Slide 1: Results for year ended 31 May 2019
Pinpoint-Invest-Exit Results for year ended 31 May 2019 Steve McQuillan, CEO Stephen King, CFO 10 September, 2018
Slide 2: Pinpoint-Invest-Exit (PIE)
Pinpoint-Invest-Exit (PIE) • Strong balance sheet • Seasoned board and management • Creating significant shareholder value 2
Slide 3: Our divisions
Our divisions Energy: Engineered Energy: Process Solutions Medical and Industrial Pumps and Motors (EPM) and Rotating Equipment Imaging (MII) (PSRE) HT Inc, USA Metalcraft UK (Energy) Metalcraft UK (Medical) HT Luton (HT) Fluid Handling Metalcraft China HT China Peter Brotherhood Scientific Magnetic
Slide 4: Our strategy in action - Pinpoint
Our strategy in action - Pinpoint Strengthening the portfolio Blast doors - Avingtrans successfully acquires Booth Nuclear Life Extension - Avingtrans successfully assets for £1.8m on 11 June 2019. acquires Energy Steel for $0.6m on 24 June 2019. 4
Slide 5: Our strategy in action - Invest
Our strategy in action - Invest Establishing world class capability Energy Energy • Production ramp-up phase for 3M3 intermediate • New 3,250m2 factory opened in Kunshan, China. level waste (ILW) boxes • Provides aftermarket service and manufacture of • Full production capacity expected in FY20. new
Slide 6: Our strategy in action - Exit
Our strategy in action - Exit Building and returning shareholder value Avingtrans is engaged with the Invest phase of • Avingtrans is committed to long term development and its two energy divisions and its medical division. to business exits at advantageous valuations. This follows the Exit of Sigma
Slide 7: Divisional priorities - EPM
Divisional priorities - EPM EPM (Hayward Tyler and Energy Steel) • Markets • Nuclear - life extension focus – multiple international opportunities • Contract wins in Sweden (£10m) and South Korea ($6m) • Next Generation nuclear and renewables – molten salt contract wins • Fossil Fuels – some limited
Slide 8: Divisional priorities - PSRE
Divisional priorities - PSRE PSRE (PB, Metalcraft, Fluid Handling, Ormandy, Crown, Booth) • Markets • Nuclear • Decommissioning – Sellafield steady progress • Life extension – further opportunities emerging in the UK • Fossil fuels / Oil & Gas – signs of recovery. £10m FLNG win. Focus on aftermarket
Slide 9: Divisional priorities - MII
Divisional priorities - MII MII (Sci Mag, Tecmag, Metalcraft Medical, Composite Products) • Markets • NMR • Promising progress with Q One Instruments, as new player in the market • NMR service – modest start in UK/Europe – seeking to accelerate • MRI – strategic review of options continues – pre-pro
Slide 10: Financial Highlights
MD. Avingtrans Financial Highlights 10
Slide 11: Financial highlights
Financial highlights Group Revenue Gross Profit Margin Adjusted Op Profit £105.5m 26.7% £5.8m +34% 2018: 25.5% +108% Adjusted Diluted EPS Total Dividend Net Debt 14.9p 3.8p £2.0m 2018: 8.4p 2018: 3.6p 2018: £7.1m 11
Slide 12: Summary Divisional Results
Summary Divisional Results Energy: Energy: Energy: Energy: EPM PRSE Medical Central FY19 EPM PRSE Medical Central FY18 £’M £’M £’M £’M £’M £’M £‘M £’M £’M £’M Revenue: OE 13.9 31.5 12.0 - 57.4 15.2 20.1 10.4 - 45.7 AM 35.1 12.9 0.1 - 48.1 21.6 11.6 - - 33.2 Total Revenue 49.0 44.4 12.1 - 105.5 36.8
Slide 13: Eighth year of dividend growth
Eighth year of dividend growth 4 3.5 3 2.5 2.4 2.3 2.2 2.1 2 2.0 1.8 1.5 1.5 1 1.2 1.3 1.4 0.5 1.0 0.9 1.0 1.1 0.7 0.4 0 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 Interim Final 13
Slide 14: Balance Sheet
Balance Sheet FY19 FY18 £m £m Tangible fixed assets 26.6 27.6 Goodwill 23.4 23.4 Other intangible 14.5 15.6 Deferred Tax Asset/Pension Surplus 2.7 3.0 Working capital 14.5 18.6 Provisions (5.3) (6.1) Tax 0.1 0.6 Net Debt (2.0) (7.1) Creditors > 1 year (3.1) (3.6) Deferred Tax Liability (2.1) (2.9) N
