Slide 1: Half Year Results to 30 November 2018
MONTHLY FINANCE REPORT July 2018 STRATEGY DELIVERING FUEL, FOOD & FEED [Division] October 2018 NWF GROUP PLC HALF YEAR RESULTS TO 30 NOVEMBER 2018
Slide 2: Group Overview: Results summary
GROUP OVERVIEW Results summary: Profit improvement, on track to meet Board expectations Revenue Headline operating profit* Headline profit before tax* £330.5m +11.7% £2.6m +8.3% £2.4m +9.1% 2018 £330.5m 2018 £2.6m 2018 £2.4m 2017 £295.8m 2017 £2.4m 2017 £2.2m Headline earnings per share* Net debt H1
Slide 3: Key highlights
GROUP OVERVIEW Key highlights » Profit improvement, trading in line with full year Board expectations » Fuels in line with expectations » Food delivering planned recovery » Feeds strong volume growth in the summer: providing nutrition with limited grazing » Market conditions » Warm summer » Rising c
Slide 4: Fuels - Operating Highlights
FUELS - OPERATING HIGHLIGHTS Good start to the year, acquisition completed » Good start to the year » Warm summer reduced market demand and increased competitive pressure » Autumn performance strong across the depot network » Major tanker fleet refresh: 49 new tankers on order – shorter replacement
Slide 5: Food - Operating Highlights
FOOD - OPERATING HIGHLIGHTS Recovery on plan » Significant improvement in profitability from prior year H2 » New customers bedding in » Staffing levels stable » Managing site challenges from high activity levels » Activity levels (loads) up 13% » Aldi platform provider trial successful » Fledgling e
Slide 6: Feeds - Operating Highlights
FEEDS - OPERATING HIGHLIGHTS Planned returns from strategic investment » Summer grazing conditions poor, autumn very good » NWF nutritionists increased feed rates to maintain farmers’ milk yields » Farmers now have reasonable forage stocks » Volume up over 15% in July and August » Pricing aligned to
Slide 7: Financial Review: Income statement summary
FINANCIAL REVIEW Income statement summary Nov 2018 Nov 2017 May 2018 £m £m £m » Revenue increased by 11.7% driven by commodity prices Revenue Fuels 222.4 198.5 400.7 » Headline operating profit of £2.6 million – up 8.3% on prior Food 23.8 19.5 40.4 year Feeds 84.3 77.8 169.9 Total revenue 330.5 295.
Slide 8: Financial Review: Balance sheet summary
FINANCIAL REVIEW Balance sheet summary Nov 2018 Nov 2017 May 2018 £m £m £m Fixed assets 66.9 68.6 67.9 » Fixed assets broadly stable at £66.9 million Net working capital 11.4 8.2 2.5 » Working capital increased by £3.2 million as a result of Assets employed 78.3 76.8 70.4 increased activity Pension
Slide 9: Financial Review: Pension summary
FINANCIAL REVIEW Pension summary Movement in pension scheme deficit Nov 2018 Nov 2015 May 2018 £m £m £m » Single defined benefit pension scheme Assets 35.6 36.3 » Closed to new members in 2002 and future accrual in Liabilities (51.0) (53.4) 2016 Deficit (15.4) (17.1) Related deferred tax asset 2.6 2
Slide 10: Financial Review: Cash flow summary
FINANCIAL REVIEW Cash flow summary Nov 2018 Nov 2017 May 2018 £m £m £m Cash flows from operating activities » Headline EBITDA* of £4.9 million (2017: £4.7 Operating profit (excluding GMP exceptional) 2.6 2.4 10.6 million) Depreciation and amortisation 2.3 2.3 4.5 Profit on disposal of fixed assets -
Slide 11: Financial Review: Net debt summary
FINANCIAL REVIEW Net debt summary » Facilities of £65 million with RBS until October 2023 Movement in net debt » Net debt of £14.8 million at November 2018 with 18.0 16.3 15.3 substantial facility and covenant headroom 16.0 2.7 14.8 14.0 2.9 Facility Facility Drawn 12.0 Invoice Discounting £50.0m £1
Slide 12: Development Strategy: Solid platform for growth
GROUP DEVELOPMENT STRATEGY Solid platform for growth – good track record » Diversified sources of earnings deliver resilient growth Track Record Five year headline PBT £m » Solid cash generative businesses in large stable markets 11 10 » Number 2 in UK Feed and Number 3 in UK Fuels markets 9 » Fuels
Slide 13: Fuels - Development Strategy
FUELS - DEVELOPMENT STRATEGY Consolidate the market and win new customers » Fragmented market for oil distribution » Stable demand for oil with other energy sources to meet increasing demand for energy UK oil market share (of c. 35bn litres) Certas WFL NWF Fuels Ri x Petroleum Top 10 Ni cholls (Fuel
Slide 14: Fuels - Development Strategy
FUELS - DEVELOPMENT STRATEGY Consolidate the market and win new customers NWF depots Off gas grid homes in GB » Third largest oil distributor in the UK » Low cost depot operating model » Good track record of acquisition integration » Low ROS, high ROCE > 20% Midland Fuel Oil Supplies Development Str
Slide 15: Food - Development Strategy
FOOD - DEVELOPMENT STRATEGY Optimise customer mix and targeted expansion » Market for ambient groceries remains large and stable » Working under contracts with blue chip brands and retailers » Delivering products across the UK » Warehousing in the UK remains in short supply Development Strategy » De
