Avingtrans Plc · LSE:AVG
Avingtrans — H1 FY2022 Earnings Presentation
27 slides from Avingtrans's earnings presentation, February 2022
Slide 1: Results for 6 months ended 30 November 2021
Pinpoint-Invest-Exit Results for 6 months ended 30 November 2021 Steve McQuillan, CEO Stephen King, CFO
Slide 2: Financial highlights
Financial highlights Group Revenue Gross Profit Margin Adjusted EBITDA £45.1m 33.6% £5.8m (7.3)% 2021 H1: 31.7% 2021 H1: £5.8m Adjusted Diluted EPS Dividend Net Cash* 10.0p 2022 H1: 1.6p £22.7m 2021 H1 10.8p Reinstated 31 May 2021: £23.3m Net cash* - pre-IFRS 16 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 2004 Acquired 2017 Acquired 2017 Acquired 2018 Acquired 2017 Acquired 2019 Acquired 2012 Acquired 2018 Acquired 2021 Acquired 2019 Revenue (£m) Adjusted Revenue (£m)
Slide 4: Compelling Pinpoint-Invest-Exit (PIE) strategy
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 • Magnetica - compact helium-free MRI systems • Adaptix – compact 3D X-ray systems • £4.0m now invested in Adaptix shares (11.9% of total) • Initial markets are orthopaedic and veterinary. • Businesses are collaborating on commerci
Slide 6: Our proven strategy in action - Invest
Our proven strategy in action - Invest Establishing world class capability • Booth site rationalisation will complete this year • Construction of new Bolton site extension completed • New wing will eliminate surplus leased building • Booth has a record orderbook and strong prospects • Market researc
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 project for ES confirmed • Hydrocarbons – progress still subdued by CV-19
Slide 9: Divisional priorities - PSRE
Divisional priorities - PSRE Metalcraft, Fluid Handling, Ormandy, Booth, Composite Products • Markets • Nuclear decommissioning (Metalcraft, Fluid Handling) • Sellafield – phase 2 of 3M3 box contact won (£70m) Metalcraft 3M3 box manufacture • £4.4m Fluid Handling contract win for remote valves • Def
Slide 10: Divisional priorities - MII
Divisional priorities - MII MRI scanner Magnetica, Scientific Magnetics. Tecmag Minority stake in Adaptix • Medical Imaging • Integration of Magnetica has gone to plan • Compact MRI system progressing well 3D X-ray scanner • Convergent orthopaedic and veterinary focus • Initial addressable MRI marke
Slide 11: Financial Highlights
MD. Avingtrans Financial Highlights 11
Slide 12: Interim results
Interim results £m H1 FY22 H1 FY21 FY21 Revenue 45.1 48.7 98.5 Gross Profit 15.2 15.4 29.9 Gross Profit % 33.6% 31.7% 30.4% Adjusted EBITDA 5.8 5.8 12.5 Adjusted EBITDA % 12.9% 12.0% 12.7% Adjusted Profit before tax 3.5 3.7 7.7 Adjusted Profit after tax 3.2 3.5 7.3 Adj. Diluted EPS (pence) 10.0 10.8
Slide 13: Divisional Results
Divisional Results Energy: Energy: 1H Energy: Energy: 1H EPM PSRE Medical Central FY22 EPM PSRE Medical Central FY21 £’m £’m £’m £’m £’m £’m £’m £’m £’m £’m Revenue: OE 6.1 20.5 0.8 - 27.4 7.5 17.3 4.4 - 29.2 AM 16.5 1.2 - - 17.7 18.5 1.0 - - 19.5 Total Revenue 22.6 21.7 0.8 - 45.1 26.0 18.3 4.4 - 4
Slide 14: Balance Sheet
Balance Sheet H1 FY22 H1 FY21 FY21 £’m £’m £’m Tangible fixed assets 25.0 32.3 25.3 Goodwill 21.2 23.5 21.2 Investments 2.5 - - Other intangible 14.5 13.2 14.5 Deferred tax asset & pension surplus 3.1 3.0 3.1 Working capital 23.2 23.2 21.3 Provisions (1.7) (5.3) (1.7) Tax asset 0.3 0.5 - Net cash /
Slide 15: Movement in Net Cash (£m)
Movement in Net Cash (£’m) Mainly MRI new product 5.8 development (1.3) (1.2) (0.8) (0.3) 20.3 20.0 (2.5) 31 May 2021 30 Nov 2021 Net cash 20.3 20.0 Impact of IFRS 16* 3.0 2.7 Net cash 23.3 22.7 (excl. IFRS 16 impact) 1 June 2021 Adjusted EBITDA Working capital Capex - Tangible Capex - Intangible In
Slide 16: Dividend growth
Dividend growth 4 3.5 Suspended due to Covid-19 3 2.5 2.4 2.3 2.2 2.1 2 2.0 4.0 1.8 1.5 1.5 1 1.6 1.3 1.4 0.5 1.1 1.2 1.0 0.9 1.0 0.7 0.4 0 - FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 Interim Final 16
Slide 17: Summary
MD. Avingtrans Summary 17
Slide 18: Summary
Summary H1 FY22 - on target to deliver full year expectations - despite covid-19 disruptions Revitalisation of Hayward Tyler, Energy Steel and Booth remains on plan Order book: robust notwithstanding some contract delays Significant Nuclear sector contract wins in the UK and USA, Sellafiel
Slide 19: Appendix
MD. 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 2021)
Our locations and employees (30 November 2021) UK 457 China USA 135 India 70 10 Australia 16 21
Slide 22: 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 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. In 2021, we have reassessed our approach to sustainability, aligning ourselves with the UN’s Sustainable Development Goals (SDGs). We consider the following to
Slide 24: 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 Purchased Maloney 2014 45 Oil Price Shock Purchased RMDG 2015 31 Purchased Rolls Royce pipes; Exited Sigma 2016 50 Returned £19m to sh
Slide 25: Blue chip partnerships
Blue chip partnerships /o. Avingtrans HS2 VATTENFALL @ <fpepreNency Q Sellafield Ltd EUREKA Shinhoo AN og Qy -— ini Rapiscan LAING O'ROURKE ee coors 4 ystems = n OSI Systems Company 25
Slide 26: 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 27: Largest investors
Largest investors Ordinary shares of 5p each Number of shares % of total (000s) shares Harwood Capital 4,034 12.6% Funds managed by Business Growth Fund 2,363 7.4% Funds managed by Unicorn Asset Management Ltd 1,946 6.1% R S McDowell’s Pension Fund 1,406 4.4% Funds managed by JTC Employer Solutions