Scott Technology Limited · NZX:SCT
Scott Technology — Merger or Acquisition (February 2018)
19 slides from Scott Technology's merger presentation, Feb 21, 2018
Slide 1: Acquisition of Alvey Group
Acquisition of Alvey Group 21 February, 2018
Slide 2: Transaction summary
Transaction summary Revenue to March 2017: €33.6m (NZ$56.5m) Multiple: Approx. 4.5x historic March 2017 EBITDA Location: Headquartered in Belgium along with operations in France, Czech Republic and the UK Staff: 250 Expected acquisition date: 4 April 2018 Payment from cash reserves NZ dollar figures
Slide 3: Company overview
Company overview Offering: Automated and robotic systems for handling the internal logistics of secondary packaging (trays, carton boxes, crates) and pallets. Palletisers and depalletisers Stacker cranes Pallet conveyors In-house software to run and manage automation Case conveyors processes (Maestr
Slide 4: Company overview
Packing and sorting line for ca . “SMM ALVEY.EU - MASTERS IM INDUSTRY GROUP AWE A scotrT’ MASTERS IN INDUSTRIAL AUTOMATION
Slide 5: Company overview – Locations
Company overview – Locations Location: Deerlijk – 60km west of Brussels Belgium Scott Germany 50 year history 93 staff Corporate head office Two-thirds of engineering staff Hosts the majority of project management staff Some modest production United Kingdom Location: Podivin – near Czech/Austrian bo
Slide 6: Company overview – March 2017 revenue snapshot
Company overview – March 2017 revenue snapshot Revenue to March 2017: €33.6m (NZ$56.5m) Equivalent to approx. 42% of Scott’s FY17 revenue 5 year CAGR of 14% pa Composition: 73% from projects (design through to build and integration) and 25% from service work such as maintenance contracts, 24/7 hotli
Slide 7: Company overview - People
Company overview - People A very high calibre Senior Executive Maarten van Leeuwen Senior executive snapshot Group Managing Director • Average tenure of 10 years 15 years with Alvey Led a management buyout in 2011 which • Average age of 41 positioned Alvey for the shape it takes today • Majority are
Slide 8: Strategic rationale
Strategic rationale Build an end-to-end Add to our overall automation offering automation capabilities • Fills a gap in our offering [Automation = hardware + • Complementary software + electrical + • One-stop-shop analytics + integration] Get skills and/or technology faster than Accelerate market de
Slide 9: Strategic rationale: end-to-end automation offering
Strategic rationale Building an end-to-end automation offering for the overall production process from raw material receipt to final distribution. Production & Scott Raw material receipts manufacturing process Packaging Palletising Internal logistics External transport Warehousing and distribution P
Slide 10: Strategic rationale – Business appeal
Strategic rationale – Business appeal High calibre Robust systems Low cost European management team and internal manufacturing scale/visibility and workforce processes Existing expertise Meaningful entry Direct application Greatly add to our in chilled/frozen into backend to JBS software factory log
Slide 11: Strategic rationale – Synergy opportunities
Strategic rational – Synergy opportunities Take Alvey into new markets via our Scott channels • Geographies – Germany, USA, Australia, New Zealand and China • Key customers – JBS • Applications – meat processing Utilise key aspect of Alvey across Scott globally • Service business model • Software en
Slide 12: Proforma revenue snapshot
Proforma revenue snapshot Scott Alvey Proforma (12 month actual to August 2017) (12 month actual to March 2017) (Scott historic + Alvey historic) $133m $57m $190m NZ dollar figures based on a EURNZD rate of 1.6805
Slide 13: Q&A: Impact on STG and European operation
Q&A Q) What impact will this have on STG and the operation in Europe? Alvey will provide Scott with increased critical mass. We will look to combine resources to best effect. This will include co-ordinating sales teams.
Slide 14: Q&A: Why acquire another company in Europe?
Q&A Q) Why acquire another company in Europe? We have been looking globally for businesses that have good products and strong management. Alvey fits this category and are in a markets Scott is already active in.
Slide 15: Q&A: Impact on work of each region/division
Q) Will this change or influence the type of work each region/ division is currently involved with? Not directly but there will be a drive to expand the activities of Scott into Alvey markets and to make Alvey products available into Scott markets
Slide 16: Q&A: Where will Alvey sit in Scott's structure?
Q) Where will Alvey sit in the Scott organisational structure? Alvey management become part of the Scott Europe management team and will come under the Regional Director for Europe.
Slide 17: Q&A: Which existing sector is targeted?
Q) Which existing sector that we sell into is targeted with this acquisition? Industrial Automation – which can cut across our other target market sectors
Slide 18: Q&A: Selling Alvey product in NZ/Aus/USA
Q) Will we be selling Alvey product in NZ/Aus/USA etc and if so how will we do this? Yes – this is part of our strategic direction. Initially we will look to offer Alvey products under the “SCOTT” brand to our existing customers in NZ/AUS/USA
Slide 19: Q&A: Alvey as base for Scott products
Q) Will Alvey be a base from which to sell the whole Scott product offering in their region? We will be offering Scott products and systems into the wider Europe market through Alvey distribution channels – particularly – Belgium, France, and Czech Republic
Scott Technology — Merger or Acquisition (February 2018) on 6ix