Slide 1. MITIE Group PLC. Analyst & Investor Strategy Presentation. 22 September 2011

Transcription

1 Slide 1 MITIE Group PLC Analyst & Investor Strategy Presentation 22 September 2011

2 Slide 2 Growth aspirations Ruby McGregor-Smith Chief Executive

3 MITIE today MITIE is a strategic outsourcing and energy services company which manages facilities, energy, property and infrastructure for its clients Market-leading FTSE 250 support services business Second largest energy services company in the UK* Revenues of 1.9bn and operating profit of 108.3m (FYE March 2011) 23-year track record of profitable growth High-quality client base of UK public sector organisations and many private sector domestic and multinational businesses, including half of the UK FTSE100 Predominantly UK-based, with growing European presence One of the UK s top 50 private sector employers with 61,000+ employees * BSRIA, 2010 Analyst & Investor Strategy Presentation 3

4 How we are structured MITIE 1,891.4m 5.7% FY2011 Revenues EBITA margin Facilities Management Technical Facilities Management Property Management Asset Management Overseas FY2011 Revenues 882.2m 437.1m 509.7m 62.4m EBITA margin 6.4% 5.6% 4.2% 3.2% 25.0m Total security management Cleaning Catering Document management Reception & front of house Landscaping Pest control Waste & environmental Integrated FM M&E engineering maintenance CarbonCare energy services Lighting Mobile multi-site FM Building management systems & controls Compliance services Property maintenance Building refurbishment Roofing Painting Interior fit-out M&E engineering installation Solar PV panels Insurance claims management & repairs Energy Services Decentralised energy centre development Low carbon data centre development Renewable energy integration Energy services company (ESCo) management Community infrastructure Analyst & Investor Strategy Presentation 4

5 The outsourcing market evolves 1980 In-house 1990 Single service 2000 Bundled services 2010 Integrated FM Strategic outsourcing Shift Security M&E engineering Catering Cleaning Maintenance Pest control Broader cost savings Single point contact Standardised provision Best practice Integrated delivery Management information systems Property management Overseas Add-on specialist services Consultancy Buildings management and services Business process outsourcing Technology Data management Asset investment Energy/carbon Supply chain Project management Analyst & Investor Strategy Presentation 5

6 A few more of our notable clients Analyst & Investor Strategy Presentation 6

7 Our strong track record Revenue Basic Earnings Per Share before other items Analyst & Investor Strategy Presentation 7

8 How we will continue to grow Record order book and sales pipeline 85% of 2012 budgeted revenues secured as at 30 June 2011 (June 2010: 78%) 6.8bn order book as at March bn sales pipeline as at March 2011 Committed long-term funding, low gearing and no material pension deficit Excellent client relationships drive organic growth Resilient business model allows flexible market approach Energy services capability transforms existing outsourcing model Market-leading technology provides competitive edge and operational excellence Significant potential for overseas growth Incentives at all levels result in better performance and entrepreneurial culture Analyst & Investor Strategy Presentation 8

9 The opportunities in our 11.4 billion sales pipeline Property Management and Real Estate Manufacturing Leisure Technology Support Services Retail Transport Utilities Central government Local government Financial and Professional Services Construction Private:Public sector split Social Housing Health Education Other public sector 35:65 Analyst & Investor Strategy Presentation 9

10 Private sector opportunities Energy services currently 34% of revenues and increasing Opportunity to repeat the growth achieved with Rolls-Royce and Vodafone with a number of existing major clients over the next 2-3 years Significant integrated FM opportunities in financial services and retail Eg. decentralised energy centres: 17 opportunities in pipeline over 5m each (and up to 170m) and 50 smaller projects International development driven by private sector relationships and shift towards pan-european procurement Analyst & Investor Strategy Presentation 10

