Mpac Group Plc · LSE:MPAC
Mpac — H1 2023 Earnings Presentation
27 slides from Mpac's earnings presentation, September 2023
Slide 1: Mpac Group plc 2023 Half Year Results
Mpac Group plc 2023 Half Year Results September 2023 Smart thinking, innovative solutions We create faster, more efficient automation and packaging systems
Slide 2: Agenda
Agenda 04 What we do 06 Investment case 07 Customers 08 Business Model 09 Financials 14 Ambition & Strategy 17 Case Study: People 18 Case Study: Mars 19 Case Study: Freyr 20 Summary & Outlook 22 Appendices 2 Mpac Group plc 2023 Half Year Results
Slide 3: About Mpac
About Mpac 3 Mpac Group plc 2023 Half Year Results
Slide 4: We create and service superior automation and packaging machines globally
We create and service superior automation and packaging machines globally Tadcaster H1 2023 Sales by Sector (%) (UK) Mississauga 150 staff (CA) 6,500 m2 Food & Beverage 100 staff Wijchen (NL) 4,500 m2 38% 190 staff 4,700 m2 Healthcare £52.8m 37% Cleveland (USA) (H1 2022:£50.6m) 50 staff Singapore Ot
Slide 5: Mpac operates in a very attractive market with significant growth opportunities
Mpac operates in a very attractive market with significant growth opportunities Attractive Market Growth Opportunities Product category Solutions Market value Huge Significant opportunities addressable for growth market Packaging Machinery > Personal healthcare $47.0bn* > Contact lens > Point of use
Slide 6: Mpac has an attractive investment proposition
Mpac has an attractive investment proposition Growth opportunity High quality of earnings > F&B and Healthcare markets offer compelling growth opportunity > Growing higher margin recurring Service revenue > Substantial opportunity to benefit from operational leverage and > Strong original equipment
Slide 7: Mpac is highly trusted by its diversified blue chip customer base
Mpac is highly trusted by its diversified blue chip customer base Examples of our customers and what we do for them: Our install base also includes: Revenue: $107.3bn (2022) Providing a specialist noodle packaging line for the world’s largest food and beverage company. Revenue: $45bn (2022) Providin
Slide 8: A business model which wins and retains customers
“We channel limitless ingenuity to A business model which wins and retains customers create and optimise whole line manufacturing ecosystems. With many parts, in many countries, our world- class productivity helps our clients achieve more with less.” Consult Early customer engagement and buy-in usin
Slide 9: H1 2023 results
H1 2023 results 9 Mpac Group plc 2023 Half Year Results
Slide 10: Financial review: 2023 half year highlights
Financial review: 2023 half year highlights £62.4m £52.8m £77.5m 23.9% Order intake Revenue Order book Gross profit margin +90.2% (H1 2022: £32.8m) +4.3% (H1 2022: £50.6m) +23.8% (H1 2022: £62.8m) +13.3% (H1 2022: 21.1%) £2.2m £0.2m £2.2m £9.6m Underlying operating profit Statutory profit before tax
Slide 11: Financial review: Group Income Statement (£m)
Financial review: Group Income Statement (£m) For the period to 30 June 2023 OE revenue (£m) Service revenue (£m) 74.1 74.6 23.1 69.4 64.1 20.2 19.4 19.6 34.8 31.2 40.1 12.3 10.0 37.0 9.9 11.8 17.6 38.2 39.8 34.0 35.2 10.8 9.7 10.2 27.1 7.6 2019 2020 2021 2022 2023 2019 2020 2021 2022 2023 H1 H2 11
Slide 12: Financial review: Balance sheet
Financial review: Balance sheet For the period to 30 June 2023 Commentary > Non-current assets include £24.3m of Intangible assets, £9.3m of Tangible fixed assets, £35.2m of 30.06.2023 31.12.2022 Pension assets and a £1.0m Deferred tax asset. (£m) (£m) Change Non-current assets 69.8 68.0 3% > Net pe
Slide 13: Financial review: 2023 half year cash bridge and working capital (£m)
Financial review: 2023 half year cash bridge and working capital (£m) For the period to 30 June 2023 Commentary H1 2023 delivered a significant increase in order intake and machine deliveries, the timing of which had a material positive impact on working capital movements £20m borrowing facility ent
