GR ENGINEERING SERVICES LIMITED — Investor Presentation 2021

Feb 28, 2021

Investor Presentation 1 March 2021

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Our Strategy

Growing to increase the Company’s diversity and strength Facilitate larger projects and minimise vulnerability to changing market conditions

Extend Strategic Larger Geographical Alliances and Projects Presence Investments Strong Extend Client and Diversify Acquisition Relationships Experience

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HY21 Results Summary

Earnings

Balance Sheet & Cash Flow

Revenue

Cash

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$200m
$150m
$100m HY21
176.3 HY20
$50m
95.3
$0m
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$60m
$40m
HY21
$20m 52.8
HY20
20.7
$0m
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EBITDA Net Operating Cash Flow
$20m $20m
$10m HY21
$10m HY21
14.2
17.8
$0m
HY20 $0m
-$10m -15.4 HY20
-7.5
-$20m -$10m
PBT Total Dividend [1]
$10m HY21 6cps
12.6
$0m 4cps
HY20 HY21
-$10m -16.7 2cps 5.0
HY20
2.0
-$20m 0cps
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1) HY21 dividend is fully franked

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HY21 Results

• GR Engineering increased revenue by 85.0% to $176.3 million. The EBITDA contribution was $14.2 million which was a strong turnaround from the prior corresponding period.

• Cash generation was excellent and resulted in a high conversion of EBITDA to free cashflows. During the twelve month period from 31 December 2019 to 31 December 2020, cash at bank increased by $32.1 million.

• GR Engineering’s strong order book into FY22 and anticipated continued strong cash flow generation leaves its well placed to continue to deliver returns to its shareholders.

• The Total Reportable Injury Frequency Rate for HY21 was 11.4.

• A final dividend of 5 cps (fully franked) was declared for the half year period.

• GR Engineering continues to be proactive in its response to the COVID-19 pandemic. COVID-19 has had no material impact on the HY21 results.

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Mineral Processing

• Practical completion was achieved on the following projects in HY21:

• Saracen Minerals Holdings Ltd’s Carosue Dam Operations Plant Expansion Project (excluding variation work)

• • Tellus Holdings Limited’s Sandy Ridge Project

• Practical completion was also achieved on Ora Banda’s Davyhurst Restart Project post 31 December 2020.

• GRES has been successful in building up its contracted pipeline of work during FY20 and subsequent to year end. New and ongoing projects include:

Salt Lake Potash Ltd	Lake Way Project	EPC/EPCM	$107.9m	Australia
Calidus Resources Ltd	Warrawoona Gold Project	EPC	$75.0m	Australia
Pantoro Ltd	Norseman Gold Project	EPC	$57.2m	Australia
Saracen Minerals Holdings Ltd	Thunderbox Paste Plant Project (and variation)	EPC	$34.2m	Australia
Wiluna Mining Corporation	Wiluna Gold Operation – Concentrator	EPC	$25.7m	Australia
Silver Lake Resources Ltd	Deflector Flotation Tails Leach Project	EPC	$23.0m	Australia
Novo Resources Corp.	Nullagine Mill Refurbishment Project	Reimbursable	$8.3m	Australia
BCI Minerals Ltd	Mardie Salt Project – FEED / Early Works	FEED / Early works	$6.1m	Australia
First Majestic Corp.	San Dimas Silver Mine Project	EPCM	US$4.5m	Mexico

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Mineral Processing

• GR Engineering’s pipeline of work opportunities includes:

Galena Mining Ltd	Abra Base Metals Project	$74m	Australia
Geopacific Resources Ltd	Woodlark Gold Project	$92m	PNG
EcoGraf (Australia) Ltd	WA Battery Graphite Manufacturing Facility	$25m	Australia
Sheffield Resources Ltd	Thunderbird Minerals Sands Project	$244m	Australia
Australian Potash Ltd	Lake Wells SOP Project	$170m	Australia
Bluestone Mines JV Ltd	Renison Paste Plant	$16m	Australia
Galena Mining Ltd	Abra Paste Plant	$12m	Australia

 At 31 December 2020, GR Engineering was engaged on 24 studies across a broad range of commodities for projects both in Australia and abroad.

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Oil & Gas

• GR Engineering’s wholly owned subsidiary, Upstream PS, generates longer term operations and maintenance services revenue which results in baseline revenue alongside project based design and construction work.

• During HY21, revenue contributions were primarily from:

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

• Providing operations and maintenance and project services to the Northern Endeavour FPSO and associated infrastructure

• Timor Sea operations and maintenance services (Australian Government and Eni Australia Ltd)

• Maintenance work on assets in the Perth Basin including Mitsui Co. (Australia) Pty Limited

• Commissioning, operations and maintenance support services and surface facility construction in Victoria to clients including APA Group

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Balance Sheet

• Strong balance sheet maintained at 31 December 2020

• Cash: $52.8 million (31 December 2019: $20.7 million)

• Significant headroom on bank guarantee and bonding facilities

• Net operating cashflows: $17.8 million (HY20: negative $7.5 million)

• Half year dividend declared: 5 cents (fully franked)

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FY21 Outlook

• As the consolidated entity moves into FY21, GR Engineering has a strong order book dominated by Australian projects.

• The consolidated entity expects revenue for FY21 to be in the range of $340 million to $360 million, with improved EBITDA margins.

• GR Engineering’s strong cash position means that it is well capitalised to deliver its pipeline of work.

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Capabilities

GR Engineering

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

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

• Expertise in gold, base metals and industrial mineral commodities

Upstream Production Solutions

• Oil and gas services business providing operations, maintenance, project advisory and engineering services to Australian oil and gas industry

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

Selected Clients

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Selected Clients

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Corporate Profile

Capital Structure

Shares on issue	m	155.2
Share price_(GNG.ASX)(26 Feb 2021)_ Market Capitalisation	$ $m	1.37 212.6
Cash (31 December 2020)	$m	52.8
Debt_(31 December 2020) (excluding office lease_	$m	2.8
liabilities and premium financing)
Enterprise Value	$m	162.6

Directors & Management

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

Share price history

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$1.60 0.9
$1.40 0.8
$1.20 0.7
0.6
$1.00
0.5
$0.80
0.4
$0.60
0.3
$0.40 0.2
$0.20 0.1
$0.00 0
GNG.ASX Volume (millions)
Register Analysis
17%
22%
61%
Directors, Founders & Senior Management Institutions Other
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Contact Details

Australian Office Details

GR Engineering Services Ltd

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

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

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Upstream Production Solutions

Level 16, 350 Queen Street Melbourne VIC 3000

Level 10, 345 Queen Street Brisbane QLD 4000

• +61 3 8623 9800

• +61 7 3239 5800

Level 11, 99 St Georges Terrace Perth WA 6000

29 Dawson Street East Arm NT 0822

• +61 8 6109 4000

• +61 8 7979 2340

Hanlon Engineering & Associates

2502 N Huachuca Dr, Tucson, AZ 85745, United States

• +1 520 326 0062

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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 2020. 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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GRES Locations

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