Transcript Slide 1

REVIEWED INTERIM RESULTS
FOR THE SIX MONTHS
ENDED 31ST AUGUST 2011
2012 – UP UP AND AWAY!
COMPARATIVE INTERIM REVIEW
H1 FY 2011
R’000
H2 FY 2011
R’000
H1 FY 2012
R’000
Revenue
750 798
615 635
857 524
Gross margin
147 504
13 941
79 895
38 013
(54 436)
(14 415)
37,3m
13,1m
152,3m
5,1%
(8.8%)
(1.7%)
(10,6%)
(18%)
39.3%
19,6%
2.3%
9.3%
Profit/(loss) before interest and
tax
Capex
Ratios
Operating margins
Turnover increase/ (decrease)
on previous interim period
Gross margin
CONTENTS
• Salient features
• Financial review
• Strategy
• Operational review
• Capex
• Group geographical segments
• General
• Conclusion
• Contacts
SALIENT FEATURES – 31 August 2011
Order book up to R1,5 billion
Revenue up 14,2% (Aug 2010 comparative)
EBITDA down 2,9%
HEPS down 195%
SALIENT FEATURES – 31 August 2011
R 2,3 billion short-term prospects pipeline
HEPS down from 4,1 to (3,9) cents
Group operating loss (1,7)% (2011H 2:(9%))
• Geotechnical 5% (2011H2: (2%))
• Civil
(6)% (2011H2:(9%))
• Pipelines
0.3% (2011H2:(6%))
FINANCIAL REVIEW
Statement of Financial Position
Salient Features:
At
Aug 2010
R’ 000
At
Feb 2011
R’ 000
At
Aug 2011
R’ 000
Assets
Non-current assets
986 302
966 187
1 085 923
Current assets
622 468
498 164
626 951
1 608 770
1 464 351
1 712 874
Share capital and reserves
758 829
703 156
893 375
Non-current liabilities
376 813
195 562
298 564
Current liabilities
473 128
565 633
520 935
Total equity and liabilities
1 608 770
1 464 351
1 712 874
Net asset value per share
(cents)
258,4
238,9
230,1
Total assets
Equities and liabilities
Statement of Financial Position
Salient Features - Feb11 to Aug 11
•
Total assets
• Cash
•
•
•
•
•
Trade & other receivables
PPE
Cash reserves
• Operational cash-flow consumed
• Acquisition PPE
• Proceeds rights issue
• Decrease in secured borrowings
Secured borrowings
• Debt/debt + equity ratio
Equity
• Loss after tax
• FCTR
↑ R 248,5m
↓ R 62m
↑ R 137,0m
R 152,3m Capex
(R 55.7m)
(R 152,3m)
R 200m
(R 53m)
26,4 % (Aug 2010 : 34,1%)
(R 18,7m)
R 6,3m
Debt:Equity Ratio
DEBT: EQUITY PLUS DEBT
1 000 000
90%
900 000
80%
800 000
70%
700 000
60%
600 000
50%
500 000
40%
400 000
30%
300 000
20%
200 000
10%
100 000
0%
0
2006
2007
2008
2009
Financial years
2010
2011
2012
Equity
Interest bearing
debt
Debt:equity ratio
R'000
100%
Statement of Income Salient Features
Aug 2010
R’000
Revenue
%
Aug 2011
R’000
750 798
14,2%
857 524
EBITDA
75 171
(66,2%)
25 405
Profit /(loss) after tax
12 311
(251,7%)
(18 677)
Headline earnings/(loss)
12 006
(225,3%)
(15 047)
4,1
(195%)
(3,9)
Headline earnings /(loss)
per share
Esorfranki (Mnth)
Revenue data (R'000)
250000
R’000
225000
200000
175000
150000
125000
100000
75000
50000
25000
0
Geotechnical Civils Pipelines
Mar-10 Apr-10 May-10 Jun-10
Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11
Jul-11 Aug-11
1
Pipelines
18,844 24,036 18,641 19,800
Civils
38,333 42,591 38,843 47,833 37,632 20,089 57,174 64,881 62,853 31,427 25,717 51,434 43,690 69,625 50,001 84,063 49,876 57,111
Geotechnical
59,279 59,844 51,411 79,452 82,183 91,011 40,643 60,969 56,761 28,380 32,246 64,493 45,870 62,478 61,543 81,914 78,993 74,813
6,583
14,393
7,301
15,457 12,641
6,321
8,329
16,659 15,580 16,598
2,403
18,527 29,103 31,109
Geotechnical
150000
125000
R’000
100000
75000
50000
25000
0
Mar-10
Apr-10
May-10
Jun-10
Jul-10
Aug-10
Sep-10
Oct-10
Nov-10
Dec-10
Jan-11
Feb-11
Mar-11
Apr-11
May-11
Jun-11
Jul-11
Aug-11
Geotechnical 59,279
59,844
51,411
79,452
82,183
91,011
40,643
60,969
56,761
28,380
32,246
64,493
45,870
62,478
61,543
81,914
78,993
74,813
Civils
150000
125000
R’000
100000
75000
50000
25000
0
Civils
Feb-09 Mar-10 Apr-10 May-10 Jun-10
Jul-10
Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11
Jul-11
Aug-11
38,333 42,591 38,843 47,833 37,632 20,089 57,174 64,881 62,853 31,427 25,717 51,434 43,690 69,625 50,001 84,063 49,876 57,111
Pipelines
STRATEGY
Group Strategy
Short term
•
•
•
•
•
•
•
Competition Authority - current and ongoing
Rights offer - completed
BEE scorecard improvement to Level 4 - completed
Consolidate and integrate operating divisions into one single entity completed
Expand market share into SSA growth countries - ongoing
 Civils - Mozambique
 Geotechnical – Ghana, Kenya
Restore profitability with existing contract portfolio and divisions
Working capital management
Medium to long term
•
•
•
Further geographical expansion
Expanding the product range organically and acquisitively to focus
specifically on growth sectors
BEE scorecard improvement
New Group Structure as of 1 March 2011
Divisionalisation
Esorfranki Limited
• Holding company
Esorfranki Construction (Pty) Ltd
• Operations company
• Civils
• Geotechnical
• Pipelines
• Shared Services
• All off-shore companies
and divisions
Esorfranki Properties
Geotechnical Merge
• Durban
•
The former Esor Africa and Franki Africa will operate as Esorfranki
Geotechnical Division from single premises situated in Phoenix
Industrial Park from 1st September 2011.
• Johannesburg
•
The former Esor Africa’s operations excluding pipejacking have
moved to the Wynberg facilities and together with the former
Franki Africa operate as Esorfranki Geotechnical
•
Esorfranki Pipejacking is operating under Esorfranki Civils from
our Activia Park facilities
The Esorfranki Network
Currently working in
Ghana for an Australian
mining group
OPERATIONAL REVIEW
Outstanding Order Book and
Secured Revenue
Business Unit
Order Book
As at 31 Aug
2011
(R millions)
Secured
Revenue FY
2012
(R millions)
Secured
Revenue
FY 2013
(R millions)
Secured
Revenue
FY 2014
(R millions)
Geotechnical
244
603
15
-
Civils
984
781
382
205
Pipelines
568
277
134
270
1 796
1 661
531
475
Total
Outstanding Order Book & Secured
Revenue excluding Western Aqueduct
Business Unit
Order Book
As at 31 Aug
2011
(R millions)
Secured
Revenue FY
2012
(R millions)
Secured
Revenue
FY 2013
(R millions)
Secured
Revenue
FY 2014
(R millions)
Geotechnical
244
603
15
-
Civils
984
781
382
205
Pipelines
137
227
33
-
1 365
1 611
430
205
Total
Esorfranki Civils
Civils products and services
• Road building
• Bridge construction
• Township infrastructure
• Mining infrastructure
• Water reticulation
• Water towers & reservoirs
• Sewer reticulation
• Bulk earthworks
• Building
Geographical
footprint &
some key
contracts
Civils Segment Revenue
Aug 2010
R’ 000
Aug 2011
R’ 000
225 321
354 366
24 097
(22 096)
459 909
718 654
No of employees
1 176
1 544
Revenue growth
(34%)
57%
Operating margins
10,6%
(6,2)%
Order book
501 801
983 954
Pending awards
515 000
2 200 000
2 600 000
3 000 000
Non-government
36%
34%
Government
64%
66%
Segment revenue
Profit/(loss) before interest and tax
Segment assets
Prospects
* As at 28/02/2011
Civils outlook 2012 and beyond
•
K71/R55 current road contract R213m
•
RAL current road contract R80m
• Budget of R500m for new road contracts
•
Kusile current civils and earthworks contract R326m
• Potential add-ons to current contract R300m
• Admin block R200m
• Commercial fill R150m
• Crushing contract R400m
•
Lawley current infrastructure contract to existing low-cost housing R30m
• Potential for adjacent developments
•
Bakwena N4 Mooinooi current road contract R330m
•
Mine work Atcom (Xstrata) and Anglo R200m
• Big dig cannels R120m targeted for next year
•
N1/N2 Winelands PPP we should get some geotechnical work from the contract
Civils outlook 2012 and beyond (cont.)
