Orascom Construction Plc · EGX:ORAS
Orascom Construction — Investor Presentation (September 2016)
32 slides from Orascom Construction's investor presentation, September 2016
Slide 1: Orascom Construction Limited September 2016
Orascom Construction Limited September 2016
Slide 2: Highlights
Highlights Global contractor focused on infrastructure, industrial and high-end commercial projects in the MENA and USA Backlog of USD 7.5 billion as of 30 June 2015 and pro forma backlog of USD 9.5 billion including 50% share in BESIX – Ranked #34 on ENR’s Int’l Contractors list and #82 on Global
Slide 3: Strong Track Record of Growth and International Expansion
Strong Track Record of Growth and International Expansion History of Creating Value for Shareholders Growing Family Construction Business Incubating Cement, Port & Fertilizer Lines Building a Concessions Portfolio Roots trace back to 1950s in Egypt where first Created a top 10 global cement prod
Slide 4: A Wide Range of Capabilities Across Various Geographies
A Wide Range of Capabilities Across Various Geographies Orascom Construction Limited operates under three brands and owns 50% of BESIX Group Orascom Weitz Established in 1950 Established in 1855 Leading MENA industrial and infrastructure contractor Backlog: USD 964 million Backlog: USD 6.0
Slide 5: Strategic Geographic and Sector Diversification
Strategic Geographic and Sector Diversification Algeria Rest of World 2.8% of Backlog 3.2% of Backlog United States 26.5% of Backlog Egypt 62.9% of Backlog Saudi Arabia 4.6% of Backlog Large geographic presence – each region with an established customer base Note: Backlog contributions as at 30 June
Slide 6: Select Construction Track Record
Select Construction Track Record Currently constructing over Executed Assiut and West Over 17,000 MW of power Over 40 mtpa of cement 7 petrochemical projects 10,500 MW of power Damietta power plants in generation projects in the production capacity around (ex. fertilizer) in the Middle generation ca
Slide 7: Consolidated Backlog Grew 4.8% to USD 7.5 Billion
Consolidated Backlog Grew 4.8% to USD 7.5 Billion Focus on pursuing quality projects where the Group has a competitive edge and is confident in the source of funding Growing US backlog to complement MENA operations and provide incremental value Backlog Excluding BESIX Increased 4.8% in H1 2016 $7.54
Slide 8: Strategic Backlog Diversification
Strategic Backlog Diversification Backlog by Geography Backlog by Sector Backlog by Client Rest of World 3.2% Commercial OCI N.V. USA (OCI N.V.) 14.2% 9.3% 9.3% Private 17.3% USA Industrial 17.2% 13.6% Algeria Egypt 2.8% 62.9% Saudi Arabia Infrastructure Public 4.6% 72.2% 73.4% Backlog by Brand Back
Slide 9: Backlog Evolution
Backlog Evolution Backlog by Geography Backlog by Sector $3.3bn $4.9bn $3.8bn $5.8bn $6.7bn $7.5bn $3.3bn $4.9bn $3.8bn $5.8bn $6.7bn $7.5bn 0.2 1.1 0.2 2.0 1.1 1.0 0.3 0.2 2.5 0.6 0.3 1.4 0.9 0.7 2.4 0.1 1.9 0.3 0.7 1.4 0.6 0.7 1.7 0.5 1.4 0.2 0.3 1.1 5.4 0.2 4.7 0.6 0.1 0.1 1.2 4.2 0.6 0.8 3.2 2.8
Slide 10: Growing US Business
Growing US Business Established to Pursue US Acquiring Strong Organically Strengthening Implementing MENA Government Work Presence Within the US US Operations Business Model in the US Established in 1985 to work on US Acquired In 2012, allowing the Established in 2013 to develop The Group is
Slide 11: Strategic Investment in BESIX: 60% of Backlog in MENA
Strategic Investment in BESIX: 60% of Backlog in MENA Highlights An international Belgian construction player founded in 1909 OC acquired 50% of BESIX in a joint leverage buyout in partnership with BESIX management in 2004 ‒ Held value as an investment in associates on Orascom Construction’s bal
Slide 12: BESIX: Standalone Backlog Grew 9% to EUR 3.6 Billion
BESIX: Standalone Backlog Grew 9% to EUR 3.6 Billion Increase in BESIX’s standalone backlog to a recent high of EUR 3.6 billion H1 2016 new awards of EUR 1.5 billion in MENA and Europe across several sectors BESIX book value represents 56% of Orascom’s total equity value of USD 539.3 million Standal
Slide 13: Complementary Construction Materials and Property Management Portfolio
Complementary Construction Materials and Property Management Portfolio Subsidiaries currently benefitting from increased construction and industrial activity Operational synergies with Orascom and BESIX Ownership: 100% Ownership: 100% Ownership: 100% Ownership: 60.5% H1 2016 revenue: USD 4
Slide 14: Proven Financing Capabilities
Proven Financing Capabilities Funding requirements are supported by strong relationships with Egyptian, regional and international financial institutions (the group maintains relationship with more than 30 lending institutions) Bilateral Facilities & Bilateral facilities with limits close to USD
Slide 15: Legal Update
Legal Update Golden Pyramids Plaza / City Stars Project Arbitration SIDRA Medical Research Center arbitration The Group and its partner, Consolidated Contractors International Co. The Group is part of an ongoing arbitration case against the Qatar SAL, were awarded a positive outcome against Gold