11 Public sector opportunities Justice MOJ pipeline of up to 1bn Total facilities management contracts for MOJ decision due in Autumn Health Energy services framework agreement Large increase in FM opportunities Local authorities Edinburgh City Council facilities management and property outsourcing Oxfordshire County Council and Essex County Council facilities management outsourcing Social Housing Over 200 social housing bids in pipeline Analyst & Investor Strategy Presentation 11

12 Well-positioned for the future Leading UK outsourcing and energy services company with a 24- year track record of growth Substantial pipeline of opportunities bn will drive continued long-term growth in the business Supported by a high-quality client base and long-term relationships Demand from public and private sector to increase scale and scope of outsourcing Integrated FM Energy services International expansion Analyst & Investor Strategy Presentation 12

13 Slide 13 Market Opportunities Patrick Stirland Managing Director, Strategic Outsourcing

14 11.4 billion sales pipeline Property Management and Real Estate Manufacturing Leisure Technology Financial and Professional Services Support Services Retail Transport Utilities Central government Local government Construction Social Housing Health Education Other public sector Private:Public sector split 35:65 Analyst & Investor Strategy Presentation 14

15 Local authority market Spending Review October 2010 Localism Bill December 2010 Local Authorities Response Business model review Bundling of adjacent services, e.g. FM, utilities, estate management, work style, capital projects Procurement consolidation neighbouring authorities procuring together Larger authorities setting up frameworks for smaller public sector agents PCT and LA cooperation Analyst & Investor Strategy Presentation 15

16 Recent success Essex County Council Preferred bidder 8m base contract value District councils within Essex can access this contract 10 year contract Integrated facilities and property management with energy services and estates management Service over 350 sites including Essex County Hall and various offices, libraries, community centres and depots covering 145,000m 2 Partnering with Lambert Smith Hampton to provide estates management Energy services and waste management Community investment Analyst & Investor Strategy Presentation 16

17 Live opportunities Edinburgh City Council Transformational facilities, property, capital works and energy management contract 18 month bidding process, down to two bidders: MITIE/Atkins/Lambert Smith Hampton (Vital Edinburgh) and Capita/Carillion Decision due in October 7 year (+ 5 year extension) contract Camden Integrated FM services across the borough 5 years + 2 year extension Shortlisted to last four Analyst & Investor Strategy Presentation 17

18 Other public sector Olympic Park (legacy) 5-year contract to deliver integrated FM to selected parts of the Olympic estate (post-games) Shortlisted to the last four bidders Decision expected in December 2011 Sellafield Largest re-bid in 2011 (current contract expires March 2012) Potential to expand our existing contract significantly by adding services and additional buildings Analyst & Investor Strategy Presentation 18

19 Central Government OGC Framework DBIS (Department of Business, Innovation and Skills) FM bid DFE & CLG (Department for Education and Department for Communities and Local Government) GPU (Government Property Unit) Outsourcing of FM, energy management and property services across government departments Five regional procurements commencing no later than April 2015 First two pilots London Whitehall and Bristol City Centre are expected to bid in January 2012 Analyst & Investor Strategy Presentation 19

20 Health market overview The UK healthcare market has four segments primary, secondary, community and central bodies Analyst & Investor Strategy Presentation 20

21 Health market overview Opportunity in: Soft Services Facilities Services Integrated Facilities Management Energy Services Analyst & Investor Strategy Presentation 21

22 Slide 22 Justice proposition Jeff Flanagan Group Corporate Development Director

23 11.4 billion sales pipeline Property Management and Real Estate Manufacturing Leisure Technology Financial and Professional Services Support Services Retail Transport Utilities Central government Local government Construction Social Housing Health Education Other public sector Private:Public sector split 35:65 Analyst & Investor Strategy Presentation 23

24 Justice overview Home Office and MOJ both have to achieve 25% savings over four years The MoJ has quantified the market over the next five years Well-defined market and opportunity A visible pipeline over a defined timespan MoJ procurement is centralised MoJ has acted to begin the process of cost reductions Analyst & Investor Strategy Presentation 24

