GWA Group Limited · ASX:GWA
GWA — GWA International — FY2010 Earnings Presentation
26 slides from GWA's earnings presentation, Aug 17, 2010
Slide 1: ASX announcement: Annual Results Presentation cover letter
GWA International Limited ABN 15 055 964 380 17 August 2010 ASX On-Line Manager Company Announcements Australian Securities Exchange Dear Sir Annual Results Presentation for the Year Ended 30 June 2010 We enclose the following documentation for immediate release to the market: e Annual Results Prese
Slide 2: GWA International Limited
GWA International Limited
Slide 3: Annual Results Presentation 17 August 2010
GWA International Limited Annual Results Presentation 17 August 2010 Presented by: Peter Crowley Managing Director
Slide 4: GWA's Growth Strategy
GWA International Limited GWA’s Growth Strategy Focussed on driving: Organic Growth – investing in R & D, people, systems and supply chain to enhance our customer value proposition and business efficiency Inorganic Growth – pursuing acquisitions which add scale to the Group in product and market
Slide 5: Major Successes and Challenges for the Year
GWA International Limited Major Successes and Challenges for the Year √ Delivering on non-core business rationalisation - Sale of Rover Mowers and Wisa sanitaryware √ Delivering on acquisition strategy - Acquired Brivis Climate Systems (and APAC) √ Business improvement initiatives accelerated in sec
Slide 6: Major Operational Results
GWA International Limited Major Operational Results Results are presented for continuing operations Sales up by 7% (4% on like for like basis excluding Brivis) Trading EBIT of $94.5 million up 9.5% Increased operating cash flow of $116 million reflects strong working capital management Lab
Slide 7: Results – Year to 30 June 2010
GWA International Limited Results –Year to 30 June 2010 - From Continuing Operations Including Brivis Full Year Full Year $Million 2010 2009 Change Sales Revenue 656.8 613.0 +7.1% Trading EBIT 94.5 86.4(1) +9.5% EBIT Margin 14.4% 14.1% Trading Profit after Tax for Continuing Businesses 55.4 50.6 +9.
Slide 8: Major Variations in Trading EBIT
GWA International Limited Major Variations in Trading EBIT $M 100 110 50 60 70 80 90 • Reduction in environmental 20 Vo 09 86.4 lu products offset by BER and m e an general market improvement d M 4.6 ix • Full years impact of 2009 Pr price increases ice 5.0 Ac qu • Full years impact of Austral isi t
Slide 9: Ongoing Restructuring Continues to Improve Productivity
GWA International Limited Ongoing Restructuring Continues to Improve Productivity Total Employees June 2009 1891 Acquisitions +242 Divestments -159 General reductions -52 Total Employees June 2010 1922 $’000 revenue / Employee 2009 369 $’000 revenue / Employee 2010 376 Note: 2010 reven
Slide 10: Completions have Lagged the Underlying Improvement in Building Approvals
GWA International Limited Completions have Lagged the Underlying Improvement in Building Approvals New Dwelling Activity 190,000 180,000 Moving Annual Numbers 170,000 160,000 150,000 140,000 130,000 Source: BIS Shrapnel 120,000 3 4 5 6 7 8 9 f 03 04 05 06 07 08 09 10 -0 -0 -0 -0 -0 -0 -0 n- n- n- n-
Slide 11: Our Strategy Has Led to Redefining our Businesses
GWA International Limited Our Strategy Has Led to Redefining our Businesses GWA has historically defined its businesses by the brands it markets This constrains the way we look at the markets where we can grow Our core businesses are now defined as • Bathrooms and Kitchens • Heating and Coolin
Slide 12: Operating Results Reported in Three Segments
GWA International Limited Operating Results will be Reported For Continuing Businesses in Three Segments Building Fittings comprising: Bathrooms and Kitchens Door and Access Systems Heating and Cooling comprising: Dux Hot Water Brivis Climate Systems EcoSmart Commercial Furniture
Slide 13: Segment Performance – Building Fittings
GWA International Limited Results –Year to 30 June 2010 Segment Performance – Building Fittings $Million 2010 2009 Change Sales Revenue 420.0 403.7 +4.1% Segment Result 88.8 78.4 Restructuring costs 3.4 Trading EBIT 88.8 81.8 +8.6% EBIT Margin 21.1% 20.3%
Slide 14: Segment Performance – Building Fittings: Bathrooms and Kitchens
