Amec Foster Wheeler
Investor presentation
April 2015
Background
►
Ticker: AMFW
► Listed on LSE and NYSE
►
Market cap: c£4bn / $6bn
► Ave liquidity: >£30m/$50m p.d.
►
Location of shareholders
5%
Americas
37%
Europe
58%
Rest of
World
2
All Share
250
Amec Foster Wheeler: a new force in……..
►
Full project delivery
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From consulting to project management
►
Highly skilled workforce
►
Global reach
►
Diversified across markets, services
and the asset lifecycle
►
3
Financial performance
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Low risk, diversified portfolio
►
Asset light and cash generative model
►
Focus on shareholder value
Add a coloured
transparent
segment and
caption if
required.
Multi market, global reach
►
Split of 2014 pro forma scope revenues
By Market
10%
By Business Unit
Oil &
Gas
upstream
8%
28%
54%
17%
47%
28%
midstream
4%
22%
8%
downstream
Oil & Gas
Mining
Clean Energy
Environment & Infrastructure
4
28%
Americas
N Europe & CIS
Africa, Middle East, Asia & S Europe
Global Power Group
Diverse and flexible model
►
Split of 2014 PF revenues
By contract
By service
2%
5%
12%
26%
28%
31%
72%
8%
16%
Reimbursable
Fixed price
Technology
5
Consulting
EPCM/PMC
Project Delivery
Engineering
Design & Supply
Other
Technology
GoTechnology®
6
Supercritical CFBs
SYDECSM delayed coking
Blue-chip customer base
7
Major customers
Long
Term
Contracts
Long
Term Contracts
Long
term
contracts
Partners
Partners
NOCs
Current projects
Current
projects
Frameworks
Frameworks
Order book reflects strength and diversity
►
Only committed work included
►
no major projects cancelled
7
Order book £bn (1)
£bn (1)
6
►
c.30% long term contracts
5
4
No project or customer represents
more than 10%
upstream
►
3
downstream
2
1
0
2012
Oil & Gas
8
2013
Mining
2014
Clean Energy
1) Pro forma
E&I
Long term growth markets
Share of energy consumption
►
Long term demand story intact
►
Adapt to changes
►
More gas
►
More clean coal
►
More renewables
►
More non-OECD
2015
2020
2025
OECD
2030
2035
non-OECD
Changing mix of energy production
2015
2020
Liquids
9
Gas
2025
Coal
2030
2035
Renewable
Source: BP Energy Outlook 2035
Our priorities
►
►
►
10
Control our own destiny
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Adapt to market conditions
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Be lean and efficient
►
Increase cost savings
Take full advantage of our business model
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Low-risk
►
Multi-market
►
Global reach
Upgrade our business
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Continue integration
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Collaborate more
Focus for 2015: reducing our cost base
►
Targeted cost savings increased
to $125m per annum by 2017
►
►
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11
Updated cost savings plan
Cost to achieve c.$150m
Main initiatives
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Remove duplication in head office
and regional management
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Further IT integration
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Accelerate shared services
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Coordinated procurement
2017: move back to continuous
improvement programme
Original $75m
Updated $125m
Head office
Regional mgmt
IT
Other
Focus for 2015: managing our resources
2015
“normal year”
Very
flexible
Contractor
Contractor
?
