GR ENGINEERING SERVICES LIMITED — AGM Information 2019

Nov 27, 2019

==> picture [235 x 74] intentionally omitted <==

ASX RELEASE

28 November 2019

For immediate release to the market

Annual General Meeting Presentation – Outlook Statement

GR Engineering Services Limited (ASX:GNG) ( GR Engineering ) will today hold its 2019 Annual General Meeting.

The presentation materials to be delivered at the meeting follow this announcement and include an outlook statement at slide 7 addressing GR Engineering’s revenue forecasts for FY20.

GR Engineering confirms details of the outlook statement that forecast total revenue for FY20 is likely to be in the range of $200 million to $220 million.

Please refer to the Annual General Meeting presentation for further details.

Ends

For further information please contact:

Geoff Jones

Managing Director  +61 8 6272 6000  geoff.jones@gres.com.au

Omesh Motiwalla CFO & Company Secretary  +61 8 6272 6000  omesh.motiwalla@gres.com.au

==> picture [36 x 38] intentionally omitted <==

GR ENGINEERING SERVICES LIMITED ABN 12 121 542 738 Tel: +61 8 6272 6000 Fax: +61 8 6272 6001 Email: gres@gres.com.au Website: www.gres.com.au PO Box 258, Belmont WA 6984 71 Daly Street, Ascot WA 6104

==> picture [277 x 61] intentionally omitted <==

==> picture [780 x 256] intentionally omitted <==

2019 Annual General Meeting Presentation 28 November 2019

FY19 Results Summary

Earnings

Balance Sheet & Cash Flow

Revenue

Cash (ex. available facilities)

==> picture [199 x 61] intentionally omitted <==

----- Start of picture text -----

$300m
$200m
FY18
$100m FY19 283.6
182.3
$0m
----- End of picture text -----

==> picture [197 x 61] intentionally omitted <==

----- Start of picture text -----

$40m
$30m
FY19
$20m
31.4
FY18
$10m
21.8
$0m
----- End of picture text -----

EBITDA

Net Operating Cashflow

==> picture [198 x 177] intentionally omitted <==

----- Start of picture text -----

$20m
$15m
$10m FY19 (1) FY18
$5m 11.2 17.1
$0m
PBT
$20m
$15m
$10m FY18
FY19
$5m 16.2
8.8
$0m
----- End of picture text -----

PBT

==> picture [201 x 65] intentionally omitted <==

----- Start of picture text -----

$30m
$20m
FY19
$10m 24.7
$0m
FY18
-$10m
-0.9
----- End of picture text -----

Total Dividend

==> picture [201 x 61] intentionally omitted <==

----- Start of picture text -----

12cps
9cps
FY18
6cps
FY19 11.0
3cps
6.0
0cps
----- End of picture text -----

(1) Represents underlying EBITDA – excludes bad debt expenses of $1.0m primarily associated with the settlement agreed in relation to the EPC contract for Davyhurst Refurbishment Project and other doubtful debtors of $0.3m

2

FY19 Results Summary

Ke features y

• GR Engineering transitioned from a period of strong design and construction activity in FY18 into a phase of consolidating new project opportunities

• The financial results were impacted by delays in key projects outside of GR Engineering’s control

• Not withstanding this, GR Engineering significantly increased its cash balance to $31.4 million at 30 June 2019 (30 June 2018: $21.8 million)

• Positive contributions from Upstream PS through operations and maintenance service delivery

• Group FY19 TRIFR: 4.99 (FY18: 8.62) comparing favourably to the industry average

Se ment Revenue g

Mineral Processing

==> picture [202 x 129] intentionally omitted <==

----- Start of picture text -----

$250m
$150m FY19 FY18
93.8 202.4
$50m
Oil & Gas
$100m
$50m FY19 FY18
88.4 81.2
$0m
----- End of picture text -----

Se ment PBT g

Mineral Processing

==> picture [201 x 132] intentionally omitted <==

----- Start of picture text -----

$20m
FY19
$10m FY18
3.6
15.7
$0m
Oil & Gas
$6m
$4m
FY19
$2m 5.1
FY18
$0m
1.3
----- End of picture text -----

Oil & Gas

==> picture [131 x 26] intentionally omitted <==

3

FY19 Operational Performance

Mineral Processin g

Design and Construction

• Successfully delivered Saracen Gold Mines Pty Ltd’s Carosue Dam Paste Plant in Western Australia

• Progressed delivery of the Fosterville Paste Plant for Kirkland Lake Gold Ltd, Carapateena Northern Wellfield Water Supply Project for OZ Minerals Ltd, Sandy Ridge Waste Storage Project for Tellus Holdings Ltd and the Ok Tedi Crusher Upgrade (25 Mtpa) in PNG

