LEADING THE WAY FORWARD Results for the year ended 30 June 2019 21 August 2019 Full Year Results Presentation Seven Group Holdings 2 21 August 2019 GROUP OVERVIEW Our objective is to grow shareholder returns by ensuring our businesses continue to perform and deliver market-leading positions Full Year Results Presentation Seven Group Holdings 3 21 August 2019 GROUP OVERVIEW BUSINESSES AND MARKETS Mining production Industrial Industrial Energy Media • We provide equipment solutions to the world’s services services investments largest miners, supporting record production volumes and driving efficiency Infrastructure investment • We are the largest national equipment hire business, providing solutions to major infrastructure and construction customers with WesTrac (100% owned) is Coates Hire (100% owned) Beach Energy (28.6% Seven West Media (41% a strong pipeline of committed government one of the largest CAT is the largest nationwide owned) is a leading mid-cap owned) is a leading dealers globally (by sales) industrial and general E&P business and a key diversified media company projects and supports customers in equipment hire company supplier to a growing East in Australia with 2,800 Australia’s rich iron ore and Coast market employees East coast gas thermal coal regions SGH Energy (100% owned) Audience of 18.9 million • Beach and SGH Energy are well positioned to Australians engaged Over 160 branches and holds operated and non- 23 branches and 3,300 monthly meet growing East Coast gas demand and 2,300 employees operated oil and gas employees interests including 15% of domestic LNG export opportunity the Crux LNG Project Key customers: BHP, Key customers: BMD, Key customers: Alinta, AGL, Other media investments Diversified investments CIMIC, FMG, Macmahon, CIMIC, Downer, FMG, Adelaide Brighton, Origin include interests in China • Strong balance sheet to pursues growth Min Res, Rio Tinto, Roy Hill Lend Lease, John Holland Energy P/E funds opportunities within or adjacent to our existing core businesses Trading revenue Trading revenue Segment Underlying EBIT Segment Underlying EBIT $3.0b $1.0b $157m $66m Asset value Asset value Segment assets Segment assets $1.9b $2.2b $1.2b $0.5b Full Year Results Presentation Seven Group Holdings 4 21 August 2019 GROUP OVERVIEW PEOPLE, SAFETY AND CULTURE Our people are our greatest asset and keeping them safe is our top priority LTIFR TRIFR • Expanded our safety commitment through leadership programs FY19 FY18 FY19 FY18 – WesTrac’s “Built By Us” program is designed to drive a transformational shift in safety culture and behaviour along with WesTrac WA 1.2 2.5 8.3 12.8 staff engagement WesTrac NSW 1.0 0.4 10.2 4.8 – Objective is to create a safer, enjoyable and more productive workplace Coates Hire 1.6 2.3 12.8 21.5 • Improvements achieved in safety performance within most AllightSykes 0.0 0.0 4.9 7.7 businesses SGH Energy 0.0 0.0 0.0 0.0 Range of people and culture initiatives underway • Apprenticeship program launched by Coates Hire while WesTrac’s Group Total 1.3 1.4 10.4 14.0 program has expanded in recent years with targets set for gender diversity and indigenous intake – Lost time injury frequency rate (LTIFR) = number of lost time injuries per million hours worked; – Total recordable injury frequency rate (TRIFR) = number of recordable injuries per million hours worked; • Executed “train to task” across six key operational teams in WesTrac, aimed at redirecting our trained technicians to higher skilled tasks • “Competent Person Program” being rolled out in Coates Hire, delivering career development for staff and savings to the business • Good leadership supported by people and culture initiatives has led to over 10% improvement in engagement results across all our businesses Full Year Results Presentation Seven Group Holdings 5 21 August 2019 GROUP OVERVIEW HIGHLIGHTS Strong financial results with EBIT up 40% to $695m • Trading revenue of $4.1bn up 27% with growth across all businesses • EBIT up $198m on pcp delivered through WesTrac ($83m), Coates Hire ($54m) and Beach Energy ($85m) • Continued operating discipline reflected in underlying margin improvement of 1.5% at EBIT level and 1.7% at NPAT level • Improved operating cash flow despite investment in future growth through working capital Unique position in all our key markets to drive growth • Industrial services EBIT growth of 40% reflecting strength of end markets in mining and infrastructure – WesTrac part lines invoiced were up 11% to 6.4m driven by the record level of mining production and export volumes – Coates Hire asset utilisation remains 1.2% higher than average over previous five years despite slower construction market and project delays Energy investments creating value • Beach delivered record production