GR ENGINEERING SERVICES LIMITED — Investor Presentation 2017

Mar 6, 2017

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Investor Presentation March 2017

HY17 Results Summary

Earnings

Revenue

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$150m
$100m
HY16
HY17
$50m 127.2
105.9
$0m
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EBITDA

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$15m
$10m
HY17 HY16
$5m
10.8 10.8
$0m
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PBT

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$15m
$10m
HY17 HY16
$5m
10.5 10.5
$0m
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Balance Sheet & Returns

Net Cash

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$50m
$25m HY17 HY16
40.1 42.6
$0m
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Total Equity

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$60m
$30m HY17 HY16
51.8 49.1
$0m
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Interim Dividend

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6cps
3cps HY17 HY16
5.0 5.0
0cps
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HY17 Results Summary

Ke Features y

• Maintained consistent operational and financial performance

• Achieved anticipated outcomes on existing projects

• Lower revenue from mineral processing design and construction activity partially offset by record contribution from Upstream Production Solutions

• Overall profitability consistent with HY16

• Record performance for Upstream Production Solutions

• Strong balance sheet maintained (>$40 million net cash)

• Fully franked interim dividend maintained (5cps)

Se ment Revenue g

Mineral Processing

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$120m
$60m HY16
HY17 110.0
74.3
$0m
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Oil & Gas

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$40m
$20m HY17
31.6 HY16
17.2
$0m
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Se ment PBT g

Mineral Processing

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$10m
$5m HY17 HY16
9.5
7.2
$0m
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Oil & Gas

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$4m
$2m HY17 HY16
3.4 1.0
$0m
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HY17 Operational Performance

Mineral Processin g

Design and Construction

• EPC – contributions from Nova Nickel Project, Chillagoe Project (Mungana), Davyhurst Project

• EPCM – Olympias Phase II gold lead/zinc

• LTI free – continually progressing safety initiatives to maintain a zero harm workplace

Studies and Consulting

• 16 studies completed during HY17

• GRES engaged on a further 15 studies for projects at various pre-development stages

• Study outcomes demonstrate potential for near term development opportunities for GRES

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HY17 Operational Performance

Oil & Gas

• Record operations and maintenance services revenue and earnings[1 ]

• Strong contributions from existing operations in Queensland (APLNG), onshore Perth Basin and offshore Perth Basin (Cliff Head)

• Key renewals obtained for Perth Basin O&M contracts in HY17

• Northern Endeavour FPSO – full O&M scope of services commenced in HY17 following completion of operator transition

• Blacktip maintenance services contract award in February 2017 – second Timor Sea project for Upstream PS

1. Post acquisition of Upstream PS business by GR Engineering

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Strategy & Outlook

• GR Engineering remains uniquely placed as a proven process engineering design and construction group providing fixed price, turnkey solutions to the mineral processing sector

• High levels of study activity on robust development projects

• Pipeline of mineral processing design and construction projects identified with total estimated capital values of circa $1.4 billion

• Letter of intent for Mt Morgans Gold Project EPC contract to provide solid start to FY18 order book

• Other near term design and construction opportunities exist - predominantly for Australian gold and base metals projects

• Subject to award of these near term opportunities and continued strong performance by Upstream Production Solutions, GR Engineering anticipates FY17 financial outcomes consistent with FY16 results

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Appendix: Corporate Summary

Capital Structure
Shares on issue	m	152.9
Share price_(GNG.ASX)(6 March 2017)_	$	1.57
Market capitalisation	$m	240.0
Cash_(31 December 2016)_	$m	41.3
Debt_(31 December 2016)_	$m	1.2
Enterprise Value	$m	199.9
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 Terry Strapp Non-Executive Director Joe Totaro CFO & Company Secretary

Share Price Performance

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$2.50 10m
$2.00 8m
$1.50 6m
$1.00 4m
$0.50 2m
$0.00 0m
Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17
Volume GNG.ASX
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Register Analysis

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36.8%
40.1%
23.1%
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Directors & Senior Management Institutions Other

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Appendix: About GR Engineering

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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 West Africa, United Kingdom, PNG, Indonesia and the Americas

• Expertise in gold, base metals, uranium and industrial mineral commodities

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Upstream Production Solutions

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

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

Selected Clients

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Selected Clients

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Contact

Geoff Jones

Managing Director

• +61 8 6272 6000

• geoff.jones@gres.com.au

Joe Totaro

CFO & Company Secretary

Australian Office Details

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179 Great Eastern Highway Belmont WA 6104

• PO Box 258 Belmont WA 6984

• +61 8 6272 6000

17 Graystone Street Tingalpa QLD 4173

• +61 7 3838 8000

• +61 8 6272 6000

• joe.totaro@gres.com.au

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Level 11, 607 Bourke Street Melbourne VIC 3000

• +61 3 8623 9800

• 17 Graystone Street Tingalpa QLD 6173

• +61 7 3239 5800

Suite 2, 100 Havelock Street West Perth WA 6005

• +61 8 9482 0650

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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 financial report for the half year ended 31 December 2016. 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.

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