Siv Capital Limited · ASX:SIV
Siv Capital — Silver Chef — 5th Microequities Rising Stars Microcap Conference (June 2011)
26 slides from Siv Capital's conference presentation, Jun 21, 2011
Slide 1: 5th Microequities Rising Stars Microcap Conference – Silver Chef
For personal use only 5th MICROEQUITIES RISING STARS MICROCAP CONFERENCE SILVER CHEF ASX-SIV Presented by Charles Gregory (CEO) RADISSON PLAZA SYDNEY, June 21st 2011
Slide 2: For personal use only
For personal use only • Overview • Business model • Our customers • Risk management • Funding • Industry leadership • Performance highlights • Outlook
Slide 3: Overview
For personal use only Overview • Long-term rental of commercial equipment • One company – two growing brands • Core division, Silver Chef – hospitality (restaurants, cafes, coffee shops, takeaways) • New division, GoGetta (since 2008) – new markets in construction equipment, large trailers, health a
Slide 4: Our Success Story
For personal use only Our Success Story • Operating successfully - 25 years • ASX-listed since 2005 • Market cap - $13m (2005) to >$75m (current) • Strong growth revenue, dividends and EPS • From listing to FY2010 CAGR 23.1% in EPS
Slide 5: Business Model
For personal use only Business Model • An alternative to debt and equity funding for essential business equipment • Offering business advantages for SME operators • Market leadership with growth opportunities and barriers to entry
Slide 6: Business Model
For personal use only Business Model • Business Model works in good and bad economic times • Effective risk-management strategies • Approx 70% annuity-style income • Attractive business margins for Silver Chef
Slide 7: Coffee Shop example
For personal use only Coffee Shop example • Upgraded coffee machine • Better product + higher throughput + greater efficiency • $4500 machine @ rental cost of 3 cups of coffee per day • Additional coffee sales go to Gross Profit • Flexible Options
Slide 8: Market Reach
For personal use only Market Reach • Over 400 dealers nationally • Support of vendor and broker relationships • Franchise market opportunities • Growing demand in SME target market • Currently >6000 customers nationally
Slide 9: Our Customers
For personal use only Our Customers • SMEs our target market • Meet “Harry” our profile client • Independent operators • Needing business-critical assets
Slide 10: Risk Management
For personal use only Risk Management • Credit • Assets • Funding
Slide 11: Managing Risk - Credit
For personal use only Managing Risk - Credit • 13-week rental bond • Weekly direct debit payments in advance • No client larger than 1% of revenue • 50% to 60% credit approval rate
Slide 12: Managing Risk - Assets: equipment returned, serviced and sold
micro EQUITIES Unleashing the value of Micro Cap Companies silverchef hospitality equipment funding Rent. Try. Buy.” Silver Chef ) Service Facility -) Asset Cleaned & Serviced Client returns equipment Target FY 2010 80% sold within 60 days of receipt Dealer Web Online Sales Sales Auction
Slide 13: Managing Risk - Assets: Client returns equipment
micro EQUITIES Unleashing the value of Micro Cap Companies silverchef hospitality equipment funding Rent. Try. Buy.” Client Returns Equipment to Vendor Y ... within 90 Days & New Client Purchase for Stock Sale or ... New Rental Contract with GoGetta
Slide 14: Risk Management
For personal use only Risk Management • Active risk review process • Risk identification and management • Robust rental model
Slide 15: Funding
For personal use only Funding • $74m interest only CBA facility to August 2013 • $30m interest hedge in place @4.46% to June 2011, then 5.25% to 2013 plus margin • Pro active interest rate risk management • Strong operating cash flows • Introduction of DRP assisting capital management
Slide 16: Industry Leadership
For personal use only Industry Leadership
Slide 17: Financial Highlights – 1HFY2011
For personal use only Financial Highlights – 1HFY2011 • Rental revenues $30.1m up 29% • EBITDA $19.48m up 22% • NPBT $4.23m, steady • Interim fully-franked dividend 9cps vs 8cps (1H 2010) up 12.5%
Slide 18: 1H Revenues up 29%
For personal use only 1H Revenues up 29% Revenue $'000 50,000 45,000 40,000 35,000 30,000 2nd half 25,000 Ist Half 20,000 15,000 10,000 5,000 - 2006 2007 2008 2009 2010 2011
Slide 19: 1H EBITDA up 22%
For personal use only 1H EBITDA up 22% EBITDA $'000 35,000 30,000 25,000 20,000 2nd half Ist Half 15,000 10,000 5,000 - 2006 2007 2008 2009 2010 2011
Slide 20: 1H DPS up 12.5%
For personal use only 1H DPS up 12.5% Dividend Performance (cents per share) 18.0 16.0 14.0 12.0 10.0 Final Interim 8.0 6.0 4.0 2.0 - 2006 2007 2008 2009 2010 2011
Slide 21: 1H Operational Highlights
For personal use only 1H Operational Highlights • Rental assets (at cost) $127.2m up 17% • Rental asset purchases $36.8m up 40.8% • Net operating cash flows $19.95m up 19.3%
Slide 22: 1H Divisional Performance
For personal use only 1H Divisional Performance Hospitality – our growing, core division • 1H rental revenues $23.5m up 19.45% GoGetta – establishing new markets • 1H rental revenues $5.8m up 82.8%
Slide 23: 1H Factors
For personal use only 1H Factors • Write off unamortised borrowing costs ($336k for new facility) • Write down investment property valuation ($248k vs $23k 1H2010) • Tax rate increase to 27.7% from 24.8% ($1.17m vs $1.04m 1H2010) • NPBT steady at $4.23m vs $4.2m (IH 2010)
Slide 24: FY2011 Outlook
For personal use only FY2011 Outlook • Solid 1H growth – revenue, EBITDA & dividends • Natural disasters – no material earnings impact • FY2011 guidance maintained – EPS 31.2cps vs 28cps
Slide 25: and beyond …
For personal use only and beyond … • High asset & cash utilisation driving revenue growth 2H - and beyond • Organic growth in existing markets • Opportunities for new products and new markets
Slide 26: Disclaimer
For personal use only Disclaimer Silver Chef Limited has not considered the financial position or needs of the recipient in providing this presentation. Persons needing advice should consult their stockbroker, bank manager, solicitor, attorney, accountant or other independent financial or legal advi
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