and earnings result, enabling reinvestment from strong cash flow and $172m net cash • Crux FEED more 50% complete, FID targeted for Q2 2020, and interest in project growing from a range of LNG buyers and investors Full Year Results Presentation Seven Group Holdings 6 21 August 2019 GROUP OVERVIEW KEY FINANCIALS Underlying Results ($m) – continuing operations FY19 FY18 % Change Trading revenue 4,084.0 3,207.9 27% Earnings before interest and tax1 695.1 496.9 40% Underlying net profit after tax1 478.9 321.9 49% Underlying earnings per share1 143 cents 97 cents 47% Underlying EBITDA cash conversion1,2 59% 54% 5% Statutory results ($m) – continuing operations FY19 FY18 % Change Trading revenue 4,084.0 3,207.9 27% Earnings before interest and tax 436.1 570.4 (24)% Net profit after tax attributable to shareholders 219.2 405.2 (46)% Earnings per share 65 cents 124 cents (48)% Final fully franked ordinary dividend 21 cents 21 cents Notes: 1. Excluding significant items. Refer to slide 9 for listing of significant items 2. Refer to slide 11 for EBITDA cash flow conversion Full Year Results Presentation Seven Group Holdings 7 21 August 2019 GROUP FINANCIALS Our financial results reflect the level of operating performance achieved and our continued focus on driving efficiencies and cash flow Full Year Results Presentation Seven Group Holdings 8 21 August 2019 FINANCIALS PROFIT AND LOSS $m FY19 FY18 Change % Revenue 4,084.0 3,207.9 27% Other income 53.5 65.1 (18)% Share of results from equity accounted investees 210.2 144.1 46% Trading revenue and other income 4,347.7 3,417.1 27% Expenses (excluding. depreciation, amortisation and interest) (3,452.5) (2,774.4) 24% Underlying EBITDA 895.2 642.7 39% Depreciation and amortisation (200.1) (145.8) 37% Underlying EBIT 695.1 496.9 40% Net finance costs (102.8) (101.7) 1% Underlying net profit before tax 592.3 395.2 50% Underlying tax expense (113.4) (73.3) 55% Underlying NPAT from continuing operations 478.9 321.9 49% NPAT from discontinued operations - 10.4 - Significant items (including tax impact) (259.7) 83.3 - Underlying NPAT from continuing operations 219.2 415.6 (47)% Full Year Results Presentation Seven Group Holdings 9 21 August 2019 FINANCIALS SIGNIFICANT ITEMS $m FY19 FY18 Share of equity accounted investees' significant items (230.4) (17.4) (Impairment) / impairment reversal – SWM equity (57.5) 28.6 Other items 28.9 62.3 Significant Items – EBIT (259.0) 73.5 Net finance income (1.0) - Tax benefit relating to significant items 0.3 9.8 Significant Items – NPAT (259.7) 83.3 Statutory NPAT 219.2 405.2 NPAT excluding significant items 478.9 321.9 Full Year Results Presentation Seven Group Holdings 10 21 August 2019 FINANCIALS EARNINGS SUMMARY Total Coates Allight Invest- $m WesTrac Energy Media Other Group Hire Sykes ments Trading revenue 4,084.0 3,041.3 956.5 77.6 6.5 - 2.1 - Statutory EBIT 436.1 285.6 183.6 1.3 159.2 (224.6) 21.4 9.6 Add unfavourable significant items Impairment – SWM equity 57.5 - - - - 57.5 - - Share of equity accounted investees significant items 233.0 - - - - 233.0 - - Subtract favourable significant items Gain on conversion of convertible notes (28.9) - - - - - - (28.9) Share of equity accounted investees significant items (2.6) - - - (2.6) - - - Total significant items – EBIT 259.0 - - (2.6) 290.5 - (28.9) Underlying EBIT – FY19 695.1 285.6 183.6 1.3 156.6 65.9 21.4 (19.3) Underlying EBIT – FY18 496.9 202.7 129.4 3.0 71.8 72.6 33.1 (15.7) Year-on-year change 40% 41% 42% (57)% 118% (9)% (35)% 23% Full Year Results Presentation Seven Group Holdings 11 21 August 2019 FINANCIALS CASH FLOW $m FY19 FY18 Underlying EBIT 695.1 496.9 Add: depreciation and amortisation 200.1 145.8 Underlying EBITDA 895.2 642.7 Operating cash flow 410.6 253.1 Add: interest and other costs of finance paid 85.6 83.4 Net income taxes paid 28.2 8.3 Add back: restructuring costs - 1.8 • Strong operating cash flow of $411m Underlying operating cash flow 524.5 346.6 and conversion of ~60% Underlying EBITDA cash conversion 59% 54% • Operating cash flow includes inventory investment of $103m primarily in Operating cash flow 410.6 253.1 WesTrac parts and components to drive Investing cash flow (188.9) (216.1) FY20-21 growth Financing cash flow (248.8) (102.1) • Investing cash flow includes: $111m Beach investment, $262m in net capex Net (decrease) / increase in cash and cash equivalents (27.1) (65.0) ($194m Coates, $62m WesTrac, $7m Opening net debt 2,036.1 1,308.1 SGHE), and $184m net investment Movement in net debt (38.4) 728.0 proceeds including listed portfolio sales Closing net debt 1,997.6 2,036.1 • Financing cash flow includes $138m ordinary dividend and $110m in debt repaid (net) Full Year Results Presentation Seven Group Holdings 12 21 August 2019 FINANCIALS BALANCE SHEET As at