FORWARD-LOOKING INFORMATION

Transcription

1 May 2015

2 FORWARD-LOOKING INFORMATION The information in this presentation includes certain forward-looking statements. These forward-looking statements are based on currently available competitive, financial and economic data and operating plans but are subject to risks and uncertainties. In addition to events beyond Aecon s control, there are factors which could cause actual or future results, performance or achievements to differ materially from those expressed or inferred herein including, but not limited to: operational and reputational risks, including large project risk and contractual factors, the timing of projects, unanticipated costs and expenses, labour relations, specific sector performance and general market, economic and industry conditions. Readers are referred to the specific risk factors relating to and affecting Aecon s business and operations as filed by Aecon pursuant to applicable securities laws. Forwardlooking statements may include, without limitation, statements regarding the operations, business, performance, prospects, strategies and outlook for Aecon. Forward-looking statements, may in some cases be identified by words such as will, plans, believes, expects, anticipates, estimates, projects, intends, should or the negative of these terms, or similar expressions. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and Aecon undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. 2

3 2015 Q1 AND TTM** RESULTS $ Millions Three months ended March 31 March 31 TTM** Revenue , ,963.0 Gross Profit Gross Margin % 7.4% 7.1% 10.0% 9.5% Adjusted EBITDA Adjusted EBITDA Margin % 1.3% 0.7% 6.5% 6.7% Operating Profit (18.2) (23.2) 68.6 $105.2 Adjusted Net Income * (17.0) (24.7) $29.5 $51.3 Adjusted EPS (Diluted) * ($0.30) ($0.47) $0.61 $0.79 New Awards ,263 3,068 Backlog 2,787 2,178 * Before impact of fair value gain/loss on convertible debentures ** TTM = Trailing Twelve Months 3

4 CONTINUED PROGRESS TO BECOMING THE LEADER IN CANADA FOR LARGE-SCALE, TURNKEY PROJECT DELIVERY DEMONSTRATING A WINNING PROPOSITION FOR CLIENTS AND PROVIDING A PLATFORM FOR TOP AND BOTTOM LINE GROWTH 4

5 RECORD NEW CONTRACT AWARDS IN 2014 COMBINED WITH ONGOING STRENGTH FROM RECURRING REVENUE + Recurring revenue is not included in backlog and is, therefore, over and above work to be performed from contracts in backlog *Segment structure not applicable in

6 RECORD BACKLOG *Recurring revenue is not included in backlog and is, therefore, revenue over and above work to be performed from contracts in backlog 6

7 RECORD SUCCESS RATE ON REQUESTS FOR PROPOSAL DRIVING RECORD AWARDS, BACKLOG, AND VISIBILITY SINCE 2013, AECON AWARDED SIX MAJOR PROJECTS AFTER PRE-QUALIFICATION PROCESS 43% WIN RATE $2.0BN* WON John Hart Power Station (P3) BC Eglinton LRT Tunnel ON Regina WWTP (P3) SK Viva Rapidway BRT ON New Post Creek ON Waterloo LRT (P3) ON SUBMISSIONS IN PROGRESS AECON CURRENTLY IN SUBMISSION STAGE FOR EIGHT RFP S $15.0BN* Site C Civil Works BC Winnipeg BRT MB Edmonton LRT (P3) AB Eglinton LRT (P3) ON Saskatoon N. Commuter Bridge (P3) SK Viva Next Hwy 7 BRT (P3) ON Regina Bypass Ring Road (P3) SK Point Saint Charles Shed (P3) QC *Total project size, not necessarily Aecon s share, as most major projects bid with partners 7

8 RECORD ADJUSTED EBITDA MARGIN IN 2014 MARGIN PROGRESSION IN 2014 DESPITE LOWER REVENUE BODES WELL FOR CONTINUED PROGRESS ON THE BACK OF SIGNIFICANTLY HIGHER BACKLOG IN

9 SUCCESSFUL TRANSITION KEY DRIVERS AECON PLATFORM BUILT ON FOUR KEY PILLARS PARTNERSHIPS Clients, engineers, contractors, First Nations, unions The sought-after Canadian partner-of-choice Increasingly leading major consortia pursuits REPUTATION Highest quality safety programs, people, value as a partner, proven capability and track record Leads to more repeat business with key clients Leads to more negotiated and target-style projects TURNKEY CAPABILITY % of work from large, multi-faceted projects is now 30% - 40% per annum Most vertically-integrated Canadian contractor Driven by ONE Aecon philosophy EXECUTION Focus on risk management and project controls Focus on self perform capabilities and differentiation from general contractors Focus on world-class systems and tools ALL ON THE FOUNDATION OF AN UNMATCHED NATIONAL PRESENCE IN OUR CORE MARKET SEGMENTS OF INFRASTRUCTURE, ENERGY, AND MINING. 9

