Uni-Select — Q3 2019 Earnings Presentation
31 slides from Uni-Select's earnings presentation, Nov 13, 2019
Slide 1: Q3 2019 Conference Call
Q3 2019 (Ended September 30, 2019) Conference Call November 13, 2019
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain statements made in this presentation are forward-looking statements. These forward-looking statements include, but are not limited to, statements relating to Uni-Select’s financial guidance (including, without limitation, adjusted EBITDA, adjusted EBITDA margin, ad
Slide 3: Adoption of IFRS 16 - Leases
Adoption of IFRS 16 - Leases On January 1, 2019, the Corporation applied, for the first time, IFRS 16 - Leases using the modified retrospective transition approach and did not restate comparative amounts of the year prior to its adoption as permitted. As a result, the 2019 interim condensed consolid
Slide 4: Q3 2019 Highlights
UNI-SELECT. THE POWER OF TEAMWORK * Q3 2019 Highlights
Slide 5: Consolidated Results – Q3 2019 Highlights
Consolidated Results – Q3 2019 Highlights Financial Results HIGHLIGHTS Q3-18 Q3-19 VAR Sales 448.8 450.8 0.4% In constant currency, sales increased 1.9% driven by a different # of billing days and acquisitions Organic growth(1) (0.4%) CAG organic growth(1) of 1.3%, TPA at (2.6%) and FM EBT 14.4
Slide 6: Performance Improvement Plan ("PIP") - Update
Performance Improvement Plan (“PIP”) - Update Savings of $45M and costs of $20.5M expected by the end of fiscal 2019 will be completed as planned Expected Expected Realized Schedule .0 By the end As at YTD As at Q1-20 of 2020 Dec. 2018 Q3-19 Sept. 2019 Annualized cost savings (M$) $50.0 $18.7 $23.7
Slide 7: Strategic Alternatives Review - Update
Strategic Alternatives Review - Update • In September 2018, the Board announced the formation of a Special Committee of independent members of the Board to oversee a review of strategic alternatives. As was indicated at the outset of this process, we have not determined a definitive schedule. • The
Slide 8: FinishMaster US – Q3 2019 Highlights
FinishMaster US – Q3 2019 Highlights Financial Results HIGHLIGHTS Q3-18 Q3-19 VAR Sales 214.2 215.7 0.7% Sales increased 0.7%, driven by a different # of Organic growth(1) (0.5%) billing days, partially offset by negative organic growth(1) and erosion of sales resulting from the EBT 16.7 12.4 (25.
Slide 9: Canadian Automotive Group – Q3 2019 Highlights
Canadian Automotive Group – Q3 2019 Highlights Financial Results HIGHLIGHTS Q3-18 Q3-19 VAR Sales 131.1 137.2 4.7% In constant currency, sales increased 5.7%, primarily explained by acquisitions and the Organic growth(1) 1.3% effect of # of billing days EBT 6.2 25.9 316.8% EBT%(1) 4.7% 18.9% 1,420
Slide 10: The Parts Alliance UK – Q3 2019 Highlights
The Parts Alliance UK – Q3 2019 Highlights Financial Results HIGHLIGHTS Q3-18 Q3-19 VAR Sales 103.5 97.8 (5.5%) In constant currency, sales decreased 0.3% due to negative organic growth(1), partially offset by Organic growth(1) (2.6%) # of billing days and acquisitions EBT 4.3 (1.3) (130.4%) Org
Slide 11: Q3 2019 Financial Review
UNI-SELECT. THE POWER OF TEAMWORK * Q3 2019 Financial Review
Slide 12: Sales
Sales Q3 Total Sales by Business Segment TTM Total Sales by Business Segment 448.8 450.8 1,747.5 1,746.4 0.4% (0.1%) 103,5 97,8 417,6 394,2 131,1 137,2 504,4 516,3 214,2 215,7 825,5 835,9 Q3-18 Q3-19 TTM Q3-18 TTM Q3-19 FinishMaster US Canadian Automotive Group (1) The Parts Alliance UK FinishMaster
Slide 13: Consolidated EBITDA and Adjusted EBITDA
Consolidated EBITDA(1) and Adjusted EBITDA(1) Q3-19 Q3-18 VAR EBITDA as reported(1) 51.4 29.7 72.9% % sales 11.4% 6.6% 480 bps Special items (13.6) 5.2 Adjusted EBITDA(1) 37.7 34.9 8.1% % sales 8.4% 7.8% 60 bps IFRS 16 impact (7.5) - Proforma adjusted EBITDA(1) 30.3 34.9 (13.3%) % sales 6.7% 7.8% (1
Slide 14: EBT and Adjusted EBT
EBT and Adjusted EBT(1) Q3 EBT by Business Segment Q3 Adj. EBT(1) by Business Segment 26.9 20.9 14.4 4,3 14.3 4,3 25,9 6,2 1,8 6,2 6,9 16,7 16,7 13,4 12,4 -1,3 4.7% 3.2% 3.2% 6.0% -6,4 -7,9 -12,9 -10,2 Q3-18 Q3-19 Q3-18 Q3-19 FinishMaster US Canadian Automotive Group EBT margin FinishMaster US Canad
Slide 15: Earnings and EPS
Earnings(1) and EPS(1) Earnings(1) EPS(1) 24,6 0,58 Net earnings and 15,5 EPS impacted by a net gain on 0,37 business disposal 10,6 10,7 of $19.4M 0,25 0,25 Q3 Net Earnings Q3 Adj. Earnings(1) Q3 EPS Q3 Adj. EPS(1) Q3-18 Q3-19 Q3-18 Q3-19 Q3-19 Adj. earnings(1) decreased by $4.8M mainly resulting fr
Slide 16: Cash Flow & FCF