Slide 16: Feeds - Development Strategy
FEEDS - DEVELOPMENT STRATEGY Operational efficiency, consolidation and broadening offer Feed mills & customers » Agriculture represents an attractive market for the Group » National player with a strong track record » Effective operational platform » Market prospects underpinned by stable milk price
Slide 17: NWF Investment summary
GROUP OVERVIEW NWF Investment summary Experienced and ambitious management team Strong and defensible positions Growth opportunities Asset backing Focus on return on capital Good cash generation Growing dividend NWF Group plc HALF YEAR RESULTS TO 30 NOVEMBER 2018 17
Slide 18: Summary and outlook
GROUP OVERVIEW Summary and outlook » Profit improvement delivered in first half » Full year Board expectations for trading performance and net debt levels unchanged » Fuels - effective management of volatile pricing in normal winter conditions » Food - managing higher storage and activity rates » Fe
Slide 19: Additional information
GROUP OVERVIEW Additional information » Analyst coverage and consensus forecasts » Business overview » Locations » Organisation » Main site photo » Group financial performance » Divisional track record » Additional market data NWF Group plc HALF YEAR RESULTS TO 30 NOVEMBER 2018 19
Slide 20: Analyst coverage and consensus forecasts
GROUP OVERVIEW Analyst coverage and consensus forecasts Actual Consensus forecasts 2018 2019 2020 2021 Revenue £611.3m £651.3m £661.1m £671.9m Headline operating profit £10.6m £9.5m £10.0m £10.2m Headline profit before tax £10.2m £9.0m £9.5m £9.7m Headline earnings per share 16.7p 14.7p 15.3p 15.5p
Slide 21: Business Overview: Fuels
BUSINESS OVERVIEW Fuels Supply of fuels and fuel cards to commercial, domestic and retail customers across the UK » Third largest oil distributor in the UK » 59,000 customers » 203 people » 19 depots across the UK » Supply 29 retail petrol stations » 99 tankers » Fuel card marketing » 543 million li
Slide 22: Business Overview: Food
BUSINESS OVERVIEW Food Consolidation of ambient grocery products to UK Supermarkets » Market leader in the North West » 100,000 pallet spaces » 800,000ft2 of warehousing in Wardle » 543 people » 122 trucks, 236 trailers » 200 customers including Arla & Typhoo » Packing room for added value work » E-
Slide 23: Business Overview: Feeds
BUSINESS OVERVIEW Feeds Supply of feed to ruminants in the UK – principally dairy » Number two in the UK – feeds one in six dairy cows in the UK » Feed for dairy, beef and sheep » 589,000 tonnes per annum » Sell added value products including minerals, supplements and fertiliser » 4,750 customers »
Slide 24: Business locations
GROUP OVERVIEW Business locations Feeds Aspatria Longtown Wardle* Wixland Food Wardle* Fuels Ammanford Midland Fuel Oil Supplies Babbinswood Bangor Boston Burnley Burwell Droitwich Dyserth Fishers Pond Great Yarmouth Home Counties Kenilworth Long Marston Mansfield Martlet Staffordshire Fuels Stoke W
Slide 25: Organisation
GROUP OVERVIEW Organisation Chief Executive Richard Whiting Non Executives Chairman: Philip Acton Yvonne Monaghan Company David Downie Finance Director Secretary Chris Belsham Rob Andrew Fuels Food Feeds Richard Huxley Keith Forster Andrew Downie 203 employees 543 employees 198 employees NWF Group p
Slide 26: Wardle – Main operating site
GROUP OVERVIEW Wardle – Main operating site NWF Group plc HALF YEAR RESULTS TO 30 NOVEMBER 2018 26
Slide 27: Track record
GROUP OVERVIEW Track record Revenue Headline PBT 700 12 611.0 10.2 600 545.8 537.7 555.8 10 492.3 8.5 8.3 8.5 500 465.9 8.1 7.7 8 400 £m £m 6 300 4 200 100 2 - - 2013 2014 2015 2016 2017 2018 2013 2014 2015 2016 2017 2018 Headline EPS Dividend 18 16.7 7 6.3 6.0 16 6 5.7 14.0 5.4 13.5 5.1 14 13.0 12.
Slide 28: Divisional track record
GROUP OVERVIEW Divisional track record Fuels Food 450 8.0 50 3.5 400 7.0 45 3.0 350 40 6.0 35 2.5 300 Operating profit £m 5.0 30 Operating profit £m Revenue £m Revenue £m 250 2.0 4.0 25 200 1.5 3.0 20 150 15 1.0 2.0 100 10 1.0 0.5 50 5 - - - - 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2
Slide 29: Fuels additional market data
GROUP OVERVIEW Fuels additional market data Oil Prices - Brent crude $ per barrel Oil Market Journal 95 90 85 80 75 70 65 60 55 50 $ 45 40 35 30 25 20 15 10 5 0 17 06 17 17 17 17 17 17 17 17 17 17 17 18 06 18 18 18 18 18 18 18 18 18 18 1/ 2/ 3/ 4/ 5/ 6/ 7/ 8/ 9/ 0/ 1/ 2/ 1/ 2/ 3/ 4/ 5/ 6/ 7/ 8/ 9/ 0
Slide 30: Feeds additional market data
Price per tonne $ Price per tonne £ 01 /1 0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 100.0 110.0 120.0 130.0 140.0 150.0 160.0 170.0 180.0 190.0 200.0 210.0 0 50 100 150 200 250 300 350 400 450 500 2 15 /201 /1 2 7 01/12/17 29 /201 /1 13/12/17 2 7 12 /201 /0 25/12/17 1 7 26 /201 06/01/18 /0 1