annual general meeting 28 october 2011 · annual general meeting 28 october 2011 . page 1...
TRANSCRIPT
![Page 1: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/1.jpg)
Annual General Meeting 28 October 2011
![Page 2: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/2.jpg)
Page 1
Chairman’s Address
Mr John Robinson
![Page 3: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/3.jpg)
Page 2
FY11 Overview
� Reshaping of the business, with a clear focus on the core mobile crane and travel tower activities
� Severe and protracted weather events, particularly impacted the Bowen Basin in the second half
� Mitigating impacts through broadening of the business in terms of operating activity, customer profile and location
![Page 4: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/4.jpg)
Page 3
FY11 Trading Results
Year on year improvement in all trading metrics
$m FY10 1H11 2H11 FY11FY11
pcp
Total Revenue 328.4 171.0 169.4 340.4 4%
Trading EBITDA 49.8 31.2 24.3 55.5 11%
Trading EBITDA Margin 15% 18% 14% 16%
Trading EBIT 19.0 14.9 8.3 23.2 22%
Trading EBIT Margin 6% 9% 5% 7%
Trading Net Profit after Tax 4.1 5.1 0.3 5.4 31%
1. The FY11 trading result excludes $5.6m one-off restructure costs relating to the exit James Equipment
and GM Baden and other depot restructuring. Impairments of $47.6m relating to goodwill ($19.6m) and
assets ($28.0m) were also recognised in FY11.
![Page 5: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/5.jpg)
Page 4
Trading Result Reconciliation
$m EBIT NPAT
Trading Result 23.2 5.4
Interest income (0.5) -
1H11 restructure costs (3.3) (2.4)
2H11 restructure costs (1.5) (1.0)
GM Baden restructure costs (inventory impairment) (0.8) (0.6)
Boom Sherrin adjustments
Access related goodwill write off (18.3) (18.3)
Access related asset write off (19.1) (13.4)
Glove & Barrier write down (3.7) (2.6)
Assets scheduled for sale write down (1.7) (1.2)
GM Baden goodwill write off (1.4) (1.3)
Assets scheduled for sale write down (3.3) (2.3)
Statutory Result (30.4) (37.7)
![Page 6: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/6.jpg)
Page 5
Business Restructure – Boom Sherrin
� Low end access equipment
� Increased competition
� Low barriers to entry
� Highly competitive metropolitan markets
� No future investment by Boom
� Travel Towers
� Strong market presence
� Alignment with core strategy
� Continued future investment
![Page 7: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/7.jpg)
Page 6
Business Exits
� James Equipment
� Crane sales business exited
� Tadano sales agreement concluded June 2009
� Challenging trading conditions under a stronger $AUD
� Aitkin Dry Hire business acquired with James Equipment continues to deliver strong margins within the Crane Logistics business
� GM Baden (Crane Maintenance and Repair)
� Maintenance systems and processes integrated into core business
� Melbourne Tower Cranes
� Sold in October for $7.5 million
� c. $3 million profit on sale
� Allows future investment focussed on core mobile cranes and travel tower assets
![Page 8: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/8.jpg)
Page 7
Business Restructure Impacts
� Lower fixed cost base through business exits and restructure
� Flatter management structure
� Improved systems
� Re-financed debt, with a lower cost of funds
� Improved first quarter result in FY12
![Page 9: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/9.jpg)
Page 8
![Page 10: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/10.jpg)
Page 9
Managing Director’s Address
Mr Brenden Mitchell
![Page 11: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/11.jpg)
Page 10
Safety Journey
� 25% reduction in Total Recordable Injury Frequency Rate
� No injuries and no significant equipment damage due to FY11’s extreme weather events
Total Recordable Injury Frequency Rate (TRIFR)
20.0
21.0
22.0
23.0
24.0
25.0
26.0
27.0
28.0
29.0
30.0
Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11
TR
I's
pe
r M
illio
n H
ou
rs W
ork
ed
![Page 12: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/12.jpg)
Page 11
FY11 Results
� Crane Logistics experienced strong growth in resources and energy sectors
� Weather events and soft metropolitan markets particularly impacted the second half
� Significant disruptions to customers operations
� Trading NPAT of $5.4 million
![Page 13: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/13.jpg)
Page 12
FY11 Divisional Results
Revenue
Crane Logistics 106.9 117.5 224.5 130.9 132.7 263.6 17%
Boom Sherrin 38.2 40.1 78.3 36.9 35.6 72.5 (7%)
James Group - Discontinued 17.3 5.6 22.9 2.6 0.8 3.4 (85%)
Operating Revenue 162.4 163.1 325.6 170.4 169.1 339.6 4%
National Office1 0.5 2.3 2.8 0.6 0.3 0.9 (69%)
Total Revenue 162.9 165.4 328.4 171.0 169.4 340.4 4%
Trading EBIT2
Crane Logistics 9.4 11.7 21.1 19.9 12.2 32.0 52%
Boom Sherrin 5.1 5.5 10.6 3.5 3.7 7.2 (32%)
James Group - Discontinued (0.6) (1.4) (2.0) (1.0) (0.7) (1.7) 13%
National Office3 (6.6) (4.1) (10.7) (7.4) (6.8) (14.3) (34%)
Total Trading EBIT 7.3 11.7 19.0 14.9 8.3 23.2 22%
1. National Office includes foreign exchange gains / losses, profit / loss on sale of fixed assets and interest income. The 2H10 result included $1.0m of interest income from the ATO
associated with tax refunds and $0.9m of foreign exchange gains.