Project
Contractor
Project
Core
Central functions
12
Volume
driven
+
Project
=
Core
Talent
investment
Central functions
Efficient
operations
Core
Central functions
Focus for 2015: reducing project costs
►
Customers need our help
►
►
This is not an optional extra
Whole supply chain needs to adapt
►
15%
Biggest savings likely to come from
equipment and construction
Reducing capital spending
100
80
60
►
13
3 things we can do
40
►
Innovate
20
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Standardise
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Use multi office delivery
Outside
AMFW
traditional
scope
AMFW scope
0
Financial details FY 2014
14
Overview
►
2014 performance in line with expectations
► Benefits of low-risk, multi-market model with global reach evident
2014 results (£m)
AMEC
Pro Forma
►
Revenue
3,993
3,719
5,800
►
Scope revenue (1)
3,920
3,669
5,493
►
Trading profit (2)
321
320
457
►
Trading margin (3)
8.2%
8.7%
8.3%
►
Adjusted EPS (4)
79.5p
►
Dividend per share
43.3p
(1)
(2)
(3)
(4)
15
Reported
Excluding pass through procurement revenue
Before intangibles’ amortisation, net asbestos-related costs and exceptional items, but including joint venture trading profit
Trading profit divided by scope revenue
Diluted for continuing operations, before amortisation and exceptional items, net asbestos-related expense
Scope revenue by new business unit
►
Underlying scope revenue up 4%
►
Reflects mix of services and markets
2014
►
Americas
2,638
+5%
+12%
►
North Europe & CIS
1,541
-4%
-3%
►
Africa, Middle East, Asia and S Europe
958
+1%
+7%
►
Global Power Group
451
-10%
-9%
►
Centre and intercompany eliminations
(95)
-
+4%
5,493
(1) Excluding the impacts of currency movements, acquisitions and pass through procurement revenue
16
Headline Underlying(1)
£ million
Scope revenue by market
►
Strong performance downstream; with weaker upstream Oil & Gas
►
Strong performance from Solar and Nuclear in Clean Energy
£ million
►
Oil & Gas
►
Mining
►
Clean Energy
2014
Headline
Underlying(1)
3,007
-
+4%
453
-14%
-7%
1,580
+8%
+11%
►
E&C
1,129
+17%
+22%
►
GPG
451
-10%
-9%
-3%
+5%
-
+4%
►
Environment & Infrastructure
548
►
Centre
(95)
5,493
1)
17
Excluding the impacts of currency movements, acquisitions and pass through procurement revenue
Outlook
►
Benefits of low-risk, multi-market model
►
Benefits of integration and cost saving programme
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Strong cash conversion
►
2015 guidance
►
LFL scope revenue flat
►
►
Increased pricing pressure from customers
►
18
Currency benefit estimated at c.£150m
Trading margin down modestly
Amec Foster Wheeler: a new force in……..
►
Full project delivery
►
From consulting to project management
►
Highly skilled workforce
►
Global reach
►
Diversified across markets, services
and the asset lifecycle
►
19
Financial performance
►
Low risk, diversified portfolio
►
Asset light and cash generative model
►
Focus on shareholder value
Add a coloured
transparent
segment and
caption if
required.
Important information
This presentation contains “forward-looking statements” within the meaning of the US Private Securities Litigation Reform Act of 1995. These forward-looking statements
include: expectations regarding global economic conditions or other macroeconomic developments in the geographic regions and markets in which Amec Foster Wheeler
operates, including fluctuations in exchange rates; expectations regarding revenues, trading profits and other results of operations, and tax rates for the 2015 financial year;
and expectations regarding the integration or performance of current and future investments, associates, joint ventures and newly acquired businesses, including Foster
Wheeler.
There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements.
These factors include, but are not limited to, global economic conditions or other macroeconomic developments in the geographic regions and markets in which Amec Foster
Wheeler operates, including fluctuations in exchange rates, changes in commodity prices which may impact demand for Amec Foster Wheeler’s services, Amec Foster
Wheeler’s exposure to the risks associated with operating in emerging markets] and the possibility that the regulatory environment in which Amec Foster Wheeler operates
may change.
Furthermore, a review of the reasons why actual results and developments may differ materially from the expectations disclosed or implied within forward-looking statements
can be found by referring to the information contained under the heading Forward-looking statements” and "Principal risk factors and uncertainties" in Amec Foster Wheeler
plc’s Annual Report for the year ended 31 December 2014. The Annual Report can be found on Amec Foster Wheeler’s website (www.amecfw.com/investors).
All subsequent written or oral forward-looking statements attributable to Amec Foster Wheeler or any persons acting on its behalf are expressly qualified in their entirety by
the factors referred to above. No assurances can be given that the forward-looking statements in this presentation will be realised. Except as otherwise stated herein and as
may be required to comply with applicable law and regulations, Amec Foster Wheeler does not intend to update these forward-looking statements and does not undertake
any obligation to do so.
Further information
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21
[email protected]
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44 (0) 207 429 7500
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1 713 570 8327
www.amecfw.com/investors