Reliance Worldwide Corp. Ltd. · ASX:RWC
Reliance Worldwide — FY2018 Earnings Presentation
27 slides from Reliance Worldwide's earnings presentation, Aug 27, 2018
Slide 1: FY2018 Results Presentation
RELIANCE WORLDWIDE CORPORATION LIMITED ACN 610855877 FY2018 RESULTS PRESENTATION 27 August 2018 Reliance Worldwide Corporation Limited INVESTOR PRESENTATION FY18 RESULTS | PAGE 0
Slide 2: Important Notice
Important Notice This presentation contains general information about Reliance Worldwide Corporation Limited’s activities at the date of presentation (27 August 2018). It is information given in summary form and does not purport to be complete. The presentation is not an offer or invitation for subs
Slide 3: Agenda
Agenda 1. Highlights 3 2. Financial Performance 7 3. Strategy 15 4. John Guest Acquisition 17 5. New Market Opportunities 21 6. Outlook 24 Reliance Worldwide Corporation Limited INVESTOR PRESENTATION FY18 RESULTS | PAGE 2
Slide 4: Highlights
01. HIGHLIGHTS Reliance Worldwide Corporation Limited PAGE 3
Slide 5: Key Highlights
Key Highlights Double digit growth in sales and EBITDA led by core SharkBite Push-to-Connect (“PTC”) fittings and accessories, good growth across both EMEA and APAC and first full year inclusion of Holdrite Further penetration of SharkBite PTC in North America. SharkBite products now available in
Slide 6: FY18 Financial Highlights
FY18 Financial Highlights Net sales Adjusted EBITDA1 Adjusted NPAT1 $769.4 million $150.9 million $78.6 million +28% growth2, +30% on a +25% growth2 +20% growth2 constant currency basis Continued strong Balance Sheet Final dividend sales growth from strength declared of 3.0 cps America
Slide 7: Continuing RWC's long-term track record of strong growth
Continuing RWC’s long-term track record of strong growth RWC historical net sales growth, constant currency basis1 (A$M) 1 Period from FY2008 to FY2018. Pro forma net sales calculated based on a constant currency basis of AUD/USD: 0.7752, AUD/GBP: 0.5760, AUD/CAD: 0.9841, AUD/NZD: 1.0842, AUD/EUR: 0
Slide 8: Financial Performance
02. FINANCIAL PERFORMANCE Reliance Worldwide Corporation Limited PAGE 7
Slide 9: FY18 Consolidated Results
FY18 Consolidated Results Commentary June Year End (A$m) FY18 FY17 Variance Net Sales 769.4 601.7 +28% Net sales up 28% compared to FY17 (+30% on a constant currency basis) Reported EBITDA 135.4 120.7 +12% EBITDA margin 17.6% 20.1% (250bps) Solid performance across all 3 segments1: Americas (+29
Slide 10: Segment Results – Americas
Segment Results – Americas June year end (A$m) FY18 FY17 Variance Net sales1 559.7 435.3 + 29% EBITDA2 95.4 74.6 + 28% EBITDA margin 17.0% 17.1% (10 bps) Adjusted EBITDA3 101.4 74.6 + 36% Adjusted EBITDA margin 18.1% 17.1% +100 bps Financial commentary Operational commentary Net sales growth of 29
Slide 11: Segment Results – Asia Pacific
Segment Results – Asia Pacific June year end (A$m) FY18 FY17 Variance Net sales1 232.0 218.1 + 6% EBITDA2 52.4 47.5 + 10% EBITDA margin 22.6% 21.8% +80 bps Financial commentary Operational commentary Net sales growth of 6% compared to FY17 Strong SharkBite production to meet demand in the Americ
Slide 12: Segment Results – EMEA
Segment Results – EMEA June year end (A$m) FY18 FY17 Variance Net sales1 81.1 50.1 n/m EBITDA2 8.3 0.5 n/m EBITDA margin 10.2% 1.0% n/m Adjusted EBITDA3 2.5 0.5 n/m Adjusted EBITDA margin 4.0% 1.0% n/m Financial commentary Operational commentary Net sales increase of 62% compared to FY17 inclusive
Slide 13: Strong Cash Flow Generation
Strong Cash Flow Generation Commentary June year end (A$m) FY18 FY17 Variance Reported EBITDA 135.4 120.7 + 12% Cash flow from operations Add back Transaction Costs generated1 $124.8 million in FY18, 20.5 - n/m expensed an increase of 25% over FY17 and Changes in Working Capital (31.1) (21.2) - 47
