Kingspan Group Plc · EURONEXT:KRX

Kingspan — H1 2016 Earnings Presentation

32 slides from Kingspan's earnings presentation, Aug 22, 2016

  1. Slide 1: Kingspan Interim Results 22nd August 2016

    Kingspan Interim Results 22nd August 2016

  2. Slide 2: Disclaimer

    Disclaimer Forward Looking Statements This presentation contains certain forward-looking statements including, without limitation, regarding the Group’s financial position, business strategy, plans and objectives of management for future operations. Such forward-looking information involves risks an

  3. Slide 3: The Business

    The Business  A global leader in high performance insulation and building envelopes  Market leading positions in UK, Mainland Europe, North America and Australasia  Proprietary technology drives differentiation in product performance 3

  4. Slide 4: What We Deliver

    What We Deliver 0 QO Excellence Architectural Fully Integrated in Energy Inspiration Envelope Solutions 6 © Building Comfort Science & Savings

  5. Slide 5: H1 2016 In a Nutshell

    H1 2016 In a Nutshell 1.47 Billion 167 Million 5

  6. Slide 6: Our Strategy

    Our Strategy  Be the leader in high performance insulation globally – proprietary and differentiating technologies  Be the world’s leading provider of low energy building envelopes  Greater geographic reach – focus on The Americas, Continental Europe and certain developing markets 6

  7. Slide 7: Completing the Envelope

    Completing the Envelope Kingspan Insulation Boards Global Leadership – continue to drive worldwide reach through greenfield and consolidation Kingspan Insulated Panels & Facades Global Leadership – continue to drive worldwide reach through greenfield and consolidation Kingspan Flatroof Membrane Embr

  8. Slide 8: 5 Year Financial Performance

    5 Year Financial Performance Revenue (€’m) (CAGR 17%) 3,056.4 2,774.3 1,776.8 1,891.2 1,628.7 2012 2013 2014 2015 2016* Trading Profit (€’m) (CAGR 28%) 291.3 255.9 148.5 107.7 122.8 2012 2013 2014 2015 2016* * Analyst consensus 8

  9. Slide 9: H1 2016 In Summary

    H1 2016 In Summary Revenue • Insulated Panel sales growth of 26% globally, with up 19% significant advances in Western Europe and North to €1.47bn America in particular. • Insulation Board sales growth of 9%, with the strongest performance in the UK, North America, and the Netherlands. Trading • Env

  10. Slide 10: Financial Highlights

    Financial Highlights H1 2016 H1 2015 Change cc* Revenue (€m) 1,468.1 1,235.3 +19% +22% Trading Profit (€m) 167.3 111.7 +50% +55% EBITDA (€m) 196.8 137.9 +43% +47% Earnings per share (cent) 70.6 €x 46.5 +52% Interim Dividend (cent) 10.0 8.0 +25% Free Cashflow (€m) 92.6 105.7 -12% Net Debt (€m) 348.1

  11. Slide 11: Trading Profit & Margin Progression

    Trading Profit & Margin Progression Trading Profit Margin % 200.0 175.0 H1 15 FY 15 H1 16 150.0 Insulated Panels 9.3% 9.3% 11.8% 125.0 Insulation Boards 8.9% 9.2% 11.5% 100.0 Environmental 4.3% 5.1% 5.3% €’m 167.3 Access Floors 11.4% 12.1% 12.2% 75.0 Group 9.0% 9.2% 11.4% 111.7 50.0 69.2 25.0 52.7 5

  12. Slide 12: Group Sales & Profit Bridge

    Group Sales & Profit Bridge Sales 180.5 90.1 37.8 1,468.1 1,235.3 Revenue H1 15 Currency Acquisitions Underlying Revenue H1 16 Trading Profit 53.0 8.1 5.5 167.3 111.7 Revenue H1 15 Currency Acquisitions Underlying Revenue H1 16 12

  13. Slide 13: Strong Free Cash Flow

    Strong Free Cash Flow 250.0 WC/Sales 10.5% 200.0 (26.0) 2.1 (7.5) 150.0 (20.3) 196.8 €’M (52.5) 100.0 92.6 50.0 0.0 13

  14. Slide 14: Working Capital %

    Working Capital % 16.0% 14.0% Average 12.8% 12.0% 10.0% 8.0% 14.2% 13.6% 12.8% 12.7% 6.0% 10.5% 4.0% 2.0% 0.0% H1 12 H1 13 H1 14 H1 15 H1 16 14

  15. Slide 15: Movement in Net Debt

    Movement in Net Debt 400.0 1.9 350.0 30.2 300.0 92.6 80.6 250.0 348.1 €’M 200.0 328.0 150.0 100.0 50.0 0.0 Net Debt Dec 15 Free Cash Flow Acquisitions Dividend Shares issued/fx Net Debt Jun 16 etc. 15

