Slide 1: Healthy air, sustainably
Healthy air, sustainably Volution Group plc Interim results to 31 January 2023
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 Interim results to 31 January 2023 1
Slide 3: Overview
Overview Interim results to 31 January 2023
Slide 4: Strong first half performance
Strong first half performance Organic revenue growth 6.3% (cc) through volume and price Operating margin 21.1%, above our long-term target Recycled plastic use +18.4pp to 76.4% (H1 2022: 58.0%) Heat recovery ventilation now 32.2% of Group revenue Strong cash generation, robust balance sheet, signifi
Slide 5: Delivering on our strategy
Delivering on our strategy Organic Value-adding growth acquisitions Organic growth • Organic revenue growth 7.3% (6.3% cc), supported by price and volume. • Organic growth in all three regions, the UK, Continental Europe and Australasia. Value-adding acquisitions • Inorganic revenue growth 1.2% (due
Slide 6: Volution supports legislative transition as we decarbonise
Volution supports legislative transition as we decarbonise Decarbonisation Healthy Air Comfort 40% of our energy use and 36% of Increasing focus on good indoor air Increasing risk of over heating as well our emissions are from buildings. quality (IAQ) and the importance of as nuisance noise as we mo
Slide 7: Driving sustainable solutions
Driving sustainable solutions • Low-carbon revenue 69.4% of Group total. • Continuing regulatory and legislative tailwinds. • Heat recovery sales increased to 32.2%. • Product development programmes progressing well; new heat recovery solutions to be launched in H2. Product 70% Target 70% of our sal
Slide 8: Improving environmental performance
Improving environmental performance • 76.4% of plastic we used in our own production facilities came from a recycled source. • Investment in extrusion capability to increase ducting output and optimise PVC material usage. • Have now supplied over 450,000 complete ventilation units where chassis and
Slide 9: Connecting people together
Connecting people together • Reportable accident frequency rate reduced to 0.15 per 100,000 hours worked from 0.25 in FY22. • Achieved certification to ISO 45001:2018 Occupational Health and Safety Management for all ventilation sites in the UK (43.8% of our workforce). People ZERO Target zero repor
Slide 10: Financial Review
Financial Review Interim results to 31 January 2023
Slide 11: Financial highlights
Financial highlights Revenue £m Adjusted operating profit £m Adjusted operating profit margin % £162.3m £34.2m 21.1% +8.5% +7.5%cc +7.1% -0.2pp 2023 162.3 2023 34.2 2023 21.1 2022 149.6 2022 31.9 2022 21.3 2021 131.7 2021 27.7 2021 21.1 2020 118.8 2020 21.8 2020 18.3 2019 114.8 2019 20.2 2019 17.6 A
Slide 12: Revenue up 8.5% with organic revenue up 7.3% (+6.3% at cc)
Revenue up 8.5% with organic revenue up 7.3% (+6.3% at cc) £1.5m £1.8m £1.0m £4.7m +1.0% £162.3m +0.7% +1.2% £3.7m +3.1% £149.6m +2.5% Organic growth £9.4m, (+6.3% at cc) H1 FY22 UK Continental Europe Australasia Inorganic Currency H1 FY23 Volution Group plc Interim results to 31 January 2023 11
Slide 13: Group adjusted operating profit up 7.1% to £34.2 million
Group adjusted operating profit up 7.1% to £34.2 million £0.4m £0.2m £1.7m £34.2m £31.9m H1 FY22 Organic Inorganic Currency H1 FY23 Target 20% H1 2023 21.1% Group 21.1% Group H1 2022 21.3% H1 2023 United Kingdom 21.2% H1 2021 21.1% Continental Europe 24.0% H1 2020 18.3% Australasia 22.6% H1 2019 17.
