Weir Group Plc · LSE:WEIR
Weir — The Weir Group — FY2004 Earnings Presentation
28 slides from Weir's earnings presentation, Mar 21, 2005
Slide 1: 2004 Full Year Results
Excellent The Weir Group PLC Analysts Presentation Engineering London, 21 March 2005 Solutions 2004 Full Year Results
Slide 2: Agenda
The Weir Group PLC Excellent Engineering Solutions Agenda Introduction & Financial Highlights Sir Robert Smith Financial review Chris Rickard Input and Operational review Mark Selway Outlook Mark Selway Restructuring and Share buy back Chris Rickard Questions and Answers All
Slide 3: Full Year 2004 - Financial Highlights
City Presentation 2001 The Weir Group PLC Excellent Engineering Solutions Full Year 2004 - Financial Highlights Group Results 2004 Consolidated 2004 Variance Net Debt 25 £m % 15 5 £m Order Input (2) 875.9m Up 23.4% -5 -15 Turnover 847.6m Up 6.8% -25 Jun 2004 Dec 2004 Net Debt 23.2 -12.3 Pre-tax prof
Slide 4: Financial Review
Excellent The Weir Group PLC Analysts Presentation Engineering London, 21 March 2005 Solutions 2004 - Full Year Results Financial Review
Slide 5: Consolidated Profit and Loss
The Weir Group PLC Excellent Engineering Solutions Consolidated Profit and Loss 2004 2003 £m £m Turnover Group Operations 739.4 690.7 JVs / Associates 108.2 102.7 847.6 793.4 Operating Profit Group Operations 51.2 53.2 JVs / Associates 10.0 10.3 61.2 63.5 Net Interest & Other Income (3.9) (3.8) Othe
Slide 6: Divisional Split
The Weir Group PLC Excellent Engineering Solutions Divisional Split Turnover Operating Profit (1) 2004 2003 (2) 2004 2003 (2) £m £m £m £m Engineering Products 439.0 416.3 30.9 33.5 Engineering Services 198.7 184.4 20.5 20.0 Techna 101.7 73.1 3.4 0.8 J/V and Associates 108.2 102.7 10.0 10.3 Central c
Slide 7: Cash Flow from Operating Activities – 2004
The Weir Group PLC Excellent Engineering Solutions Cash Flow from Operating Activities – 2004 2004 2003 £m £m (1) Operating Profit 51.2 53.2 Depreciation 15.2 15.2 Working Capital (1.0) 0.6 Other 1.6 (3.1) Funds Generated by Operations 67.0 65.9 Capital Expenditure (23.9) (12.7) Net Cash Inflow from
Slide 8: Cash Flow Highlights – 2004
The Weir Group PLC Excellent Engineering Solutions Cash Flow Highlights – 2004 2004 2003 £m £m Net Cash Inflow from Operations 43.1 53.2 Exceptional funding of pension & post retirement costs (12.1) (10.0) Net Interest (2.1) (4.2) Tax (8.8) (7.6) Net Dividends paid (20.4) (20.8) Acquisitions / Dispo
Slide 9: Summarised Balance Sheet – 2004
The Weir Group PLC Excellent Engineering Solutions Summarised Balance Sheet – 2004 Dec Dec 2004 2003 £m £m Net Tangible Assets 194.4 192.5 Goodwill 103.9 113.9 Net Pension Deficit (65.1) (72.7) Net Funds 12.3 0.5 Net Assets 245.5 234.2 Share Capital & Reserves 245.5 234.2
Slide 10: Exchange rates – 2004
The Weir Group PLC Excellent Engineering Solutions Exchange rates – 2004 2004 2003 Average Rate Average Rate Movement Currency USD 1.83 1.64 -11.6% AUD 2.49 2.51 +0.8% EUR 1.47 1.45 -1.4%
Slide 11: IFRS: Transitional arrangements on course
The Weir Group PLC Excellent Engineering Solutions IFRS: Transitional arrangements on course External reporting - Business segments Hedge accounting - Potentially volatile impact on Weir Development costs - SSE JV for tidal turbine power Share based payments - Change to basis of calculation
Slide 12: 2004 Full Year Results
Excellent The Weir Group PLC Analysts Presentation Engineering London, 21 March 2005 Solutions 2004 Full Year Results
Slide 13: Order Input by Division - Continuing Operations
The Weir Group PLC Excellent Engineering Solutions Order Input by Division - Continuing Operations (1) Consolidated 2004 2003 Variance £m £m % Minerals 264.5 221.2 +19.6% Clear Liquid 153.0 140.5 +8.9% Valves 75.1 59.6 +26.0% Services 204.0 188.0 +8.5% Techna 179.3 100.6 +78.3% Total 875.9 709.9 +23
Slide 14: Order Input by Division - Continuing Operations
The Weir Group PLC Excellent Engineering Solutions Order Input by Division - Continuing Operations (1) Non Techna 2004 2003 Variance £m £m % Minerals 264.5 221.2 +19.6% Clear Liquid 153.0 140.5 +8.9% Valves 75.1 59.6 +26.0% Services 204.0 188.0 +8.5% Sub Total 696.6 609.3 +14.3% Techna 179.3 100.6 +
Slide 15: Order input by geographic location
The Weir Group PLC Excellent Engineering Solutions Order input by geographic location (1) (Continuing Operations) 2004 2003 Variance £m £m % Americas 290.1 217.8 +33.2% Middle East / Africa 112.4 110.2 +2.0% Europe & FSU 93.5 77.7 +20.4% United Kingdom 153.0 167.0 -8.4% Indo Pacific 146.5 77.7 +88.6
Slide 16: Order input by sector
The Weir Group PLC Excellent Engineering Solutions Order input by sector (1) (Continuing operations) 2004 2003 Variance 2004 Total £m £m % Input Naval & marine General General industrial 133.6 122.3 +9.3% 12% industrial 15% Minerals processing 229.8 189.3 +21.4% Water & waste water 9% Oil & gas 174.
