Drake & Scull International (p J S C) · DFM:DSI
Drake & Scull International (p J S C) — Drake & Scull International — FY2014 Earnings Presentation
56 slides from Drake & Scull International (p J S C)'s earnings presentation, March 2015
Slide 1: FY 2015 Investor Relations Presentation
FY 2015 INVESTOR RELATIONS PRESENTATION
Slide 2: People. Innovation. Passion
People. Innovation. Passion 2
Slide 3: Table of Contents
Table of Contents • Company Introduction 05 • Financial Highlights 25 Trend Analysis ( FY 2009 , FY 2013) YoY Comparison Q4 2014 (Revenues, EBITDA, Net Profit) YoY Comparison Jan - Dec 2014 (Revenues, EBITDA, Net Profit) Revenues Distribution by Geography Q4 2014 Revenues Distribution by Geography J
Slide 4: People. Innovation. Passion
People. Innovation. Passion 4
Slide 5: People. Innovation. Passion
People. Innovation. Passion 5
Slide 6: People. Innovation. Passion
People. Innovation. Passion 6
Slide 7: People. Innovation. Passion
People. Innovation. Passion 7
Slide 8: Overview of DSI
Overview of DSI Business divisions Shareholding • Drake & Scull International (“DSI”) is a regional 1. Engineering: (est. 1967/2012) MEP, Water, Power market leader delivering integrated end to end and associated works UAE Investors (51.14%) solutions in the Engineering (MEP & WP), 2. Construction a
Slide 9: DSI Management
DSI Management DSI benefits from a highly Key management qualified management with extensive industry experience Khaldoun Rashid Tabari, Vice Chairman and CEO and a proven track record of • Has over 30 years of industry experience and acquired majority stake in DSI in 1998 identifying opportunities
Slide 10: DSI Employee base
DSI Employee base DSI’s management is Total employees Employees by business supported by a growing number of qualified employees which the 28,000 Company has retained 25,018 despite difficult market conditions in the past 15,548 13,915 10,300 Engineering (62%) Construction (32%) Oil & Gas (5%) 2010
Slide 11: DSI Competitive Advantage
DSI Competitive Advantage Strong brand name and track record Vertical integration of businesses Geographical expansion • From its origins in the 19th century in the UK, the Group General • Over the course of the last few years, the Company has has grown significantly and now employs over 28,000 Cont
Slide 12: People. Innovation. Passion
People. Innovation. Passion 12
Slide 13: People. Innovation. Passion
People. Innovation. Passion 13
Slide 14: People. Innovation. Passion
People. Innovation. Passion 14
Slide 15: People. Innovation. Passion
People. Innovation. Passion 15
Slide 16: People. Innovation. Passion
People. Innovation. Passion 16
Slide 17: People. Innovation. Passion
People. Innovation. Passion 17
Slide 18: People. Innovation. Passion
People. Innovation. Passion 18
Slide 19: Drake & Scull IPO Journey
Drake & Scull IPO Journey People. Innovation. Passion 19
Slide 20: Drake & Scull IPO Journey
Drake & Scull IPO Journey People. Innovation. Passion 20
Slide 21: Drake & Scull IPO Journey
Drake & Scull IPO Journey People. Innovation. Passion 21
Slide 22: Drake & Scull IPO Journey
Drake & Scull IPO Journey People. Innovation. Passion 22
Slide 23: Drake & Scull IPO Journey
Drake & Scull IPO Journey People. Innovation. Passion 23
Slide 24: Investment Proposition
Investment Proposition Attractive macro-economic and industry fundamentals Strong brand name and execution track record • GCC & MENA projects expected to stabilise around the AED477bn and AED3,011bn, respectively • Long standing presence in the region since 1966, evolving from a regional into an int
Slide 25: People. Innovation. Passion
People. Innovation. Passion 25
Slide 26: Trend Analysis FY 2009 – FY 2013
Trend Analysis FY 2009 – FY 2013 People. Innovation. Passion 26
Slide 27: Revenues CAGR (FY 2009 - FY 2013)
Revenues CAGR (FY 2009 - FY 2013) 7000 6000 CAGR:20.49% 4,867 5000 4000 3,321 Revenue 3,110 CAGR 3000 1,917 1,855 2000 1000 0 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 • All figures in AED Million People. Innovation. Passion 27
Slide 28: EBITDA CAGR (FY 2009 - FY 2013)
