Melrose Industries Plc · LSE:MRO
Melrose Industries — Investec conference 2021
9 slides from Melrose Industries's conference presentation, Nov 16, 2021
Slide 1: Melrose Industries PLC – Investec conference
Buy Improve Sell Strictly private and confidential Melrose Industries PLC Investec conference 16 November 2021 Buy Improve Sell
Slide 2: Executive summary
Executive summary ▪ Buy, Improve, Sell ▪ Nortek largely sold and value doubled, GKN being significantly improved ▪ Aerospace seeing better trends, operational performance improving ▪ Automotive and Powder Metallurgy restructuring well progressed; all projects underway. Underlying demand strong and o
Slide 3: Melrose key financial numbers: sensibly conservative positioning
Melrose key financial numbers: sensibly conservative positioning 1. Balance sheet well placed with spare capacity when the time is right Net debt1 Leverage1 £1,029m 1.5x ▪ Proforma net debt1 of £1,029 million and proforma leverage1 of 1.5x, including the £729 million Return of Capital (but excluding
Slide 4: Melrose key financial numbers: increasing momentum
Melrose key financial numbers: increasing momentum 2. Increasing momentum: significant upside potential in the continuing businesses Melrose margin target Based on 2020 revenue Businesses sold in 2021 (average)3 2 1 Continuing businesses (83%) Continuing businesses (average) 2 Businesses sold in 202
Slide 5: Melrose key financial numbers: good margin progression
Melrose key financial numbers: good margin progression 3. Margin progression: Automotive & Powder Metallurgy well advanced Target % of required operating projects already margins underway Half the required projects have started, the rest to Aerospace 10%1 c.50% commence in H2 this year Automotive >1
Slide 6: GKN & Nortek both highly cash generative
Melrose key financial numbers: GKN & Nortek both highly cash generative 4. Strong cash generation since the GKN acquisition from all businesses Total Melrose cash flows since GKN acquisition: Total cash inflow £3.5bn £2.5bn Disposals £1.0bn £1.0bn £1.1bn Free cash inflow1 current proforma returned t
Slide 7: GKN & Nortek both highly cash generative (continued)
Melrose key financial numbers: GKN & Nortek both highly cash generative (continued) 4. Strong cash generation since the GKN acquisition from all businesses (continued) Free cash inflow1 since GKN acquisition £1 billion: ▪ GKN has generated £1.7 billion of gross cash inflow Central costs, tax & since
Slide 8: Melrose business portfolio
Melrose business portfolio Aerospace Automotive Powder Metallurgy ▪ Leading global tier one supplier ▪ #1 in Driveline with technology ▪ #1 in supply of precision leadership powder metal parts Strong market ▪ Strong positions on major civil position and defence platforms ▪ Supplies 90% of OEMs, 50%
Slide 9: Sustainable technology
Sustainable technology Aerospace Automotive Powder Metallurgy Improving efficiency and Producing driveline solutions Commercialising additive sustainability of current aircraft: tailored to electric vehicles: manufacturing (AM) across sectors: Wing of Tomorrow High efficiency, high Intricate metal p