Brightview Holdings, Inc. · NYSE:BV
Brightview — William Blair 39th Annual Growth Stock Conference (June 2019)
32 slides from Brightview's conference presentation, Jun 6, 2019
Slide 1: BrightView Holdings, Inc. (NYSE: BV)
BrightView Holdings, Inc. (NYSE: BV) William Blair – 39th Annual Growth Stock Conference June 6, 2019 Inspiring people. Nurturing landscapes.
Slide 2: Disclaimer
Disclaimer This presentation contains “forward looking statements” within the meaning of the safe harbor provision of the U.S. Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended,
Slide 3: Today's Presenters
Today’s Presenters Andrew Masterman, President and Chief Executive Officer • Joined BrightView in December 2016 • Most recently served as Executive Vice President at Precision Castparts • At Precision Castparts, Andrew also served as President of the Wyman Gordon and Structural Casting divisions • P
Slide 4: Company Overview
Inspiring people. Nurturing landscapes. Company Overview Cedars-Sinai Medical Center – Los Angeles, CA
Slide 5: BrightView: 70+ Years of Delivering Best-in-Class Service
BrightView: 70+ Years of Delivering Best-in-Class Service • Founded in 1939 by Theodore Brickman • Founded in 1949 by Burton Sperber • Primarily landscape maintenance and snow • Provider of landscape maintenance and removal services development services • Strong national presence • Strong evergreen
Slide 6: We Provide Holistic Solutions Across the Full Spectrum of Maintenance & Development Services
We Provide Holistic Solutions Across the Full Spectrum of Maintenance & Development Services Landscape Maintenance Landscape Development Revenues: $1.77B1 Revenues: $0.58B1 FY’18 Revenue $2.35B1 75% of Revenues 25% of Revenues • Commercial landscaping and snow removal services • Landscape architectu
Slide 7: And Offer a Highly Compelling Value Proposition to our Customers
And Offer a Highly Compelling Value Proposition to our Customers Average Local Competitor Deep local market knowledge “Strategic partnership” mentality Lower organizational sophistication Local Market Professional, empowered and accountable branch managers Lower consistency of service and
Slide 8: Our Breadth of Coverage Enables Us to Serve Customers Across the Country
Our Breadth of Coverage Enables Us to Serve Customers Across the Country National Footprint #1 Player in a ~$67B Market ~10x Next Largest Competitor Strong Margins and Free Cash Flow ~80% Cash Conversion Modest Capex Needs States with BrightView Branches Maintenance Location ~2.5% of Revenue Extende
Slide 9: Consistent Execution of Complex Maintenance and Development Engagements
Consistent Execution of Complex Maintenance and Development Engagements Getty Museum Marlins Park Four Seasons Hualalai ExxonMobil Headquarters Los Angeles, CA Miami, FL Kona, HI Irving, TX Pavilion Park Duke University Beacon Irvine, CAPark Colonial Williamsburg Ritz Carlton Durham, NC Irvine, CA W
Slide 10: Industry & Business Model Highlights
Industry & Business Model Highlights Toyota North American Headquarters – Plano, TX
Slide 11: Sustainable Future Growth Levers
Sustainable Future Growth Levers LEVERS FOR FUTURE GROWTH GROW WALLET SHARE EXPAND WITH EXISTING CUSTOMER CUSTOMERS BASE Infrastructure and Technology Capitalize on Multiple Channels in place to expand existing relationships to win new business DRIVE EXECUTE OPERATIONAL ACCRETIVE M&A ENHANCEMENTS OP
