ALS LIMITED — Interim / Quarterly Report 2014

Nov 24, 2013

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September 2013 Half Year Results

25 November 2013

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Important notice and disclaimer

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• This presentation has been prepared by ALS Limited, ( ALS or the Company ). It contains general information about the Company’s activities as at the date of the presentation. It is information given in summary form and does not purport to be complete. The distribution of this presentation in jurisdictions outside Australia may be restricted by law, and you should observe any such restrictions.

• This presentation is not, and nothing in it should be construed as, an offer, invitation or recommendation in respect of securities, or an offer, invitation or recommendation to sell, or a solicitation of an offer to buy, securities in any jurisdiction. Neither this document nor anything in it shall form the basis of any contract or commitment. This presentation is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any investor. All investors should consider such factors in consultation with a professional advisor of their choosing when deciding if an investment is appropriate.

• The Company has prepared this presentation based on information available to it, including information derived from public sources that have not been independently verified. No representation or warranty, express or implied, is provided in relation to the fairness, accuracy, correctness, completeness or reliability of the information, opinions or conclusions expressed herein.

• This presentation may include forward-looking statements within the meaning of securities laws. Any forward-looking statements involve known and unknown risks and uncertainties, many of which are outside the control of the Company and its representatives. Forward-looking statements may also be based on estimates and assumptions with respect to future business decisions, which are subject to change. Any statements, assumptions, opinions or conclusions as to future matters may prove to be incorrect, and actual results, performance or achievement may vary materially from any projections and forward-looking statements.

• Due care and attention should be undertaken when considering and analysing the financial performance of the Company.

• All references to dollars are to Australian currency unless otherwise stated.

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September 2013 Half Year Summary

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	H1	H2	H1
half year	FY13	FY13	FY14
	($mn)	($mn)	($mn)
Revenue	813.6	685.7	744.7
EBITDA1	227.5	178.5	178.7
EBITDA1,2from continuing operations	223.4	178.5	178.7
Gain on sale of discontinued operations	5.8	0.1	0
Impairment	(6.1)	(10.0)	0
EBIT1	200.2	150.1	143.8
NPAT	135.5	91.8	97.7
EPS3(basic – cents per share)	39.3	26.7	27.1
Dividend (cents per share)	21	27	19

1 Excludes gain on sale of discontinued operations and impairment loss

2 EBITDA from continuing operations post the sale of the Chemical Division (Deltrex and Panamex)

3 Restated for impact of 1:11 renounceable rights issue undertaken in July 2013

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September 2013 Half Year Trend

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Average USD:AUD (cents)
81 90 106 103 94
1000 250
800 200
600 150
400 100
200 50
0 0
H1 2010 H1 2011 H1 2012 H1 2013 H1 2014
Revenue EBITDA NPAT
Revenue (AUD million)
EBITDA & NPAT (AUD million)
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REVENUE
30 [th] September 2013 8%
$745mn
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EBITDA 30[th] September 2013 21% $179mn NPAT 30[th] September 2013 28% $98mn

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Operating Profit (EBIT) Diversification

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200
150
100
50
0
Sep-04 Sep-05 Sep-06 Sep-07 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Sep-13
Minerals Life Sciences Energy Industrial Reward + Chemical
EBIT ($ million)
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Note: Chemical Division (“Chemical”) divested during Sep-12 half year

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Strategy – Revenue Growth and Diversification

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100% 80% 60% 40% 20%

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0% Minerals Life Sciences Industrial Energy

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Prorate Oil & Gas H1 FY14

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Revenue – Market and Geography

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M
A
R
K
E
T
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H1 FY13 ($709mn) H1 FY14 ($685mn)
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G
E
O
G
R
A
P
H
Y
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Geochemistry Metallurgy Inspection Environmental Food/Pharma Coal Oil & Gas Asset Care Tribology

Australasia North America Asia South America Africa Europe Middle East

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CAPEX and Depreciation

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25
CAPEX reduced in line with current
operating environment
20
15
10
5
0
Jun-12 Sep-12 Dec-12 Mar-13 Jun-13 Sep-13
Quarter
CAPEX (AUD$ million)
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CAPEX (exl. property purchases) Depreciation & Amortisation

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Revenue Growth

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900
ALS Group Revenue Growth 800
700
600
•
Organic Growth -16%
500
•
Divestments -5% 400
• 300
Acquired Growth +10%
200
•
Currency Impact +3% 100
0
Reported Growth -8%
Revenue Growth H1 FY14 Vs H1 FY13
Industrial
Energy
Life Sciences
Minerals
-40% -20% 0% 20% 40% 60% 80%
Organic Acquired FX Movement
Revenue (AUD$mn)
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Life Sciences Division

