Velocity Composites Plc · LSE:VEL
Velocity Composites — Investor Presentation (October 2023)
25 slides from Velocity Composites's investor presentation, October 2023
Slide 1: Investor Presentation
Investor Presentation October 2023 © Velocity Composites Plc - JAN 2022
Slide 2: Velocity Disclaimer
Velocity Disclaimer IMPORTANT NOTICE Regulations 2019) (the “EUWA”) who also: (i) have professional experience in matters relating to Company, for providing the protections afforded to customers of Cenkos, nor for providing advice investments falling within Article 19(5) of the Financial Services an
Slide 3: Investment Case
Investment Case ©© Velocity Velocity Composites Composites • OUR SOLUTIONS ARE NECESSARY TO THE Plc AEROSPACE INDUSTRY If the aerospace industry Plc - 2023 is to meet its projections it needs our solutions to - 2023 reduce costs and accelerate production rates • REVENUE INCREASES 2.5x to 3.0x BY 202
Slide 4: Experienced Board
Experienced Board © Velocity Composites Plc - 2023 Andy Beaden Jon Bridges Andrew Hebb Annette Rothwell David Bailey Non-Executive Chairman Chief Executive Officer Interim Finance Director Non-Executive Director Non-Executive Director Andy has over 30 Jon has 31 years’ Andrew was CFO and Annette has
Slide 5: Composite Materials
Composite Materials © Velocity Composites Plc - 2023 • A combination of a matrix and a reinforcement, which when combined gives properties superior to the COMPOSITE USE IN AIRCRAFT properties of the individual components • In the case of an aerospace composite, the reinforcement is the fibres and th
Slide 6: Composite Composition
Composite Content per Aircraft © Velocity Composites Plc - 2023 60% Wide Body Aircraft A350 50% B787 Composite Composition Narrow Body Aircraft C Series (Relative size determined 40% by maximum take off weight) MC-21 30% B777x A380 20% A320 B747 A330 B777 10% A300 A310 B767 MD-11 MD-80 B737-300 1970
Slide 7: Sustainability Driving Growth
Sustainability Driving Growth • Composites play an important role in • The aerospace sector has a clear • Velocity customers need to do light weighting all new aircraft platforms, strategy to achieve net zero by 2050 more-for-less to meet the production civil and defence and demand for composites wi
Slide 8: The Velocity Solution
The Velocity Solution Raw Material Structural Product Vacuum Bag Product Finished Part (1m diameter) Aimed at providing at least 10% material cost saving and 20% time cost saving to customers 8
Slide 9: Velocity Technology
MATERIAL SUPPLIER EXPECTED STOCK ACTUAL STOCK D IBP FREEZER D CUSTOMER MONTHLY MATERIAL D RAW MATERIAL VC DEMAND 12 to 34 MANAGEMENT ERP ORDER BOOK DEMAND PLANNING Weeks (KIT/Part level) DEMAND (WITH RFID) REVIEW RAW MATERIAL STOCK 2 to 12 Weeks P.O. COVER PLANNED STOCK NEEDED Vs ACTUAL PRODUCTION M
Slide 10: Where Velocity sits in the Global Composites Industry
Where Velocity sits in the Global Composites Industry VELOCITY TOTAL KIT PROVISION • Inventory Finance • Inventory Management • Demand Aggregation Global Material Suppliers / Distributors • Goods In • Quality Inspection • Kit Manufacturing • Warehousing • Goods Out / Transportation • Subcon Integrat
Slide 11: Market and Growth Opportunities
Market and Growth Opportunities © Velocity Composites Plc - 2023 Customer Estimated Annual Opportunity ($m) Qarbon Circa $25m Velocity has identified Safran (Additional) Circa $25m the following long term opportunities that are not GKN (Additional) Circa $25m already included in Velocity’s RTX $50m
Slide 12: European Site: Current & Potential Customers
European Site: Current & Potential Customers © Velocity Composites Plc - 2023 Potential Customers Current Customers Aerospace Composites Aerospace Composites 12
Slide 13: Velocity's North American Site and Current & Potential Customers
Velocity’s North American Site and Current & Potential Customers © Velocity Composites Plc - 2023 KS NC TN AR SC GA AL OK MS LA TX Potential Customers FL Current Customers FINAL ASSEMBLY LINE 13
Slide 14: Contract Timeline
Contract Timeline AUTHORITY TO FULL CONTRACT FIRST ARTICLE PROCEED AWARD AWARD INSPECTION FULL REVENUE PROJECT 5 FIRST ARTICLE INSPECTION FULL REVENUE PROJECT 4 FIRST ARTICLE INSPECTION FULL REVENUE PROJECT 3 FIRST ARTICLE INSPECTION FULL REVENUE PROJECT 2 FIRST ARTICLE INSPECTION FULL REVENUE PROJE
Slide 15: Why Invest Now?