Slide 14: Ambition and Strategy
Ambition and Strategy 14 Mpac Group plc 2023 Half Year Results
Slide 15: We are targeting double digit % revenue CAGR and 10% return on sales
We are targeting double digit % revenue CAGR and 10% return on sales Delivered via Delivered via Innovation Operational leverage Delivering innovative, highly Our global manufacturing footprint efficient machines into extensive and centres of excellence ensure addressable markets efficient delivery
Slide 16: Progress on strategy
Progress on strategy > New customer acquisition in target sectors Going for Growth > Expansion and deification of Lambert project prospect pipeline Outstanding > Expansion of Service capacity in the Americas Customer Service > Elevating customer experience with best-in-class service function Operati
Slide 17: People are critical to delivering our strategy
People are critical to delivering our strategy > Over 30 years industrial experience at Fortune500 > Over 18 years experience at global organisations companies of varying sizes within the engineering & manufacturing sectors > Track record in engineering, project management, > Wealth of knowledge in
Slide 18: Case study: Mars
Case study: Mars Requirement > Automatically package various size flow wraps in Mars recently purchased a 6th an end-load carton Frank Jeurissen packaging line from Mpac. > Automatically group and pack 5,6,12,14 and Global Strategic Accounts Manager The Mpac team worked tirelessly to ensure all 24 c
Slide 19: Strategy Clean Energy case study: CQP status and Market Opportunity
Strategy Clean Energy case study: CQP status and Market Opportunity Global battery capacity forecast Customer Qualification Plant by supplier type (yield adjusted) (TWh) Freyr: Long-term opportunity and plans Mpac opportunity – Long term engagement FREYR is targeting 200GWh output 4.9 by 2030, twice
Slide 20: Summary & Outlook
Summary & Outlook 20 Mpac Group plc 2023 Half Year Results
Slide 21: Operational highlights
Operational highlights 2023 half year highlights > Acquisition of new customers in target sector > Strong growth in Service business, delivering on strategic focus to improve and sustain customer support > Reduction in working capital expansion progressing to plan > Shipment, installation and commis
Slide 22: Appendices
Appendices 22 Mpac Group plc 2023 Half Year Results
Slide 23: Financial review: Group income statement
Financial review: Group income statement For the period to 30 June 2023 H1 2023 H1 2022 (£m) (£m) Change Commentary Revenue 52.8 50.6 4.3% > OE revenue reduction driven by the Americas region, which enjoyed an exceptional early 2022, following the – Original Equipment 35.2 39.8 -11.5% post-covid tax
Slide 24: Financial review: Group Balance Sheet (£m)
Financial review: Group Balance Sheet (£m) For the period to 30 June 2023 80.0 Inventory (£m) Working Capital (£m) 69.8 68 63.1 61.7 63.3 62.2 60.0 10.2 40.0 9.6 16.9 6.3 5.5 9.6 20.0 4.3 11.9 12.2 0.0 FY21 HY22 FY22 HY23 FY21 HY22 FY22 HY23 - Net pension asset (£m) Net Current Assets (£m) -20.0 -18
Slide 25: 2023 Pension scheme
2023 Pension scheme UK Pension Scheme – IAS19 surplus UK scheme (£m) 450.0 > Accounting surplus £35.2m (FY 2022: £31.5m) 400.0 > Scheme surplus remained stable in the face of the continuing volatility in H1 2023, with the increase driven by increasing discount rates, partially offset by increasing 3
Slide 26: Appendices: Summary Share Register
Appendices: Summary Share Register For the period to 30 June 2023 30 June 2023 Schroder Investment Management 4,196,253 Hargreaves Lansdown, stockbrokers (EO) 1,989,156 Interactive Investor (EO) 1,856,667 Tellworth Investments 1,670,952 Oury Family 1,364,370 Individuals 747,607 AJ Bell, stockbrokers
Slide 27: We create faster, more efficient automated packaging systems
Mpac Group plc Station Estate Station Road Tadcaster North Yorkshire LS24 9SG Tel: +44 (0)2476 421100 Email: ho@mpac-group.com mpac-group.com We create faster, more efficient automated packaging systems