McConnell Dowell 2019 Annual Review

6 McConnell Dowell Group Message from our CEO FY19 Highlights & Overview • Solid platform for consistent performance • Another year of profitable performance • All Business Units profitable in year • Strong project execution performance • Derisked project portfolio • Improved New Business performance • Achieved outstanding safety performance across the Group with Australia recording a 12-month rolling LTIFR of zero • Work in Hand up 50% with New work up 200% at $1.35B • Achieved strategic new business wins in target markets (e.g. New Zealand building sector, NSW civil construction, PUB contract in Singapore, W.A. gas pipeline) • Group wide Values firmly embedded and continues to gather momentum in uniting staff with a performance-driven culture • Continued to position for growth and sustained profitability by strengthening customer relationships, increasing focus on engineering, technology and innovation and building an increasingly robust order book • Strong underlying project performance was partly offset by a small number of historical commercial issues. • On track to deliver Vision 2025 of sustained profitability and sustained growth. Financial Highlights We have reported a full year EBITDA of $23 million, during FY19 we increased our level of work in hand, delivered another year of profit and saw strong execution performance across our active project portfolio. The Group’s revenue is down 20% due to delays in several target and sole source projects. Our NewWork Won performance was improved substantially from FY18, with much of this secured revenue being carried forward to FY20. We have seen a decrease in risk and an overall increase in margin performance across our project portfolio. Growing the Order Book Progressively We are focused on operational excellence and achieving progression and profitability by building a diversified project portfolio. We recorded total FY19 new work won at AUD1.35 Billion. Whilst we achieved lower than planned bid volume across the Australia and South East Asia business units, we significantly improved the year-on-year performance for secured revenue across all operating regions (200% increase in FY19 from FY18). The value of outstanding tenders stands at $3 billion including preferred status contracts at $1.3 billion. We have increased bidding activity responsibly as supported by additional resources and in accordance with our planned growth trajectory. As we enter a new financial year, we have a reliable and focused target pipeline developed to sustain business growth. Safety and health performance McConnell Dowell continued to focus on lead indicator initiatives to increase hazard awareness, subcontractor engagement, hazard reporting and an improvement in safety culture across all business units. Our LTIFR improved significantly to 0.15 (2018: 0.54). Performance highlights include eight months LTI-free operations, and successfully launching the CodeSafe platform and the Permit to Work programme. McConnell Dowell’s health, safety, environment and quality (HSEQ) database, CMO, provides access to group HSEQ data trends and internal HSEQ auditing, allowing automatic tracking and monitoring of action close-out. A SharePoint platform allows greater search functionality and easier collaboration and access to group documents. Environmental performance McConnell Dowell experienced sound environmental performance with no serious environmental incidents recorded. This outcome was the result of consistent application of the environmental elements of the McConnell Dowell management system (MMS), and a strong focus on environmental awareness. McConnell Dowell continues to strengthen networks and relationships with sustainability organisations. McConnell Dowell is a member of the UN Global Compact and an active contributor to ISCA.