VERIS LIMITED — AGM Information 2014

Nov 2, 2014

2014 Annual General Meeting

Simon Thomas CEO OTOC Limited November 2014

Disclaimer

This Document should not be considered as an offer or invitation to subscribe for or purchase any securities in OTOC Limited (“OTOC” or “The Company”) or as an inducement to make an offer or invitation with respect to those securities. No agreement to subscribe for securities in OTOC should be entered into on the basis of this Document.

This Document contains high level information only and does not purport to be all inclusive or to contain all information which its recipients may require in order to make an informed assessment of OTOC and its prospects. Any forecasts and forward looking information contained in this Document are subject to risks and uncertainties and are not a guarantee of future performance. Actual performance will almost certainly differ from those expressed or implied.

OTOC makes no representation or warranty, express or implied, as to the accuracy, currency or completeness of the information presented herein. Information contained in this Document may be changed, amended or modified at any time by OTOC. OTOC is under no obligation to update any information or correct any error or omission which may become apparent after this Document has been issued.

To the extent permitted by law, OTOC and its officers, employees, related bodies corporate and agents (‘Associates’) disclaim all liability, direct, indirect or consequential (and whether or not arising out of the negligence, default or lack of care of OTOC and/or its Associates) for any loss or damage suffered by recipients of this Document or other persons arising out of, or in connection with, any use of or reliance on this Document or information contained herein. By accepting this Document, the recipient agrees that it shall not hold OTOC or its Associates liable in any such respect for the provision of this Document or any other information provided in relation to this Document.

Recipients of this Document must make their own independent investigations, consideration and evaluation of the information contained herein. Any recipient that proceeds further with its investigations, consideration or evaluation of the information described herein shall make and rely solely upon its own investigations and inquiries and will not in any way rely upon this Document. Recipients of this Document should not act or refrain from acting in reliance on material in this Document.

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Hi hli hts of the Past Year g g

• FY14 revenue $113 million

• FY14 EBITDA $12.8 million, up 17%

FINANCIAL

• Cash on hand $6.8 million (30 June 2014)

• $10m equity placement completed (post 30 June) to support surveying growth strategy

• New facility with Commonwealth Bank of Australia, $16.2 million

• Appointment of Simon Thomas as CEO

• Safety: 100% LTI free (>3 million hours)

• Successful completion of Nauru processing centre

OPERATIONS

• Awarded new work at Nauru. Evident pipeline of opportunities

• Awarded Roy Hill in-ground services contract

• Growth of our Communications division

• Restructure of Whelans and appointment of Brett Goodridge as General Manager

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STRATEGY
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• Strategic focus - creation of a premium national surveying business

• Completed first acquisition in executing strategy

• Bosco Jonson – a premium Victorian surveying business. Blue chip client base. Consistently strong financial performance

• Continue to pursue acquisition opportunities on the East Coast

• Continued diversification of the OTOC Australia operations

• Strengthening contract order book across the business

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Cor orate Structure p

Emerging Infrastructure Services Company with Market Cap > $50m

Share price (as at 29 October 2014)	$	0.21
Ordinary shares on issue	m	248.1
Market cap	$m	52.1
Cash (as at 31 October 2014) Debt (HP $7.0M Bank Debt $9.0M) Enterprise Value EV:EBITDA (FY2014)	$m $m $m $m	14.5 16.0 53.6 4.2x

Rising Institutional Investor Ownership

12 month share price performance – 188% rise since 2013 AGM

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25.0
20.0
$10m equity
placement
15.0
Acquisition of
10.0
Bosco Jonson
Simon Thomas appointed CEO
Initial contract award
5.0
at Roy Hill
0.0
Share Price (A$ cents)
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34%
43%
Institutions
Directors
Other
23%
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Grou Structure p

OTOC is an emerging diversified infrastructure services group

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Survey
Acquisition
Targets
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FY2014 | Financial Highlights