Slide 14: Capital expenditure
Capital expenditure Historical Cap Ex (A$M) and Cap Ex as a % of Net Sales Commenced Cullman Phase 1 Property Capacity Expansion of construction of expansion acquisition in expansion product range, Cullman facility completed, Cullman supporting core capacity and increasing brass PTC product efficien
Slide 15: Balance Sheet Strength
Balance Sheet Strength Debt metrics Commentary A$m 30 June 2018 30 June 2017 Strong balance sheet with pro forma net leverage of 1.57x at 30 Cash and cash equivalents 274.3 35.0 June 20181 Gross debt 662.3 270.4 Higher working capital compared with 30 June 2017 to support a Net debt 388.0 235.4
Slide 16: Strategy
03. STRATEGY Reliance Worldwide Corporation Limited PAGE 15
Slide 17: Driving Shareholder Value
Overview of Growth Strategy Invest in the core • Continued penetration of core brass PTC fittings & accessories in Americas • Growth in core valves, pipe, thermostats across all existing geographies Disciplined M&A to Create new solutions accelerate growth Driving • Pursue adjacent “tuck • New produ
Slide 18: John Guest Acquisition
04. JOHN GUEST ACQUISITION Reliance Worldwide Corporation Limited PAGE 17
Slide 19: Strategically compelling acquisition, positioning RWC for continued growth
Strategically compelling acquisition, positioning RWC for continued growth into the future 1 Creates 2 Transforms 3 Extension and a global leader in PTC technology, with global RWC’s UK business, provides a strong platform for further growth in diversification distribution and strong regional Europe
Slide 20: Combining RWC and John Guest has created a global leader in PTC technology
Combining RWC and John Guest has created a global leader in PTC technology Americas EMEA Asia Pacific USA Canada UK Europe Australia Brass PTC #1 #1 Launched Minimal #1 Plastic PTC #1 #1 #1 Top 2-3 #1 PEX pipe Top 3 Launched Top 2 N.A. #2 Water heater #1 #1 #1 N.A. #1 valves1 Shading represents key
Slide 21: Update on John Guest acquisition and integration activities
Update on John Guest acquisition and integration activities Post close integration activities are underway with dedicated integration teams in all 3 regions – EMEA, APAC and the Americas Early efforts have been focused on change management and bringing together the two cultures and seeking to le
Slide 22: New Market Opportunities
05. NEW MARKET OPPORTUNITIES Reliance Worldwide Corporation Limited PAGE 21
Slide 23: HydroFlame Pro Series
HyroFlame Pro Series End use • Commercial new construction • Multi-family residential, concrete buildings Scenario Building codes require firestopping material in through penetrations (pipes, cables, etc.) in concrete floors Current challenges Manual, built-in-place systems (mineral wool & fire caul
Slide 24: Streamlabs
Streamlabs End use • Single family residential Scenario Water monitoring and leak detection Current challenges • Leaks are typically not discovered until too late resulting in significant water damage • Insurance industry pays out $multi- billion annually in water damages in the U.S. Streamlabs solu
Slide 25: Outlook
06. OUTLOOK Reliance Worldwide Corporation Limited PAGE 24
Slide 26: FY19 Outlook
FY19 Outlook FY19 forecast EBITDA of $280 million to $290 million, including actual synergies expected to be realised in FY19 and excluding one-off integration costs expected to be incurred1 Realised synergies to be achieved are expected to be $20 million p.a. on a run rate basis (excluding one-
Slide 27: Reliance Worldwide Corporation Limited
Reliance Worldwide Corporation Limited PAGE 26