Slide 17: Operational Review
The Weir Group PLC Analysts Presentation Excellent Engineering London, 21 March 2005 Solutions Operational Review
Slide 18: Journey to Excellence
The Weir Group PLC Excellent Engineering Solutions Key elements in our Journey to Excellence Year end Year end 2001 2002 2003 2004 2005 2006 A watershed year A programme of transition Building on Potential Positioned for growth • Sorting low margin • Market review • Structure and competency • Perfor
Slide 19: Weir Minerals Division Full Year 2004 performance
The Weir Group PLC Excellent ORDER INPUT Engineering Solutions Weir Minerals Division £264.5 Up 19.6% Full Year 2004 performance UK Input Europe / FSU Minerals Input 2000-2004 down 34.4% Input up 15% to £10.1m to £38.2m 300 Indo Pacific 250 Input up 32.9% 200 to £38.4m £m 150 100 Australia Input up
Slide 20: Weir Clear Liquid Division Full Year 2004 performance
The Weir Group PLC Excellent ORDER INPUT Engineering Solutions Weir Clear Liquid Division £153.0m Up 8.9% Full Year 2004 performance UK Input Europe / FSU down 16.3% Input up 63% 200 Clear Liquid Input 2000-2004 to £20.5m to £26m Indo Pacific 150 Input up 5% to £25.4m £m 100 50 Americas 0 Input up 4
Slide 21: Weir Valves & Controls Division Full Year 2004 performance
The Weir Group PLC Excellent ORDER INPUT Engineering Solutions Weir Valves & Controls Division £75.1m Up 26.0% Full Year 2004 performance UK / Europe / FSU Input up 34.2% Valves & Controls Input 2000-2004 to £35.8m 80 Indo Pacific 70 Input up 17% 60 to £12.2m 50 £m 40 30 20 10 Americas 0 Input up 18
Slide 22: Weir Services Division Full Year 2004 performance
The Weir Group PLC Excellent ORDER INPUT Engineering Solutions Weir Services Division £204.0m Up 8.5% Full Year 2004 performance UK / Europe / FSU Input down 7.2% Services Input 2000-2004 to £66.3m 250 200 150 £m 100 Australia & Indo Pacific 50 Input up 39.4% Americas to £29.1m 0 Input up 3.3% Afric
Slide 23: Weir Techna Division Full Year 2004 performance
The Weir Group PLC Excellent ORDER INPUT Engineering Solutions Weir Techna Division £179.3m Up 78.3% Full Year 2004 performance UK Input Europe / FSU down 8.3% Input down 48.4% to £45.6m to £4m Techna Input 2000-2004 Indo Pacific Input up 810% 200 to £67m 150 £m 100 Australia Input up 50.1% 50 Ameri
Slide 24: 2004 Weir Group Scorecard
The Weir Group PLC Excellent Engineering Solutions 2004 Weir Group Scorecard 150 125 100 Net Debt - 1999-2004 75 £m 50 25 0 -25 1999 2000 2001 2002 2003 2004 ISO 14001 Strong Certification £m 146.5 95 66 -1.9 -0.5 -12.3 Cash Position New New Weir Valves Product Product Earnings Earnings Huddersfield
Slide 25: Outlook
The Weir Group PLC Excellent Engineering Solutions Outlook Engineering Products – encouraging outlook for 2005, driven by: - Minerals – strong growth in sales due to higher customer demand - Clear Liquid – maintaining 2004 profits pre-exceptionals - Valves – profit improvements pre-exceptionals wi
Slide 26: 2004 Full Year Results
Excellent The Weir Group PLC Analysts Presentation Engineering London, 21 March 2005 Solutions 2004 Full Year Results
Slide 27: Summary - Reorganisation Costs
The Weir Group PLC Excellent Engineering Solutions Summary - Reorganisation Costs Trading Performance 2004 Estimated Current Expected Turnover Operating Company Name Location Cash Costs Employees Redundancies £m Loss £m WVC UK Huddersfield * £ 16.0m 350 180 Weir Pumps Ltd Glasgow £ 15.0m 900 310 TOT
Slide 28: Key criteria of Weir Group £50m Share Buy Back
The Weir Group PLC Excellent Engineering Solutions Key criteria of Weir Group £50m Share Buy Back Reason - add shareholder value - EPS enhancing despite lack of UK tax shield for additional interest expense Size - maximum permitted is 10% of issued share capital - need to fund cash exceptionals