		FY14	FY13	Change
Revenue	$m	113.1	113.9	(1%)
Underlying EBITDA	$m	12.8	10.9	17%
Underlying EBIT	$m	9.1	7.7	18%
Underlying EBIT Margin	$m	8.0%	6.8%	18%
Underlying Profit before Tax	$m	7.2	6.6	9%
Net Profit after Tax	$m	5.5	5.2	6%
Earnings per share	cents	2.8	2.5	12%

• Strong profit growth in context of subdued conditions in resources sector

• Improved operating margins on construction projects

• Diversification initiatives including government infrastructure, remote communications and facilities has contributed to improved margins and lower risk profit (cost-plus)

• Strong focus on rebalancing the Whelans business in order to achieve margin growth

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Health, Safety and Environment

The safety of our people is our number one priority

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Outstanding HSE Performance

• 3.3 million hours Lost Time Injuries Free

• TRIFR decreased since FY2013

Certification

• All safety certifications maintained

Continuous Improvement Initiatives

• Psychosocial Health Strategy

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• Healthy Living Campaign Implemented

• HSEQ System Integrated External audit

• Zero External Major Non-Conformances

• Plant & Equipment procedures and policies improved

• Thorough HSEQ Management System audit & update

• Comprehensive Risk Management process review

• HSEQ accreditation maintained with all clients

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OTOC Australia

• Nauru Island – processing centre project completed

• Continue to secure new work and variations at Nauru

GOVERNMENT INFRASTRUCTURE

• Initial early works award for $6.2m has grown into $75m of work completed to date

• Currently tendering on government infrastructure projects in Western Australia

• Confident of securing ongoing work through the remainder of FY15 and into early FY16

• Awarded Roy Hill in-ground services contract by NRW. Initial contract $3m, orders to date $8m and confident of securing further work at this very large, world class project

RESOURCES INFRASTRUCTURE

• Tendering activity has risen in late FY14 and into H1 FY15

• Tenders submitted for 10+ resources projects that are yet to be awarded

• Targeting new markets that align with core competencies

• Division continues to showcase strong growth and product innovation

• Completed installation of communications and security systems at Nauru

COMMUNICATIONS

• Recently awarded contracts for delivery of telephony and network systems equipment and on-going management services

• New clients from a diverse range of industries including Bunnings, Department of Public Prosecutions, University of Western Australia and Remote Control Technologies (RCT)

• Regular income from hire of remote equipment

FACILITIES

• Rental solutions for clients seeking to reduce capital expenditure

• Commenced operation of Turner Village

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OTOC Australia – Government and Resources Projects

Nauru Processing Centre

Roy Hill

Client Canstruct / Federal Government Value Initial contract - $6.2 million ~ $75 million (to date)

OTOC Division Government Infrastructure Communications Details Nauru Processing Centre 900 person facility including re-build construction

Installation and management of communications & security systems

Maintenance Services

Client

NRW / Roy Hill

Initial contract - $3 million ~ $8 million (to date)

Value

OTOC Division Resources Infrastructure

Details

Roy Hill is a globally significant iron ore project

Contract with NRW for Mine Process Plant (Civil Works) in-ground services

Developing capability in large scale HDPE piping systems

Permanent Settlement Infrastructure

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OTOC Australia – Communications Projects

Bunnings

RCT (Remote Control Technologies)

Client Bunnings Group Limited

Client Remote Control Technologies

Value $164,000 (YTD)

Value

$ 280,000 (YTD)

Details Unified National Contact Centre & Communication Systems for State offices (Brisbane, Sydney, Melbourne and Perth)

Details National Unified Communications Centralisation including VoIP and Video Conferencing

Nation wide 24 hour Managed Service Desk – currently in discussions

Core IT Infrastructure Centralisation and Wide Area Network Design and Deployment

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Surveying Division

A National Leader in Surveying, Aerial Surveying & Town Planning

• OTOC is pursuing a strategy of creating a premium national surveying company

Award Winning Brands

• OTOC Surveying provides surveying, aerial surveying, laser scanning and town planning services to the property, resources and civil infrastructure sectors

• Two long-standing, premium brands: Whelans (established in the 1980’s) and Bosco Jonson (established in 1997 and acquired by OTOC in 2014)

• Approximately 230 staff with offices in Perth, Karratha, Port Hedland and Melbourne

• Why the National Strategy?

