Overcoming financial barriers for exporters

EFIC
C solutions
i f Austrade customers
for

2011

1
Wh are we?
Who ?

The Australian government’s export credit agency

Self-funding statutory corporation – “AAA” rated
Mission: to support growth of Australian business internationally
Provides financial solutions for Australian exporters and offshore
investors
Over 50 years’ of export finance & industry experience
Can draw on resources beyond the commercial domain:
other export credit agencies
multi-lateral agencies and development finance institutions
Australia’s network of diplomatic posts

2
O role
Our l

Fill ‘market gap’ when commercial finance unavailable/insufficient

Role complementary to commercial lenders
Operate on a commercial basis
Support Australian involvement in:
export of goods or services
domestic export-related transactions and projects
overseas investment
Customers range from SMEs to large listed companies

3
M k t gap
Market g

Role complementary to commercial lenders

Fills ‘market gap’ when commercial finance unavailable/insufficient

riskier
countries

EFIC extends
market capacity

commercial
markets stop here
(frontier fluctuates)

smaller, riskier
companies

4
EFIC’ exposures att 30 JJune 2010
EFIC’s 2010: A$2
A$2.7
7 billi
billion across 24 countries*
ti *

*Maximum exposures for the Commercial Account and National Interest Account. Includes exposures not yet drawn.

5
EFIC’ exposures att 30 June
EFIC’s J 2010*

Exposures by industry sector

*Commercial Account exposures

6
EFIC’ finance
EFIC’s fi and
d insurance
i solutions
l ti

WIN FINANCE PROTECT

export contracts export activities against risk

• Additional working • Working capital / • LC confirmations

capital pre-shipment finance • Political risk insurance
• Loans to overseas • Capex / structured finance • Export payments insurance
buyers • Advance payment & • Bond insurance
• Bonding line of credit performance bonds
• Project
P j t finance
fi
• Film Finance

TAILORED SOLUTIONS

7
EFIC’ b
EFIC’s broad
d range
g off clients
li t

• Companies exporting from Australia or facilitating

EXPORTERS exports, including service providers and
manufacturers

• Foreign companies, including foreign subsidiaries

BUYERS
of Australian companies
of Australian exports
• Foreign governments

• Australian-based companies investing overseas

INVESTORS
• Australian subsidiaries of foreign companies

• Lenders
FINANCIAL INSTITUTIONS
• Hedge providers

8
Case studies

9
Export working capital guarantee (EWCG)

Secures funding for specific export contract/s

‘Export contract’ can include being an onshore subcontractor to an

export project

Where working capital/pre-shipment finance need is >$0.5m

There is a clearly identifiable takeout

EFIC undertakes detailed risk assessment

contract, technical, financial and payment risks

Si l exportt transaction
Single t ti or for
f multiple
lti l buyers
b or contracts
t t

10
EWCG case study – Drilling Co

Customer
Brisbane-based provider of pipe laying services Result
contracted to a CSG project Company
Co pa y has as the
t e funds
u ds
required to
Need fulfill the contract
Contract win meant company needed access to
additional working capital
capital, as well as a performance
bond. The company’s bank was unable to provide the
financial support required
Solution
EFIC is providing their bank with an export working
capital guarantee, to ensure additional funding is
made available

11
B d /b k g
Bonds/bank t
guarantees

A common contractual obligation for construction and building

services’ projects
P f
Performance, advance
d paymentt & warranty
t bonds
b d
EFIC assesses and backs exporter’s performance capability
Bonding lines for multiple buyers / contracts
EFIC can issue bonds directly to the overseas buyer or back-to-back
via banks

12
B d case study
Bond t d – Warill
W ill EEngineering,
gi i g 2008

Customer Result
South-Australian-based designer and manufacturer of
Warill’s working capital
foundry equipment with a strong presence in the Indian
was freed up to deliver
market
one its largest contracts
Need
Warill won a major contract in Bangalore to supply and
install a sand mixer and sand reclamation equipment
The buyer required an advance payment bond, which
Warill could not obtain from its bank as it had reached
its approved borrowing limit
Solution
EFIC issued an advance payment bond to the buyer in
India

13
R f
Referral
lgguide
id

Who can we help?

EFIC is most likely to be able to assist an Australian company that:

has an export contract or expects to have an export contract very shortly

has a key sub-contract for an export related project located in Australia or
is planning to invest in an overseas production or distribution facility
and
has an annual turnover of at least $5 million

EFIC’s partner referral line +61 2 8273 5454

14
C t t
Contact

Robert Dravers
Director, SME & Mid-Market
Phone: +61 2 8273 5268
Email: [email protected]

Jonathan Reso
Director, SME & Mid-Market
Phone: +61 2 8273 5267
Email: [email protected]

Paul Kyriacou
Director, SME & Mid-Market
Ph
Phone: +61
61 2 8273 5203
Email: [email protected]

15
Di l i
Disclaimer

This material (Information) has been prepared by EFIC for information purposes only.
It is in summary form and is therefore not necessarily complete.

It is not an offer by EFIC to make available to any party any of the financial products
referred to in the Information (Products) and the Information must not, in any way, be
construed as specific or general advice in respect of any Products. A person or entity
should seek their own advice as to the suitability of any Products for their own financial or
tax circumstances. Whilst reasonable care has been taken to ensure that the Information
f
is not untrue or misleading, no representation is made as to its accuracy or completeness
and no liability is accepted for any loss arising from reliance upon the Information.

In accordance with applicable exemptions, EFIC is not required to hold an Australian

financial services licence nor is it regulated by the Australian Prudential Regulation
Authority in connection with any of the Products.

16