Slide 12: #1 Provider of Commercial Landscaping Services…
#1 Provider of Commercial Landscaping Services… Top 10 North American Landscaping Companies1 ~10x The Size of Next ~10x Largest Direct Competitor Industry Leader Across a Number of Service Lines #1 Commercial #1 Snow Removal Leading Leading Provider of Golf Leading Water Irrigation Landscaper in the
Slide 13: …In a Large, Growing and Highly-Fragmented Commercial Landscaping Industry
…In a Large, Growing and Highly-Fragmented Commercial Landscaping Industry Commercial Landscaping and Snow Removal Services: Steadily Growing Industry ($B)1 CAGR: 0% $70 $71 $67 $68 $69 $69 $65 $65 $58 $61 $50 $53 $46 $48 $47 $45 $46 $44 '06A '07A '08A '09A '10A '11A '12A '13A '14A '15A '16A '17A '1
Slide 14: Topline Benefits from High Retention, Limited Concentration and Low Relative Cost of Service
Topline Benefits from High Retention, Limited Concentration and Low Relative Cost of Service Nature Diversified Limited of Services… Customer Base1 Customer Concentration¹ Top 10 Recurring Anchor business that provides Customers predictable recurring revenue and 12% Maintenance high degree of visibi
Slide 15: Snow Services: Valuable Source of Counter-Seasonal Revenue and Employee Retention
Snow Services: Valuable Source of Counter- Seasonal Revenue and Employee Retention Inherent Benefits of Snow Services Offering Efficient utilization of existing assets High value-add to customers (combination with landscape) Balanced mix of fixed price contracts with guaranteed minimums (reduc
Slide 16: Strong-on-Strong Acquisition Strategy
Strong-on-Strong Acquisition Strategy The Leading Acquirer of Commercial Landscaping Businesses $250M+ Annualized revenue since Jan 1, 2017 Austin, TX Bay Area, CA 4,500+ Additional Phoenix, AZ customer sites Tucson, AZ 2019 Danville, CA 2018 South Florida Hartford, CT Portland, OR Shamong, NJ Dalla
Slide 17: Proven Management and Experienced Local Leadership Teams
Proven Management and Experienced Local Leadership Teams Brightview Management Combines Extensive Business Services Experience with Robust Local Landscaping Leadership Senior Leadership Team Local Leadership Team Andrew Masterman Position Number of Avg. BrightView President and Chief Executive Offic
Slide 18: Financial Highlights
Financial Highlights Los Angeles County Museum of Art – Los Angeles, CA
Slide 19: Record Results in Fiscal Year 2018
Record Results in Fiscal Year 2018 Revenue Adj. EBITDA Adj. EBITDA Margin ∆ YoY ∆ YoY ∆ YoY (bps) $2,353.6M $300.1M 12.8% Up 5.7% Up 12.6% Up 80 bps • Record Total Revenue • Maintenance Services Revenue $1,774.8M – up 7.4% • Record Adjusted EBITDA Adj. EBITDA $289.8M – up 12.3% • Record Adjusted
Slide 20: FY2019 Financial Guidance
FY2019 Financial Guidance1 Total Revenue Adjusted EBITDA Net Capital Expenditures $2,400M - $2,470M $310M - $318M ~2.5% of Revenue Predictable Drivers Profitable Growth Long-Term Average Full Year 2019 Assumption • Acquisitions: expected to contribute at least $75 million to fiscal 2019 revenue • EB
Slide 21: 2Q FY2019 Revenue
2Q FY2019 Revenue (Numbers $M) 2Q19 2Q18 Commentary • 1.1% Increase Total Revenue $596.6 $590.4 • (+) Maintenance Revenue • (-) Development Revenue • 2.9% Increase Maintenance Services $473.3 $460.1 • (+) Acquisitions • (-) Managed Exits • (5.4%) Decrease Development Services $124.0 $131.0 • (+) New
Slide 22: 2Q FY2019 Adjusted EBITDA
