Slide 1: Eurocell Plc 2016 Half year results
EUROCELL PLC 2016 Half year results
Slide 2: Agenda
AGENDA Mark Kelly Michael Scott Chief Executive Officer Chief Financial Officer Introduction and headlines Financial performance Group strategy and growth opportunities Current trading and outlook Eurocell at a glance 1
Slide 3: Highlights
HIGHLIGHTS Strong first half performance in line with expectations, despite muted RMI market New and experienced management team in place Broader uncertainty due to EU referendum – positive start to the second half Significant opportunities for delivering long-term growth 2
Slide 4: Operational highlights
OPERATIONAL HIGHLIGHTS Operational improvements and initiatives in line with strategy Reviewed and aligned management structure Offset general cost increases with customer price increases Acquisition of Vista Panels performing in line with expectations Revision of major supply contracts to mitigate
Slide 5: Market backdrop
MARKET BACKDROP Above market growth Demand for our products is driven by the UK economy and more specifically the housing market Market segment % of Eurocell revenue Market growth (1) Private home improvement 84% ▲ 2% Private new build housing 12% ▲ 8% Social housing improvement ▼ 3% 4% Public new b
Slide 6: Financial highlights
FINANCIAL HIGHLIGHTS Strong financial performance, in line with market expectations £m H1 16 H1 15 Change Revenue 97.2 82.5 ▲ 17.8% Gross margin % 52% 52% Adjusted EBITDA (1) 14.2 13.0 ▲ 9.2% Adjusted profit before tax (2) 10.7 9.6 ▲ 11.5% Adjusted earnings per share (pence) (3) 8.72 7.61 ▲ 14.6% Di
Slide 7: Financial performance
FINANCIAL PERFORMANCE Strong sales growth and robust profitability £m H1 16 H1 15 Change Revenue Strong underlying revenue growth Profiles 42.4 35.2 +20.5% Building Plastics 54.8 47.3 +15.9% - Profiles +4.5% 97.2 82.5 +17.8% - Building Plastics L4L(1) +11.5% Direct costs (46.5) (39.4) Gross margin m
Slide 8: Financial position
FINANCIAL POSITION Strong balance sheet £m Jun 16 Jun 15 Dec 15 Intangible assets 20.1 13.9 14.5 Intangible assets Property plant and equipment 27.7 26.3 27.6 - Vista acquisition Working capital Underlying working capital Underlying 18.3 15.7 15.2 - Volume growth Acquisitions 1.8 - 0.6 - New branche
Slide 9: Cash flow
CASH FLOW Improved free cash flow £m H1 16 H1 15 Adjusted EBITDA 14.2 13.0 Change in underlying working capital (3.3) (1.2) Other non-cash items 0.2 0.4 Operating cash conversion Operating cash flow 11.1 12.2 - Increased working capital Capital expenditure (2.7) (3.2) - To mitigate through targeted
Slide 10: Eurocell at a glance
EUROCELL AT A GLANCE EUROCELL PROFILES EUROCELL BUILDING PLASTICS Market position: The UK’s Market position: Ranked #1 leading manufacturer, distributor PVC building products specialist and recycler of window, door, outlet conservatory and roofline products Sells and distributes: A range of Eurocell
Slide 11: Segment review: Profiles
SEGMENT REVIEW Profiles Strong growth in larger customers Continued growth in new build market Benefit from new customers secured in 2015 Increased use of recycled material in profiles, following investment in extruders and tooling in late 2015: now accounts for 14% of usage (H1 2015: 8%) Vista Pane
Slide 12: Segment review: Building Plastics
SEGMENT REVIEW Building Plastics Like for like sales up 12% Increased emphasis on pulling through higher value-added manufactured product Growth significantly ahead of muted RMI market 7 new branches opened in H1 and a further 12 expected in H2 Acquisition of Vista will benefit sales of doors throug
Slide 13: Group strategy and growth opportunities
GROUP STRATEGY AND GROWTH OPPORTUNITIES Strategy Growth opportunities Expand our branch network On track to open more branches than last year Broaden the range of products Develop new products Further innovation in Modus, Skypod and Equinox Increased use of recycled material Expand waste collection
Slide 14: Current trading and outlook
CURRENT TRADING AND OUTLOOK 7 weeks to 19 August 2016 Overall +17% Excluding acquisitions +8% Full year outlook Pressure on raw material prices – partially mitigate via price increase and use of recycled materials Full year expectations in line with market forecasts 13
Slide 15: Summary
SUMMARY Strong first half performance in line with expectations, despite muted RMI market New and experienced management team in place Broader uncertainty due to EU referendum – positive start to the second half Significant opportunities for delivering long-term growth – Expand the branch network –
Slide 16: Thank you
Thank you Connect with us: fe AS fing > eurocell: All together better 15
Slide 17: Appendices
Appendices eurocell: All together better
Slide 18: Differentiation
DIFFERENTIATION B2B supplier Sustainability Vertically Clear strategy of innovative PVC In-house Branch roll-out, new Stable ownership integrated Fresh focus, with building products closed loop business model product recycling facility development, new horizons Recycling, manufacturing operational a
Slide 19: A complete product range
A COMPLETE PRODUCT RANGE Modus windows and doors Skypod pitched skylights Aspect bi-folding doors Conservatories and equinox tiled roofs Fascias, soffits and guttering Traded goods 18
Slide 20: Locations
LOCATIONS Centrally located Extrusion centre Secondary Recycling Warehousing HQ, Manufacturing, 140,000 sq ft operations factory Warehousing, 260,000 sq ft 120,000 sq ft 75,000 sq ft Injection Moulding 45 extruders and Recycling 6 extruders 12 extruders Injection Composite Door Moulding Manufacture
Slide 21: Disclaimer
DISCLAIMER This Presentation may contain forward-looking statements form of commitment on the part forward-looking statements that involve risks and uncertainties of the Company to proceed with involve substantial risks and because they relate to events and any transaction. uncertainties, and actual