EBITDA CAGR (FY 2009 - FY 2013) 300 CAGR: -0.25% 250 243 227 224 200 176 150 150 EBITDA CAGR 100 50 0 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 • All figures in AED Million People. Innovation. Passion 28
Slide 29: Net Profit CAGR (FY 2009 - FY 2013)
Net Profit CAGR (FY 2009 - FY 2013) 300 283 250 CAGR:-8.46% 208 200 182 162 150 Net Profit CAGR 115 100 50 0 2009 2010 2011 2012 2013 • All figures in AED Million • Net Income in 2009 excludes income from IPO ( AED 93 Million) People. Innovation. Passion 29
Slide 30: Project Awards (FY 2009 - FY 2013)
Project Awards ( FY 2009 - FY 2013) 7,5 FY 2013 5,4 FY 2012 FY 2011 4,4 FY 2010 3,0 FY 2009 2,0 0 1 2 3 4 5 6 7 8 9 10 • All Figures in AED Billion People. Innovation. Passion 30
Slide 31: Backlog CAGR (FY 2009 - FY 2013)
Backlog CAGR (FY 2009 - FY 2013) 16,000 CAGR: 28.81% 14,000 12,000 12,000 10,000 9,100 8,000 Backlog 7,062 CAGR 6,285 6,000 4,000 3,300 2,000 0 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 • All Figures in AED Billion People. Innovation. Passion 31
Slide 32: Receivables & Retention (FY 2010 - FY 2013)
Receivables & Retention (FY 2010 - FY 2013) 2,000 30.0% 1,779 1,647 1,800 25.0% 1,533 1,600 20.0% 1,400 1,307 15.0% 1,200 Trade receivables & 1,000 10.0% retention 800 5.0% % Change 600 0.0% 400 -5.0% 200 - -10.0% FY 2010 FY 2011 FY 2012 FY 2013 • All Figures in AED Billion People. Innovation. Passi
Slide 33: Operating Cash flow (FY 2009 - FY 2013)
Operating Cash flow ( FY 2009 - FY 2013) 200 200% 165 150% 100 100% - 50% FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 0% (100) (121) -50% Operating Cash flow (132) % Change (200) (198) -100% (300) -150% -200% (400) -250% (448) (500) -300% • All figures in AED Million People. Innovation. Passion 33
Slide 34: Q4 2014 – Jan / Dec' 2014 Overview
Q4 2014 – Jan / Dec’ 2014 Overview People. Innovation. Passion 34
Slide 35: Year-on-Year Comparison (Q4 2013 Vs Q4 2014)
Year-on-Year Comparison (Q4 2013 Vs Q4 2014) Q4 2014 Q4 2013 Revenues 91.5 1,317 60.0 36.7 1,237 13.0 Q4 2014 Q4 2013 EBITDA Net Profit Q4 2014 Q4 2013 % Change Revenues 1,237 1,317 -6% EBITDA 60 91.5 -34% Net Profit 13 36.7 -65% • All values in AED Million • Net Profit Q4 ‘2014 affected by delays i
Slide 36: Year-on-Year Comparison (Jan-Dec 2013 Vs 2014)
Year-on-Year Comparison ( Jan - Dec’ 2013 Vs Jan - Dec’ 2014) (Jan - Dec'14) ( Jan- Dec'13) Revenues 386 4,879 304 182 110 4,831 ( Jan- Dec'14) ( Jan-Dec'13) EBITDA Net Profit Jan- Dec' 14 Jan- Dec' 13 % Change Revenues 4,831 4,879 -1% EBITDA 304 386 -21% Net Profit 110 182 -40% • All values in AED
Slide 37: Q4 2014 Revenues Distribution by Geography
Q4 2014 – Revenues Distribution by Geography 700 50% Q4 2014 Revenues by Geography 46% 600 567 40% 500 30% 392 32% 400 300 20% 200 11% 10% 141 100 4% 3% 3% 3% 3% 3% 45 41 2% 1% 33 31 31 31 24 0% 15 - -9% -10% (100) (114) (200) -20% Q4 2014 Revenues % of the Total Revenue • All values in AED Million
Slide 38: Jan-Dec 2014 Revenues Distribution by Geography
Jan-Dec’ 2014 Revenues Distribution by Geography 3000 60% Jan - Dec' 2014 Revenues by Geography 2468 51% 2500 50% 2000 40% 28% 1500 1340 30% 1000 20% 9% 5% 500 429 3% 10% 255 3% 3% 3% 2% 2% 2% 141 134 133 122 109 98 83 0 0% KSA UAE Qatar Iraq Algeria Kuwait Egypt Oman India Jordan Others Elimination
Slide 39: Project Awards Q4 2014
Project Awards Q4 2014 Awards Breakdown by Country/ AED Million Awards Breakdown by Business Stream 300 255 250 200 Engineering 150 Engineering, 100 100% 50 0 UAE Q4 2014 Project Awards Business Stream Project Name (AED Mn) DSE Al Ruwais District Cooling Plant 173 DSE Musanada Rehabilitation Center
Slide 40: Project Awards Jan-Dec 2014
Project Awards Jan- Dec’ 2014 2500 Awards Breakdown by Country Awards Breakdown by Business Stream 2200 Rail Waste 2000 0% Water 4% 1437 1500 Engineering 986 General Contracting 1000 Engineering Oil &Gas 39% Oil &Gas 37% 500 406 Rail 259 132 94 167 129 52 60 33 Waste Water 0 General Contracting 20%
Slide 41: Backlog as of 31st Dec. 2014 AED 14.4 BN