2Q FY2019 Adjusted EBITDA (Numbers $M) 2Q19 2Q18 Commentary • 18.4% Increase Total Adj. EBITDA $61.1 $51.6 • 10.2% Adjusted EBITDA margin • 150 basis point expansion • 11.5% Increase Maintenance Services $65.0 $58.3 • 13.7% Adjusted EBITDA margin • 100 basis point expansion • (14.3%) Decrease Develo
Slide 23: Capital Expenditures and Net Debt
Capital Expenditures and Net Debt Capital 3 Expenditures Net Debt (Numbers $M) 1Q19 2Q19 $44.1 $42.6 $1,174.1 $1.5 $1,161.4 $3.0 Total Financial $21.6 $1,179.1 $1,185.3 Legacy Debt2 Assets $39.6 Net Capex1 Total Cash and $21.0 $17.7 $11.2 Net Equivalents Capex1 1H18 1H19 Dec. 31, '18 Mar. 31, '19 Ne
Slide 24: Thank You
Thank You Rose Fitzgerald Kennedy Greenway – Boston, MA
Slide 25: Appendix – 2Q19 Non-GAAP Reconciliations
Appendix – 2Q19 Non-GAAP Reconciliations Full Year 2018 Results & Non-GAAP Reconciliations Agnes Scott College – Atlanta, GA
Slide 26: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation Three Months Ended Six Months Ended March 31, March 31, (in m illions)* 2019 2018 2019 2018 Adjusted EBITDA Net loss $ (3.6) $ (22.1) $ (12.4) $ (2.7) Plus: Interest expense, net 18.9 25.1 36.1 50.0 Income tax benefit (1.3) (7.9) (4.5) (59.4) Depreciation expense 21.7
Slide 27: Non-GAAP to GAAP Reconciliation (Con't)
Non-GAAP to GAAP Reconciliation (Con’t) Three Months Ended Six Months Ended March 31, March 31, (in m illions)* 2019 2018 2019 2018 Adjusted Net Income Net loss $ (3.6) $ (22.1) $ (12.4) $ (2.7) Plus: Amortization expense 13.8 29.3 28.9 60.4 Establish public company financial reporting compliance (a
Slide 28: Non-GAAP to GAAP Reconciliation (Con't)
Non-GAAP to GAAP Reconciliation (Con’t) (a) Represents costs incurred to establish public company financial reporting compliance, including costs to comply with the requirements of Sarbanes-Oxley and the accelerated adoption of the new revenue recognition standard (ASU 2014-09 – Revenue from Contrac
Slide 29: Fiscal Year 2018 Non-GAAP Reconciliations – Adj. EBITDA
Fiscal Year 2018 Non-GAAP Reconciliations – Adj. EBITDA Three Months Ended Twelve Months Ended September 30, September 30, (in millions)* 2018 2017 2018 2017 Adjusted EBITDA Net loss $ (10.9 ) $ 0.4 $ (15.1 ) $ (37.4 ) Plus: Interest expense, net 20.3 24.7 97.8 98.1 Income tax benefit (8.1 ) (2.0 )
Slide 30: Fiscal Year 2018 Non-GAAP Reconciliations – Adj. Net Income and Adj. Free Cash Flow
Fiscal Year 2018 Non-GAAP Reconciliations – Adj. Net Income and Adj. Free Cash Flow Three Months Ended Twelve Months Ended September 30, September 30, (in millions)* 2018 2017 2018 2017 Adjusted Net Income Net loss $ (10.9 ) $ 0.4 (15.1 ) $ (37.4 ) Plus: Amortization expense 15.3 31.0 104.9 125.8 Es
Slide 31: Fiscal Year 2018 Non-GAAP Reconciliations – Footnotes
Fiscal Year 2018 Non-GAAP Reconciliations – Footnotes (a) Represents costs incurred to establish public company financial reporting compliance, including costs to comply with the requirements of Sarbanes-Oxley and the accelerated adoption of the new revenue recognition standard (ASC 606 – Revenue fr
Slide 32: Investor Relations Contact
Investor Relations Contact: Media Contact: Daniel Schleiniger Fred Jacobs VP, Investor Relations VP, Communications & Public Affairs BrightView Holdings, Inc. 484.567.7148 484.567.7244 Daniel.Schleiniger@BrightView.com investor.brightview.com Fred.Jacobs@BrightView.com
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