GWA International Limited Segment Performance – Building Fittings Bathrooms and Kitchens Australian sales up 4% with underlying improvement being adversely impacted by low Queensland building activity Movex implementation complete with optimisation phase now delivering benefits Major focus on improv
Slide 15: Segment Performance – Building Fittings: Door and Access Systems
GWA International Limited Segment Performance – Building Fittings Door and Access Systems Sales up 16% due to full year impact of Austral acquisition and good performance in DIY market Focus for growth in architectural and commercial market segments. Entered into exclusive Hillaldam distributorship
Slide 16: Segment Performance – Heating and Cooling
GWA International Limited Results –Year to 30 June 2010 Segment Performance – Heating and Cooling $Million 2010 2009 Change Sales Revenue 161.5(1) 153.3 +5.4% Trading EBIT 14.6 15.1 -3.7% EBIT Margin 9.0% 9.9% Growth in Heating and Cooling is a 2-3 year strategy driven by efficiency gains plus new p
Slide 17: Segment Performance – Heating and Cooling
GWA International Limited Segment Performance – Heating and Cooling Dux Very volatile year with reduction in sales due to reduced Government rebates Board approval of $18 million upgrade of Moss Vale factory. Completion due mid 2011 / 2012 EcoSmart Growing channel and brand for our solar products de
Slide 18: Segment Performance – Furniture
GWA International Limited Results – Year to 30 June 2010 Segment Performance – Furniture $Million 2010 2009 Change Sales Revenue 74.8 56.1 +33% Trading EBIT 5.7 2.0 +182% EBIT Margin 7.6% 3.6% Strong demand from Government Building Education Revolution (BER) programme High sales expected to continue
Slide 19: Working Capital Improvement Reflects Continued Focus on Supply Chain
GWA International Limited Working Capital Improvement Reflects Continued Focus on Supply Chain Management $Million 2010 2009 EBITDA from continuing businesses 112.1 103.2 Working capital movements from continuing operations 5.2 -0.5 Restructuring and provision movements -8.6 1.7 Capital Expenditure
Slide 20: Financial Metrics Remain Strong
GWA International Limited Financial Metrics Remain Strong 2010 2009 Net Debt ($M) 176.0 155.0 Gearing (Net Debt / Debt Plus Equity) 29% 27% Leverage (Net Debt / EBITDA) 1.5 1.5 Debt Maturity Profile Mid 2011 47.5 Mid 2012 170.0 Early 2013 50.0
Slide 21: Acquisition and Divestments Have Improved Funds Efficiency
GWA International Limited Acquisition and Divestments Have Improved Funds Efficiency and Increased Growth Options 97% of trading profit has been paid in dividends Increase in net debt during 2009/10- $21 million Increase in underlying earnings from acquisitions / divestments- $5-6million pa
Slide 22: Ordinary Dividend Maintained
GWA International Limited Ordinary Dividend Maintained $Million 2010 2009 Trading profit after tax 55.4 50.6 Trading earnings per share 18.5¢ 17.9¢ (excluding restructuring) Reported earnings per share 16.1¢ 16.9¢ Ordinary Dividend Interim 9.5¢ 9.5¢ Final 8.5¢ 8.5¢ Total (fully franked) 18.0¢
Slide 23: GWA's Organic Growth Strategies
GWA International Limited GWA’s Organic Growth Strategies Invest in product innovation to build new markets Pursue new market and channel opportunities eg. Aged care, DIY, commercial segment, sustainability, access control systems Drive down supply costs and improve supply chain efficiency L
Slide 24: GWA's Strategic Agenda for Inorganic Growth Has Been Established
GWA International Limited GWA’s Strategic Agenda for Inorganic Growth Has Been Established Capacity to fund acquisitions up to $100 million through debt and $300-$400 million through debt plus equity We have clear financial and strategic criteria for growth which underpins our work • Four transa
Slide 25: 2010/11 Outlook
GWA International Limited 2010/11 Outlook Full year benefit from Brivis acquisition will positively impact results Underlying demand expected to increase 5–6% With market uncertainty, improvement in operating results are difficult to forecast until we confirm underlying demand Will be in bet
Slide 26: GWA International Limited
GWA International Limited