For personal use only COFFEY INTERNATIONAL LIMITED Lodge Partners - - PowerPoint PPT Presentation

• COFFEY INTERNATIONAL LIMITED

Lodge Partners Mid Cap Confab Presentation Debbie Goodin, Director of Operations 31 March 2009

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Agenda

• Organisation
• verview
• Financial performance overview
• Operations overview
• Strategy and outlook
• Questions

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Organisation overview

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Company snapshot

• Multi-specialist model –

market leading, global

• ~4000 employees globally
• Diversification by service, sector and geography

– Offices in more than 10 countries and projects in more than 80 countries – 54% of revenue from outside Australia – Consulting

• Geotechnics; Environments; Natural Systems; Mining; Rail; Peron;

Information – International Development – Project Management

• Diversification strategy has Coffey well-positioned in challenging economy
• New leadership team launched in 2008/09
• ~30 acquisitions in the past 3 years
• $80m rights issue in 2007 oversubscribed
• Strong balance sheet with conservative gearing
• $200m debt facility secured in 2008 which matures in 2012

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Financial performance overview

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Strong growth in revenues and operating profits

Total Revenue

558.6 362 251.9 170 417.9 100 200 300 400 500 600 FY05 FY06 FY07 FY08 1H FY09 $m 3 Year CAGR 48.7%

Pre vendor earn-out & share-based payment expense (“pre VEO & SBP”)

Operating EBITDA*

36.3 17.5 24.2 29.1 49.8 10 20 30 40 50 60 FY05 FY06 FY07 FY08 1H FY09 $m 3 Year CAGR 41.7%

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Half year revenues & operating profits

Total Revenue

237.6 159.5 110.8 80.1 417.9 50 100 150 200 250 300 350 400 450 H1 FY05 H1 FY06 H1 FY07 H1 FY08 H1 FY09 $m 3 Year CAGR 55.7%

Pre vendor earn-out & share-based payment expense (“pre VEO & SBP”)

Operating EBITDA*

36.3 7.7 9.9 15.5 19.8 5 10 15 20 25 30 35 40 H1 FY05 H1 FY06 H1 FY07 H1 FY08 H1 FY09 $m 3 Year CAGR 54.0%

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Increasing dividends and earnings per share

Dividends Per Share

3.5 5.0 7.0 7.0 8.5 7.0 8.0 8.0 9.0 3 6 9 12 15 18 FY05 FY06 FY07 FY08 1H FY09 Cents Per Share

Earnings Per Share

15.7 20.8 16.0 19.0 17.3 5 10 15 20 25 FY05 FY06 FY07 FY08 1H FY09 Cents Per Share 10.5 13.0 15.0 16.0

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Our diversification strategy has assisted Coffey with increased earnings

* Pre VEO & SBP

8% 18% 74%

81% 14% 5%

60% 15% 25% 1H FY07 EBITDA* 15.5m 1H FY08 EBITDA* 19.8m 1H FY09 EBITDA* 36.3m International Development Consulting Project Management

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Recap – Summary – financial performance (for the 6 months to 31 December 2008)

• Improving working capital management
• Improved fee margins with Operating EBITDA* / fee revenue up from 12.2% to 13.9%
• Substantial growth in Operating EBITDA* up 83.3%
• EPS growth of 69%** on pcp

(3 year CAGR of 28%)

• Solid balance sheet with conservative gearing
• Fully franked interim dividend of 8.5 cps -

increased 21.4% on pcp

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* Pre VEO & SBP ** Pre amortisation, VEO and SBP

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Operations overview

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Global presence

Australia & New Zealand (c. 2,480 FTE)

• Geotechnics
• Environments
• Mining
• Natural Systems
• Peron
• Rail
• Information
• Projects

Canada (c. 160 FTE)

• Geotechnics
• Mining

United Kingdom & Poland (c. 220 FTE)

• Geotechnics
• International Development

Philippines (c. 30 FTE)

• International Development

United States (c. 710 FTE)

