Btg Consulting Plc · LSE:BTG
Btg Consulting — Begbies Traynor Group — FY2018 Earnings Presentation
29 slides from Btg Consulting's earnings presentation, July 2018
Slide 1: Full year results presentation
Full year results presentation Ric Traynor – Executive Chairman Nick Taylor – Group Finance Director July 2018
Slide 2: Introduction
Introduction Begbies Traynor Group plc is a leading business recovery, Office Locations financial advisory and property services consultancy, providing services nationally from a comprehensive network of UK locations through two complementary operating divisions. We work with businesses, professio
Slide 3: Our operating businesses
Our operating businesses Oo Begbies Traynor Obra Advisory including # Springboard Eddisons ~~ GD Paro Eins Begbies Traynor is the UK’s leading independent business recovery practice handling the largest number of corporate appointments, principally serving the mid-market and smaller companies. BTG A
Slide 4: Financial highlights
Financial highlights Revenue Adjusted Adjusted Total PBT EPS dividend £52.4m £5.6m 4.0p 2.4p 5% increase 14% increase 21% increase 9% increase (2017: £49.7m) (2017: £4.9m) (2017: 3.3p) (2017: 2.2p) Business Property Operating Net debt recovery services cash flow £7.5m profit profit £9.1m £7.6m £3.1m
Slide 5: Overview - a further year of progress
Overview - a further year of progress • A further year of progress in developing the group with continued earnings growth • Business recovery and financial advisory services: • Increase in revenue and profit whilst investing in our team for future growth • Developed advisory services through the acq
Slide 6: Solid track record
Solid track record • Net debt at its lowest level since 2007 • First increase in annual dividend since 2011 5
Slide 7: Financial review
Financial review O Begbies Traynor Group
Slide 8: Income statement
Income statement Year ended Year ended £'000 30 April 18 30 April 17 Revenue 52,441 49,685 Operating profit (before amortisation and transaction costs) 6,059 5,627 Interest costs (482) (776) Adjusted profit before tax 5,577 4,851 Refinancing costs - (225) Transaction costs * (1,364) (1,545) Amortisa
Slide 9: Tax rate
Tax rate • Adjusted tax rate reduced to 22% (FY17: 27%) • Resulting from a combination of: • Increase in accounting profits combined with a reduction in non tax-deductible costs • 1% reduction in UK corporation tax rate • Adjustment in relation to prior year provisions • Expect to maintain at 22% fo
Slide 10: Segmental performance
Segmental performance Business recovery and advisory Year Year Revenue increase due to: ended ended investment in our team which has increased market £m 30 April 18 30 April 17 share; Business recovery and financial advisory success fees on contingent cases; and Revenue 38.3 36.2 developing
Slide 11: Balance sheet
Balance sheet • Non current assets increased to £62.3m (2017: £60.0m): • Tangible fixed assets £1.5m (2017: £1.5m) • Intangible fixed assets £59.0m (2017: £58.5m) £m April 18 April 17 • Deemed remuneration after one year £1.8m (2017: £nil) Non current assets 62.3 60.0 • Current assets increased to £
Slide 12: Cash flow
Cash flow • Operating: Year ended Year ended • Strong operating cash generation maintained in the year £m 30 April 18 30 April 17 • Tax payments reduced due to phasing of prior year payments Cash from operations 9.1 8.0 • Investing Tax (1.0) (1.5) • Cap-ex of £0.5m (2017: £0.3m) • Deferred considera
Slide 13: Acquisitions
Acquisitions Springboard Corporate Finance – 6 March 2018 • Mid-market corporate finance practice with strong private equity links working on buy and sell side transactions • Team of 13 joined the group (including 3 partners) • Initial consideration of £2.75m (in cash and shares) with contingent con
Slide 14: 2018/19 financial guidance
2018/19 financial guidance • Adjusted tax rate 22% (FY18: 22%) • Transaction/amortisation costs: • Transaction costs £2.6m (FY18: £1.4m) • Amortisation £2.2m (FY18: £1.9m) • Cash outflows: • Working capital unwind of £1.0m • Provisions outflows of £0.8m • Tax payments: FY18 provision £1.5m and two p
Slide 15: 2018/19 outlook
2018/19 outlook • Market for counter cyclical activities remains stable • We continue to focus on investing to deliver future growth: • in-year cost of investment of £1m • 1% inflationary rise in operating costs • Currently anticipate revenue growth from investment and business development to match
Slide 16: Operating review
Operating review O Begbies Traynor Group 15
Slide 17: Business recovery and financial advisory
Business recovery and financial advisory • Insolvency market: • Appointments in calendar year 2017 broadly unchanged at 14,608 (2016: 14,716) • Appointments in Q1 of 2018 increased to 3,987 - 13.0% increase on Q4 2017 and 0.6% increase on Q1 2017 • Highest quarterly level of corporate insolvencies s
Slide 18: Property services
Property services • Invested in our property valuation team through recruitment of experienced surveyors • Enhanced building consultancy offering to education sector • Increased level of instructions over last 12 months • Machinery and business asset disposal business performed well • Good cross-ref
Slide 19: Strategic overview
Strategic overview O Begbies Traynor Group 18
Slide 20: Our strategy
Our strategy » To be recognised as a leading professional services consultancy » Business restructuring » UK businesses and insolvency » Financial institutions on fem » Transactional support and the investment delivering: ay 5 cena . te » Valuations and y S » business recovery, Fe ; . ov . . = a adv
Slide 21: Our expertise
Our expertise Business Property recovery services Business restructuring and insolvency • Corporate recovery a % of pro-forma revenue • Personal insolvency a • Restructuring a (including recent acquisitions) • Property receiverships a • Machinery and business asset disposal a • Specialist insurance
Slide 22: Business development areas
Business development areas • Business recovery • Senior recruitment and selective acquisitions to increase market share • Continuing investment in internet marketing and direct work generation • Investment in technology to enhance working practices • Financial advisory • Grow corporate finance servi
Slide 23: Summary
Summary O Begbies Traynor Group 22
Slide 24: Summary & outlook
Summary & outlook • Further year of progress: • continued earnings growth; and • first increase in dividend since 2011 • Anticipate continuing our recent track record of earnings growth: • benefit of two recent acquisitions • ongoing organic investment in both divisions • Overall in strong position
Slide 25: Investment case
Investment case • Listed on AIM since 2004 • A leading business recovery, financial advisory and property services consultancy with over 570 staff and partners operating across the UK • As the UK’s leading independent business recovery practice, we handle the largest number of corporate appointments
Slide 26: Appendix
Appendix O Begbies Traynor Group 25
Slide 27: Ownership structure
Ownership structure The group has 110.3m shares in issue. The ownership profile is: Name % holding Ric Traynor 24.6% Other management 4.7% Major institutions: • Hof Hoorneman Bankiers 11.1% • Fidelity 9.6% • Insinger Gilissen 6.6% • Close Brothers 4.8% • Allianz Global Investors 3.9% 26
Slide 28: Profile of our insolvency caseload
Profile of our insolvency caseload 5,000 £5,859 4,000 Volume 3,000 2,000 1,000 £31,083 £58,308 £84,717 £262,973 - £20k £20 - £50k £50 - £75k £75k - £100k >£100k * As at 30 April 2018 27
Slide 29: Offices across the UK
Offices across the UK. www.begbies-traynorgroup.com Begbies Traynor Group plc; registered in England No: 5120043, registered office: 340 Deansgate, Manchester, M3 4LY, a member of the Begbies Traynor Group; Specialist Professional Services.