1 AUDITED ANNUAL RESULTS FOR THE YEAR ENDED 31 DECEMBER 2018 2 - PowerPoint PPT Presentation

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AUDITED ANNUAL RESULTS FOR THE YEAR ENDED 31 DECEMBER 2018 2

PRESENTED BY DANIE PRETORIUS, CEO ANDRE VAN DEVENTER, CFO 3

Who we are Business overview Operational overview Financial overview In Closing Commodity AGENDA 4

• Established in 1986, listed on JSE in 2012 • Design, manufacture, operate and maintain boring technology • Operations in 23 countries in Africa, South America, North America, Europe and Asia • Motivated by tailor-made solutions, that in turn support our diversifjcation strategy • Trusted partner to blue-chip and mid-size mining companies • A technology company that challenges the status quo WHO WE ARE 5

BUSINESS OVERVIEW 6

Client Innovative tailor made drilling Challenges solutions • Safety Non-Blasting environment • Increased costs • Mobile Tunnel Borer • Productivity decline • Blind Shaft Boring System • Net present • Horizontal Raise Boring value hurdles • Automation/Autonomous drilling • Accessibility • Geotechnical to ore bodies TECHNOLOGY STRATEGY 7

2018 2017 0% 12% Other Countries 2017 2018 12% 12% Central and North America 2017 2018 2017 2018 42% 43% 34% 45% Africa South America Current Operations New Operations REVENUE GEOGRAPHIC DIVERSIFICATION 8

2018 2017 2% 1% Exploration Exploration 82% 95% 4% Production d ti Production d ti 16% Capital C Capital Capital REVENUE MINING ACTIVITY DIVERSIFICATION 9

2018 2017 Other Othe Other Iron Ore r 1% r 4% Other Other 13% Iron Ore 12% 26 Fe F Fe fE fE f fE fE fE fE fE fE fE fE f fE E E E E e 26 2 6 Au Au Au Au Au Au Au Au Au Au Au A u Au Au Au Au Au Au Au Au Au Au Au A u 34% 27% 79 79 Gold Gold Commodity Commodity 29 Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu u 32% 30% 29 2% Copper Copper Platinum 78 4% 0% Coal Platinum 2% 2% Coal C Chrome 0% Chrome 2% 5% 82 Diamonds d Diamonds 18% Silver / Lead / Silver / Lead / 12% Zinc Zinc REVENUE COMMODITY DIVERSIFICATION 10

2018 2017 0% 0% Civil & Construction C C Civil & Construction 1% <1% Hydro-energy d Hydro-energy d Mining Sector Mining Sector 99% 99% REVENUE BUSINESS SECTOR DIVERSIFICATION 11

OPERATIONAL REVIEW 12

2018 2017 LTIFR 2.31 2.06 3.0 2.5 2.0 1.5 1.0 0.5 0.0 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 LOST TIME INJURY FREQUENCY RATE 13

FINANCIAL OVERVIEW 14

• USD Revenue increased by 14.2% • Two business combinations and one associate • Improved working capital cycle - improved from 126.3 to 119.1 days • Strong order book of USD203.6 million • Healthy cash balance - geared for future growth HIGHLIGHTS FOR THE PERIOD 15

HEPS (ZARc) HEPS (USDc) 250 15 200 12 150 9 100 6 50 3 0 0 2018 2017 2016 2016 2015 2015 2018 2018 2017 2016 2016 2015 2015 HEADLINE EARNINGS PER SHARE 16

151.5 2020 2019 85.6 2021 2020 Total 2021 2022 and Beyond 2022 and Beyond 57.6 2019 283.9 Total 578.6 Million 300 250 200 150 100 50 0 2019 2019 2020 2021 2021 2022 Awarded And Beyond Awaiting adjudication Enquiry received/ possible lead PIPELINE (USD ‘ MILLION) 17

Nickel Chrome 9.6 6.8 1.0 24 Cr Cr Cr Cr Cr Cr Cr Cr Cr r Ni 5.2 2.1 28 Null Coal 1.4 1.4 Null Platinum Copper 10.4 2.5 8.2 7.2 29 Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu u 20.9 78 Diamonds 4.2 26.1 0.6 3.6 Polymetallic Polymetal Gold Salt Au A Au Au Au Au Au Au Au Au Au u u u 8.9 6.2 1.1 22.2 NaCI 6.5 79 Silver Hydroelectric 1.0 3.1 Infrastructure Water H 0.8 2.7 Iron Ore 26 Fe fE fE f fE fE f Fe F E E Zinc 9.0 9.6 9.8 11.9 26 6 30 2022 and Beyond 1.0 27.9 2019 2021 2021 124.5 2019 Total 2020 2022 and beyond 2020 Total 203.6 Million 50.2 COMMITTED ORDERS (USD ‘ MILLION) 18