• Environments
• International Development

Brazil (c. 250 FTE)

• Mining
• Information

Middle East (c. 50 FTE)

• International Development
• Projects
• Environments
• Mining

Africa (c. 90 FTE)

• Mining
• Projects

FTE = full-time equivalents

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Experienced new executive team

Roger Olds

MD & CEO

Mark Croudace Director of Business Development Bob Simpson Director of Corporate Development Urs Meyerhan Director of Finance & CFO Stephen Dunkerley Director of Systems Debbie Goodin Director of Operations Pamela Young Director of PFG Mark Newton Director People & Culture

• 30 years

leadership experience in international finance

• Previously

Finance Director at Wattyl Limited; CFO of United Group Limited; Group Financial Controller of WMC Resources Limited and CFO

• f Swiss

Aluminium Australia

• Previously

Corporate Development Officer

• Coffey Board

member from 1996 to 2000.

• 10 years

specialising in business development with Ernst & Young

• Previously a

Partner with Ernst & Young NZ

• Previously

Acting CFO of Coffey and ran M&A

• Chartered

Accountant

• Previous

Senior finance roles with State Government

• f Victoria,

City of Melbourne, Ferrier Hodgson and Arthur Andersen

• Previously

Chief Information Officer at Transport Infrastructure Development Corporation and General Manager Technology Services with KBR Asia Pacific

• Previously a

consultant to Coffey regarding Coffey’s transformational growth program, Platform For Growth (PFG)

• Experienced

working with global businesses, and in particular professional services

• 15 years

experience as a senior executive at Microsoft

• Specilaises in

global human resources

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Specialist services across high demand sectors

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Sectors Infrastructure, Oil & Gas, Government, International Development, Mining Property, Sport & Leisure

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Specialist engineering & environmental consulting

• Australia’s leading and first specialist geotechnical consulting firm
• Around 700 staff
• Nearly 50 years’

experience

• Geotechnical engineering -

analysis and design, site investigation, geo-environmental engineering, groundwater, geophysics and laboratory testing

• Offices throughout Australia, New Zealand, Canada and the UK
• Key clients include: Leighton Companies; BHP Billiton; Lihir Gold;

Chevron; Toronto Transit Commission; Inpex Browse Limited; Qld Main Roads; Network Rail UK

• Sustainable engineering, environmental impact and field ecology,

waste management, workplace health and safety

• Around 550 staff
• Australia’s largest enviro, H&S and sustainability consultancy
• Offices in Australia, USA, NZ
• Key clients include: Fortescue Metals Group; Thiess John

Holland; Chevron; Mobil; Rio Tinto; Caltex; Shell; Department of Defence; Telstra; Sydney Airport; Sydney Ports; LA School Board

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Specialist mining & social and environmental impact consulting

• One of Australia’s biggest mining consultancy groups
• Provide ‘turn-key’

consulting and operational support services in over 70 countries on six continents, supported by operational offices located throughout Australasia, Africa, and North and South America

• Around 450 staff
• Services from ‘cradle to the grave’

– exploration, feasibility, funding, development, operations / business improvements and site closure

• Key clients include: BHP Billiton; Rio Tinto; Newcrest; African

Minerals; Xstrata

• Environmental and social impact assessments and environmental

management

• Around 80 staff
• More than 30 years experience from more than 40 countries
• Offices in Adelaide, Brisbane, Darwin, Melbourne, Sydney, Perth

and Papua New Guinea

• Key clients include: Exxon; Oxiana; Shell; Tarong

Energy; Atlas Iron; African Minerals; Morobe Consolidated Goldfields; Iluka Resources; Australian Defence Force; Xstrata

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Specialist international development

• Social infrastructure development –

i.e. helps donor organisations deliver governance systems, public services and business models to developing and emerging markets; emerging market for assisting private sector focus on developing countries

• Around 1,400 staff & contractors
• Operations in more than 60 countries
• Offices in Vietnam, the Philippines, PNG, Indonesia, UAE,

