ACROW LIMITED — Interim / Quarterly Report 2019

Feb 26, 2019

ASX:ACF Acrow Formwork and Construction Services Limited C/- Level 5, 126 Phillip Street Sydney NSW 2000

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FY19 Half Year Results

Sydney, 27[th] February 2019 – Acrow Formwork and Construction Services Limited (“Acrow” or “the Company”), today provided its FY19 half-year financial results and operational highlights for the period.

Overview of Financial Results

The results presented in these financial statements reflect the operations of Acrow Limited and all subsidiaries (together the “Group”) for the six months from 1 July 2018 to 31 December 2018 (“1H FY19”). For the half year ended 31 December 2018, the summary financial highlights include:

Financial

• Group revenue $36m (an increase of 7% on 1H18);

• Formwork Hire Revenue of $10.4m (an increase of 48% on 1H18);

• Sales Contribution of $21.6m and Margin of 60.1%;

• Result driven by favourable revenue mix to higher margin Formwork Hire and contribution of Natform.

• Underlying EBITDA of $6.7m (+33% on 1H18); and

• Underlying EBITDA margin of 18.6% (up from 15.0% in 1H18).

Treasury

• Strong Operating Cash Profit of $5.5m (cash conversion of c. 83%);

• Operating Cash profit generated up 30% over pcp;

• Net debt of $2.5M from $15M Westpac facility;

• Interim Dividend declared of 1 cent per share (unfranked); and

• Basic Earnings per share of 1.98 cents per share compared to (2.00) in 1H FY18 an increase of 199%.

Operational

• Natform acquisition trading well and in line with acquisition announcement;

• Focus on Formwork Hire into Civil and Commercial markets;

• Key personnel appointments made into NSW and QLD markets enhance go to market strength;

• Growth Capex utilised and committed to customer construction projects; and

• Pipeline remains strong.

Overall it was a strong financial performance in 1H FY19 with Underlying EBITDA for this six-month period of $6.7m up 33% pcp.

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ASX:ACF Acrow Formwork and Construction Services Limited C/- Level 5, 126 Phillip Street Sydney NSW 2000

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A summary of the Underlying Group EBITDA is provided in the below table:

HY/E 31 Dec,A$'000	1HY18 2HY18 1HFY19
Summary P&L
Formwork Hire Scaffold Hire Residential Labour & Cartage Other Total Revenue Formwork Hire Scaffold Hire Residential Labour & Cartage Other Total Contribution Contribution Margin Yard Related Expenses Labour Other Total Overheads Significant Items Reported EBITDA Underlying EBITDA Margin	6,992 8,591 10,382 7,922 6,375 5,262 4,001 3,680 4,172 7,434 6,209 8,005 7,259 6,878 8,137
	33,608 31,733 35,958 6,992 8,591 10,382 7,922 6,375 5,262 1,690 1,694 1,815 1,064 1,064 1,435 1,925 2,014 2,732
	19,593 19,738 21,626 58.3% 62.2% 60.1% 6,032 6,128 6,393 6,145 6,370 6,793 2,373 1,747 1,728
	14,550 14,245 14,914 - 536 389 5,042 4,958 6,320 5,042 5,494 6,736 15.0% 17.3% 18.7%

Note:

(1) Unaudited and based on management accounts. Restructuring costs consist of redundancy, branch relocation, duplicate rents, other non-recurring costs associated with the business restructure. (2) FY18A excludes costs of being a public company, including listing and director fees, to allow for comparability. (3) Represents recurring costs for Acrow

Earnings per share

Basic Earnings per share for the six months to 31 December 2018 was AUD 1.98 cents per share versus AUD (2.00) cents per share in the pcp an increase of 199%.

Dividend

As a result of the continued improvement in operating results and a strong cash position, the board of Acrow is pleased to announce an unfranked interim dividend from 1.0 cents per share with a dividend reinvestment plan (DRP) maintained. Further details are contained in a separate ASX announcement released today.

Managing Directors Comments

Managing Director Steven Boland said

“The HY19 results for Acrow continue the positive trajectory of the business since its listing in April 2018. The underlying EBITDA result of $6.7 million is the best recorded for a six month period in over 10 years. With the successful integration of Natform coupled with the continued positive growth emanating from our core Formwork business, we continue to be in an excellent position to grow both our top and bottom line organically and via concentrated M & A activity.”

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ASX:ACF Acrow Formwork and Construction Services Limited C/- Level 5, 126 Phillip Street Sydney NSW 2000

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Outlook

As a result of the record result from 2018 financial year, and the 1H FY19 performance the Company expects to continue to trade in line with expectations.

The pipeline for new contracts won is strong and the national business with a high quality defensible earnings base and geographic customer spread provides comfort towards the trading outlook ahead.

Acrow has now committed $5.5m Growth Capital since its ASX listing into its core formwork equipment to support new Civil and Commercial opportunities.

Natform continues to trade well and in line with management expectations.

ENDS

This summary should be read in conjunction with the Appendix 4D and results presentation lodged with ASX today.

For more information contact:

Steve Boland

Chief Executive Officer

Ph +61 417 667 495

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