Franchise Brands Plc · LSE:FRAN
Franchise Brands — FY2021 Earnings Presentation
34 slides from Franchise Brands's earnings presentation, Mar 3, 2022
Slide 1: Empowering Franchisees: Annual Results Presentation 2021
Slide 2: Our purpose
Our purpose BUILDING MARKET-LEADING BRANDS Our purpose is to build market- leading businesses primarily via a franchise model. Contents 03 = Introduction to Franchise Brands "1~—~Digital transf 04 2021 results summary Filta acquisiti O05 Franchise Brands: at a glance B2C division 08 Metro Rod 14 Fin
Slide 3: Presenters
Results Presentation 2021 Presenters STEPHEN HEMSLEY Executive Chairman * Stephen co-founded Franchise Brands in 2008 and has led the development of the business, including the IPO and external growth. A Chartered Accountant by training, he spent nearly ten years with 3i as Investment Director. * He
Slide 4: An Introduction to Franchise Brands plc
AN INTRODUCTION TO FRANCHISE BRANDS PLC METR@ ROD Established in 2008 by Stephen Hemsley (Executive Chairman) and Nigel Wray (Non-executive Director). Focused on building marketleading businesses in selected customer segments, primarily via a franchise model. 430 franchisees across five principal fr
Slide 5: Our Highlights
Our Highlights AND RECORD PROFIT GROWTH REVENUE +17% 2020: £49.3m ADJUSTED EARNINGS PER SHARE** +27% 2020: 4.35p ADJUSTED EBITDA* +28% 2020: £6.6m DIVIDEND PER SHARE +36% 2020: 1410p DAs earnings before interes, ax. depreciation, amortisation and share-based payment expense and non-recurring tems is
Slide 6: The 2021 Results at a Glance
Results Presentation 2021 5 The 2021 Results AT A GLANCE 10 8 £1.7m £0.5m £8.5m —_——__ 5 £(0.)m £(0.2)m 7 £6.6m Adjusted EBITDA £m 2020 METR@ ROD WILLQW PUMPS B2c Group overheads 2022 METRO PLUMB ChipsAway ovénclean Barking Mad
Slide 7: Our Leading Brands
Results Presentation 2021 6 Our Leading Brands FRANCHISE BRANDS: GROUP AT A GLANCE B2B B2Cc Metro Rod is a commercial drainage expert. Its 42 > ia ChipsAway is the UK’s leading mobile (mw ETR® ROD franchisees provide full national coverage via the B2B ChipsAway car paintwork repair specialist. ora c
Slide 8: B2B
BUSINESS FORMS PER r. METRO ROD a CAUTION §& § HIGH PRESSURE @ WATER JETTING § M IN.PROGRESS
Slide 9: Strong overall performance by Metro Rod
Results Presentation 2021 METR@ ROD A strong recovery with system sales for Metro Rod and Metro Plumb growing by 24% to a record £50.4m in the period (2020: £40.6m). New contracts won with a wide range of local and national customers. Investment by franchisees in tankers and pumps enables “one-stop
Slide 10: Metro Plumb gaining traction
B2B METRO PLUMB GAINING TRACTION AS A STAND-ALONE FRANCHISE Our objective is to develop Metro Plumb as a Stand-alone franchise, serving the commercial, insurance-based and domestic sectors. Two new franchisees were recruited in 2021, bringing the total number of stand-alone franchisees to seven. In
Slide 11: Willow Pumps
Results Presentation 2021 10 WILLQW Willow Pumps, which is a direct labour The Metro Rod corporate franchises of organisation, had a mixed year. Kent & Sussex and Exeter grew sales by 12% and showed strong growth in Service revenue from the reactive and profitability, albeit from a small base. plann
Slide 12: Digital transformation progressed at pace
B2B DIGITAL TRANSFORMATION PROGRESSED AT PACE 0800 6 , ISION The digital transformation of the business has progressed at pace in 2021, culminating in the acquisition of Azura in November 2021. The ‘Vision’ works management system (which is built on Azura’s core system) was further optimised during
Slide 13: Announcement of Filta acquisition
ANNOUNCEMENT OF FILTA ACQUISITION filta Announcement, on 16 February 2022, of a recommended allshare offer for Filta Group Holdings plc, a transformational acquisition for the Group. The merger will create a franchise business with an international reach in North America, UK and mainland Europe, whi
Slide 14: Strong recovery by B2C
B2c Results Presentation 2021 13, STRONG RECOVERY BY B2C ChipsAway ovéenclean LUKE IT NEVER HAPPENED Teese ene, wone time — The B2C division recovered strongly in 2021 from the three-month shutdown at the start of the Covid-19 pandemic in 2020. Recovery in revenue as almost all franchisees paid full
Slide 15: Financial
FINANCIAL
Slide 16: Summary of Group Results
Summary of Group Results 2021 2020 Change Change Year ended 31 December £'000 £000 £'000 % Statutory revenue 57,690 49,287 8,403 17% Cost of sales (35,764) (30,307) (6.457) (18)% Gross profit 21,926 18,980 2,946 16% Administrative expenses (13,452) (12,341) (1.112) 9% Adjusted EBITDA 8,474 6,640 1,8
Slide 17: Divisional Trading Results