Poland, UK, USA and Australia

• Key clients include: world’s major donor organisations including

the UN, the World Bank, the EU, the Asian Development Bank, USAID, the United Kingdom Department for International Development and AusAID

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Specialist project management

• Project management, strategic development advice, feasibility

advice, procurement, tender & post-construction processes management and transportation project management

• Around 400 staff
• Operations throughout Australia, New Zealand, South Africa,

Middle East and South East Asia

• Diversifying into resources and infrastructure
• Acquired Bovell

Freeman & Holley in South Africa, September 08

• Key clients include: Chevron; ING Real Estate; Standard Bank,

Nedbank, Cairns Airport Authority Transpower (NZ); Department

• f Defence; Ministry of Transport; SEQld

Water; NSW Health Infrastructure, Sydney University, Vodacom

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Strategic infrastructure advice

• Front-end strategy, transaction advice –

major infrastructure

• Experience in multilateral agency projects in Africa, Indonesia and

Papua New Guinea

• Around 30 staff
• Key infrastructure clients including Victorian and Queensland

Governments

• One of Australia's leading leisure and sports consultancy firms
• High-level strategic advice –

large sporting and leisure infrastructure – Master planning, businesses cases, community consulting, market research, funding proposals and project delivery

• Around 10 staff
• Key clients include AFL, NRL, FFA and several clubs; horse

racing clubs (e.g. AJC, Racing Victoria); government and local councils

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Rail engineering & consultancy

• Leading specialist rail engineering consultancy
• Delivers quality strategic, modelling, design, management and

implementation services to the rail industry

• Specialises in track, signalling and infrastructure projects
• Offices in around Australia and New Zealand
• Around 70 staff
• Key clients include: Victrack;

Department of Transport (Victoria); MainCo;

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Coffey Information

• Launched Coffey Information (out of Coffey Geotechnics & Coffey

Environments) July 2008

• Industry-leading specialist in scientific testing solutions around the

globe

• Works on projects across a large number of sectors and

industries including government, commercial and residential building and construction, property, civil infrastructure, defence, marine, heavy industry and resources

• Around 350 staff
• Acquired Civil Lab in New Zealand (December 2008) and Testrite

in Sydney (February 2009)

• Clients include: Chevron; Thiess John Holland; Roads and Traffic

Authority (NSW), Inpex, Airport Link

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Strategy and outlook

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We are developing a new 3 year strategy

• Developing a 3 year strategy to 2012
• Synergies starting to be realised –

more room for improvement

• Business development effort needs upgrading
• Corporate functions to be refined to match recent growth
• Global presence to be leveraged to provide growth
• PFG –

transformational strategy –

• ne year on

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We have excellent growth prospects

• Organic

– Continued investment in staff – Expanding services into newly acquired geographies – Increased business development focused on cross-selling – Strong diversified business across sectors and geographies

• Acquisition

– Funding available to support opportunities – Bolt-on opportunities will continue – But reduced focus over next few years

• Transformational – One Coffey: aligning our global culture & capabilities

– Platform For Growth (PFG) programme - a global organisation transformation programme to:

• Create one global Coffey culture
• Globalise Coffey operations & service delivery processes
• Mobilise Coffey people to work across businesses
• Streamline systems & structures for greater efficiency
• Increase value to clients

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Key project wins – Last 3 months

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Business Country Project Cross-sell businesses Value to Coffey Geotechnics Australia Wheatstone project Environments, Natural Systems, Information, Projects $20.0m Gorgon project Environments, Information, Projects $6.0m Inpex Browse Ichthys LNG project Environments, Information, Projects $4.5m Tarcutta Bypass Alliance N/a $3.0m Canada Toronto-York Spadina Subway extension N/a C$3.5m Mining Australia Wadi Yiba Feldspar Project N/a $350k Brazil Nova Aurora Iron Ore Prospect N/a Withheld Environments Australia Major Intermodal Logistics Centre (Sydney) N/a $500k Colonial First State property management N/a $500k Woolworths asbestos risk management N/a $1.4m Information Australia Centenary Highway Transport Corridor N/a $2.0m Tarcutta Bypass Alliance N/a $4.0m International Development Indonesia AusAID Nusa Tenggara Timur assistance N/a $40m project value Projects Australia Department of Defence N/a $5.5m Western Australia Department of Education N/a $1.9m

