Investor presentation
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 ► From consulting to project management ► Highly skilled workforce ► Global reach ► Diversified across markets, services and the asset lifecycle ► 3 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. 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 ► Adapt to market conditions ► Be lean and efficient ► Increase cost savings Take full advantage of our business model ► Low-risk ► Multi-market ► Global reach Upgrade our business ► Continue integration ► Collaborate more Focus for 2015: reducing our cost base ► Targeted cost savings increased to $125m per annum by 2017 ► ► ► 11 Updated cost savings plan Cost to achieve c.$150m Main initiatives ► Remove duplication in head office and regional management ► Further IT integration ► Accelerate shared services ► 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 ► Standardise ► 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 ► 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 ► ► 21 [email protected] ► 44 (0) 207 429 7500 ► 1 713 570 8327 www.amecfw.com/investors
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