•
•
•
Housing
•
Mozambique middle class housing and infrastructure 1st phase R700m 1-2 year
•
Johannesburg low-cost housing R1,5bn 3-4 years
•
Eastern Cape low-cost housing R550m 1-2 years
Building
•
The Rose in Rosebank current R30m
•
Roedean Hostel current R17m
•
Munitoria pending R100m
Pipejacking
•
Current contracts this year R100m (short term contracts)
Esorfranki Pipelines
Add a picture here
Pipelines products and services
• Gas & Petrochemical steel pipelines
• Water & Wastewater pipelines & pump stations
• Sewer pipelines & pump stations
• Pipeline refurbishments
• Cement mortar lining
• Valve chambers
• Associated concrete structures
• Associated infrastructure
Pipelines Segment Revenue
Aug 2010
R’ 000
Aug 2011
R’ 000
102 297
113 320
423
313
103 546
115 445
467
475
(21,6%)
10,7
0,41%
0,27%
Order book
240 488
567 618
Pending award
425 000
170 000
5 900 000
500 000
0%
0%
100%
100%
Segment revenue
PBIT
Segment assets
No of employees
Revenue growth
Operating margins
Prospect
Non-government
Government
* As at 28/02/2011
Geographical
footprint &
some key
contracts
BG3 Pipeline contract
Pipelines outlook 2012 and beyond
•
Current contracts
•
•
•
•
BG3 contract near Vaal Dam R160m still to do.
Miscellaneous contracts R35m still to do
Western Aqueduct R420m awaiting review application on 16th September
2011 but currently working on site
Mooihoek 3 contract R60m
• Potential awards
•
•
•
•
•
Giyani R200m (under appeal by Esorfranki) approximately R120m still to do.
Metalong Lesotho
• Phase 1 placed 3rd R375m
• Phase 2 placed 3rd R291m
• Phase 3 placed 3rd R130m
Piet se Kop R24m
Bluff Military Base R23m
Thulele/Woodmead R25m
Pipelines outlook 2012 and beyond (cont.)
• Prequalifications
TCTA
• Olifants River prequalification JV with Civcon pending R2bn
• Gweru and Kadoma Zimbabwe
• Other prospects
•
•
•
• Rand Water Augmentation Budget R4bn
• TCTA Mooi Umgeni water transfer scheme R800m
• Sasol SNI 26” from Sasolburg to Secunda R400m
Sasol 12” Secunda R40m
Zimplats pipeline R60m
N10 pipeline Bloemendal R70m
Esorfranki Geotechnical
Geotechnical products and services
• Piling
• Lateral Support
• Marine Structures
•
Diaphragm Walls
• Ground Improvement
• Dynamic Compaction
• Ground Remediation
• Soils Investigation
• Geotechnical Design
Geotechnical Segment Revenue
Aug 2010
R’000
Aug 2011
R’000
423 180
405 611
24 820
18 591
713 901
674 136
No of employees
1 408
1 095
Revenue growth
(19,8%)
(4,1%)
5,9%
4,5%
Order book
254 089
244 017
Pending awards
190 252
94 775
1 480 843
1 246 870
Non-government
56%
58%
Government
44%
42%
Segment revenue
PBIT
Segment assets
Operating margins
Prospects
* As at 28/02/2010
Geographical
footprint &
some key
contracts
Geotechnical outlook 2012 and beyond
•
Johannesburg current awarded R186m
• Kusile current piling work R20m
• Kusile ancillary piling work R140m
• Village Walk, Sandton R40m
• 114 West Street, Sandton R15m
• Stella Rise, Old Mutual, Sandton R30m
• Rosebank Growthpoint R25m
• Other pending R94m
• Other key R147m
•
Cape Town current awarded R128m
• Portside R10m
• V & A Clocktower R15m
• Other pending R13m
• Other key R166m
•
Angola current award R38m
• Other pending R92m
• Other key R253m
Geotechnical outlook 2012 and beyond (cont.)
