Avingtrans Plc · LSE:AVG
Avingtrans — H1 FY23 Earnings Presentation
28 slides from Avingtrans's earnings presentation, March 2023
Slide 1: Results for 6 months ended 30 November 2022
Pinpoint-Invest-Exit Results for 6 months ended 30 November 2022 Steve McQuillan, CEO Stephen King, CFO
Slide 2: Financial highlights
Financial highlights Group Revenue Gross Profit Margin Adjusted EBITDA £50.0m 32.6% £6.4m FY22 H1: £44.5m FY22 H1: 33.9% 2022 H1: £5.7m Adjusted Diluted EPS Interim Dividend Net Cash* 10.8p 1.7p £17.3m 2022 H1 10.2p 2022 H1: 1.6p 31 May 2022: £16.7m Net Cash* - impact of IFRS 16 removed 2
Slide 3: Our divisions and brands
Our divisions and brands Engineered Pumps and Process Solutions and Medical and Industrial Motors Rotating Equipment Imaging Acquired 2017 Acquired 2018 Acquired 2004 Acquired 2018 Acquired 2017 Acquired 2019 Acquired 2019 Acquired 2012 Acquired 2021 Revenue Adjusted EBITDA Revenue Adjusted EBITDA R
Slide 4: Compelling PIE strategy, niche leadership, shareholder returns
✓ Compelling Pinpoint-Invest-Exit (PIE) strategy ✓ Niche market leadership positions ✓ Consistent shareholder returns 4
Slide 5: Our proven strategy in action - Pinpoint
Our proven strategy in action - Pinpoint Strengthening the portfolio HEVAC & HES • Ormandy acquired the assets of HEVAC & HES for £852k* • Complementary product ranges • Widens product portfolio – including aftermarket offering • Team in Elland will move to Ormandy’s Bradford site • Site rationalisa
Slide 6: Our proven strategy in action - Invest
Our proven strategy in action - Invest Developing world class products • Magnetica - compact helium-free MRI systems • Adaptix – compact 3D X-ray systems • Further planned fund raising completed for Magnetica* • A further £2.0m invested in Adaptix via loan note* • Initial markets are orthopaedic and
Slide 7: Our proven strategy in action - Exit
Our proven strategy in action - Exit Building and returning shareholder value PB acquired for c£9m as part of HTG in 2017 • Avingtrans is committed to profitable growth and to business Exit of PB for enterprise value of £35m in March 2021 exits at advantageous valuations. Gross return on original ca
Slide 8: Divisional priorities - EPM
Divisional priorities - EPM ITER construction in France Hayward Tyler and Energy Steel • Markets • Nuclear – on-going life extension focus • Further contract wins in USA “life extension” market • Next Generation nuclear – ITER & TerraPower orders • Hydrocarbons – North Sea recovery underway • New pr
Slide 9: Divisional priorities - PSRE
Divisional priorities - PSRE Metalcraft, Ormandy, Booth, Composite Products • Markets • Nuclear decommissioning (Metalcraft) • Sellafield – phase 2 of 3M3 box contact progressing • Defence (Booth) – UK Government contracts extended CAD render of HS2 cross-tunnel door • Infrastructure (Booth) – £36m
Slide 10: Divisional priorities - MII
Divisional priorities - MII MRI scanner Magnetica, Scientific Magnetics. Tecmag Minority stake in Adaptix • Medical Imaging 3D X-ray scanner • Convergent orthopaedic and veterinary focus • Initial addressable MRI market estimate c£400m • Bigger “pay per scan” opportunity targeted • Plans on track, a
Slide 11: Financial Highlights
Ds. Avingtrans Financial Highlights 11
Slide 12: Interim results
Interim results £m H1 FY23 H1 FY22 FY22 Revenue 50.0 44.5 99.1 Gross Profit 16.3 15.1 33.8 Gross Profit % 32.6% 33.9% 34.2% Adjusted EBITDA 6.4 5.7 12.4 Adjusted EBITDA % 12.8% 12.9% 12.5% Adjusted Profit before tax 4.0 3.8 8.1 Adjusted Profit after tax 3.6 3.4 7.2 Adj. Diluted EPS (pence) 10.8 10.2
Slide 13: Divisional Results