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Summary

• Revenues and operating profits have grown strongly over the past

4 years

• Increasing dividends and earnings per share over the past 4 years
• Strong balance sheet and conservative gearing
• Diversification strategy has Coffey well-positioned in challenging economy
• Transformation delivering cross-selling and one global Coffey culture
• Governments have committed to spending in infrastructure and international

development programmes

• Developing strategy for next 3 years

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Questions

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Appendix

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A snapshot of Coffey over the past 5½ years

Metrics ($m) unless otherwise stated FY04 FY05 FY06 FY07 FY08 H1 FY09 Revenue 131.3 170.0 251.9 362.7 558.6 417.9 Fee Revenue 115.1 141.0 210.9 281.9 376.6 249.9 Operating EBITDA (pre VEO & SBP) 12.3 17.5 24.2 29.1 49.8 36.3 Operating EBITA (pre VEO & SBP) 11.5 16.3 22.4 25.4 43.2 32.6 EBIT 10.8 15.4 20.6 18.4 35.0 28.5 NPAT (pre VEO & SBP) 7.7 11.2 13.4 14.4 22.9 17.6 NPAT (reported) 7.0 10.2 11.6 8.4 15.3 13.5 Operating EBITDA (pre VEO & SBP) (revenue) Margin 9.4% 10.3% 9.6% 8.0% 8.9% 8.7% EPS (basic) (NPAT pre VEO & SBP) 13.1cps 17.3cps 19.0cps 16.0cps 20.8cps 15.7cps Net Debt 4.7 3.1 54.8 46.1 91.9 93.6 Equity 25.3 34.2 67.0 177.6 196.1 194.1 Net debt/equity 18.7% 9.2% 81.8% 26.0% 47.9% 48.3% Net debt/capital 15.7% 8.4% 45.0% 20.6% 31.9% 32.6% Interest cover (Operating EBITDA pre VEO & SBP) 31.8x 19.4x 7.6x 6.0x 6.3x 6.5x Operating EBITDA (pre VEO & SBP) / Capital (equity + net debt) 40.7% 46.8% 19.9% 13.0% 17.3% 12.6%

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Disclaimer

The material in this presentation is a summary of the results of Coffey International Limited (Coffey) for the 12 months ended 30 June 2004, 2005, 2006, 2007, 2008, the 6 months ending 31 December 2008 and an update on Coffey’s activities and is current at the date of preparation, 31 March 2009. Further details are provided in the Company’s full year and half year accounts. No representation, express or implied, is made as to the fairness, accuracy, completeness or correctness of information contained in this presentation, including the accuracy, likelihood of achievement or reasonableness of any forecasts, prospects, returns or statements in relation to future matters contained in the presentation (“forward-looking statements”). Such forward-looking statements are by their nature subject to significant uncertainties and contingencies and are based on a number of estimates and assumptions that are subject to change (and in many cases are outside the control of Coffey and its Directors) which may cause the actual results or performance of Coffey to be materially different from any future results or performance expressed or implied by such forward-looking statements. This presentation provides information in summary form only and is not intended to be complete. It 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 particular investor. Due care and consideration should be undertaken when considering and analysing Coffey’s financial performance. All references to dollars are to Australian Dollars unless otherwise stated. To the maximum extent permitted by law, neither Coffey nor its related corporations, Directors, employees or agents, nor any other person, accepts any liability, including, without limitation, any liability arising from fault or negligence, for any loss arising from the use of this presentation or its contents or otherwise arising in connection with it. This presentation should be read in conjunction with other publicly available material. Further information including historical results and a description of the activities of Coffey is available on our website, coffey.com

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