2018 22.3% EBITDA (USD’m) Revenue (USD’m) 35 150 30 120 25 90 20 15 60 10 30 5 0 0 2018 2018 2016 2016 2018 2018 2017 2017 2016 2016 2017 2017 30.9 31.0 32.8 138.7 121.4 118.1 EARNINGS BEFORE INTEREST TAX DEPRECIATION AMORTISATION (USD ‘ MILLION) 19

2018 2017 2016 Total Raise bore rigs 149 107 105 Utilization % 61% 69% 73% ARPOR* (USD) 121 531 110 937 111 040 Total Slim rigs 30 34 33 Utilization % 68% 77% 55% ARPOR* (USD) 70 430 63 597 74 280 * Average Revenue Per Operating Rig per month ARPOR SUMMARY PER ANNUM 20

25 20 15 10 5 0 2016 2016 2018 2018 2017 201 PROFIT AFTER TAX (USD ‘ MILLION) 21

2018 2017 Comment USD 'million USD 'million Assets Total non-current assets 157.7 133.2 Two new business combinations Total current assets 108.7 103.7 Working capital ratio improved from 126.3 to 119.1 Total assets 266.4 236.9 Equity Equity 155.1 153.0 Non-controlling interest 9.0 8.3 Total equity 164.1 161.3 Liabilities Total non-current liabilities 61.2 47.1 Gearing ratio of 16.2% Total current liabilities 41.1 28.5 Healthy current ratio of 2.65 Total liabilities 102.3 75.6 Total equity and liabilities 266.4 236.9 STATEMENT OF FINANCIAL POSITION 22

2018 2017 USD 'million USD 'million Revenue 138.7 121.4 Cost of sales (95.1) (76.8) Gross profjt 43.6 44.6 Other operating income 5.9 3.7 Other operating expenses (25.8) (23.4) Operating profjt 23.7 24.9 Investment revenue 0.7 0.5 Finance costs (2.8) (2.9) Share of profjt from equity accounted investment (0.0) (0.0) Profjt before taxation 21.5 22.6 Taxation (4.0) (5.1) Profjt for the year 17.5 17.5 Explanation\Comment Revenue Two new business combinations Cost of Sales Increased in line with increased revenue Other operating expenses Increased due to additional business combinations Profjt for the year Fair results considering challenging operating environment STATEMENT OF COMPREHENSIVE INCOME 23

2019 Revenue Costs Costs 100% 80% 49% 67% 60% 40% 51% 20% 33% 0% USD Emerging Currencies USD’ million Negative impact on profjt before taxation (1.19) IMPACT OF CURRENCY ON PROFIT BEFORE TAXATION 24

2018 2017 Comment USD 'million USD 'million Net cash from operating activities 19.4 25.0 Addition of new geographies and client base Net cash from investing activities (33.0) (15.3) Two new business combinations Net cash from fjnancing activities 9.7 9.4 USD20 million drawn down on facility Total cash movement for the period (3.9) 19.1 Cash at the beginning of the period 40.2 20.4 Effect of exchange rate movement on cash balances (3.0) 0.7 Total cash at the end of the period 33.3 40.2 Suffjcient cash for future growth opportunities STATEMENT OF CASH FLOWS 25

150 120 90 60 (USD’m) 20 0 Fleet Acquisition Fleet mix & 2017 Forex 2018 utilization expansion -20 Revenue - 2017 121.4 Forex 0.1 Fleet Expansion 2.5 Acquisition 13.2 Fleet Mix and Utilisation 1.5 Revenue - 2018 138.7 REVENUE WATERFALL BREAKDOWN (USD ‘ MILLION) 26

Working Capital Breakdown 2018 2017 Movement Inventory 25.8 23.9 (1.9) Trade and Other Receivables 48.2 38.6 (9.6) Trade and Other Payables 28.7 20.1 8.6 WORKING CAPITAL BREAKDOWN (USD ‘ MILLION) 27

2018 2017 14.6% 14.9% Return on Capital Employed (EBITDA) 119.1 126.3 Working Capital Ratio (Days) 16.2% 2.4% Gearing Ratio (Net of Cash) BALANCE SHEET RATIOS 28

40 35 30 25 20 15 10 (USD’m) 5 0 -5 -10 -15 -20 2018 Cash at beginning of period 40.2 Cash from operation activities 19.4 Net acquisition of property, plant & equipment (16.0) Dividends paid (3.1) Acquisition of subsidiary (14.7) Acquisition of associate (2.6) Net movement in Financial Liabilities 12.9 Other (2.8) Cash at end of period 33.3 CASH FLOW WATERFALL (USD ‘ MILLION) 29

90.3% 9.7% Expansion Sustainable Plant and Machinery 96% Buildings 1% Motor Vehicles 2% IT Equipment 1% CAPITAL SPEND 30

• Healthy pipeline of USD578.6 million • Stable orderbook of USD203.6 million • Geographical footprint expansion • Opportunities beyond mining industry • Mobile Tunnel Borer • Blind Shaft Boring System IN CLOSING 31