one ALS Commodities Life Sciences Industrial Citi s 8 th Annual Australian & New Zealand Investment Conference Sydney 19 th October 2016 All figures stated in AUD unless otherwise stated 1 RIGHT SOLUTIONS RIGHT PARTNER
New Business structure and end market focus (1) (1) (1) (1) (2) (3) (1) (Global market position) (Australian market position) 2
ALS Strategic Assets Network Brand Systems Technology Culture A L S S t r a t e g i c A s s e t s 408 sites quality LIMS state-of-the-art people 73 countries timeliness MIS innovators training 6 continents service standardisation standardisation focus global IT innovation systemisation unique client service network technology multi-language centres of communication value global excellence passion 3
ALS global locations a strategic asset 4
Strategic mix of revenue 5
Group Strategy geographies & markets FY06 revenue $212mn FY11 revenue $862mn FY16 revenue $1365mn Australia Asia South America North America Africa Europe Middle East Environmental Food/Pharma Consumer Products Geochemistry Metallurgy Inspection Engineering Oil & Gas Coal Asset Care Tribology 6
Strategic mix of revenue 7
Debt Metrics AUD$200m available for acquisitions from cash held 8
Life Sciences poised for continued growth Environmental and Water Food Safety Specialized and Complex Testing Increased and Enforced Regulations Consumer Products Public Awareness and Consumer Concern Infrastructure and Population Growth Pharmaceutical 9
ALS Life Sciences Industry Significant opportunities available to ALS Large Addressable Market Strong Growth Fragmented Market Total: US$11bn Environmental: US$4bn Food Safety: US$2bn Pharma: US$5bn Overall: 6% p.a. Environmental: 6% p.a. Food Safety: 7% p.a. Pharma: 6% p.a. ALS Market Share Environmental: 10% Food Safety: 4% Pharma: <1% Track Record of Growth Strong Returns Irreplicable Global Platform Life Sciences FY07-16 Revenue CAGR: 16% Environmental market share increased from 3% to 10% since 2006 Life Sciences ROIC 19% Life Sciences EBITDA margin 23% 400 sites 70 countries Global Network Note: Company estimates 10
Track record of growth Life Sciences FY07 LOCATIONS REVENUE EBITDA EBITDA% ROIC 34 $165mn $37mn 22% 13% FY16 LOCATIONS REVENUE EBITDA EBITDA % ROIC 155 $634mn $145mn 23% 19% ROIC calculated as LTM EBIT / Total Invested Capital. Total invested capital calculated as reported segment assets minus segment liabilities. 11
Leading market positions ALS Current Food and Environmental Market Share Canada Europe (Nordic Region, Eastern Europe, and Iberia) 11% 19% 20% 25% 5% 10% UK 10% Asia USA 35% 25% Latin America 40% 30% Australia Note: Company estimates of ALS market share of commercially available work for the services ALS currently offers 12
Sustainable strong returns Historical Life Sciences ROIC (1) 16% 16% 18% 22% 23% 23% 20% 20% 18% 18% 16% 17% 17% 19% 1H10 2H10 1H11 2H11 1H12 2H12 1H13 2H13 1H14 2H14 1H15 2H15 1H16 2H16 Historical Life Sciences Revenue and EBITDA Margin (2) EBITDA Margin (%) Revenue ($ millions) 350 300 250 200 150 100 50 0 Eurofins 19% SGS 18% Intertek 15% 1H10 2H10 1H11 2H11 1H12 2H12 1H13 2H13 1H14 2H14 1H15 2H15 1H16 2H16 30% 25% 20% 15% 10% 5% 0% Revenue EBITDA Margin 1 ROIC calculated as LTM EBIT / Total Invested Capital. Total invested capital calculated as segment assets minus segment liabilities. 2 Intertek margin represents the Chemicals & Pharmaceuticals division, SGS margin represents the Life Sciences Services and Environmental Services divisions. Eurofins margin includes Corporate costs 13
AUD $millions Mineral cycle at a trough Australian Mineral Exploration Spend (excluding iron ore & coal) 600 500 33% decrease 53% decrease 400 300 27% decrease 28% decrease 46% decrease 200 100 0 7.5 years 9.0 years 11.0 years GFC Induced 3.2 years Source: Australian Bureau of Statistics 14
Minerals & Energy Revenue $ millions Platform well positioned to benefit from recovery Historical revenue and EBITDA margin for the Minerals and Energy segments (FY ending March) 1 800 45.0% Laboratory Service Provider used for SNL Top Ranked Assay Drill Intersection Announcements 2014-2015 2 600 30.0% 400 200 SGS 20% BV 18% Intertek 17% Intertek 18% SGS 18% BV 16% 15.0% 0 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 0.0% Minerals & Energy Revenue Minerals & Energy EBITDA Margin Leading global platform leveraged to inevitable market recovery Enhanced by ongoing cost base management and service optimisation 1 Estimated EBITDA Margins for SGS, Intertek, Bureau Veritas are for Calendar Year 2015 and 2012 and refer to the Commodities segment for Intertek, the Commodities segment for Bureau Veritas and the Minerals and O&G & Chemicals Services segments for SGS. EBITDA is underlying EBITDA for all companies 2 SNL Top 10 Ranked Assay Targets for Copper, Gold, Lead, Silver and Zinc published in Quarterly SOTM reports 15
$CAD $AUD $USD Mineral cycle are we past the bottom of the cycle? SNL Metals & Mining 16
Global Exploration Budget US$ bn (non ferrous metals) Mineral cycle driven by gold at top and bottom of the cycle Bottom of the cycle Top of the cycle Figure 2 :Worldwide Exploration meters drilled by target 2012 Other 17% 20 15 10 Silver 12% Zinc/Le ad 5% Copper 15% Gold 51% 5 0 SNL Metals & Mining 17
Mineral cycle are we past the bottom of the cycle? SNL Metals & Mining 18
Mineral cycle are we past the bottom of the cycle? 19
Expenditure rebased to 100 DOLLARS USD$ billion price value What does increased sample flow mean to ALS? Market Trends Analytical Spend Drivers 400 20 350 300 15 250 200 150 18% 10 generic innovative SERVICE 100 5 50 0 CY2007 CY2008 CY2009 CY2010 CY2011 CY2012 CY2013 CY2014 CY2015 CY2016 $ Grassroots $ Late STage $ Minesite Grassroots Late Stage Minesite Source: SNL Data 0 ALS continues investment to maintain technical capabilities and feed innovation to high end value added services ALS focus on systems, productivity and cost base to maintain volume in generic services market sector 20