• Durban current awarded R104m
• Other pending R16m
• Other key R283m
• Mozambique current awarded R73m
• Other pending R15m
• Other key R180m
• Tanzania current award R37m
• Other pending R25m
• Other key R105m
• Mauritius current award R50m
• Other pending R5m
• Other key R212m
General 2012 and beyond
•
Eskom
• Medupi Power Station still some housing likely to happen
• Kusile Power Station housing and civil works
• Nuclear Power Station (announced in the media)
• 3rd Coal Fired Station (mooted)
• Transmission lines
•
Sanral and other roads (15 000km non-toll)
• Coal haul-roads upgrades R20bn
• Nelspruit Bypass
• Non-toll roads budget of R8,6bn in 2011 expected R9,5bn for 2012 from
National Treasury
•
GFIP Phase 2 (Sanral)
• PWV 9 JHB-Pta link west of Ben Schoeman
• PWV 5 connects R21 at Olifantsfontein to N1 and on to Soweto
• PWV 14 connects R21 from Easr Rand Mall to M2
• K54 is the Pta eastern ring road from Rietvlei to Donkerhoek on N4
General 2012 forecast and beyond (cont.)
•
•
•
•
•
•
•
•
•
Transnet (PRASA)
Portnet (Dry docks and general harbour upgrades)
Petronet (Refined product line from Maputo)
Coega
• Refinery
• Smelter
Expansion in resource arena
• Iron ore and manganese
• Coal
• Platinum
Mozambique Gasline (Temani Gas Fields)
African new markets
• Ghana
• Mozambique
• Kenya
Gautrain private development spinoff
Private & commercial developments
CAPEX
Segments
Financial years
2012 H2
R’000
(Forecast)
2012 H1
R’000
(Actual)
2011
R’000
2010
R’000
Geotechnical
15 289
14 086
11 793
42 727
Civils
44 759
137 933
17 964
49 711
Pipelines
20 000
-
6 104
3 096
Corporate
2 000
323
14 512
500
Total
82 048
152 342
50 373
96 034
South Africa
82 048
142 565
47 509
58 097
Sub-Sahara
-
9 777
2 863
37 937
CAPEX requirements for 2012
• Geotechnical – nothing specific
• Civils – site specific (hire where possible)
K71/R55 (24 months)
N4 (30 months)
Kusile Civil works (30 months)
Kusile crushing and fill (15 months)
Mocambique (5 years)
Maintenance capex
• Pipelines
Western Aqueduct (48 months)
Maintenance capex
New 65-tonne excavator
Tippers for the N4
Crushers on the N4
GROUP GEOGRAPHICAL SEGMENTS
South Africa
(R’000)
Africa
(R’000)
Total
(R’000)
Segment revenue
714 633
142 891
857 524
Profit/(loss) before interest
and tax
(33 219)
18 804
(14 415)
(Loss)/profit after Tax
(33 096)
14 419
(18 677)
Segment assets
1 300 919
411 955
1 712 874
Order book
1 732 010
63 579
1 795 589
2 928
196
3 124
(4,6%)
13,1%
(1,68%)
No of employees
Operating margins
Non-government
39% (42% FY 2011)
Government
61% (58% FY 2011)
GENERAL
• Mega projects
• Africa
• Succession planning
• Challenges
• Protracted awards/funding
• Competition and margin squeeze
• Angolan liquidity
• Working capital pressure
• Lack of private investment spend
CONCLUSION
•The Esorfranki group is aware that trading conditions will continue to be
tight going forward
•We will continue to experience margin squeeze
•We are aware that Government’s planned spending is under pressure
through decreased revenue streams and funding constraints
•Africa remains a difficult but opportunistic market for the group
•Notwithstanding these conditions and restraints our management team
believes we have the acumen and the wherewithal to steer the group
successfully through these troubled times.
CONTACT DETAILS
Esorfranki Limited | 30 Activia Road Activia Park Germiston 1401
PO Box 6478 Dunswart 1508 South Africa
Bernie Krone| CEO
Wayne van Houten| CFO
+ 27 83 259 2584
+ 27 84 556 2486
+27 11 776 8700
+27 11 776 8700
+27 11 822 1158
+27 11 822 1158
[email protected]
[email protected]