Half year results For the six months ended 30 June 2019 Results - PowerPoint PPT Presentation

30 JULY 2019 Half year results For the six months ended 30 June 2019 Results presentation July 2019 1

Introduction Chris Weston CEO Results presentation July 2019 2

Headlines On target to deliver mid-teens ROCE in 2020  Group revenue down 4%, reflecting Winter Olympics in the prior year  Improved profitability resulted in PBT up 9%  Continued discipline on capex and working capital  ROCE up 0.6pp  Interim dividend maintained Continue to adapt to customer needs as energy markets evolve  Successful launch and mobilisation of the Y.Cube  Significant pipeline for hybrid thermal-solar opportunities Results presentation July 2019 3

Rental Solutions REVENUE (% OF GROUP excl. pass-through fuel) 53 % UTILISATION at 30 June (MW) 1H19 56% Operating margin Completed Adapting to improvement systems rollout changing markets 1H18 61% Strong Enabling Mobilising Y.Cube for performance in improvements in our hybrid project at NAM driven by efficiency and Granny Smith mine, sector focus customer service Australia Results presentation July 2019 4

Power Solutions Industrial REVENUE (% OF GROUP excl. pass-through fuel) 27 % UTILISATION at 30 June (MW) 1H19 68% Revenue growth Diversifying Utilising of 4%, excl. 2018 in Eurasia landfill gas 1H18 70% Winter Olympics 35% of new order Signed our first Driven by LAM, in-take related to NGG projects Africa and Middle manufacturing using landfill gas East offset by sector to deliver cheaper, Eurasia cleaner power Results presentation July 2019 5

Power Solutions Utility REVENUE (% OF GROUP excl. pass-through fuel) 20 % UTILISATION at 30 June (MW) 1H19 66% Operating margin Cash collections Amazonas (Brazil) improvement Good progress in First sites now live 1H18 65% Increased cost the period, on this 15-year discipline especially in Africa project, across 26 delivering benefits locations Results presentation July 2019 6

Continuing to adapt to customer needs Launch of Y.Cube, our mobile and modular storage system Mobile and modular Easy integration Single units can be easily Fits perfectly with our thermal combined to deliver the power power systems for an optimised and energy capacity required hybrid solution Key benefits Quick set-up on site Fast deployment All-in-one and ready-to-install Up and running in less than 3 storage system reducing months after contract signature footprint and installation costs Results presentation July 2019 7

Continuing to adapt to customer needs We are already seeing considerable interest from various sectors for a range of applications Typical applications Application case study REPLACE SPINNING RESERVE CONTROL PV PRODUCTION RAMPS 100% NCY ACTUAL PVPRODUCTION Spinning reserve Ramp rate control CI E WITH Y.CUBE ATOR E FF I displacement STEADY FEED-IN WITH Y.CUBE GENE R WITHOUT Y.CUBE REDUCE DEMAND AND SHIFT ENERGY PROVIDE POWER TO CRITICAL LOADS GRIDOUTAG E GRIDSUPPLY Peak shaving Uninterrupted power supply (UPS) / Bridging power UPS NOON EVENING PEAK Granny Smith goldmine (Australia): Setting the standard for hybrid microgrids Results presentation July 2019 8

1H19 results review Heath Drewett CFO Results presentation July 2019 9

Group summary Movement CHANGE excluding pass-through fuel and  Revenue down 4% £m 1H19 1H18 CHANGE currency Revenue 768 857 (10)% (4)%  Good underlying profit growth Operating profit 81 76 6% 12%  Operating margin of 10.5%, up Operating margin 10.5% 8.9% 1.6pp 1.5pp 1.5pp on an underlying basis Net interest expense (21) (17) (21)%  Effective tax rate of 35% Profit before tax 60 59 2% 9% Taxation (21) (18) (14)%  ROCE of 10.2%, up 0.6pp on an Profit after tax 39 41 (3)% underlying basis Diluted earnings per share 15.33 15.85 (3)% 4% Dividend per share 9.38 9.38 - ROCE 10.2% 10.5% (0.3)pp 0.6pp Results presentation July 2019 10

Improving cash flow £m 1H19 1H18 EBITDA 247 224 Working capital movement Working capital (16) (47) £m 1H19 1H18 Cash flows relating to fulfilment assets/demob provisions (30) (21) Other 9 4 Trade and other receivables 34 7 Operating cash flow 210 160 Trade and other payables (48) (50) Tax (30) (33) Inventory (2) (4) Net interest (22) (18) Working capital (16) (47) Acquisitions and investments - (33)  Mobilisation spend primarily related to the Purchase of fixed assets (99) (95) 2020 Tokyo Olympics , PIE A contract in Other fixed asset movements 5 - Brazil and Burkina Faso Lease payments (related to IFRS 16) (14) -  Reduced fleet capex of £83m including Free cash flow 50 (19) £15m related to 2020 Tokyo Olympics Dividends (45) (45) (2018: £87m) Changes in equity - (7) Net cash flow 5 (71)  Increased free cash flow of £50m Exchange (1) (18) (2018: £(19)m) Movement in lease liability (102) -  Net debt/EBITDA (incl. IFRS 16 leases) 1.5x Movement in net debt (98) (89) Net debt (784) (741) Results presentation July 2019 11