Studies and Consulting

• 39 studies completed in FY19. Engaged on 40 studies at 30 June 2019 across a broad range of commodities for projects both in Australia and abroad

• Advanced studies completed or in progress include:

• BFS for Salt Lake Potash Ltd’s Lake Way Potash Project

• DFS for Galena Mining Ltd’s Abra Base Metals Project

• DFS for BCI Minerals Ltd’s Mardie Salt & Potash Project

• DFS for Artmin Madencilik’s Hod Maden Gold-Copper Project in Turkey

• DFS for Red 5 Ltd’s King of the Hills Gold Project

==> picture [131 x 26] intentionally omitted <==

4

FY19 Operational Performance

Oil & Gas

• Upstream Production Solutions contribution to group revenue of approximately 50%

• Longer term operations and maintenance services revenue generating baseline revenue alongside project based work

• Revenue contributions primarily from:

• Wellsite and plant maintenance work in Bowen and Surat Basins (Origin and Santos)

• Timor Sea operations and maintenance services (ENI and Northern Oil & Gas Australia)

• Maintenance work on assets in the Perth Basin including Mitsui and Triangle Energy

==> picture [261 x 155] intentionally omitted <==

==> picture [261 x 128] intentionally omitted <==

==> picture [131 x 26] intentionally omitted <==

5

Balance Sheet

Key Features

• Strong balance sheet maintained at 30 June 2019:

• Cash: $31.4 million (30 June 2018: $21.8 million)

• Interest bearing debt: $0.5 million (30 June 2018: $0.5 million)

• Significant bonding headroom:

• $130 million total project bonding facilities

• Bank guarantee facility: $70 million

• Insurance bond facility: $60 million

• GR Engineering well placed to meet future bonding requirements under all growth assumptions, including where order book increases in value and project quantum

==> picture [131 x 26] intentionally omitted <==

6

Outlook

Key Features

• Active contracts: Sandy Ridge Waste Storage Project ($46.0 million), Carosue Dam Mill Expansion Project ($24.5 million), Wassa Paste Plant Project (US$9.3 million) and Renison Upgrade Project ($6.0 million)

• In addition to existing conditional EPC agreements & Letters of Intent (including the Thunderbird Mineral Sands Project and Woodlark Gold Project), GR Engineering established quality exposure to a number of new projects (including the Lake Way Potash Project and Abra Base Metals Project) that have already attracted significant funding

• GR Engineering is forecasting total FY20 revenue of $200 million to $220 million

• GR Engineering’s assessment of its subsidiary’s (Upstream PS) exposure to the Timor Sea Oil & Gas Australia Pty Ltd (Administrators Appointed) contract is $17.4 million (representing receivables). Upstream PS continues to work with the administrator and senior secured lender and as of 20 September 2019, is being paid on an agreed daily rate

==> picture [131 x 26] intentionally omitted <==

7

Appendix: Corporate Summary

Capital Structure
Shares on issue	m	153.6
Share price_(GNG.ASX)(25 Nov 2019)_	$	0.85
Market capitalisation	$m	130.6
Cash (30 June 2019)	$m	31.4
Debt_(30 June 2019)_	$m	0.5
Enterprise Value	$m	99.7

Directors & Management

Phillip Lockyer Non-Executive Chairman Geoff Jones Managing Director Tony Patrizi Executive Director Barry Patterson Non-Executive Director Peter Hood Non-Executive Director Joe Totaro Non-Executive Director Omesh Motiwalla Chief Financial Officer

Share Price Performance

==> picture [366 x 347] intentionally omitted <==

----- Start of picture text -----

$1.60 3.50m
3.00m
$1.20 2.50m
2.00m
$0.80
1.50m
1.00m
$0.40
0.50m
$0.00 0.00m
Sep-18 Nov-18 Jan-19 Mar-19 May-19 Jul-19 Sep-19 Nov-19
Volume GNG.ASX
Register Analysis
14.2%
25.4%
60.4%
Directors, Founders & Senior Management
Institutions
Other
----- End of picture text -----

==> picture [131 x 26] intentionally omitted <==

8

Appendix: About GR Engineering

==> picture [90 x 18] intentionally omitted <==

GR Engineering

• Process engineering design and construction contractor servicing the mining and minerals processing industry

• Specialising in EPC / EPCM contracting to provide project delivery with secure cost, time, plant performance and contract completion warranties and guarantees