	H1 FY14	H1 FY13
Revenue	$272mn	$225mn
EBITDA	$69mn	$58mn
EBIT	$54mn	$47mn
EBIT Margin	19.6%	21.0%

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Environmental Food - Pharma Electronics Consumer Products

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Overview

• Organic revenue growth (9%) in Asia

• Organic revenue growth (10%) in mainland Europe

• Organic revenue growth (18%) in Scandinavia

• Margin improvement (80bps) in North America

• South America underperforming but improving

• Pricing pressure in Australia but significant project wins

• Food strategy implemented – “building blocks” in place, focus now on growth

• New laboratories under construction

• Copenhagen (Denmark)

• Consumer Products Testing business performing to expectation

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Minerals Division

	H1 FY14	H1 FY13
Revenue	$232mn	$345mn
EBITDA	$75mn	$137mn
EBIT	$63mn	$127mn
EBIT Margin	27.1%	36.7%

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Geochemistry Metallurgy Inspection Mine Site Services

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Overview

• Geochemistry

• All markets remain weak – especially West Africa, Canada and South America

• Global sample volumes stable for last four months

• Some localized pricing pressure

• Hub & Spoke levers maintaining margins within expected range of 26% to 32%

• Metallurgy

• North America reasonable

• Challenging market in Australia

  • Pilot plants underutilized

  • Revenue down 37%

• New Santiago (Chile) facility now operational

• Inspection

• Revenue +16%

• Margin >20% following losses H1 FY13

• Further improvement to come

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Industrial Division

	H1 FY14	H1 FY13
Revenue	$89mn	$86mn
EBITDA	$16mn	$18mn
EBIT	$14mn	$16mn
EBIT Margin	15.3%	18.4%

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Asset Care Tribology

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Overview

• Asset Care

• Scheduled outage inspection/maintenance postponements – especially higher margin Power Generation work

• Lower margins due to mobilization problems at Gladstone LNG projects – now resolved

• Decrease in “jobbing” market and pricing pressures

• Successful relocation to new Brisbane site

• Successful implementation of Osprey –

  • “LIMS”

• Tribology

• Revenue growth of 8%

• Market share increase in mining

• Some pricing pressure in Australia

• Significant improvement in North America

  • Revenue +4%

  • Margin +340bps

• Successful acquisition of OilCheck

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Energy Division

	H1 FY14	H1 FY13
Revenue	$91mn	$53mn
EBITDA	$27mn	$18mn
EBIT	$22mn	$17mn
EBIT Margin	24.2%	30.9%

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Overview

• Coal

• Close to bottom of cycle – exploration activity to pick up in late CY14

• Australian production and export levels at record high

• Five new on-site production labs in place over last 12 months

• Pricing pressure globally

• Current margins remain >20%

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Coal Oil & Gas

• Significantly restructured cost base

• • Oil & Gas

• Acquired Reservoir Group in August 2013

• Acquired EarthData in July 2013

• Acquisitions performing to plan

• Lab strategy well advanced

  • Brisbane lab – completed

• Recruited Mark Beach – global executive for ALS Oil & Gas lab business

• • Further acquisitions planned

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Divisional and Business Stream Structure

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Geochemistry
•Global
Metallurgy
Mineral Division •Australia & Americas
Mine Site
Environmental
•Global
•Global excluding Africa
Inspection
Food - Pharma
•Europe, Africa, Asia &
Life Science Division South America •Australia, Asia & Europe
Electronics
•Asia
Asset Care
Consumer Products
Industrial Division •Australia •Asia
Tribology
•Australia, Asia, Europe &
the Americas
Oil & Gas
•Global
Energy Division Coal
•Australia, Asia, Africa &
North America
Internal Perspective External Perspective
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Revenue Growth and Margin Strength

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1,500 35%
Core Labs
1,200 30%
ALS
900 25%
600 20%
SGS
Bureau Veritas
Intertek
300 15%
Eurofins
0 10%
FY09 FY10 FY11 FY12 FY13 H1 FY14
ALS Financial Year Ending March
ALS Revenue ALS EBITDA Margin
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EBITDA Margin for SGS, Intertek, Bureau Veritas & Eurofins is for Half Year Ending June 2013 actual, and for Core Labs 9 months ending September 2013.

EBITDA Margin & Revenue for ALS excludes non-laboratory businesses but does include all corporate expenses..

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