Why Invest Now? • First to market • 10x market growth by 2041 • Revenue increases 2.5x to 3.0x by 2024 • Funding for £70m capacity secured • 5 year revenue target of £100m with 10% EBITDA • Sticky, high-quality customers “ Velocity Composites has put into effect a clear strategy to capitalise on the
Slide 16: Revolutionising composite manufacturing
plc revolutionising composite manufacturing © Velocity Composites Plc - 2023
Slide 17: Appendices
© Velocity Composites Plc - 2023 17 Appendices
Slide 18: Velocity's Material Efficiency Gains
Velocity’s Material Efficiency Gains total material spend © Velocity Composites Plc - 2023 Operational EXAMPLE OF A 3 X Waste SINGLE PART NEST material utilisation total material spend Operational Waste Saving EXAMPLE OF A 3 X Reduced Up to 20% reduced HYPERNEST material spend improved material util
Slide 19: Process Materials Optimisation
Process Materials Optimisation © Velocity Composites Plc - 2023 Laser Cut Peel Ply/Release Fabrics Cut Shape Release Films The Conventional Way Vacuum Bagging Time: 2hrs 15m Operators: Dedicated Traceability: None 3D Breather/Bleeder Fabrics 3D Welded Vacuum Bag Films Value Engineered Kits Vacuum Ba
Slide 20: Value Proposition to Customers
Value Proposition to Customers © Velocity Composites Plc - 2023 The challenges for composite part manufacturers when Velocity offers a more efficient, outsourcing option by: they perform the kitting process in-house are: • Invested in advanced, real-time proprietary technology • Materials are expens
Slide 21: FY2022 Results - Summary Income Statement
FY2022 Results - Summary Income Statement © Velocity Composites Plc - 2023 • Sales increase of 22.4% as the market begins to recover from the pandemic FY 2022 FY 2021 £000 £000 • The additional volume has generated a gross profit of Revenue 11,959 9,767 • £2.7m, £0.2m ahead of the £2.5m achieved in
Slide 22: FY2022 Results - Summary Statement of Financial Position
FY2022 Results - Summary Statement of Financial Position © Velocity Composites Plc - 2023 FY 2022 FY 2021 £000 £000 Non-current assets 3,541 2,830 • Increase in non-current assets of £0.7m driven by investment in technology and the Inventories 1407 877 development of the US manufacturing facility Tr
Slide 23: FY2022 Results - Summary Statement of Cash Flows
FY2022 Results - Summary Statement of Cash Flows © Velocity Composites Plc - 2023 • A positive working capital movement and tax FY 2022 FY 2021 receipt have generated a cash inflow from £000 £000 operating activities of £0.3m Operating cash flows (490) (562) • £0.4m invested in technology and US bus
Slide 24: US Market Entry & GKN Agreement
US Market Entry & GKN Agreement • Facility constructed in Alabama to support the Company’s five-year agreement with GKN Aerospace in the United States in December 2022 • Expected to be worth in excess of US$100 million in revenue over five years • Site successfully achieved AS9100, Rev. D approval i
Slide 25: Shareholder Register
Shareholder Register © Velocity Composites Plc - 2023 Shareholder Shareholder Shareholder % * Jon Bridges 13.49% Gerard Antony Johnson 11.74% Christopher Banks 11.50% Stonehage Fleming 10.61% Hargreaves Lansdown 6.15% Charles Stanley 4.19% AJ Bell 4.05% Octopus 3.83% Interactive Investor 3.33% * FIG
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