• Australian offices in Perth and Brisbane. Offshore presence in the Americas, Africa, United Kingdom, PNG and Indonesia

• Expertise in gold, base metals and industrial mineral commodities

==> picture [61 x 19] intentionally omitted <==

Upstream Production Solutions

• Oil and gas services business providing operations, maintenance, well management and engineering services to Australian oil and gas industry

• Strong presence on and offshore Perth Basin, Timor Sea, Queensland and Victoria

Selected Clients

==> picture [105 x 170] intentionally omitted <==

Selected Clients

==> picture [104 x 110] intentionally omitted <==

==> picture [104 x 170] intentionally omitted <==

==> picture [104 x 110] intentionally omitted <==

==> picture [104 x 170] intentionally omitted <==

==> picture [104 x 110] intentionally omitted <==

==> picture [131 x 26] intentionally omitted <==

9

Appendix: About GR Engineering

 Significant gold process construction history

 Significant base metal construction history

==> picture [329 x 293] intentionally omitted <==

==> picture [327 x 193] intentionally omitted <==

==> picture [131 x 26] intentionally omitted <==

10

Contact

Geoff Jones

Managing Director

• +61 8 6272 6000

• geoff.jones@gres.com.au

Omesh Motiwalla

CFO & Company Secretary

• +61 8 6272 6000

• omesh.motiwalla@gres.com.au

Australian Office Details

==> picture [131 x 26] intentionally omitted <==

71 Daly Street Ascot WA 6104

Building 3, Level 3, Kings Row Office Park 42 McDougall Street Milton QLD 4064

• PO Box 258 Belmont WA 6984

• +61 7 3838 8000

• +61 8 6272 6000

==> picture [312 x 63] intentionally omitted <==

==> picture [99 x 31] intentionally omitted <==

Level 16, 350 Queen Street Melbourne VIC 3000

• +61 3 8623 9800

Level 11, 99 St Georges Terrace Perth WA 6000

17 Graystone Street Tingalpa QLD 6173

• +61 7 3239 5800

Level 2, 70 Hindmarsh Square Adelaide SA 5000

 +61 8 6109 4000  +61 438 804 070

==> picture [131 x 26] intentionally omitted <==

11

Disclaimer

RELIANCE ON THIRD PARTY INFORMATION

This presentation may contain Information that has been derived from publicly available sources that have not been independently verified. No representation or warranty is made as to the accuracy, completeness or reliability of the information. No responsibility, warranty or liability is accepted by GR Engineering Services Limited ( Company ), its officers, employees, agents or contractors for any errors, misstatements in or omissions from this presentation.

PRESENTATION IS A SUMMARY ONLY

This presentation is information in a summary form only and does not purport to be complete. It should be read in conjunction with the audited financial report for the financial year ended 30 June 2019. Any information or opinions expressed in this presentation are subject to change without notice and the Company is not under any obligation to update or keep current the information contained within this presentation.

NO OFFER OF SECURITIES

Nothing in this presentation should be construed as either an offer to sell or a solicitation of an offer to buy or sell Company securities in any jurisdiction.

FORWARD LOOKING STATEMENTS

This presentation may include forward-looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, these statements are not guarantees or predictions of future performance, and involve both known and unknown risks, uncertainties and other factors, many of which are beyond the Company’s control. As a result, actual results or developments may differ materially from those expressed in the statements contained in this presentation. Investors are cautioned that statements contained in this presentation are not guarantees or projections of future performance and actual results or developments may differ materially from those projected in forward-looking statements.

DISCLOSURE OF NON- IFRS FINANCIAL INFORMATION

Throughout this presentation, there are occasions where financial information is presented not in accordance with accounting standards. There are a number of reasons why the Company has chosen to do this including to maintain a consistency of disclosure across reporting periods

ROUNDING

Due to rounding, numbers presented throughout this document may not add up precisely to the totals provided.

NOT INVESTMENT ADVICE

This presentation is not intended and should not be considered to be the giving of investment advice by the Company or any of its shareholders, Directors, officers, agents, employees or advisers. The information provided in this presentation has been prepared without taking into account the recipient’s investment objectives, financial circumstances or particular needs. Each party to whom this presentation is made available must make its own independent assessment of the Company after making such investigations and taking such advice as may be deemed necessary.

NO LIABILITY

To the maximum extent permitted by law, neither the Company nor its related bodies corporate, Directors, employees or agents, nor any other person, accepts any liability, including without limitation any liability arising from fault or negligence, for any direct, indirect or consequential loss arising from the use of this presentation or its contents or otherwise arising in connection with it.

==> picture [131 x 26] intentionally omitted <==

12