International Workplace Group Plc · LSE:IWG
International Workplace — FY2019 Earnings Presentation
23 slides from International Workplace's earnings presentation, Mar 3, 2020
Slide 1: 2019 Full Year Results
2019 FULL YEAR RESULTS 3 March 2020 2019 Full Year Results – 3 March 2020 1
Slide 2: Caution statement
Caution statement No representations or warranties, express or implied are given in, or in respect nature, they are subject to known and unknown risks and uncertainties and can of, this presentation or any further information supplied. In no circumstances, to be affected by other factors that could
Slide 3: The future of workspace
The future of workspace Organisations are ways of connecting people and now that there are The role of the city in society will also change… so many other ways to connect beyond face-to-face encounters we Creative hubs won’t be in cities that have will see the physical aspect of the organisation cha
Slide 4: 2019: A transformational year / decade
2019: A transformational year / decade § Incredible achievements § A decade of unprecedented development for flexible working, IWG and the world generally § Futurists predict an accelerating sea change in the way people and organisations work § IWG is in a unique position to play a leading role over
Slide 5: IWG is one of a kind
IWG is one of a kind 30 years of network coverage development 30 years of continuous innovation 4,000 3,388 NETWORK COVERAGE 3,000 EXECUTION EFFICIENCY 2,000 INNOVATION Apps Digital 1,000 1 0 1989 1994 1999 2004 2009 2014 2019 30 years of constant brand investment Smart buildings 120+ revenue lines
Slide 6: Drivers of shift towards flexible workspace
Drivers of shift towards flexible workspace Structural shift in the workplace Growth drivers Market size driven by secular demand trends Global flexible workspace market size based on industry revenue 1 ▪ Huge environmental advantage 1 Environment ▪ Less commuting; less space US$52bn Cost ▪ Cheaper
Slide 7: Brands create choice
Brands create choice Growing brand portfolio Suit and tie to Workstyles overalls Price points Low to high CHOICE IS KEY Locations Villages to cities Medical to Specialisation architecture 2019 Full Year Results – 3 March 2020 7
Slide 8: Enterprise accounts
Enterprise accounts Record sales / enquiries in Enterprise Accounts Global partnership to transition to flexible space. ▪ Transition to flexible space with IWG across all customer’s markets in EMEA ▪ Global membership programme for all customer employees LOGO LOGO LOGO ▪ 20 locations added, with ove
Slide 9: The next decade of global network expansion
The next decade of global network expansion Partnering across the world to accelerate network growth c. 50,000 Centres +30%* c. 10,000 +10%* Centres c. 3,500 Centres 2020 2030 2019 Full Year Results – 3 March 2020 *Compound annual growth rate 9
Slide 10: Highlights of 2019 results
Highlights of 2019 results Transformational year ▪ Record profit and cash generation ▪ Increased cash returns to shareholders ▪ Excellent momentum in franchising strategy ▪ Significant capital investment in network and infrastructure ▪ Significant investment into platform ▪ Good progress on network
Slide 11: Key financial highlights
Key financial highlights Strong trends across the board ▪ Open centre revenue up 15.0% to £2,569.8m ▪ Record profit before tax of £489.5m ▪ Operating profit up 8% to £137.7m ▪ Record cash generation of £649.2m - Increased cash to shareholders - £107.7m up 14.7% - New £100m share repurchase programme
Slide 12: Strong total network growth
Strong total network growth ▪ 3,388 locations in more than 110 countries ▪ >1,100 cities, a truly global footprint ▪ 277 new locations added ▪ Rationalisation of 195 locations ▪ Record space opened NOTE: Company owned and franchised locations 2019 Full Year Results – 3 March 2020 12
Slide 13: Excellent momentum in franchising strategy
Excellent momentum in franchising strategy Significant growth driver Franchise business Franchise agreements To date ▪ No. franchise partners 30 ▪ No. countries 26 ▪ No. locations 400+ 2019 ▪ MFA in Japan with TKP ▪ MFA in Taiwan with TKP ▪ MFA in Switzerland with Safra/Peress ▪ Added 9 franchise pa
Slide 14: Partnering
Partnering What we offer ▪ Customer reach ▪ Marketing support ▪ Industry leading platform ▪ Membership system ▪ Strong, diversified brands ▪ Loyalty system ▪ Instant revenue ▪ 2.5m users and growing ▪ Constant innovation ▪ Procurement & cost savings ▪ Design & Branding ▪ Logistics system What they o
Slide 15: Some of our new franchise partners
Some of our new franchise partners Tremendous franchise momentum, accelerating growth Germany UK Dubai Philippines Thailand 2019 Full Year Results – 3 March 2020 15
Slide 16: Company owned locations
Company owned locations More attractive space added ▪ Net growth capital investment of £389.0m ▪ 234 new locations added ▪ Record space opened ▪ 3,143 locations worldwide USA UK Chrysler Building, New York The Foundry, London Outlook ▪ c. £150m net investment and c. 150 locations - High level of scr
Slide 17: Group results
Group results Strong revenue growth and record profits £m 2019* 2018 % Constant % Actual ▪ Revenue up 9.2% to £2,653.0m Revenue 2,653.0 2,402.1 9.2% 10.4% ▪ Open centre revenue up 15.0% to £2,569.8m ▪ Pre-2018 EBITDA up 15% to £472.2m Open centre revenue 2,569.8 2,208.1 15.0% 16.4% ▪ Group EBITDA up
Slide 18: Group cash flow
Group cash flow Record cash generation and strengthened balance sheet £m 2019* 2018 % Actual ▪ Record cash flow before net growth capital expenditure of £649.2m EBITDA 428.3 389.9 10% - Positively impacted by: Working capital 267.2 166.4 61% • EBITDA growth Growth related partner contributions (263.
Slide 19: Cash to shareholders
Cash to shareholders Increased cash to shareholders driven by record cash generation £m cash to shareholders Dividends per share +105% +74% +10.3% +14.7% +23.1% 4.80 4.35 49.5 3.95 51.1 3.55 40.2 £m +8.4% p 3.10 36.4 35.5 2.75 58.2 17.2 48.5 53.7 38.8 43.3 2.15 35.4 1.75 1.95 1.40 1.55 1.25 2014 201
Slide 20: Outlook
Outlook 2019 recap ▪ Great year, record profit ▪ Excellent momentum, increased shareholder returns Current trading providing a strong outlook for 2020 ▪ Well placed to take advantage of strong demand globally ▪ Additional strong growth from current franchising ▪ Excellent momentum in partnering disc
Slide 21: Q&A?
Q&A? 2019 Full Year Results – 3 March 2020 21
Slide 22: Thank you
Thank you iwgplc.com 2019 Full Year Results – 3 March 2020 22
Slide 23: Contact details
Contact details Wayne Gerry ▪ Group Investor Relations Director ▪ wayne.gerry@iwgplc.com 2019 Full Year Results – 3 March 2020 23
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