Backlog as of 31st Dec. 2014 AED 14.4 BN Passavant Backlog AED 704 Business Stream Subsidiary (AED 5% Million) Civil AED DSI Abu Dhabi 814 Oil and Gas 5,984 42% DSIC Egypt 218 AED 2,211 15% DSI KSA 1,816 DSI Dubai 900 DSI Kuwait 300 DSI Oman 194 DSI Qatar 744 DSI Thailand 2 DSE Engineering DSI Jorda
Slide 42: Receivables & Retention (Dec 2013 Vs Dec 2014)
Receivables & Retention (Dec’ 2013 Vs Dec’ 2014) Total Trade Receivables & Retention 1900 1881 1880 1860 6% 1840 1820 1800 1779 1780 1760 1740 1720 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 • All values in AED Billion People. Innovation. Passion 42
Slide 43: Balance Sheet Items (Dec 2013 – Dec 2014)
Balance Sheet Items ( Dec 31st 2013 – Dec 31st 2014) Dec-13 Dec-14 Benchmark Liquidity Ratio: Current Ratio 1.3x 1:3x 1.5x Efficiency Ratio: Days Sales Outstanding (DSO) 124 138 120 Days Payable Outstanding (DPO) 214 247 180 Days WIP Outstanding (DWO) 151 213 120 Leverage Ratio: Debt to Tangible Equ
Slide 44: Sukuk Issuance and Utilization
Sukuk Issuance and Utilization Senior Unsecured Islamic Sukuk Amount : USD 120,000,000 Tenor: 5 Years Start: 10th November 2014 Due Date: 10th November 2019 Margin: 4.25% p.a. Repayment: Bullet Proceeds of the Sukuk will be used for 3 transactions : 1. Refinancing short term borrowings on the balanc
Slide 45: People. Innovation. Passion
People. Innovation. Passion 45
Slide 46: GCC – key construction market
GCC – key construction market Total construction CAGR The Middle East and Africa spending infrastructure sector to register a Country Overview (USDbn)1 (%) growth of 4.1% in 2014 • In 2014, construction spending is set to post a gain of 4.4% y-o-y, driven by 74.3 77.4 80.8 84.3 87.0 healthy governme
Slide 47: GCC construction sector spending
GCC construction sector spending UAE construction output Saudi Arabia construction output Despite near-term weakness, construction activity in the 100 94.8 100 90.6 region is expected to remain 85.5 84.3 87.0 81.2 80.8 robust in the long term 77.1 74.3 77.4 75 75 18.8 19.5 51.1 17.4 18.0 Saudi Arabi
Slide 48: GCC Construction sector spending
GCC Construction sector spending The energy segment accounts of majority of planned GCC Infrastructure spend by type GCC structures spend by type infrastructure spending 95.1 100 100 91 Saudi Arabia accounts for 86.3 1.6 81.7 1.4 8 80.1 around 50% of GCC energy 77.4 1.2 1.3 7.2 76.1 6.4 71.8 spendin
Slide 49: MENA – 2018 e Outlook
MENA – 2018 e Outlook* Outlook: Planned project pipeline of $820bn over the next five years. People. Innovation. Passion 49
Slide 50: MENA – 2018 e Outlook
MENA – 2018 e Outlook* Sectors: Construction and infrastructure drive 75% of the planned project pipeline People. Innovation. Passion 50
Slide 51: MENA – 2018 e Outlook
MENA – 2018 e Outlook* People. Innovation. Passion 51
Slide 52: GCC Vs. Mena Project Market 2017 e
GCC Vs. Mena Project Market 2017 e* GCC $1,081bn) Big shift in this picture is due entirely to the inclusion of the Saudi nuclear and renewables program. Iraq has potential to be at least as big as UAE People. Innovation. Passion 52
Slide 53: Key Highlights
Key Highlights Overall, over the next five years, GCC & MENA projects market is Booming expected to stabilize around the $130bn & $ 820 bn range while the greater Middle East market, boosted by Iraq, could hit as much as Industry $100bn Backlog DSI managed to substantially grow its Backlog to reach
Slide 54: Key Highlights
Key Highlights Strong DSI secured AED 5.9 billion worth of new work across MENA ,South Asia & Europe Jan- Dec 2014 Momentum Continued DSI demonstrated resilient growth in the UAE Market and secured AED 1.4 billion worth of new contracts in Fiscal 2014 Growth Business DSI centralizes its global back
Slide 55: Growth Strategy
Growth Strategy • On Track for further expansion in India and Iraq in the Infrastructure and Engineering Businesses • Consolidation of MENA operations with focus on Qatar, Abu Dhabi & KSA Expansion • Selective Tendering Strategy to target projects with healthy margins and lower risks Mode • Investme
Slide 56: People. Innovation. Passion
People. Innovation. Passion
Drake & Scull International — FY2014 Earnings Presentation on 6ix