Cash Flow & FCF(1) Cash Flow from Operations Free Cash Flow(1) 129,7 Larger interest 89,0 89,4 payments in 2019, while 2018 benefited Additional funding from a greater corporate required for working tax reimbursement 72,6 capital, due to different vendor financing transactions 36,9 43,2 30,3 2,1 Q3
Slide 17: Typical Impact of Seasonality on UNS Cashflow
Typical Impact of Seasonality on UNS Cashflow Cash Flow from Operating Activities (in millions of dollars) Q1 Q2 Q3 Q4 2016 (8) 38 49 55 2017 2 28 49 45 2018 (30) 39 72 13 2019E (69) 97 2 NEUTRAL Q3-19 was impacted by a one-time CASH BURN cash outflow of $55M that was NEUTRAL TO POSITIVE largely off
Slide 18: Financial Position
Financial Position Total Net Debt(1) Funded Debt to Adj. EBITDA(1) Lease obligations are 627 included in debt since 4,47x Q1-19 4,09x 118 534 530 3,98x 3,50x 107 104 3,12x 419 509 394 427 426 Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 At the end of the quarter, approximately $186M w
Slide 19: Guidance
UNI-SELECT. THE POWER OF TEAMWORK * GUIDANCE
Slide 20: 2019 Consolidated Guidance
2019 Consolidated Guidance Our organic growth will remain positive for the year but lower than our guidance and we expect that our profitability will be in the lower part of the range or slightly below. Guidance Consolidated (adjusted to reflect the adoption of IFRS 16) Consolidated organic sales gr
Slide 21: Conclusion
Conclusion During challenging market conditions over the past 12 months, Uni-Select continued to execute and invest for long-term success CAG TPA FM • Launched largest- • Opened 6 • Integrated 22 greenfields branches ever distribution center in Calgary • Inaugurated • Innovating new distribution • O
Slide 22: Appendix
UNI-SELECT. THE POWER OF TEAMWORK ' APPENDIX
Slide 23: Non-IFRS Financial Measures
Non-IFRS Financial Measures The information included in this presentation contains certain financial measures that are inconsistent with IFRS. Non-IFRS financial measures do not have any standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented
Slide 24: Non-IFRS Financial Measures (cont'd)
Non-IFRS Financial Measures (cont’d) Management uses adjusted EBT, adjusted earnings and adjusted earnings per share to assess EBT, net earnings and net earnings per share from operating activities, excluding certain adjustments, net of income taxes for adjusted earnings and adjusted earnings per sh
Slide 25: Non-IFRS Financial Measures (cont'd)
Non-IFRS Financial Measures (cont’d) This measure consists of long‐term debt, including the portion due within a year (as shown in note 11 to the interim condensed consolidated financial statements), net of cash. Starting January 1, 2019, the total Total net debt net debt includes new lease obligati
Slide 26: Non-IFRS Financial Measures: Organic Growth Reconciliation
Non-IFRS Financial Measures (cont’d) Reconciliation of consolidated Organic growth Third quarters YTD 2019 2018 2019 2018 FinishMaster US 215.7 214.2 632.5 626.5 Canadian Automotive Group 137.2 131.1 393.8 381.4 The Parts Alliance UK 97.8 103.5 300.7 324.6 Sales 450.8 448.8 1,327.0 1,332.5 % % Sales
Slide 27: Non-IFRS Financial Measures: Reconciliation of EBITDA
Non-IFRS Financial Measures (cont’d) Reconciliation of EBITDA Third quarters YTD 2019 2018 % 2019 2018 % Net earnings (loss) 24.6 10.6 29.6 38.9 Income tax expense 2.3 3.8 4.5 8.7 Depreciation and amortization 16.5 10.0 48.1 29.4 Finance costs, net 7.9 5.3 22.2 15.2 EBITDA 51.4 29.7 72.9 104.5 92.2
Slide 28: Non-IFRS Financial Measures: Reconciliation of EBT and Adjusted EBT
Non-IFRS Financial Measures (cont’d) Reconciliation of EBT and Adjusted EBT Third quarters YTD 2019 2018 % 2019 2018 % Net earnings (loss) 24.6 10.6 29.6 38.9 Income tax expense 2.3 3.8 4.5 8.7 EBT 26.9 14.4 87.0 34.1 47.5 (28.2) EBT margin 6.0% 3.2% 2.6% 3.6% Special items (13.6) 5.2 (2.5) 5.9 Amor
Slide 29: Non-IFRS Financial Measures: Adjusted Earnings and Adjusted EPS
Non-IFRS Financial Measures (cont’d) Reconciliation of Adjusted Earnings and Adjusted EPS Third quarters YTD 2019 2018 % 2019 2018 % Net earnings (loss) 24.6 10.6 132.4 29.6 38.9 (23.8) Special items, net of taxes (14.8) 3.9 (6.4) 4.1 Amortization of intangible assets related to the acquisition 0.9
Slide 30: Non-IFRS Financial Measures: Reconciliation of Free Cash Flows
Non-IFRS Financial Measures (cont’d) Reconciliation of Free cash flows Third quarters YTD 2019 2018 2019 2018 Cash flows from operating activities 2.1 72.6 29.8 81.2 Changes in working capital 32.4 (31.4) 67.9 2.2 34.5 41.2 97.7 83.3 Acquisitions of property and equipment (4.6) (4.1) (16.3) (10.7) D
Slide 31: Uni-Select
UNI-SELECT. UNISELECT.COM 31