Slide 1: Healthy air, sustainably
Healthy air, sustainably Volution Group plc Full-Year Results to 31 July 2024
Slide 2: Agenda
Agenda Overview Financial Review Business Review Summary and Outlook Q&A Ronnie George Andy O’Brien Chief Executive Officer Chief Financial Officer Volution Group plc Full-Year Results to 31 July 2024 1
Slide 3: Overview
Overview Volution Group plc Full-Year Results to 31 July 2024 2
Slide 4: Continuing to deliver strong compounding growth
Continuing to deliver strong compounding growth • Strong growth in revenue (+8%cc), adjusted operating profit (+11.7%) and adjusted earnings per share (+8.5%) • Asset light business model continues to deliver excellent cash generation with 107% cash conversion in FY24, ten-year average of 97% • Comp
Slide 5: A decade of strong performance
A decade of strong performance Revenue growth Adjusted cash flow 11.2% 14.2% 347.6 328.0 85.6 307.7 75.7 The Group in 2014 Ten-year CAGR 272.6 Ten-year CAGR 235.7 216.6 Revenue £120.7m 205.7 56.9 185.1 50.4 Revenue from Non-UK customers c.30% 154.5 43.4 130.2 35.9 34.4 36.9 Number of countries 4 120
Slide 6: Compelling value creation delivered through our clear and consistent strategy and differentiated business model
Compelling value creation delivered through our clear and consistent strategy and differentiated business model Structural growth Our differentiated Through our Delivering attractive drivers underpinning business case strategic pillars financial returns long-term growth Structural undersupply Leadin
Slide 7: Financial Review
Financial Review Volution Group plc Full-Year Results to 31 July 2024 6
Slide 8: Financial highlights
Financial highlights Revenue £m Adjusted operating profit £m Adjusted operating profit margin % £347.6m +6.0% (+8.0%cc) £78.0m +11.7% 22.5% +120bps 2024 347.6 2024 78.0 2024 22.5 2023 328.0 2023 69.9 2023 21.3 2022 307.7 2022 64.9 2022 21.1 2021 272.6 2021 56.9 2021 20.9 2020 216.6 2020 33.7 2020 15
Slide 9: A strong financial performance
A strong financial performance 2024 2023 Movement • Revenue up 6.0%, or 8.0%(cc) of which +1.5%(cc) organic Revenue (£m) 347.6 328.0 +6.0% • Price impact “normalising” after recent years at c.+2.0% Adjusted operating profit (£m)1 78.0 69.9 +11.7% • Adjusted operating profit margin up 120bps to 22.5%
Slide 10: Revenue
Revenue Organic growth £4.9m (+1.5% cc) £21.4m £347.6m £328.0m £4.9m £0.1m £(6.7)m £(0.1)m FY23 UK Continental Europe Australasia Inorganic FX FY24 Revenue up 6.0% with organic revenue up 1.5%cc Volution Group plc Full-Year Results to 31 July 2024 9
Slide 11: Group adjusted operating profit up 11.7% to £78.0m, with margin up 120bps to 22.5%
Group adjusted operating profit up 11.7% to £78.0m, with margin up 120bps to 22.5% £3.9m £78.0m £6.0m £69.9m £(1.8)m FY23 Organic Inorganic FX FY24 Target >20% 25.0% FY24 22.5% 23.9% 23.9% 22.6% 22.8% 22.7% FY23 21.3% FY22 21.1% FY21 20.9% Group FY24 FY24 FY24 FY23 FY23 FY23 FY20 15.6% UK Continenta
Slide 12: Net debt and cash flow
Net debt and cash flow Our 3 capital £89.0m £2.7m allocation priorities £(7.1)m £(13.2)m £(16.4)m £(5.7)m £(5.0)m £(16.8)m £(1.0)m £(31.6)m £(58.1)m 1 Aug 23 Adjusted Working CAPEX Acquisitions2 Dividend Leases Interest Tax FX and other 31 July 24 EBITDA capital 1. Net debt of £31.6m (2023: £58.1m)
Slide 13: Compelling returns on invested capital (ROIC)
Compelling returns on invested capital (ROIC) 2024 2023 £m £m • Strong pre-tax ROIC of 27.8%, significantly ahead of Group WACC AVERAGE NET ASSETS1 235.9 216.3 • Increase of 40bps vs PY with adjusted operating margin expansion part offset by acquisition impact of VMI, Ivent & DVS Add/(deduct) • Acqu
Slide 14: Strong performance against our key financial metrics
Strong performance against our key financial metrics Revenue growth Organic revenue growth (cc) Adjusted operating profit margin % FY24 5yr average FY24 5yr average FY24 5yr average +6.0% +8.6% +1.5% +4.5% 22.5% 20.3% Target: Target: Target: +10% +3% to +5% >20% Adjusted operating cash conversion Re
Slide 15: Business Review
Business Review Volution Group plc Full-Year Results to 31 July 2024 14
Slide 16: Volution at a glance
Volution at a glance 31% New build UK Continental Australasia 46.3% Europe 15.0% of Group revenue of Group revenue Revenue 38.7% split of Group revenue 69% RMI 23% Commercial Revenue Revenue Revenue Revenue split £160.8m £134.4m £52.4m Adjusted operating profit Adjusted operating profit Adjusted ope
Slide 17: Our ever-expanding geographic diversity
Our ever-expanding geographic diversity £350m 52.4 134.4 £150m 160.8 89.3 0 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 UK Continental Europe Australasia Volution Group plc Full-Year Results to 31 July 2024 16
Slide 18: UK: Good revenue growth and significant margin expansion
