Tekmar Group Plc · LSE:TGP
Tekmar — FY2023 Earnings Presentation
23 slides from Tekmar's earnings presentation, Mar 4, 2024
Slide 1: Full Year Results
Full Year Results For the 12-month period ending 30 September 2023 TGP-MAR-E-PLC (2023 FulkVear Results) | Strictly Confidential | 4 March 2024 | Paget
Slide 2: Disclaimer
This document, which comprises a presentation of the results for the year ended 30 September 2023 (the "Presentation"), has been prepared by, and is the sole responsibility of, Tekmar Group PLC (the "Company"). The Presentation is being made only to, and is only directed at, persons to whom such pre
Slide 3: Agenda
Alasdair MacDonald Agenda CHIEF EXECUTIVE OFFICER Results Overview • CEO Perspectives • KPIs Financial Review • CFO Perspectives • Financial Results Market Review • Offshore Wind Leanne Wilkinson • Energy Transition CHIEF FINANCIAL OFFICER Strategic & Operational Review Summary & Outlook
Slide 4: FY23 results in line with expectations
FY23 results in-line with expectations Business stabilised and path to profitability established. Group orderbook of £20m (as at 31 January 2024) We anticipate incremental improvement in offshore wind market conditions in FY24 We benefit from a balanced business portfolio and highlight with these re
Slide 5: Definitions of Enquiry Book, Order Intake, Order Book, Adjusted EBITDA
(1) Enquiry Book is defined as all active lines of enquiry within the Tekmar Group. Expected revenue recognition within 3 years. (2) Order intake is the value of contracts awarded in the Period, regardless of revenue timing. (3) Order Book is defined as signed and committed contracts with clients. (
Slide 6: Financial Review
Financial Review
Slide 7: CFO perspectives
Marine Civils division continues strong growth trajectory with YoY improvement in gross margin % - this business is scalable via current product offering and new service revenue streams. Incremental growth in Offshore Energy, with healthier margin backlog. Ability to benefit quickly from volume. Fur
Slide 8: Financial results: revenue, gross profit, adjusted EBITDA
Revenue Audited Audited 12M ended 12M ended • 32% increase from prior year Sep-23 Sep-22 £m £m • Continued growth per half year (H2 £22.7m v H1 £17.7m) Revenue 39.9 30.2 Gross Profit Gross Profit 9.3 7.0 • 23% consistent with prior year • Marine Civils - Margin growth of 700 basis points Adjusted EB
Slide 9: Balance Sheet
The Group’s balance sheet was stabilised in April 2023 following Balance Sheet £6.4m (£5.3m net of expenses) capital investment from SCF Partners and associated fund raise. £m FY23 FY22 Fixed Assets 6.8 5.9 Other non-current assets 19.4 24.6 • Fixed Asset addition – ROU asset relating to manufacturi
Slide 10: FY23 Results - Summary Cash Flow
FY23 Results - Summary Cash Flow 42 months 12 months 12 months 12 months FY23 FY22 Cash flows from investing and financing FY23 FY22 Cash flows from operating activities £m =m activities Em fm Loss before taxation (9.9) (5.2) Purchase of PPE / Intangible assets (1.3) (1.0) Adjustments for: Other inv
Slide 11: An evolving offshore energy market
@lekmar Group plc An evolving offshore energy market
Slide 12: Record year for FID in offshore wind
Despite current headwinds, 2023 was a record year for FID, supporting incremental volume growth in offshore wind projects in 12.3GW Record year for FID* FY24 for Tekmar Group. 14 13.1 12.3 12 10 9.1 8 6.4 6.6 6 4.2 3.8 3.2 3.1 4 1.6 2 2 2 1 0.8 0.2 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Slide 13: Project confidence and journey to 2030
Nearly 3 GW up on last quarter. China leads with 32.5 GW, followed by the ~67 GW is fully commissioned UK (14.8 GW) and Germany (8.2 GW). ~104 GW is operational, in construction, or FID made Taking total global offshore wind activity (operational or foundations 14.4% CAGR to 2030 underway) to 267 GW
Slide 14: Offshore EPC spend forecast 2023-2028
We see a sustained upcycle in the offshore EPC forecast through 2023 - 2028, with EPC spending expected to total $91bn. This is a 21% increase compared to the preceding five-year period. Market Spend by region ($ billion) 20.0 18.0 16.0 14.0 12.0 10.0 8.0 6.0 2028 and onwards market visibility still
Slide 15: Strategic & Operational Review
@lekmar Group plc Strategic & Operational Review A review of near-term priorities
Slide 16: Near-term priority 1: Revenue, gross margin and EBITDA
Near-term priority 1 6m 6m 6m 6m 6m 6m 6m Sep-23 Mar-23 Sep-22 Mar-22 Sep-21 Mar-21 Sep-20 Revenue 22.2 17.7 17.2 13 17.9 13.9 15.2 Gross Margin 20% 28% 24% 22% 16% 26% 31% Adjusted EBITDA (0.5) 0.2 (0.3) (1.8) (1.8) (1.1) 0.8 • Marine Civils delivered Adjusted EBITDA of £3.5m on revenue of £18.3m i
Slide 17: Balanced contract awards across Energy Transition and Offshore Wind
Near-term priority 2 Balanced contract awards across Energy Transition and Offshore Wind projects • Higher quality projects being secured • Improving risk/reward balance • More selective tendering • Improving supply chain pricing to acceptable margin levels • Encouraged by the strength of the enquir
Slide 18: Near-term priority 3: Industry standing and expansion
Near-term priority 3 • SCF's diligence highlighted Tekmar's industry standing and potential for service and technology expansion • Mutual alignment with customers on the role Tekmar's leadership can play in the industry • Well-equipped to deliver larger projects with more complex engineering solutio
Slide 19: Teklink, Grouting, Subsea and Marine Civils Protection
Near-term priority 4 1 2 3 Teklink Grouting Subsea and Marine Civils Protection Further enhance subsea and port Product & Analysis Evolution Grow footprint in energy transition and supported by regionalised engineering extend into offshore wind and marine scour prevention solutions with consultancy
Slide 20: Operating model and supply chain initiatives
Near-term priority 5 Operating Model Continued integration of existing businesses and process efficiency improvements £0.8m Annualised cost savings helped to offset against staff inflation costs and investment for growth Supply Chain initiatives targeted for FY24 – Framework agreements £0.5m impleme
Slide 21: Portfolio growth and SCF relationship
Near-term priority 6 Build value through scale and Alert to energy transition quality of earnings opportunities Strengthen the technology and services Leverage our relationship with SCF and we offer our customers through the £18m capital available through the complementary product/market synergies C
Slide 22: Summary and Outlook
@lekmar Group plc Summary and Outlook
Slide 23: Summary and outlook
The business has been stabilised and FY23 results were in-line with expectations The Board anticipates the business returning to profitability at the Adjusted EBITDA level for FY24 Project delays and cancellations remain a risk for offshore wind projects Positive near-term indicators for our tender