Divisional Results Energy: Energy: 1H Energy: Energy: 1H £m EPM PSRE Medical Central FY23 EPM PSRE Medical Central FY22 Revenue: OE 9.1 20.8 1.5 - 31.4 6.1 19.7 0.8 - 26.7 AM 17.3 1.3 0.0 - 18.6 16.5 1.4 - - 17.9 Total Revenue 26.4 22.1 1.5 - 50.0 22.6 21.1 0.8 - 44.5 Operating profit/(loss) 1.9 2.5
Slide 14: Balance Sheet
Balance Sheet H1 FY23 H1 FY22 FY22 £’m £’m £’m Tangible fixed assets 23.2 25.0 25.2 Goodwill 21.4 21.2 21.4 Investments 4.0 2.5 4.0 Other intangible 16.2 14.5 15.7 Deferred tax asset & pension surplus 3.6 3.1 3.2 Working capital (incl. held-for-sale assets) 33.6 23.2 30.5 Provisions (1.7) (1.7) (1.8
Slide 15: Movement in Net Cash
Movement in Net Cash (£’m) Energy divisions Medical division Central costs 7.1 (0.3) (0.8) (0.2) (0.6) (1.2) (0.5) (1.5) 0.2 14.5 13.3 £m 30 Nov. 1 June 2022 2022 Net cash 14.5 13.3 Impact of IFRS 16 2.7 3.4 Net cash (excl. IFRS 17.3 16.7 16) 1 June 2022 Adjusted Net Working Capex Adjusted Net Worki
Slide 16: Dividend growth (pence per share)
Dividend growth (pence per share) Suspended due to Covid-19 2.6 2.4 2.3 2.2 2.1 2.0 4.0 1.8 1.5 1.6 1.7 1.3 1.4 1.1 1.2 1.0 0.9 1.0 0.7 - FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 Interim Full year 16
Slide 17: Summary
Ds. Avingtrans Summary 17
Slide 18: Summary
Summary ✓ H1 FY23 - on target to deliver full year expectations - despite supply chain issues ✓ Results improving, in particular at Hayward Tyler, Energy Steel and Booth ✓ Order book: best order cover position since before the pandemic ✓ Nuclear sector contract wins in the UK and USA, ✓ Sellafield 3
Slide 19: Appendix
Ds. Avingtrans Appendix 19
Slide 20: Pinpoint-Invest-Exit (PIE)
Pinpoint-Invest-Exit (PIE) • Strong balance sheet • Seasoned board and management • Creating significant shareholder value 20
Slide 21: Our locations and employees (30 November 2022)
Our locations and employees (30 November 2022) UK 489 China USA 158 India 77 11 Australia 24 21
Slide 22: Our values
h Avingtrans v Integrity We mean what we say and will do, with re: t for all * Quality Right first time, on time. Our produc and Agility adapt rapidly and e to chang: t effectively in the enviror in ent
Slide 23: Environment, Social and Governance (ESG)
Environment, Social and Governance (ESG) • Our goal is to ensure sustainability is embedded into our pinpoint-invest-exit business strategy. Our approach to sustainability is aligned with the UN’s Sustainable Development Goals (SDGs). We consider the following to be our priorities: Development of ne
Slide 24: Sustainability: progress
Sustainability: progress Feb Jan 2019 2020 SCR Pump ISO 14001 May Our Hayward Tyler Jan Oct Environmental 2022 business secures its 2021 2021 Management Carbon tracking first order for SCR Acquisition of Green Factory Our Kunshan site gains All sites across the pumps which removes Magnetica We open
Slide 25: Market capitalisation progression (£m)
Market capitalisation progression (£m) Purchased Moss & Placing £3.5m 2009 8 Purchased Sigma* 2010 9 2011 15 2012 17 Exited JenaTec; Purchased Aerotech & PFW 2013 32 Update later (currently £120m) Purchased Maloney 2014 45 Oil Price Shock Purchased RMDG 2015 31 Purchased Rolls Royce pipes; Exited Si
Slide 26: Blue chip partnerships
Blue chip partnerships /. Avingtrans € HS2 VATTENFALL @ oS eprenercy a .e Q Sellafield Ltd Zz pemyen Fon) ; 26
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 Boneham & Turner (FY02 - FY09) (FY13) Moss Group Sigma Components B&D Patterns C&H Composites Eng Group 22.0 65.0 Aerotech Tubes PFW Farnborough (FY07 - FY16) (FY16) RMDG Rolls Royce Nuneaton
Slide 28: Largest investors
Largest investors Ordinary shares of 5p each Number of % of total shares (000s) shares Harwood Capital 4,034 12.5% Funds managed by Business Growth Fund 2,363 7.3% Funds managed by Unicorn Asset Management Ltd 1,946 6.0% Funds managed by JTC Employer Solutions Trustee Ltd 1,703 5.3% R S McDowell’s P