Slide 1: Half year results for the 26 weeks ended 29 September 2013
Half year results for the 26 weeks ended 29 September 2013 14 November 2013 Karen Slatford, Chair Christoph Eisenhardt, CEO Nick Parker, CFO Building for the Future
Slide 2: Agenda
Agenda 1 2 3 Executive Business Review Financial Review Summary Karen Slatford, Christoph Eisenhardt, Nick Parker, Chair CEO CFO 4 5 4 Summary & Questions & Request and next Appendices Appendices Outlook Answers steps Karen Slatford, All NickChair Parker, CFO © 2013 Volex plc 2
Slide 3: Disclaimer
Disclaimer THIS PRESENTATION CONTAINS FORWARD LOOKING STATEMENTS THAT INVOLVE A NUMBER OF RISKS AND UNCERTAINTIES. ACTUAL RESULTS MAY DIFFER MATERIALLY. FACTORS THAT COULD CAUSE OR CONTRIBUTE TO SUCH DIFFERENCES INCLUDE GENERAL ECONOMIC CONDITIONS, CURRENCY FLUCTUATIONS, COMPETITIVE FACTORS, THE LOS
Slide 4: Executive Summary
Executive Summary Karen Slatford, Chair 1 © 2013 Volex plc 4
Slide 5: Board and Senior Management Changes
Board and Senior Management Changes New appointments with highly relevant experience Karen Slatford Chair Christoph Geraint Anderson Eisenhardt Non-Executive Director Chair of Remuneration Committee CEO Nick Parker Martin Geh Non-Executive Director CFO Chair of CSR Committee Jill Ezard John Allkins
Slide 6: Executive summary
Executive summary Difficult period with challenging market conditions and delays in product launches New executive management team and Board members Volex Transformation Plan initiated Focus on delivering a sustainable value creation (revenue growth) Strong underlying business: Leading p
Slide 7: Business Review
Business Review Christoph Eisenhardt, CEO 2 © 2013 Volex plc 7
Slide 8: Business Review and Transformation Plan
Business Review and Transformation Plan Strengths Volex Transformation Plan Market leadership Unique global manufacturing Objectives and sales footprint Deliver sustainable revenue growth Reputation for quality and Drive supply chain excellence delivery excellence Areas of focus Blue-chi
Slide 9: Why two divisions?
Why two divisions? Address market specific Power dynamics and better leverage Singapore Volex’s strengths Improve competitiveness to benefit better from the growing markets Data Capitalise on Volex’s unique USA global manufacturing footprint and sales presence Increase business transparency
Slide 10: Power – retain leading position as power cable manufacturer
Power – retain leading position as power cable manufacturer Addressable Power Market Volex Market Share Volex 8% $2.5B $2.85B 2013 2016 Others Specifics Volex Transformation Plan Volume and price sensitive Regionalise sales and engineering to drive Dynamic sales allocations sales growth Regi
Slide 11: Data – grow share in diverse micro-connectivity market
Data – grow share in diverse micro-connectivity market Micro-Connectivity Market Volex Market Share e.$14B e.$20B 2013 2016 Volex, 1% Others Addressable: ~$3B Specifics Volex Transformation Plan Market segmenting into volume and Leverage existing technology expertise niche value provider and custo
Slide 12: Key operational priorities for next 12 months
Key operational priorities for next 12 months Stabilize the business during the second half… … and deliver sustainable growth next year Through: Increased business generation and plant utilisation Enforced design-to-cost capabilities Improved business focus and accountability © 2013 Volex plc
Slide 13: Financial Review
Financial Review Nick Parker, CFO 3 © 2013 Volex plc 13
Slide 14: Financial Highlights
Financial Highlights $m First six months Year to 31 March FY2013 FY2014 FY2012 FY2013 Revenue 249.3 196.5 517.8 473.2 Gross Profit* 44.3 33.7 102.5 85.3 Gross margin* 17.8% 17.1% 19.8% 18.0% Operating costs (39.0) (32.1) (70.5) (72.9) Operating Profit* 5.3 1.6 32.0 12.3 Operating margin* 2.1% 0.8% 6
Slide 15: Cash flow
Cash flow Underlying business is cash generative Net debt increased due to change in supplier payment profiles following a strategic decision to move to a multi-sourcing supplier model Capital expenditure considerably down on prior year (H1 FY2013: $9m) Exceptional cash outflow primarily relat
Slide 16: Power Division
Power Division $m First six months Year to 31 March FY2013 FY2014 FY2012 FY2013 Revenue 170.8 128.3 332.6 323.1 Gross profit* 25.4 17.9 60.4 48.5 Gross margin* 14.8% 13.9% 18.2% 15.0% Operating costs (16.0) (13.9) (28.6) (29.7) Operating profit* 9.3 3.9 31.8 18.8 Operating margin* 5.5% 3.1% 9.6% 5.8
Slide 17: Data Division
Data Division $m First six months Year to 31 March FY2013 FY2014 FY2012 FY2013 Revenue 78.5 68.3 185.1 150.1 Gross profit* 19.0 15.8 42.1 36.7 Gross margin* 24.2% 23.2% 22.7% 24.5% Operating costs (13.7) (10.1) (25.0) (24.0) Operating profit* 5.3 5.7 17.1 12.8 Operating margin* 6.8% 8.3% 9.2% 8.5% *
Slide 18: Summary & Outlook
Summary & Outlook Karen Slatford, Chair 4 © 2013 Volex plc 18
Slide 19: Summary & Outlook
Summary & Outlook Summary The trading environment was and continues to be challenging Period of fundamental renewal – new Board and management team Prudent decision to suspend interim dividend Outlook Significant work ahead for the new management team in turning around the business Execute
Slide 20: Q&A
Q&A All 5 © 2013 Volex plc 20