Results Presentation 2021 16 Divisional Trading Results teorenesaroeenter ‘MUMBO Wow rungs SRE Meta od Wows ES Statutory revenue 36,201 15,061 6,428 57,690 29,324 14,128 5,835 49,287 Cost of sales (25,027) (9,369) (1,368) (35,764) (20,326) (8,636) (1,345) (30,307) Gross profit 1,174 5,692 5,060 21,9
Slide 18: Metro Rod
Metro Rod Year ended 31 December Revenue Cost of sales Gross profit GM% Administrative expenses Adjusted EBITDA System sales MSF income Effective MSF % Other gross profit Gross profit 2021 £000 36,201 (25,027) 1,174 31% (5,790) 5,385 2021 £000 50,361 9,411 18.7% 1,763 11,174 2020 £000 29,234 (20,326
Slide 19: Willow Pumps
Willow Pumps Year ended 31 December Revenue Cost of sales Gross profit GM% Administrative expenses Adjusted EBITDA 2021 £000 15,061 (9,369) 5,692 38% (4,007) 1,686 2020 £000 14,128 (8,636) 5,492 39% (3,648) 1,844 Change £000 934 (733) 201 ()% (359) (158) Change 8% 4% 10% (9)% 1t
Slide 20: B2C Division
B2C Division Year ended 31 December 2021 2020 Change Change £000 £000 £000 % Revenue 6,428 5,835 592 10% Cost of sales (1,368) (1,345) (23) 2% Gross profit 5,060 4,490 570 13% GM% 79% 77% 2% Administrative expenses (2,422) (2,359) (62) 3% Adjusted EBITDA 2,638 2,131 507 24% EBITDA in
Slide 21: Adjusted and Statutory Profit
Results P ation 2021 Adjusted and Statutory Profit Year ended 31 December 2021 2020 Change Change £'000 £'000 £'000 % Adjusted EBITA 8,474 6,640 1,834 28% Depreciation & amortisation (1,716) (1,357) (359) 26% Finance charge (292) (446) 154 (34)% evaluatio! he defer Adjusted profit before tax 6,464 4
Slide 22: Adjusted EPS and Dividend
Results Pi ation 2021 Adjusted EPS and Dividend GROWTH IN ADJUSTED EPS AND DIVIDEND (PENCE PER SHARE) 201 EW 5.55 2020 4.35
Slide 23: Balance Sheet
Balance Sheet 2021 2020 Change Change At 31 December £'000 £000 £000 % Property, plant and equipment 5,331 4,651 680 15% Intangible assets 35,278 34,754 Deferred tax liability (2,139) (1,752) Accounting assets 33,139 33,002 137 0% Inventories 908 712 Trade and other receivables 16,696 15,227 Trade a
Slide 24: Cash Flow
Results P ation 2021 Cash Flow 16 14 8.5 0.3 0.9 Ha 2.8 fh from 2 EBITDA al inve &m investment fc (£1m) an 4.9 digital infra NetCash1 EBITDA Working —‘TaxPaid = Capex = Acquisitions Interest_ +“ Employee Dividends Net Cash 31 Jan 2021 Capital Benefit Trust Dec 2021
Slide 25: Summary and Outlook
Results Presentation 2021 24 Summary and Outlook 2021 saw a strong recovery in our business as the continued lifting of the Covid-19 restrictions led to an increase in the demand for the Group’s services, particularly at Metro Rod. The anticipated acquisition of Filta will be transformational for th
Slide 26: Franchise Brands
FRANCHISE BRANDS
Slide 27: The Group's Franchise Systems as at 31 December 2021
Results Presentation 2021 26 The Group’s Franchise Systems* as at 31 December 2021 Network size New franchisees Franchisees leaving Net new 31 December, 2020 recruited in 2021 the system in 2021 franchisees in 2021 Network size 31 December, 2021 B2C 386 57 + (62) = (5) 381 Metro Rod 42 1 + (1) = 10)
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Slide 30: Working Responsibly
Results Presentation 2021 29 Working Responsibly A GREAT WORK ENVIRONMENT Total number % of male % of female of employees” employees employees Metro Rod Support Centre 100 39% 61% B2C Support Centre 20 35% 65% Willow Pumps 92 78% 22% Metro Rod DLOs 69 90% 10% Franchise Brands ple 10 90% 10% Total 29
Slide 31: Working Responsibly
Working Responsibly METRO ROD IN THE COMMUNITY (weTRO ROD WALKING BUS SPONSORSHIP * Part of our commitment to supporting local schools. Will see hi-vis jackets provided to over 900 children, encouraging them to “Be Bright, Be Green, Be Seen’. + Walking to school helps reduce carbon emissions and the
Slide 32: Working Responsibly
Working Responsibly HELPING OUR FRANCHISEES AND EMPLOYEES WORK MORE RESPONSIBILITY HELPING OUR CUSTOMERS UNDERSTAND THEIR ENVIRONMENTAL OBLIGATIONS SUTIN SENS aN In 2021 we launched an Environmental Manual to help Metro Rod franchisees give a higher priority to environmental issues in all aspects of
Slide 33: Disclaimer
Results Presentation 2021 32 Disclaimer The information contained in this document (“Presentation”) and the presentation made to you verbally has been prepared by Franchise Brands plc (the “Company). Franchise Brands plc is a UK company quoted on AIM, a market operated by London Stock Exchange ple.
Slide 34: Franchise Brands contact details
FRANCHISE BRANDS www.franchisebrands.co.uk @FB_PLC Franchise Brands plc Ashwood Court Tytherington Business Park Macclesfield SK10 2XF mail@franchisebrands.co.uk 01562 826705 Contributing photographer METR@ ROD www.metrorod.co.uk @MetroRodUK METRQ PLUMB www.metrorod.co.uk @MetroPlumbUK WILLQW PUMPS