Slide 15: Movement in net debt – FY19
Movement in net debt – FY19 £m 4.0 1.5 9.4 2.0 (0.1) (1.3) (0.4) (1.1) 0.0 (2.0) (2.9) (2.0) (4.0) (6.0) (7.1) (8.0) Opening net debt Adjusted EBITDA Acquisition Restructuring Net working cap Interest, tax and Dividend Capital Closing net debt expenses expenses other expenditure 15
Slide 16: Market capitalisation progression
Market capitalisation progression Purchased Moss & Placing £3.5m 2009 8 Purchased Sigma** 2010 9 2011 15 2012 17 Sold JenaTec; Purchased Aerotech & PFW 2013 32 Purchased Maloney 2014 45 Oil Price Shock Purchased RMDG 2015 31 Purchased Rolls Royce pipes; Sold Sigma 2016 50 Returned £19m to shareholde
Slide 17: Tax highlights
Tax highlights • Effective tax rate 20% • US tax charge £0.7m offset by deferred tax credit on the amortisation of business intangibles and temporary timing differences • UK tax rate to reduce to 17% from April 2020 – Future benefit • Tax losses of £35.4m available for future use with £8.4m of these
Slide 18: Summary
MD. Avingtrans Summary 18
Slide 19: Summary
Summary Record year for revenue, order intake and profits Renaissance of Hayward Tyler and Peter Brotherhood is on plan Order book: robust cover in Energy; Medical still building steadily Significant Nuclear contract wins in the UK, USA, Sweden and South Korea Sellafield 3M3 project contin
Slide 20: Compelling Pinpoint-Invest-Exit strategy
Compelling Pinpoint-Invest-Exit strategy Niche market leadership positions Consistent shareholder returns 20
Slide 21: Appendix
MD. Avingtrans Appendix 21
Slide 22: Our locations and employees (at Sep 2019)
Our locations and employees (at Sep 2019) UK 659 China USA 158 India 61 10 22
Slide 23: Our values
/ Avingtrans Our values A High Performance Business Integrity Quality Agility We mean what we say and do what we say we Right first time, on time. Our products and We adapt rapidly and cost effectively - in will do, with respect for all concerned services have enduring value to our customers respons
Slide 24: Booth Integration
Booth Integration Banking facilities re-established Restructuring exercise completed Unneeded leased buildings eliminated Initial working capital requirement funded Strategic plan now developed Booth produces doors and walls that are: Strong order book and prospect pipeline Blast/explo
Slide 25: Energy Steel Integration
Energy Steel Integration Good progress so far Strategic ES/HT collaborative plan executed Initial working capital requirement funded Strong order book and prospect pipeline Supply chain synergies defined HT/ES cross-selling and training underway Energy Steel is a custom fabricator exclusiv
Slide 26: Blue chip partnerships
Blue chip partnerships /o. Avingtrans @® Sellafield Ltd VATTENFALL @ BEWENS <'seprenercy Cee] EASTMAN EUREKA — falltech| BAKER G9) a ° a 0) PRES Hin eS Dominion P Qone Rapiscar Apollo Machinery Energy’ ‘An OSI Systems Company 26 SH-APOLLO
Slide 27: M&A – successful exits
M&A – successful exits Brand Acquisitions Bought for £m1 Sold for £m1 JRT Ltd JenaTec Inc 4.0 14.5 JGWT GMBH (FY02 - FY09) (FY13) Boneham & Turner Moss Group Sigma Components B&D Patterns C&H Composites Eng Group 22.0 65.0 Aerotech Tubes (FY07 - FY16) (FY16) PFW Farnborough RMDG Rolls Royce Nuneaton
Slide 28: Largest investors
Largest investors Number of % of total shares shares (000s) Nigel Wray 3,227 10.3% Funds managed by BlackRock 2,172 6.9% Funds managed by RBC Trustees Limited 2,008 6.4% Funds managed by Unicorn Asset Management Limited 1,946 6.2% Harwood Capital 1,760 5.6% R S McDowell’s Pension Fund 1,406 4.5% P M