• ✓ Sector revenue of $3.4bn in FY13 with forecast growth

• ✓ Attractive earnings profile – recurring revenue, good earnings margins (EBIT >15%), strong free cash flow

• ✓ Fragmented market – many small firms contesting narrow geographic or specialist markets

• ✓ Operational synergies – better service clients with national operations, distribution channel, flexible workforce

• ✓ Products – ability to offer specialised, high-margin services in aerial surveying, laser scanning and technology

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Locations
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Port Hedland
Karratha
Perth
Melbourne
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• ✓ Diversification – across geographic markets and end-user exposure (property, civil infrastructure, resources)

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Surveying Division – Bosco Jonson Acquisition

Acquisition of Bosco Jonson: A Meaningful First Step in the National Strategy

• OTOC recently completed the acquisition of Bosco Jonson

• Established in 1997, Bosco Jonson is a Melbourne based surveying company with approximately 80 staff and longstanding reputation for quality

BOSCO JONSON

• Recognised leader in large scale urban and broad-acre developments

• Blue-chip, long-term client base including Australand, Parklea, Peet, Stockland, Lend Lease, MAB, Satterley and Salta

• Consistently delivered strong financial results, with average EBITDA margin of 33% over FY09 – FY14 and FY14 EBITDA of $4.5m

• Management of Bosco Jonson have remained with the business

• Strategic-fit: consistent with strategy of creating a premium national surveying business

• Clients: high levels of repeat business from diversified blue-chip client base

• Management: experienced management team with proven track record

ACQUISITION RATIONALE

• Geographic expansion: entry into attractive Victorian property market

• Diversification: diversification outside of resources sector

• Financial: diversifies and enhances the quality of OTOC’s earnings

• EPS accretive: expected to be EPS accretive in FY15

• Valuation metrics: up-front consideration implied a FY14 EBITDA multiple of 3.1x

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Surveying Division – Bosco Jonson Acquisition

Financial Impact

• Enhanced scale, repeatable earnings and improved profit margins

• Pro-forma FY14 EBITDA $17.3m of which combined surveying business (Whelans and Bosco Jonson) approximately 30% of pro-forma revenue and approximately 40% of pro-forma EBITDA

• is

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Pro-Forma EBITDA
20
18
16
$4.5
14
$3.5
12 $4.7
10
8
6 $12.8
$10.9
$9.6
4
2
0
2012 2013 2014
OTOC Bosco Jonson
$m
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Pro-Forma EBITDA Margin
16%
14%
13.6%
12%
11.5% 11.3%
10%
9.6%
8.6%
8%
6% 6.3%
4%
2%
0%
2012 2013 2014
OTOC OTOC Pro-forma for Acquisition
EBITDA margin
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Concluding Remarks and Outlook

Achievements in FY2014

• 100% LTI free

• Increased profit margins and profitability off solid revenue base

• Strengthened balance sheet

• First acquisition in national Surveying Strategy – Bosco Jonson

• Completed Nauru processing centre project

• Growth of Communications Division

• Whelans restructure successfully completed and new General Manager appointed

• Improved institutional investor ownership

Outlook

• National surveying strategy. Identification and evaluation of Surveying acquisitions – targeting East Coast

• Nauru work expected to continue throughout FY2015

• Tendering on Government Infrastructure projects in Nauru and Western Australia

• Continued roll-out of Communications services

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Simon Thomas Chief Executive Officer Tel (08) 9317 0608