Slide 1: Earnings Presentation Q1-24
RIYADH CABLES GROUP Earnings Presentation Q1-24 Borjan Sehovac Baha Essa Mouaaz Alyounes Chief Executive Officer Chief Financial Officer Chief Strategy Officer
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by Riyadh Cables Group Company (“RCG”) to give a fair view about the company and its operational and financial performance. It reflects management’s expectations and strategy relating to future events which may be subject to unknown factors and unforese
Slide 3: In Today's Meeting
In Today’s Meeting 01 Welcome Remarks 02 Company Overview 03 Q1-24 Performance Highlights 04 Financial Review Business Strategy Refresh & Market 05 Update 06 Closing Remarks and Guidance
Slide 4: Company Overview
Company Overview
Slide 5: Cables are the backbone of the economy, touching every segment
Cables are the backbone of the economy, touching every segment Generation Transmission Distribution End Users Legend Power Data Solar Fossil Onshore Internet ISPs Wind exchange Residencial Datacenters Offshore Wind Industrial Power Transmission Distribution Usages Generation Commercial Nuclear Infra
Slide 6: Q1-24 Performance Highlights
Q1-24 Performance Highlights
Slide 7: Q1-24 Financial and Operational Performance Snapshot
Q1-24 Financial and Operational Performance Snapshot Percentage changes refer to YoY change SARm 2,032 Kt 60 % 92 Revenue Sales Volume Utilization Rate +41% +16% + 4.9% + 3.2% +22% 60 4,667 116 115 58 +3% -1% 3,711 45 3,126 +26% SAR 4,667 SARm 225 SARm 169 Gross Profit Per Ton EBITDA Net Profit 58 +
Slide 8: Q1-24 Key Performance Drivers
Q1-24 Key Performance Drivers Percentage changes refer to YoY change S a l e s Vol ume 3 % in cre a se in sa le s vo lu m e , so lid s a le s in t ra n sm issio n p ro je ct s, t o ge t h e r wit h re n e wa b le a n d e xp o rt . S lo wd o wn in Ut ilit y se gm e n t , b u t b e t t e r V s Q 4 ‘2
Slide 9: Financial Review
& Financial Review
Slide 10: Q1-24 Financial and Operational Performance
Q1-24 Financial and Operational Performance Revenue and Volume 2,500 90 2,500 1,937 2,032 80 1,890 2,032 • Q1-FY24 revenue slightly above 2bnSAR, with the highest volume 2,000 70 2,000 sold of 60kT. 58 60 60 1,500 +3% 1,500 51 • Q1-FY24 sales revenues and volumes characterized by strong 50 +18% Loca
Slide 11: Backlog, profitability, and capacity utilization
Backlog, profitability, and capacity utilization +31% +48% SAR 4.8 billion Strong backlog in Q4-2023 pushing +5% 225 4,840 utilization rate to 92 % Record of confirmed 2,032 1,937 orders backlog 172 3,274 Average Capacity Utilization (%) 100% • Quote pipeline in Q1-24 same 2020 78% 22% level as prev
Slide 12: Gross profit and EBITDA show healthy improvement on better mix and cost optimization
Gross profit and EBITDA show healthy improvement on better mix and successful variable / fixed cost optimization Gross Profit (SARm) Gross Profit 283 283 238 • Quarterly gross profit increased as a result of efficiencies and 219 improved mix. +19% +29% • Strategic orders selection methodology to max
Slide 13: Positive free cash flow generation and consistent dividend payment
Positive free cash flow generation and consistent dividend payment Free Cash Flow 86 17 7 2 2 126 0 -15 -34 184 Prudent working capital management backs positive free cash flow -348 268 -242 generation. 55 Provision Capex Prepayments Accrual Depreciation Trade payable EOSB Contract liability PBT Tra
Slide 14: Hedging and pricing mechanisms neutralize commodity price fluctuations
Hedging and pricing mechanisms neutralize commodity price fluctuations, granting stability to gross profit per tone +26% +19% 4,667 3,711 Gross Profit per ton (SAR/tonne) 3,126 3,705 Main drivers: 3,494 2,413 • Operational Efficiencies due to high Utilization 5,524 3,700 3,946 • High demand on Trans
Slide 15: Business Strategy Refresh & Market Update
Business Strategy Refresh & Market Update
Slide 16: RCG Strategy: Drive Growth and Performance
RCG Strategy: Drive Growth and Performance Deepen And Expand Products And Environment, Social And Cost Leadership Organisation Geographical Footprint Services Innovation Governance Focus Leadership in Complete cables Focus on cost People and Responsible each target solutions and efficiency processes
Slide 17: Overall Demand in Target Markets Displays Attractive Growth Lead by KSA
Overall Demand in Target Markets Displays Attractive Growth Lead by KSA Wires and power cables market size in KSA, rest of GCC1 and Iraq 2019 - 2028F (in SAR Billion) KSA Demand – SAR billion MENA region historic and forecast demand growth 37.4-40.8 +7.6 has exceeded most other markets 10% Iraq +7.5
Slide 18: Clear market leader in the region and amongst the largest global players
Clear market leader in the region and amongst the largest global players KSA Market Share RCGC Sector Leadership Almost 2X capacity as closest regional 38% 1 36% 38% competitor 32% 30% 30% 2 Comprehensive product range 3 Technical leadership 2019 2020 2021 2022 2023 2024 Localisation advantage (high
Slide 19: Closing remarks and Guidance
Closing remarks and Guidance
Slide 20: 2024 Management Outlook
2024 Management Outlook 2024 TARGETS & GUIDANCE Backlog - WE CONFIRM THE PREVIOUS GUIDANCE - Macro trends Expected CAPEX 10% - 15% SAR ~200 million Increase of Net Profit [Insert target] [Insert target] Product portfolio DIVIDENDS Capacity Management outlook reflects expectations that may happen in
Slide 21: Q&A
Q&A 21
Slide 22: Thank you
Thank you
Slide 23: Appendix
Appendix
Slide 24: Summarized income statement (SARm)
Summarized income statement (SARm) Q1-23 Q1-24 Var. Var. % Revenue* 1,937 2,032 94 4.9% Direct costs* -1,719 -1,748 -30 1.7% Gross profit 219 283 64 2.9% Operating expenses -56 -61 -5 9.9% Operating profit 163 222 59 3.6% Investment income -0 -0 -0 Finance charges -22 -24 -2 0.8% Other income / expe
Slide 25: Condensed balance sheet (SARm)
Condensed balance sheet (SARm) YE-22 Q1-24 Fixed Assets 1,281 1,275 Investments 48 49 Other Long Term Assets 13 13 Current Assets 3,489 3,976 Total Assets 4,831 5,313 Borrowings 722 579 Long Term Liabilities 135 136 Current Liabilities (excl. borrowings) 1,728 2,163 Total Liabilities 2,585 2,879 Equ
Slide 26: Condensed cash flow statement (SARm)
Condensed cash flow statement (SARm) Q1-23 Q1-24 Var. Var. % Operating cash flow before working capital 191 348 157 81.8% Net working capital movement 206 -281 -487 -236.2% Cash generated from operating activities 398 67 -331 -83.1% Finance charges, Zakat & income tax, EOSB 2 2 0 -5.7% Net cash flow
Slide 27: Riyadh Cables Group
Riyadh Cables Group 27