  16. Slide 16: Growing ROCE

    Growing ROCE 20.0% 18.0% 16.0% 14.0% 12.0% 10.0% 17.8% 8.0% 15.2% 13.4% 6.0% 12.3% 10.7% 4.0% 2.0% 0.0% 2012 2013 2014 2015 H1 16 16

  17. Slide 17: Sales by Geography

    Sales by Geography H1 2015 H1 2016 9% 3% 8% 4% 18% 20% 28% 33% 37% 40% €’m H1 16 H1 15 Constant Currency YoY % Change Change Britain & Northern Ireland 410.1 399.7 +9% +3% Mainland Europe 592.3 459.0 +30% +29% Americas 291.4 225.9 +32% +29% Republic of Ireland 59.5 40.4 +47% +47% Rest of World 114.8

  18. Slide 18: Insulated Panels

    Insulated Panels  Solid sales performance overall H1 16 H1 15  Good growth in Germany, Sales (€m) 949.5 752.9 France and the Netherlands, % of Group Sales 65% 61% in contrast Belgium relatively flat Analysis of YoY % Change  Pockets of Central Europe Underlying Currency Acquisitions Total doing w

  19. Slide 19: Insulated Panels (Cont.)

    Insulated Panels (Cont.)  Australia order intake significantly ahead year on year  Turkey and Middle East more difficult albeit significant contract wins expected in H2 2016  IPN Quadcore® progressively rolled-out globally over the coming year  Focus on continued consolidation of end markets and

  20. Slide 20: Insulation Boards

    Insulation Boards  UK sales robust owing to penetration growth and some H1 16 H1 15 market share improvement Sales (€m) 347.4 319.2 % of Group Sales 24% 26%  Overcapacity marring Continental Europe market albeit Analysis of YoY % Change new-build sales in Netherlands Underlying Currency Acquisitio

  21. Slide 21: Access Floors

    Access Floors  Solid H1 sales performance overall H1 16 H1 15 Sales (€m) 91.7 85.7  UK office activity buoyant at % of Group Sales 6% 7% present Analysis of YoY % Change  Weaker North America sales in Underlying Currency Acquisitions Total H1 2016 +10% -3% - +7%  Grade A office floor market in N

  22. Slide 22: Environmental

    Environmental  Stable performance overall H1 16 H1 15  Improved water products sales, Sales (€m) 79.5 77.5 particularly UK % of Group Sales 5% 6%  Emphasis on preserving low Analysis of YoY % Change cost base Underlying Currency Acquisitions Total  Tankworks acquisition to +2% -6% +7% +3% provid

  23. Slide 23: Outlook

    Outlook  Positive order intake momentum in Q2 bodes well for H2 2016  Rising raw material prices in H2  Exchange rates moving away from 2015 average levels, particularly GBP  Kingspan remains well poised overall National Library, Sejong City, Korea 23 Insulation

  24. Slide 24: Additional Information

    ADDITIONAL INFORMATION Daytona Speedway Track, USA 24 Insulated Panels

  25. Slide 25: 2016 Snapshot

    2016 Snapshot Z SALES* €3.1bn 5% 65, ENVIRONMENTAL INSULATED r 2 PANELS 6% a ACCESS FLOORS PRODUCT 24% INSULATION BOARDS Million INSULATION BOARDS VOLUME 46m Million INSULATED PANELS * Analyst consensus EBITDA* €353m 4% 40 8 % a MAINLAND EUROPE ae 20», GEOGRAPHY AMERICAS: 28y, oot” UNITED KINGDOM 58

  26. Slide 26: Our Evolution - Financial

    Our Evolution - Financial CAGR = 17.5% 26

  27. Slide 27: Global Organic Expansion

    Global Organic Expansion Kankaanpaa, Finland QuadCore Panel Line 2016 m Leuze, Belgium Door Parél Line 2019) ataeeee oe ay “> PIR Roofpanel Line 2016 - Perpignan, France , a ae PIR Roofpanel Line 2017 Modesto, USA QuadCore Panel Line 2017 ~ he, Winchester, USA -_—™ Monterrey, Mexico Dubai, UAE QuadC

  28. Slide 28: Kingspan Insulates Better

    Kingspan Insulates Better 28

  29. Slide 29: Kingspan v Construction Macro

    Kingspan v Construction Macro 29

  30. Slide 30: Driving Penetration Growth

    Driving Penetration Growth Aim to change Building Practices / Material Choices 30

  31. Slide 31: Our Net Zero Energy Path

    Our Net Zero Energy Path Total Energy Use a GWh BB Total Renewable Energy GWh nz % 2016P 31

  32. Slide 32: Slide 32

Kingspan Group — H1 2016 Earnings Presentation on 6ix