Slide 16: Financial Section
Financial Section
Slide 17: Summary Financials
Summary Financials Steady progress throughout H1 2016 as the Group reported blended EBITDA margin of 5.0%, EBITDA of USD 99.1 million and net income of USD 49.4 million ‒ EBITDA margin driven primarily by the Group’s performance in the MENA region BESIX reported significant improvement over Q1 2
Slide 18: Summary Income Statement by Geography
Summary Income Statement by Geography MENA accounted for 51% of revenue in H1 2016 led by Egypt, which represented 44% of total ‒ OCI N.V. work comprised 40% of revenue in USA in H1 2016 Blended EBITDA margins led by MENA performance ‒ MENA EBITDA margin of 8.8% in H1 2016 and 9.2% in Q2 2016, m
Slide 19: Net Cash Position as of 30 June 2016
Net Cash Position as of 30 June 2016 Net cash position of USD 299.0 million as of 30 June 2016 Evolution of Net Debt Pre-Demerger Post-Demerger $796 $807 $589 $564 $575 $571 $524 $466 $476 $467 $448 $428 $439 $420 $397$371 $369 $371 $380 $272 31 Dec 11 31 Dec 12 31 Dec 13 1 Jan 15 31 Mar 15 30 June
Slide 20: Income Statement
Income Statement USD million H1 2016 H1 2015 Q2 2016 Q2 2015 Results Commentary Revenue 1,997.0 1,874.4 1,024.1 1,016.6 Revenue: Cost of sales (1,844.5) (1,733.8) (953.0) (932.1) H1 2016 revenue up 7% y-o-y Gross profit 152.5 140.6 71.1 84.5 Margin 7.6% 7.5% 6.9% 8.3% 51% of H1 2016 revenue from
Slide 21: Balance Sheet
Balance Sheet USD million 30 June 2016 31 Dec 2015 Results Commentary ASSETS Non-current assets Non-current assets PPE of USD 279.3 million, including USD 59.4 million in Property, plant and equipment 279.3 280.2 new additions purchased during H1 2016 Goodwill 13.8 13.8 Goodwill relates to the a
Slide 22: Balance Sheet
Balance Sheet USD million 30 June 2016 31 Dec 2015 Results Commentary EQUITY Equity Share capital 117.8 118.0 The decrease in share capital and share premium is due to Share premium 768.7 772.8 the cancellation of 280,113 treasury shares Reserves (128.8) (81.2) Liabilities: Retained earnings (280.
Slide 23: Cash Flow Statement
Cash Flow Statement USD million 30 June 2016 30 June 2015 Results Commentary Net profit 48.5 44.7 Cash flow from operating activities: The Group generated operating cash flow of USD 260.8 Adjustments for: million in H1 2016 compared to USD (97.2) million in H1 Depreciation 27.9 29.2 2015 Interest
Slide 24: Cash Flow Statement
Cash Flow Statement USD million 30 June 2016 30 June 2015 Results Commentary Cash flow used investing activities: Investment in subsidiary, net of cash acquired - (2.7) Cash outflow mainly driven by customary capex Investment in PPE (59.4) (37.0) requirements in the MENA region, in-line with the G
Slide 25: Appendix
Appendix
Slide 26: Board of Directors
Board of Directors Chairman CEO Non-Executive Jérôme Guiraud Osama Bishai Salman Butt Non-Executive Board Non-Executive Executive Board Member Member CEO/Director CEO CFO NNS Capital Orascom Construction OCI N.V. Non-Executive Independent Non-Executive Arif Naqvi Sami Haddad Khaled Bichara Azmi Mika
Slide 27: Entrepreneurial Track Record
Entrepreneurial Track Record Creating Shareholder Value Shareholder return: IRR of c.40% on US$ basis for OCI S.A.E. / OCI N.V. from IPO in 1999 to demerger in March 2015 – Shareholder return driven by strong longstanding leadership along with investment vision of principal shareholders Strategy
Slide 28: Longstanding Position as Global Contractor of Choice
Longstanding Position as Global Contractor of Choice Track Record and Competitive Strengths Tradition: construction has been the core business since inception in 1950 – Orascom Construction is now a leading global company employing c 58,000 people, with over 60 years of experience in MENA markets
Slide 29: Group Strategy Aimed at Delivering Top and Bottom Line Growth
Group Strategy Aimed at Delivering Top and Bottom Line Growth The Group has focused on creating shareholder value in the process of becoming a leading private sector contractor and an incubator of high-value industrial businesses Commitment instilled in management and founding shareholders to propel
Slide 30: Pursuing Value Accretive Investments
Pursuing Value Accretive Investments Construction business was integral to OCI’s value creation story: – Developed and incubated businesses both independently and with partners for nearly 20 years Key executives have been with the Group for 10+ years, guaranteeing OC’s continuity in its ability
Slide 31: Important Notice and Disclaimer
Important Notice and Disclaimer This document has been provided to you for information purposes only. This document does not constitute an offer of, or an invitation to invest or deal in, the securities of Orascom Construction Limited (the “Company”). The information set out in this document shall n
Slide 32: www.orascom.com
Contact Investor Relations: Hesham El Halaby [email protected] T: +971 4 318 0900 NASDAQ Dubai: OC EGX: ORAS www.orascom.com
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