Gale Pacific Limited · ASX:GAP
Gale Pacific — H1 2019 Earnings Presentation
20 slides from Gale Pacific's earnings presentation, Feb 19, 2019
Slide 1: Results for the Six Months to 31 December 2018
RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 For personal use only Nick Pritchard Group Managing Director Matt Parker Chief Financial Officer 19 February 2019
Slide 2: Highlights, Financial Results, Strategy & Outlook
For personal use only 1. Highlights Nick Pritchard Group Managing Director 2. Financial Results Matt Parker Chief Financial Officer 3. Strategy & Outlook Nick Pritchard Group Managing Director
Slide 3: Highlights
For personal use only HIGHLIGHTS HEALTH, SAFETY AND ENVIRONMENT KEY HIGHLIGHTS METRICS & PERFORMANCE DRIVERS
Slide 4: Health, Safety and Environment
HEALTH, SAFETY AND ENVIRONMENT Continuing to build a strong safety culture across all parts of our business For personal use only • Continuing strong performance with no major incidents or injuries during the period • Strong hazard reporting performance – an important lead indicator of a positive sa
Slide 5: Key Highlights
KEY HIGHLIGHTS Results in line with guidance For personal use only • Group revenue growth of 5% on pcp • Continued expansion of USA sales presence with revenue growth of 53% on pcp • ANZ revenue influenced by weather conditions impacting shade products and grain cover sales • PBT down A$0.4m on pcp
Slide 6: Key Metrics & Performance Drivers
KEY METRICS & PERFORMANCE DRIVERS • Sales Revenue (Excl. ANZ) of A$33.1m up 33% on pcp For personal use only • America’s revenue growth of 53% with strong growth across both retail and commercial sectors • Raw material and currency headwinds carried through from 2H 2018 * Current and Prior Period re
Slide 7: Financial Result
For personal use only FINANCIAL RESULT SEGMENT REPORTING RESULTS SUMMARY OPERATING ENVIRONMENT CASH FLOW BALANCE SHEET REGIONS
Slide 8: Changes to Segment Reporting
CHANGES TO SEGMENT REPORTING • To improve the transparency of GALE Pacific’s segment reporting, in FY 2019 GALE Pacific For personal use only initiated an activity-based allocation method of reporting • Intersegment sales/margin derived from manufacturing locations, and centrally held costs, have be
Slide 9: Results Summary
RESULTS SUMMARY Solid underlying performance For personal use only 31 Dec 2018 31 Dec 2017 Change • Revenue growth driven primarily by Results for the 6 months to A$ million A$ million % strong performance in Americas Revenue 67.8 64.3 5 EBITDA 5.2 5.4 (4) • Australia and New Zealand business EBIT 2
Slide 10: Operating Environment
OPERATING ENVIRONMENT Significant economic headwinds from the prior period easing For personal use only • Currency - CNY weakening against USD & AUD providing opportunity for margin expansion • Input costs - Input cost pressure eased following a reduction in base material prices Resin prices index 3
Slide 11: Cash Flow
CASH FLOW Operating cash flow impacted by higher inventory in Americas to support growth, and lower sales in ANZ For personal use only • Higher inventory to support seasonal growth • Investment in new coating line (A$8 million) for commercial sector growth opportunities in ANZ and abroad • Share buy
Slide 12: Australia & New Zealand
AUSTRALIA & NEW ZEALAND Seasonal and macroeconomic factors constraining growth For personal use only 31 Dec 2018 31 Dec 2017 Change Results for the 6 months to A$ million A$ million % Revenue 34.7 39.5 (12) EBITDA 2.5 3.7 (32) PBT 1.4 2.2 (36) • Seasonal and a soft retail sales environment saw reven
Slide 13: Americas
AMERICAS Increasing retail distribution, strong commercial sector growth and continued investment For personal use only 2015 USA Retail Distribution Presence 31 Dec 2018 31 Dec 2017 Change Results for the 6 months to A$ million A$ million % Revenue 24.0 15.7 53 EBITDA 1.4 1.0 50 PBT (0.8) (0.7) 6 •
Slide 14: Middle East/North Africa
MIDDLE EAST/NORTH AFRICA Challenging economic conditions For personal use only 31 Dec 2018 31 Dec 2017 Change Results for the 6 months to A$ million A$ million % Revenue 7.0 7.4 (6) EBITDA 2.0 2.2 (8) PBT 1.8 1.8 (2) • Challenging economic conditions continued • Key markets, including the UAE and Sa
Slide 15: Eurasia
EURASIA Improved customer and product mix driving growth and higher profit contribution For personal use only 31 Dec 2018 31 Dec 2017 Change Results for the 6 months to A$ million A$ million % Revenue 2.1 1.7 23 EBITDA 1.0 0.3 292 PBT 0.8 0.2 239 • Continues to deliver a highly profitable contributi
Slide 16: China Manufacturing
CHINA MANUFACTURING Strong ongoing operational performance whilst simultaneously delivering major projects For personal use only • Business transformation driving quality, service and efficiency improvements • Manufacturing facilities consolidated effectively • Strong service performance 16
Slide 17: Strategy & Outlook
For personal use only 3.STRATEGY & OUTLOOK STRATEGY OUTLOOK
Slide 18: Strategy
STRATEGY Key elements of the 2019 plan include: For personal use only Americas Region Coating Manufacturing Manufacturing Operations Product Innovation • Effectively execute the Capacity • Continuing manufacturing • Meaningful innovation in rollout of the expanded • Effective commissioning efficienc
Slide 19: Outlook
OUTLOOK For personal use only • Despite adverse trading conditions in 1H, the Company is encouraged by the reduced commodity cost and currency pressures from 2018 • Expect this to translate into improved margins for the selling regions in 2H 2019 • Well positioned for the USA spring and summer selli
Slide 20: Disclaimer
For personal use only DISCLAIMER Statements contained in this presentation, particularly those regarding possible or assumed future performance, estimated company earnings, potential growth of the company, industry growth or other trend projections are or may be forward looking statements. Such stat