2. FY11 EBIT excludes $5.6m one-off restructure costs and $47.6m one-off goodwill and asset impairments.
3. National office EBIT includes the impacts of foreign exchange gains / losses and interest income.
1H11 2H11$m 1H10 2H10 FY10 FY11FY11
pcp
![Page 14: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/14.jpg)
Page 13
Impacts of Strategic Focus
� Exit of the non-core James Equipment and GM Baden businesses
� No future investment in access and general hire equipment, requiring goodwill and asset impairments
� Streamlining of National Office
� Sale of the Melbourne tower crane assets in October 2011
A focussed crane logistics and travel tower business, concentrating on the resources, energy,
utilities and infrastructure sectors
![Page 15: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/15.jpg)
Page 14
Core Business
Crane Logistics
• Supply of cranes on a wet or dry (manned or unmanned) basis.
• Market focus on resources, energy, infrastructure and utilities.
• Value proposition aligned with major blue chips.
• Specialised transport equipment.
CRANE LOGISTICS
Aitkin Cranes
• Supply of dry hire cranes.
• National network of cranes.
TRAVEL TOWERS Boom Sherrin
• Supply of high end travel towers, with or without an operator.
• Market focus on utilities, industrial services and resources.
![Page 16: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/16.jpg)
Page 15
Crane Logistics – Strong Growth in Core Markets
� Continued focus on the resources, energy, utilities and infrastructure sectors
� Combined FY11 revenue growth of 30% in the mining & resources (27%) and energy sectors (47%)
REVENUE CONTRIBUTION BY MARKET SECTOR REVENUE GROWTH BY MARKET SECTOR
53%
10%
11%
26%
0% 10% 20% 30% 40% 50% 60%
Mining and Resources
Energy and Utilities
Manufacturing and other
maintenance
Infrastructure projects
FY10
47%
FY10
8%
FY10
12%
FY10
32%
$200
$210
$220
$230
$240
$250
$260
$270
$280
$290
$300
FY10 Mining and
Resources
Energy and
Utilities
Manufacturing
and other
maintenance
Infrastructure
projects
FY11
($m)
![Page 17: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/17.jpg)
Page 22
FY12 Priorities
� Continued implementation of the Health, Safety, Environment and Quality plan
� Meeting the significant growth expectations of Boom’s blue chip customers in the resources, energy, utilities and infrastructure sectors, with targeted capital investment
� Reshaping Boom Sherrin operations
� Improved capability in the fast growing markets of the Bowen Basin, the Hunter Valley and North West WA
� Maintaining focus on the cost base, particularly with the challenges in operating in fast growing, remote locations
![Page 18: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/18.jpg)
Page 18
Strong Growth Projected in Boom’s Customer’s Markets
Australian Iron Ore Production (Mt)
0
100
200
300
400
500
600
700
2009 2010 2011 (f) 2012 (f) 2013 (f) 2014 (f) 2015 (f) 2016 (f)
Source: ABARES, Australian Commodit ies Report , M arch 2011
Australian Thermal Coal Production (Mt)
0
50
100
150
200
250
300
350
2009 2010 2011 (f) 2012 (f) 2013 (f) 2014 (f) 2015 (f) 2016 (f)
Source: ABARES, Australian Commodit ies Report , M arch 2011 Australian LNG Production (Gm
3)
0
20
40
60
80
100
120
140
FY09 FY10 FY11 (f) FY12 (f) FY13 (f) FY14 (f) FY15 (f) FY16 (f)
Source: ABARES, Australian Commodit ies Report , M arch 2011
Australian Metallurgical Coal Production (Mt)
0
50
100
150
200
250
2009 2010 2011 (f) 2012 (f) 2013 (f) 2014 (f) 2015 (f) 2016 (f)
Source: ABARES, Australian Commodit ies Report , M arch 2011
Iron Ore Coal
Coal LNG
![Page 19: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/19.jpg)
Page 20
Boom Sherrin Strategy
� Market focus on utilities (power and telecommunications), industrial services and resources
� Competitive national presence in these markets
� Targeted future capital investment in travel towers
� Restructure to align infrastructure with core markets – to be effective by 30 November 2011:
� Closure of six branches
� Redeployment of over 400 assets
� Reduction of 54 permanent roles
� FY12 restructuring expense of $2.5 million
� Ongoing annualised benefit expected to be c. $6 million p.a.
![Page 20: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/20.jpg)
Page 23
FY12 - Strong First Quarter Result
� Strategy and restructure impacts have resulted in a strong first quarter
EBIT ($m)
$15.9m
$8.9m $9.0m
$0.0m
$2.0m
$4.0m
$6.0m
$8.0m
$10.0m
$12.0m
$14.0m
$16.0m
$18.0m
H1 FY2011 H2 FY2011 Q1 FY2012
![Page 21: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/21.jpg)
Page 24
Outlook
� Strong first quarter reflects impacts of strategic focus and provides a solid base for FY12
� Significant growth expectations from Boom’s blue chip customer base
� Focus on cost management and development of capability in high growth, remote regions
� EBIT guidance of $35 - $40 million maintained
![Page 22: Annual General Meeting 28 October 2011 · Annual General Meeting 28 October 2011 . Page 1 Chairman’s Address Mr John Robinson. Page 2 FY11 Overview Reshaping of the business, with](https://reader034.vdocuments.site/reader034/viewer/2022050219/5f6515d1f88e2766d14d6bb9/html5/thumbnails/22.jpg)
Page 25
Annual General Meeting 28 October 2011