G8 Education Limited · ASX:GEM
G8 Education — FY2015 Earnings Presentation
26 slides from G8 Education's earnings presentation, Feb 22, 2016
Slide 1: G8 Education – 2015 Results Presentation
For personal use only G8 Education – 2015 Results Presentation G8 Education Limited (ASX:GEM) 22 February 2016
Slide 2: Corporate Snapshot
Corporate Snapshot For personal use only Key Financial Highlights CY15 Capital Structure Underlying EBIT $145.4m Fully Paid Ordinary Shares (current) 374.7m Share Price (as at 3 Feb 2016) $3.32 Like For Like Centre Organic EBIT Growth $8.3m Market Capitalisation (as at 3 Feb 2016) $1.25bn Underlying
Slide 3: Key developments since last reporting date
Key developments since last reporting date For personal use only Since our last reporting date, the following key developments have taken place: 1. Appointment of a new Chairman of the Board of Directors – Mark Johnson 2. Appointment of a new Group Auditor – Ernst and Young 3. Appointment of an addi
Slide 4: Financial Strategy
Financial Strategy For personal use only The Group’s primary financial objective is to maintain year on year double digit earnings per share growth through: 1. Occupancy Growth Driven by sustaining the execution of the G8 corporate model with an emphasis on first class care provision through on goin
Slide 5: Group Financial Update
For personal use only Group Financial Update
Slide 6: CY Income Statement
CY 15 Income Statement For personal use only 2015 2014 Consolidated Year end 31 December $'000 $'000 • Revenue increased by 44% year on year rising Revenue* 703,547 488,402 from $488m in 2014 to $703m in 2015. Expenses (543,124) (382,437) • Wages as a percentage of revenue from Earnings Before Inter
Slide 7: Balance Sheet
Balance Sheet For personal use only 2015 2014 $'000 $'000 Following the decision to appoint Ernst & Young as external ASSETS auditor for 2016, the Company has engaged Ernst & Young to Current assets perform specific procedures to compare G8’s current accounting Cash and cash equivalents 193,840 120,
Slide 8: Cash Flow
Cash Flow For personal use only 2015 2014 $'000 $'000 Cash flows from Operating Activities Receipts from customers 676,870 494,744 • Operating cash flow in 2015 was strong at $95.1m compared Payments to suppliers and employees (516,762) (383,483) to $74.7m in 2014. Interest received 2,861 2,919 Inte
Slide 9: Cashflow Generation & Conversion
Cashflow Generation & Conversion For personal use only Historic cash conversion G8 has consistently delivered high levels of cash 103% 103% conversion from underlying EBITDA 99% 90% • Stable and growing revenues generated by occupancy growth and market based fee rises • Controllable and well underst
Slide 10: Debt Structure
Debt Structure For personal use only G8’s debt structure as at 31 December 2015 consists of the following debt instruments: Principle Currency Cost Maturity A$70,000,000 AUD 7.65% 7 August 2019 A$50,000,000 AUD BBSW + 3.90% 17 February 2018 S$175,000,000 SGD 4.75% 19 May 2017 S$85,000,000 SGD 4.75%
Slide 11: Key performance metrics
For personal use only Key performance metrics
Slide 12: Full year like for like EBIT performance
Full year like for like EBIT performance For personal use only Full Year Like for Like EBIT $000 Vintage Number 2011 2012 2013 2014 2015 Growth of CY15 on centres CY14 Acquired pre 2011 74 15,682 17,298 21,021 21,579 4,019 2,440 • Like for like EBIT margin % increase 10% 22% 3% 11% increased to 23.8
Slide 13: Like for Like ‐ Occupancy
Like for Like ‐ Occupancy For personal use only LFL Peak Occupancy Vintage Number of centres 2011 2012 2013 2014 2015 Acquired pre 2011 74 86% 86% 87% 87% 85% Acquired in 2011 43 ‐ 93% 95% 94% 93% Acquired in 2012 33 ‐ 95% 94% 93% Acquired in 2013 74 87% 85% Like for likes calculated based on owners
Slide 14: Support Office Cost per Licensed Place
Support Office Cost per Licensed Place For personal use only 2010 2011 2012 2013 2014 2015 Number of Places 6,304 9,868 12,661 17,597 32,782 35,221 Support Office Cost per Licensed Place $710 $523 $520 $485 $455 $439 • Support office cost per licensed place fell in 2015 to $439. • Efficiency and pro
Slide 15: Organic Growth Case Studies
For personal use only Organic Growth Case Studies
Slide 16: Operational case studies
Operational case studies For personal use only A selection of group acquisitions demonstrates the Group’s ability to drive organic EBIT growth via the execution of the G8 corporate model: Purchase Price $'000 97,480 $'000 CY15 • Ramsay Bourne – 25 Centres acquired in March 2010 Revenue 155,239 • Loc
Slide 17: Operational Excellence – Case Studies
Operational Excellence – Case Studies For personal use only Name of Acquisition Ramsay Bourne Name of Acquisition Local Kids Number of Centres 25 Number of Centres 19 Date Acquired Mar‐10 Date Acquired Sep‐10 Purchase Price 16,000,000 Purchase Price 14,300,000 $'000 CY11 CY12 CY13 CY14 CY15 $'000 CY
Slide 18: Operational Excellence – Case Studies
Operational Excellence – Case Studies For personal use only Name of Acquisition Kindy Patch Name of Acquisition Kids Korner Number of Centres 24 Number of Centres 6 Date Acquired Jan‐11 Date Acquired Apr‐11 Purchase Price 22,300,000 Purchase Price 7,080,000 $'000 CY12 CY13 CY14 CY15 $'000 CY12 CY13
Slide 19: Operational Excellence – Case Studies
Operational Excellence – Case Studies For personal use only Name of Acquisition Roly Poly Name of Acquisition Pacific Group Number of Centres 8 Number of Centres 16 Date Acquired Sep‐13 Date Acquired Sep‐12 Purchase Price 28,000,000 Purchase Price 9,800,000 $'000 CY13 CY14 CY15 $'000 CY14 CY15 Reven
Slide 20: Operational Update
For personal use only Operational Update
Slide 21: Business Organisation Flow Chart
Business Organisation Flow Chart For personal use only Non executive director Non executive director Chairman Non executive director Non executive director Revenue Generation Revenue Accounting Managing Director Big Four Auditors & Misc Lawyers Chief Executive Officer Advice for Chief Financial Offi
Slide 22: Acquisitions Responsibility Flow Chart
Acquisitions Responsibility Flow Chart For personal use only Direct approaches, repeat Source vendors, broker introductions G8 CFO Financial Modelling 5% Acquisitions Minter Ellison Various Legal due diligence 15% G8 Operational due diligence Modelling GMO 55% Operations Due Diligence Review Settlem
Slide 23: Portfolio Update
For personal use only Portfolio Update
Slide 24: Group Centre Portfolio
Group Centre Portfolio For personal use only Centre Portfolio • The Group added 44 new centres and 13,697 licensed places in 2015 Australian centres Singapore centres • Disciplined consolidation in high demand areas continues to be our focus 18 18 • As at 31 Dec 2015 the Group owned 471 centres in A
Slide 25: Mission Statement
Mission Statement For personal use only G8’s key strategic objective is to be the leading provider of high quality, developmental and education childcare services in both Australia and Singapore. By building and operating a portfolio of outstanding early childhood education brands, focusing on the i
Slide 26: Questions? Thank you
For personal use only Questions? THANK YOU