Slide 14: Adjusted operating cash flow up 88.1% supported by good inventory and working capital performance
Adjusted operating cash flow up 88.1% supported by good inventory and working capital performance Cash conversion 88% (H1 2022: 50%) Leverage 0.8x (H1 2022: 1.2x) Net debt1 £79.2m (H1 2022: £104.0m) Net debt bridge Movement in working capital Inventory £(2.5)m Other WC £(2.5)m £38.7m £(5.0)m £(4.1)m
Slide 15: Business Review
Business Review Interim results to 31 January 2023
Slide 16: Operating segments
Operating segments United Kingdom 55++45O % of Volution Group plc revenue (by segment) 45.4% UK Residential 25.5% £73.7m UK Commercial 8.8% UK Export 3.3% OEM 7.8% 45.4% of Group Continental Europe 39++61O % of Volution Group plc revenue (by segment) 39.6% £64.3m Nordics 16.4% Central Europe 23.2% 3
Slide 17: United Kingdom
40++1545O 40 45.4% % of Volution Group plc revenue Product training, Crawley, UK UK Total • Revenue grew by 5.5% (5.3% at cc) with adjusted operating profit H1 2023 H1 2022 growth (cc) of £15.6 million, an increase of 12.5%. £m £m % • Adjusted operating margin up 1.3pp to 21.2% (H1 2022: 19.9%). UK
Slide 18: Continental Europe
40++1545O 40 39.6% % of Volution Group plc revenue Project meeting, Växjö, Sweden Continental Europe • Revenue grew by 12.0% (11.4% at cc) with organic revenue growth Total of 8.9% (8.2% at cc). H1 2023 H1 2022 growth (cc) £m £m % • Adjusted operating profit of £15.4 million, an increase of 4.0%, an
Slide 19: Australasia
40++1545O 40 15.0% % of Volution Group plc revenue New product meeting, Melbourne, Australia Australasia Total • Revenue of £24.3 million, up 8.9% (4.5% at cc) against a strong H1 2023 H1 2022 growth (cc) comparator period. £m £m % • Adjusted operating profit of £5.5 million (H1 2022: £4.9 million),
Slide 20: Summary and Outlook
Summary and Outlook Interim results to 31 January 2023
Slide 21: Strong first half performance
Strong first half performance Organic revenue growth 6.3% (cc) through volume and price Operating margin 21.1%, above our long-term target Recycled plastic use +18.4pp to 76.4% (H1 2022: 58.0%) Heat recovery ventilation now 32.2% of Group revenue Strong cash generation, robust balance sheet, signifi
Slide 22: Outlook
Outlook Looking ahead, although mindful of the cautious sentiment in some of our segments, Residential RMI demand remains supportive, and inflationary pressures and supply chain challenges are easing. With our excellent levels of customer service, agile manufacturing, a well-developed M&A pipeline a
Slide 23: Thank you Q&A
Thank you Q&A Interim results to 31 January 2023
Slide 24: Appendix
Appendix Interim results to 31 January 2023
Slide 25: Operating segments
Operating segments 39.6++1545.4Q 16.4+23.2+1525.58.83.34.63.2Q 39.6 % of Volution Group plc revenue % of Volution Group plc revenue (by sector) OEM OEM UK Export 3.2% Nordics UK Export 4.6% 3.3% 16.4% UK Commercial Continental 8.8% Europe 39.6% UK 45.4% Central Europe 23.2% Australasia UK 15.0% Resi
Slide 26: Financial summary
Financial summary H1 2023 H1 2022 Movement Revenue (£m) 162.3 149.6 8.5% Revenue (cc) (£m) 160.8 149.6 7.5% Gross margin (%) 47.4 47.7 (0.3)pp Adjusted operating profit (£m)1 34.2 31.9 7.1% Adjusted operating margin (%)1 21.1 21.3 (0.2)pp Adjusted profit before tax (£m)1 31.8 30.0 6.0% Adjusted EPS
Slide 27: Reconciliation of adjusted to reported profit
Reconciliation of adjusted to reported profit H1 2023 H1 2022 Movement • Acquisition-related costs: £m £m £m • £0.2 million (H1 2022: £0.1 million) of Adjusted profit before tax 31.8 30.0 1.8 professional fees in respect of the acquisitions during the year. Items excluded from adjusted measures • Lo
Slide 28: Consolidated statement of financial position summary
Consolidated statement of financial position summary 31 January 31 July 31 January 31 July 2023 2022 2023 2022 £m £m £m £m Non-current assets Current liabilities Property, plant and equipment 29.1 28.2 Trade and other payables (42.4) (48.8) Right-of-use assets 23.2 23.6 Refund liabilities (10.3) (10
Slide 29: Cash flow/net debt
Cash flow/net debt 31 January 31 January 2023 2022 Movement Movement £m £m £m % Adjusted EBITA (A) 34.9 32.6 2.3 7.0% Depreciation 3.8 3.7 Adjusted EBITDA 38.7 36.3 2.3 6.8% Movement in net working capital (5.0) (17.5) Share-based payments 1.0 1.0 Capital expenditure (4.1) (3.6) Adjusted operating c
Slide 30: 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