UK: Good revenue growth and significant margin expansion 46.3% of Volution Group plc revenue • UK revenue up 3.1%cc to £160.8m with excellent performance in 2024 2023 Growth residential (+17.1%) offset by weak OEM and commercial £m £m % • Heightened awareness of air quality and mould and condensatio
Slide 19: Continental Europe: Acquisitions driving revenue growth, margins enhanced
Continental Europe: Acquisitions driving revenue growth, margins enhanced 38.7% of Volution Group plc revenue • Continental Europe revenue up 10.5%cc to £134.4m due to acquisitions, Growth with organic revenue (cc) flat 2024 2023 Growth (cc) £m £m % % • Nordics revenue up 0.4%cc with a good performa
Slide 20: Australasia: Strong performance in Australia, more challenging market conditions in New Zealand
Australasia: Strong performance in Australia, more challenging market 15.0% conditions in New Zealand of Volution Group plc revenue • Australasia revenue up 17.5%cc to £52.4m with organic +0.1%cc Growth and inorganic (DVS) 17.4% 2024 2023 Growth (cc) £m £m % % • Significant currency headwind with we
Slide 21: Agreement to acquire Fantech Group in Australasia
Agreement to acquire Fantech Group in Australasia for AUD $280m (announced 20th September 2024) Transaction Financial Compelling strategic overview highlights combination • Attractive valuation: c.8.5x FY24 EBITDA • FY24 (31 March) revenue of AUD$177m • Highly complementary to Group’s existing and E
Slide 22: Continuing to grow and develop our people
Continuing to grow and develop our people People Enhancing health, safety & wellbeing Attracting and developing our leaders Promoting engagement and inclusion • Reportable incident frequency rate • Key new senior hires: Group Technical • First Group-wide employee engagement reduced to 0.20 (FY23: 0.
Slide 23: Driving sustainable solutions
Driving sustainable solutions Product 70.9% (+0.8pp) Revenue from low-carbon products up to 70.9% (FY23: 70.1%). Strong regulatory tailwinds driving adoption of more energy efficient solutions. of total revenue from low-carbon products 31.7% Increased heat recovery sales from recent acquisition I-ve
Slide 24: Summary and Outlook
Summary and Outlook Volution Group plc Full-Year Results to 31 July 2024 23
Slide 25: Continuing to deliver strong compounding growth
Continuing to deliver strong compounding growth • Strong growth in revenue (+8%cc), adjusted operating profit (+11.7%) and adjusted earnings per share (+8.5%) • Asset light business model continues to deliver excellent cash generation with 107% cash conversion in FY24, ten-year average of 97% • Comp
Slide 26: Outlook
Outlook The new financial year has started as anticipated, with both revenue and adjusted operating profit ahead of the same period last year. Also in an exciting post year-end development, we have announced an agreement to acquire Fantech’s ventilation activities in Australia and New Zealand, which
Slide 27: Thank you Q&A
Thank you Q&A Volution Group plc Full-Year Results to 31 July 2024 26
Slide 28: Appendix
Appendix Volution Group plc Full-Year Results to 31 July 2024 27
Slide 29: Financial summary
Financial summary 2024 2023 Movement Revenue (£m) 347.6 328.0 6.0% Revenue (cc) (£m) 354.3 328.0 8.0% Gross margin (%) 51.3 48.4 2.9pp Adjusted operating profit (£m)1 78.0 69.9 11.7% Adjusted operating margin (%)1 22.5 21.3 1.2pp Adjusted profit before tax (£m)1 70.7 65.1 8.7% Adjusted EPS (pence)1
Slide 30: Reconciliation of adjusted to reported profit
Reconciliation of adjusted to reported profit 2024 2023 Movement £m £m £m Acquisition-related costs: Adjusted profit before tax 70.7 65.1 5.6 • £0.2m (2023: £1.0m) of professional fees in respect of the acquisitions during the year Items excluded from adjusted measures: • Gain of £0.1m (2023: loss o
Slide 31: Consolidated statement of financial position summary
Consolidated statement of financial position summary 31 July 2024 2023 £m £m Non-current assets Property, plant and equipment 30.2 29.4 Right-of-use assets 24.9 29.9 Intangible assets – goodwill 171.4 264.9 Intangible assets – others 76.9 83.9 Total non-current assets 303.4 308.1 Current assets Inve
Slide 32: Cash flow/net debt
Cash flow/net debt 31 July 2024 31 July 2023 Movement Movement £m £m £m % Adjusted EBITA (A) 79.9 71.3 8.6 12.0% Depreciation 9.1 8.0 Adjusted EBITDA 89.0 79.3 9.7 12.2% Movement in working capital 2.7 2.8 Share-based payments 1.2 1.4 Net investment in fixed assets (7.1) (7.8) Adjusted operating cas
Slide 33: Cautionary statement
Cautionary statement This document may contain forward-looking statements which are made in good faith and are based on current expectations or beliefs, as well as assumptions about future events. You can sometimes, but not always, identify these statements by the use of a date in the future or such