Slide 1: Focusrite Plc Interim Results Presentation
Focusrite Plc Interim Results Presentation Six months ended 28 February 2015 Dave Froker (CEO) Jeremy Wilson (CFO)
Slide 2: Disclaimer
Disclaimer The content of this document (the “Presentation”) has not been approved by an authorised person within the meaning of the Financial Services and Markets Act 2000 (“FSMA”), as amended. Reliance on this document for the purpose of engaging in any investment activity may expose an individual
Slide 3: Overview
Overview • Global music company supplying hardware and software products used by musicians, which enable high quality production of music Scarlett 2i2 • Two established and rapidly growing brands: • Focusrite: Audio recording equipment • Novation: Hardware and software for creating and playing elect
Slide 4: Executive Summary
Executive Summary • Successful IPO in December 2014 • Markets continue to grow as does our share of those markets, demonstrated by US market share growth to 13.4% • Positive financial performance: Revenue up 17.5% and Adjusted EBITDA up 20.5% • Important new products announced and further new produc
Slide 5: Financial Highlights
Financial Highlights • Group revenue is up by 17.5% to £23.8 million (H1 FY14: £20.3 million) • Adjusted EBITDA is up by 20.5% to £4.7 million (H1 FY14: £3.9 million) • Adjusted operating profit is up by 23.3% to £3.7 million (H1 FY14: £3.0 million) • Net cash up by 24.2% to £4.7 million (31 August
Slide 6: H1 2015 Operational Highlights
H1 2015 Operational Highlights Dave Froker 6
Slide 7: Markets and Products
Markets and Products H1 FY15 All major regions growing • USA: up 23.4% to £8.5m from £6.9m last year, despite some major dealers reducing stocks • EMEA: up 11.6% to £11.7m from £10.4m last year...affected by the weaker Euro • Rest of World (mainly Asia): up 24.4% to £3.7m from £2.9m last year Produc
Slide 8: Products: Focusrite
Products: Focusrite Focusrite • Revenue up 21.5% to £15.3m • Increased penetration in core interface market, especially ‘Scarlett’ • Rednet adoption growing; eg used for Usher’s US and Europe tour • Rednet also opening new vertical markets • Microsoft, US religion and Red Bull. • Clarett announced a
Slide 9: Products: Novation
Products: Novation Novation • Revenue up 11.4% to £6.8m • Refocused marketing strategy and brand re-launch in April 2015 to positive acclaim • LaunchPad Pro (advanced grid–based controller) announced at NAMM in January 2015 • LaunchPad App for iOS devices has now passed 2.8 million downloads. • Sign
Slide 10: People and processes
People and processes • Our people are a critical success factor for us • Average age 30 • Vast majority play musical instruments • Management intention to invest in training for all. • Won ‘Pro-Tools Expert’ People’s Choice awards for customer service and product innovation April 2015 • Focusrite in
Slide 11: Financial Performance
Financial Performance Jeremy Wilson 11
Slide 12: Income Statement
Income Statement • Revenue up 17.5%. £ million IFRS IFRS IFRS • Both major brands and all major territories increasing H1 FY15 H1 FY14 FY14 Growth Revenue 23.8 20.3 41.0 17.5% • Gross margin 39.4% (from 40.0% last year) Cost of sales -14.4 -12.2 -25.1 Gross profit 9.4 8.1 15.9 15.6% • Operating expe
Slide 13: Balance Sheet
Balance Sheet £ million IFRS IFRS IFRS • Intangible fixed assets include £3.0m of H1 FY15 H1 FY14 FY14 Intangible assets 3.6 2.7 3.0 capitalised R&D and £0.4m of goodwill Tangible assets 1.2 0.6 1.0 Total non current assets 4.8 3.3 4.0 • Tangible assets: largely tooling for new products and office r
Slide 14: Cash flow statement
Cash flow statement • Working capital remains tightly controlled £ million IFRS IFRS IFRS H1 FY15 H1 FY14 FY14 (16.7% of revenue) Adjusted EBITDA 4.7 3.9 8.2 • Operating cash flow before exceptional items Movement in wc (ex -exceptional items) -0.5 0.4 0.5 Operating cash flow ( ex-exceptional items)
Slide 15: Dividend
Dividend • Progressive dividend policy • Initial annual dividend yield of between 1% and 2% • Annual dividend weighted towards the final dividend • First step: Interim dividend of 0.6p per share announced • Based on interim statement date of 29 April, ‘ex div’ date 28 May, record date 29 May and pay
Slide 16: Outlook
Outlook Dave Froker 16
Slide 17: Outlook
Outlook The Board continues to target strong revenue growth driven by an ambitious programme of product introductions and strict operational discipline. Our goal to “Make Music Easy to Make” drives us forward, bringing more and more musicians into recording, performing and producing their music. The
Slide 18: Summary
Summary • Markets continue to grow, as does our share of those markets • Both Focusrite and Novation brands growing • Revenue up 17.5%, Adjusted EBITDA up 20.5% • Sunday Times “Best 100 Small Companies to Work For” for the fourth year • Cash balance £4.7 million • Interim dividend of 0.6p announced