25 MoJ Desire to shift away from short-term custodial sentences More rehabilitation and community sentences Prison population is over 85,000, prisons are operating at full capacity, the estate has a significant maintenance backlog and incarceration is expensive The average cost per year per person in prison is 40,000 Analyst & Investor Strategy Presentation 25

26 Key budget priorities for MoJ Courts and tribunals system will be brought together in a single agency Efficient central London estate Reduce and reorganise arm s length bodies Shared services models Reduce spending on courts and legal aid by developing access to alternative dispute resolution Analyst & Investor Strategy Presentation 26

27 Specific MoJ markets Total facilities management Prisons management Electronic monitoring Community payback Probation trusts Analyst & Investor Strategy Presentation 27

28 Total facilities management Appointed to the MoJ s Total Facilities Management Framework Route to bid for FM at courts and two prisons Total FM for courts in two lots North and South of England Fully integrated FM Decision due late September, contract commences 1 Feb 2012 Can only be awarded one region FM for prisons also in this framework, with the first 2 prisons to be announced in late September Analyst & Investor Strategy Presentation 28

29 Prisons management Framework to appoint 6 to 8 providers, expected to be agreed by 30 October 2011 First award expected by 30 September 2012 Outsourcing of 8 to15 prisons per year 14 year contracts Analyst & Investor Strategy Presentation 29

30 Community payback Compact our joint venture with A4e to bid under the community payback framework MITIE: logistics and supervision A4e: rehabilitation and training Four-year contracts Four providers on the framework Compact, Serco, Sodexo and the Probation Service London is the first region to be let Completion on all regions expected by end of March 2013 Analyst & Investor Strategy Presentation 30

31 Home Office Two principal customers UK Border Agency and Police UKBA procures centrally for immigration detention services Police procurement is local, through 43 forces Analyst & Investor Strategy Presentation 31

32 Immigration removal centres UK Border Agency contracts Awarded Campsfield House and commenced contract in May year + 3 year contract, 5m pa Includes a proposal for energy services that would be in addition to base contract value 7 currently private sector managed, 4 public sector Analyst & Investor Strategy Presentation 32

33 Summary MoJ market opportunities Total facilities management Prisons management Community payback Electronic monitoring Home Office market opportunities Police services Immigration removal centres Analyst & Investor Strategy Presentation 33

34 Slide 34 Energy services and infrastructure Mike Tivey Managing Director Asset Management

35 The converging forces are well established in the market Efficiency without loss Security of supply Low carbon technology Flexibility to meet demand Analyst & Investor Strategy Presentation 35

36 The drivers are in place Analyst & Investor Strategy Presentation 36

37 Rapidly growing demand for energy & carbon strategies 1. Reduce consumption 2. Diversify supply to include renewable energy 450 billion the amount the UK must spend on energy efficiency measures and energy supply infrastructure by 2025 * In the EU, there are an estimated active energy service contracts Market value of 6.7 to 8.5 billion Market predicted to grow to c 25 billion by 2020 Analyst & Investor Strategy Presentation 37

38 UK Energy services market Energy Consultancy & Compliance Utility Procurement & Data Management 3000 Energy Retrofit (Incl renewables) Supply and Perfotmance Performance Contracting Total Market Analyst & Investor Strategy Presentation Source: 38 BSRIA, DECC et al

39 Our capability Energy Services 34% of MITIE Group revenue Analyst & Investor Strategy Presentation 39

40 Summary Macroeconomic, environmental and legislative forces driving unprecedented demand for energy and carbon strategies Reduce energy consumption Diversify energy supply MITIE s capabilities Decentralised energy Renewable energy Energy consumption reduction Carbon compliance Data management Innovative ideas and raising awareness Positioned for rapid growth in this market Analyst & Investor Strategy Presentation 40

41 Slide 41 Summary and questions Ruby McGregor-Smith Chief Executive