Net working capital change £61m 1H19 FY18 Overall working £(2) m Increase in inventory capital outflow  Slight increase in materials, reflecting timing of in-house of £16m build programme (2018: £47m outflow) £34 m Decrease in trade and other receivables  Strong cash collection in Power Solution Utility  Reduced level of unbilled within Rental Solutions £(48) m Decrease in trade and other payables  Reflecting a reduction in fuel consumption on contracts in Brazil Results presentation July 2019 12

Trade receivables Stable performance overall, with a reduction in PSU GROUP TRADE RECEIVABLES (£m) 600  Good progress on cash collections within Power Solutions Utility  Particular focus during the period in 400 Rental Solutions on reducing the unbilled backlog 200 0 FY14 FY15 FY16 FY17 1H18 FY18 1H19 RS / PSI trade receivables PSU trade receivables Results presentation July 2019 13

Utility - Invoicing / receipts performance Good progress on collections, especially in Africa POWER SOLUTIONS UTILITY ($m) 200 $m 1H19 2H18 1H18 244 351 362 Invoicing 160 295 349 345 Receipts 120 51 (2) (17) Net total 80 Bad debt provision within PSU broadly unchanged at $84m 40 (Dec 2018: $83m) 0 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 Invoicing Receipts Results presentation July 2019 14

Rental Solutions – Trade receivables  First half focus on the level of TRADE RECEIVABLES – INCLUDING UNBILLED ($m) unbilled revenue built up 300 through 2H 2018  Decrease in unbilled revenue 250 somewhat offset by an increase 200 in trade receivables 150 100 50 0 1H18 FY18 Jan Feb Mar Apr May Jun 2018 2019 Trade receivables Unbilled receivables Results presentation July 2019 15

Guidance  On track to deliver PBT in line with market expectations − Currency headwinds of c. 2% (see appendix 4) − IFRS 16 impact of c. £(2)m PBT − Effective tax rate of c. 35%, subject to geographic mix  Confident of achieving 2020 mid-teens ROCE target − Full year fleet capex <£200m, including c. £30m for 2020 Tokyo Olympics − Working capital improvement  Net debt / EBITDA to reduce, despite IFRS 16 impact Results presentation July 2019 16

Aggreko is a customer focused specialist provider of power, temperature control and energy services on a global basis. These services are based on modular and mobile equipment operated on a digital platform with a market leading integration capability. Results presentation July 2019 Results presentation July 2019 17 17

Appendix Results presentation July 2019 18

Appendix 1 - Rental Solutions Movement CHANGE excluding 1H19 1H18 CHANGE currency Revenue (£m) 400 386 4% 1% Operating profit (£m) 47 40 17% 12% Operating margin 11.8% 10.5% 1.3pp 1.1pp ROCE (rolling 12 months) 14.3% 15.6% (1.3)pp (1.2)pp Fleet capital expenditure (£m) 29 26 % Revenue by sector 1H19 Petrochemical & refining 20 % Building services & construction 18 % 18 % Oil & Gas Utilities 10 % Events 9 % Manufacturing 6 % 6 % Mining 13 % Other Results presentation July 2019 19

Appendix 2 - Power Solutions Power Solutions Industrial Power Solutions Utility Movement Movement CHANGE CHANGE excluding excluding Excluding pass-through fuel 1H19 1H18 CHANGE Excluding pass-through fuel 1H19 1H18 CHANGE currency currency Revenue (£m) 198 219 (9)% (9)% Revenue (£m) 150 163 (8)% (7)% Operating profit (£m) 21 23 (8)% (4)% Operating profit (£m) 13 14 (2)% 52% Operating margin 10.5% 10.5% - 0.6pp Operating margin 8.9% 8.3% 0.6pp 3.5pp ROCE (rolling 12 months) 10.6% 9.7% 0.9pp 1.6pp ROCE (rolling 12 months) 6.0% 6.7% (0.7)pp 0.9pp Fleet capital expenditure (£m) 24 27 Fleet capital expenditure (£m) 30 34 % Revenue by sector 1H19  This segment includes only Utility customer Oil & Gas 45 % projects Mining 15 % Building services & construction 12 % Manufacturing 7 % Events 6 % Utilities 5 % Petrochemical & refining 2 % Other 8 % Results presentation July 2019 20