. FY13 US520m US Bank Loan & OD facilities 2,069 1,912 8% Syndication refinance Less: facilities utilized (1,116) (1,062) 5% completed during the period…
  24. H1 2014 RESULTS – WorleyParsons Limited – slide 24
    Segment performance Andrew Wood
  25. H1 2014 RESULTS – WorleyParsons Limited – slide 25
    Hydrocarbons Australian market continued to contract Canada impacted by Cord and softening activity in oil sands Improved EBIT for US business Timing of major project starts is difficult to predict Opportunities in offshore -…
  26. H1 2014 RESULTS – WorleyParsons Limited – slide 26
    Minerals, Metals & Chemicals Increased geographic diversification Minerals and metals short term market remains flat Growth in Canada and the US largely through chemicals Strengthened position in Africa LAM impacted by…
  27. H1 2014 RESULTS – WorleyParsons Limited – slide 27
    Infrastructure Merged Infrastructure & Environment and Power sectors Cancellation of a nuclear project in Bulgaria Positive outlook in North America for Unconventional Oil & Gas related infrastructure Resource related…
  28. H1 2014 RESULTS – WorleyParsons Limited – slide 28
    Summary First half earnings in line with guidance Improved earnings anticipated in second half to deliver full year Overhead reduction program implemented Business performance solid in most regions Balance sheet fundamentals…
  29. H1 2014 RESULTS – WorleyParsons Limited – slide 29
    Group outlook Confirming guidance for FY14 Commenting on the outlook for the WorleyParsons Group, Mr Andrew Wood said: On current indications the Company expects to report underlying NPAT for FY2014 in line with guidance given in…
  30. H1 2014 RESULTS – WorleyParsons Limited – slide 30
    Supplementary information Half year results 2014
  31. H1 2014 RESULTS – WorleyParsons Limited – slide 31
    Reconciliation Aggregated revenue* m HY14 HY13 Revenue and other income 4,822.9 4,413.4 Procurement services at nil margin (1,306.4) (814.4) Share of revenue from associates 289.5 283.9 Net gain on revaluation of investments…
  32. H1 2014 RESULTS – WorleyParsons Limited – slide 32
    Reconciliation Underlying* EBIT and NPAT m HY14 HY13 EBIT 189.6 251.9 Net gain on revaluation of investments previously accounted for as equity accounted (11.4) - associates Underlying EBIT 178.2 251.9 NPAT 119.8 165.9…
  33. H1 2014 RESULTS – WorleyParsons Limited – slide 33
    Dividend history Interim dividend of 34.0 cents per share (HY13: 41.5 cps) FY10 FY11 FY12 FY13 HY14 Interim dividend (cps) 35.5 36.0 40.0 41.5 34.0 Franked % 100% 100% 79% 100% 25% m total 87.0 88.6 98.3 102.4 83.8 Final dividend…
  34. H1 2014 RESULTS – WorleyParsons Limited – slide 34
    FX translation impact Movement in major currencies Group EBIT FX impact since FY10 FY10 FY11 FY12 FY13 HY14 110.0 30 20 105.0 10 4 20 100.0 0 -18 Am 95.0 -10 -32 -20 -41 90.0 -30 85.0 -40 80.0 -50 Jul-13…
  35. H1 2014 RESULTS – WorleyParsons Limited – slide 35
    Hydrocarbons Hydrocarbons Key project awards Improve Awards VNIPIgazdobycha - engineering Kuwait Oil Company - program contractor for Vladivostok LNG, management contract, Kuwait Russia EP PetroEcuador - inspection and MacKay…
  36. H1 2014 RESULTS – WorleyParsons Limited – slide 36
    Minerals, Metals & Chemicals Key project awards Improve Awards Andes Iron SpA - feasibility Codelco - asset management study for Dominga project, services, Chile Chile Invista - EPCM services for hexamethylene diamine (HMD) project…
  37. H1 2014 RESULTS – WorleyParsons Limited – slide 37
    Infrastructure Key project awards Improve Awards Corredor Do Desenvolvimento Consumers Energy - Karn units Do Norte S.A. - project 1 and 2 O&M services, US management and engineering Tennessee Valley Authority - services for Nacala…
  38. H1 2014 RESULTS – WorleyParsons Limited – slide 38
    Contractual acronyms CY Calendar year EDS Engineering and Design Services E&P Engineering and Procurement EPC Engineering, Procurement and Construction EPCM Engineering, Procurement and Construction Management ESA Engineering Services…

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