10 ACTIVE PROJECT AND CLIENT PARTNERSHIPS ACTIVE JV PROJECTS PROVINCE AECON SHARE John Hart Power Station BC 60% Port Mann Tunnel BC 40% Capilano Tunnels BC 30% Syncrude - Cogen Plant AB 50% IPL Pipeline and Stations AB 50% Anthony Henday Ring Road AB 22% Regina Wastewater Treatment Plant SK 50% Waterloo LRT ON 51% Eglinton LRT Tunnel ON 50% Darlington Nuclear Refurbishment ON 50% Viva Rapidway BRT ON 50% Sheppard South Subway Tunnel ON 30% CLIENT PARTNERSHIPS Long term MSA / supplier of choice arrangements and/or repeat business 10

11 DIVERSITY & SCALE COAST TO COAST IN OUR KEY MARKET SEGMENTS * % Q TTM Revenue 11

12 AECON ENERGY OUTLOOK 2015 weighted to H2 performance due to timing of backlog work-off and mix Significant nuclear opportunities at both Darlington and Bruce; 2015 will see increasing recurring revenue from long-term Master Service Agreements at both sites Utilities market remains robust and Aecon has been increasing market share Uncertain market conditions for oil limits longer term visibility in this sub-sector but strong backlog in place through 2015 for oil sands work Fabrication and module capacity utilization will be higher in 2015 than in recent years due to already-secured work Major pipeline projects largely stalled but solid opportunities related to integrity programs LNG opportunity still to firm up; expected to eventually lead to significant work on site preparation, process facilities, and pipelines Revenue $1.3 BN Adj. EBITDA Margin 5.2% New Contract Awards (TTM) $1,426 Recurring Revenue % of Segment (TTM) 32% Backlog (as at March 31, 2015) $993 $821 Q TTM 47% $1,417 28% Q Q Q Q Q Q

13 AECON INFRASTRUCTURE OUTLOOK Very strong project pipeline driven in large part by P3 initiatives where Aecon has been particularly successful: rail and transit, major road developments, water treatment Hydroelectric development continues to be robust and plays to a major Aecon strength Governments across Canada continue to express strong commitment to infrastructure spending as a key economic driver and recognizing need to replace / upgrade after decades of under-investment US carries potential to be the world s largest P3 market and is quickly gaining traction; future opportunity for Aecon participation and growth Revenue $0.9 BN Adj. EBITDA Margin 2.8% New Contract Awards (TTM) $1,214 $934 Recurring Revenue % of Segment (TTM) 8% 10% Backlog (as at March 31, 2015) $1,329 Q TTM $1,277 33% Q Q Q Q Q Q

14 AECON MINING OUTLOOK Number of opportunities reduced in the last 24 months due to commodity prices; however Aecon has secured a high proportion of key opportunities Potash development continues to be robust Select opportunities emerging in other commodities; project financing for developers is key Recurring revenue from Contract Mining is stable and tied in large part to production, however some softness possible if lower oil prices persist through second half of 2015 and beyond Revenue $0.5 BN Adj. EBITDA Margin 10.6% 20% Q TTM New Contract Awards (TTM) $931 $471 Recurring Revenue % of Segment (TTM) 47% 33% Backlog (as at March 31, 2015) $465 $80 Q Q Q Q Q Q

15 ONGOING PROGRESS AND FUTURE GROWTH SUPPORTED BY STRONG CASH FLOW AND BALANCE SHEET FREE CASH FLOW ($MM) Adjusted EBITDA Cash Interest Expense (net) (34.7) (31.1) Capital Expenditures (net) (50.8) (49.9) Restructuring Costs (9.0) - Income Taxes (Paid)/Recovered 0.9 (9.1) Net JV Impact* (23.5) (53.5) Change in Working Capital FREE CASH FLOW BALANCE SHEET ($MM) Q Cash 99.3 Working Capital Long-Term Debt - Finance Leases Equipment & Other Asset Loans LT Debt excluding Convertible Debentures Convertible Debentures (Face Value) - Due October 2015 (6.25%) Due December 2018 (5.5%) Total Convertible Debentures *Net JV Impact represents the difference between JV EBITDA included in Adjusted EBITDA (JV EBITDA as defined in Aecon s MD&A) and distributions from Projects Accounted for using the Equity Method Total LT Debt incl. Convertible Debentures LT Debt to 2014 EBITDA - Excluding convertible debentures - Including convertible debentures 1.1 x 2.6 x 15

16 CAPITAL MARKETS SNAPSHOT Market Capitalization (based on $13.50 as at May 11, 2015) ~ $760 Million ANNUAL DIVIDEND HISTORY $0.36 $0.32 $0.28 $0.40* Shares Outstanding 56.4 Million $0.14 $0.20 Average Daily Volume (last three months) 14 Covering Analysts (as at May 11, 2015) ~ 350, Buy/Outperform 3 Hold $ * As announced March 4, Dividend Yield based on $13.50 share price = 3.0%. $15.66 Average Target Price 16

17 A BUSINESS TRANSFORMED In 2014, Aecon had a record year securing work and improving margins in line with our strategy to become the Canadian leader in large-scale, turnkey project delivery. PROVIDING A PLATFORM FOR GROWTH Our progress to date and ability to leverage partnerships, reputation, turnkey capability and strong financial health collectively provides confidence in our ability to maximize the opportunities in front of us and drive value for our stakeholders. 17

18 May 2015