Slide 1: Polypipe Group plc Interim Results
Polypipe Group plc Interim Results 6 months to 30 June 2017
Slide 2: Disclaimer
Disclaimer The information contained in this presentation has not been independently verified and this presentation contains various forward-looking statements that reflect management’s current views with respect to future events and financial and operational performance. The words “growing”, “scope
Slide 3: Agenda
Agenda Introduction David Hall Presentation Team David Hall Martin Payne Chief Executive Officer Chief Financial Officer 3
Slide 4: Introduction
Introduction Continued strong performance, in line with management expectations Market outperformance in both UK segments UK Residential +9.2% growth driven by new house build Successfully implemented price increases and cost reductions to mitigate materials cost inflation Middle East fact
Slide 5: Agenda
Agenda Introduction Financial Review David Hall Martin Payne 5
Slide 6: Financial highlights
Financial highlights Performance in line with management expectations Revenue 8.4% higher at £242.0m, 6.9% higher on a like for like basis UK revenue 6.8% ahead Underlying operating profit 3.1% higher at £38.9m Underlying operating margin at 16.1% - pricing actions progressively implemente
Slide 7: 2017 H1 underlying results summary
2017 H1 underlying results summary £m H1 2017 H1 2016 change % change Revenue 242.0 223.3 18.7 8.4% Cost of sales (144.1) (129.8) (14.3) Gross profit 97.9 93.5 4.4 4.7% Gross margin 40.5% 41.9% Selling & distribution costs (37.9) (34.3) (3.6) Administrative expenses (21.1) (21.5) 0.4 Underlying oper
Slide 8: Revenue and underlying operating profit bridge
Revenue and underlying operating profit bridge Revenue (£m) +1.2 +7.9 +3.0 +6.6 +1.2 242.0 223.3 H1 2016 Selling price Currency Inflation Volume Middle East Investment FX H1 2017 352.9 Underlying operating profit (£m) +6.6 +1.0 +0.8 +0.1 (9.8) 69.4 +2.5 38.9 37.7 H1 2016 Selling price Currency Cost
Slide 9: Cashflow
Cashflow Year ended 31 £m H1 2017 H1 2016 change December 2016 EBITDA (before non-underlying items) 47.0 45.7 1.3 85.7 Capital expenditure (11.3) (8.4) (2.9) (19.1) Profit on disposal of property, plant & equipment (0.1) - (0.1) - Movement in net working capital (26.1) (15.5) (10.6) (0.2) Share-base
Slide 10: Balance sheet summary
Balance sheet summary 31 December £m 30 June 2017 30 June 2016 Change 2016 Non-current assets – property, plant & equipment 104.2 99.9 4.3 101.0 – goodwill 329.3 329.3 - 329.3 – other intangible assets 39.5 45.3 (5.8) 42.3 Net working capital 24.4 14.1 10.3 0.5 Net debt (178.0) (191.3) 13.3 (164.3)
Slide 11: Net working capital
Net working capital 31 December £m 30 June 2017 30 June 2016 Change 2016 Inventories 58.3 51.0 7.3 52.2 Trade and other receivables 59.2 51.9 7.3 40.1 Trade and other payables (93.1) (88.8) (4.3) (91.8) Net working capital 24.4 14.1 10.3 0.5 Net working capital to LTM revenue 5.4% 3.5% 0.1% First
Slide 12: Banking facilities
Banking facilities Headroom at 30 June 2017: £m At 30 June 2017 Facility Headroom Bank loan 208.0 300.0 92.0 Cash and cash equivalents (29.0) - 29.0 Net debt excluding unamortised debt issue costs 179.0 121.0 Unamortised debt issue costs (1.0) Net debt 178.0 Covenant Covenant Position at 30 requirem
Slide 13: Agenda
Agenda Introduction Financial Review Business Review David Hall Martin Payne David Hall 13
Slide 14: Polypipe has a balanced portfolio across all construction markets
Polypipe has a balanced portfolio across all construction markets UK Infrastructure 6.8% UK RMI UK Commercial - Public 23.0% 10.6% UK Commercial - Private 10.5% Commercial and UK Residential infrastructure 49.5% 50.5% European Markets 15.5% UK New Build 26.5% Rest of the World 7.1% Note – LTM revenu
Slide 15: Operating segment review - Residential
Operating segment review - Residential Residential H1 2017 H1 2016 % Growth Revenue £115.0m £105.4m 9.2% Underlying operating profit £22.9m £21.5m 6.5% Underlying operating margin 19.9% 20.4% 9.2% growth driven by new house build activity Activity still strong in national house builders Strong
Slide 16: Operating segment review – C&I UK
Operating segment review – C&I UK Commercial & Infrastructure - UK H1 2017 H1 2016 % Growth Revenue £97.7m £92.7m 5.4% Underlying operating profit £14.5m £15.2m (3.9)% Underlying operating margin 14.9% 16.4% 5.4% growth against strong comparatives Demand for water management/flood alleviation an
Slide 17: Operating segment review – C&I Mainland Europe
Operating segment review – C&I Mainland Europe Commercial & Infrastructure – Mainland Europe H1 2017 H1 2016 % Growth Revenue £37.4m £31.5m 18.9% Underlying operating profit £1.5m £1.0m 32.4% Underlying operating margin 3.9% 3.4% Revenue 8.6% higher on a constant currency basis French market sho
Slide 18: Summary & outlook
Summary & outlook Strong first half performance in line with management expectations Selling price and cost reduction actions successfully implemented to mitigate second half 2016 material cost inflation Good outlook for UK housebuilding and infrastructure More difficult outlook for UK RMI a
Slide 19: Questions & Answers
Questions & Answers © Polypipe 19