Adcorp Holdings Limited · JSE:ADR
Adcorp — H1 FY2022 Earnings Presentation
23 slides from Adcorp's earnings presentation, Oct 28, 2021
Slide 1: Adcorp Interim Results FY2022
Adcorp Interim Results FY2022 DATE 28 Oct 2021
Slide 2: Forward looking statements
Forward looking statements The statements contained herein may contain certain forward-looking statements relating to the Group that are based on the beliefs of the Group’s management as well as assumptions made by and information currently available to the Group’s management. These forward-looking
Slide 3: Business overview, Financial results, Operational review, Outlook
1 2 3 4 Business overview Financial results Operational review Outlook Dr John Wentzel Noel Prendergast Bruce Toerien Dr John Wentzel
Slide 4: Business Overview
Business Overview PRESENTED BY Dr John Wentzel DATE 28 Oct 2021
Slide 5: Business Overview: Focus | Agility | Growth
Business Overview • Market recovery slow and mixed • Concentrated on improving sustainability and quality of earnings • Deployed a more agile operating model • Focused on our people and specific customer segments • Capacitated for growth Focus | Agility | Growth
Slide 6: FY2022 Interim Results
FY2022 Interim Results PRESENTED BY Noel Prendergast DATE 28 Oct 2021
Slide 7: Financial snapshot
Financial snapshot Gross profit from continuing operations Revenue from continuing operations Operating profit from continuing Profit after tax from continuing increased by 6.7% to R599 million decreased by 5.4% to R5,8 billion operations increased by 10.3% operations of R27,4 million to R71,6 milli
Slide 8: Quality of earnings – Impact of once-off items in FY2021
Quality of earnings – Impact of once-off items in FY2021 Once-off income items (H1 FY21) Once-off cost items (H1 FY21) Salary sacrifices R67 million Salary costs of departed employees R56 million COVID-19 Tax relief - ETI R25 million Retrenchment costs R24 million ECL reversals R23 million Other non
Slide 9: Summarised consolidated statement of profit or loss
Unaudited Unaudited* Period end Period end Summarised consolidated Aug 2021 Aug 2020 statement of profit or loss R'000 R'000 %Change Revenue 5,780,831 6,110,733 (5.4) Cost of sales (5,181,408) (5,549,124) 6.6 Key notes: Gross profit 599,423 561,609 6.7 Gross profit margin % 10.4% 9.2% Revenue decl
Slide 10: Segmental performance: Gross profit
Segmental performance: Gross profit (R’000) Industrial - SA Professional - SA Group 202 255 200 214 123 949 111 386 599 423 9,0% 9,0% 11,9% 11,2% 561 609 F2021 F2022 F2021 F2022 Gross Profit Gross Margin Gross Profit Gross Margin Training - SA Australia 10,4% 9,2% 214 261 188 559 73 562 8,8% 46 846
Slide 11: Segmental performance: Operating profit
Unaudited Unaudited Period end Period end Segmental performance: Aug 21 Aug 20 Operating profit (R’000) R'000 R'000 % Change South Africa - continuing operations 32,392 38,135 (15.1) Key notes: Industrial Services 44,797 59,636 (24.9) Operating profit – continuing operations Professional Services 10
Slide 12: Summarised consolidated statement of financial position
Unaudited Unaudited* Audited Period end Period end Year end Summarised consolidated Aug 21 Aug 20 Feb 21 statement of financial position R'000 R'000 R’000 Assets Property and equipment 43,922 67,796 48,286 Key notes: Right-of-use lease assets 333,072 385,020 364,572 Intangible assets and Goodwill 63
Slide 13: Cash flow movement for the period
Cash flow movement for the period • Cash management remains judicious with continued focus on working capital management • Degearing of the balance sheet remains a focus area – utilised facilities of R250 million at period end
Slide 14: Pro-forma net cash/(debt)
Unaudited Unaudited Period end Period end Pro-forma net cash/(debt) Aug 21 Aug 20 R'000 R'000 Key notes: (250,000) (629,238) Interest-bearing borrowings South African facility to August 2022 Bank overdraft - (193) Australian facility to June 2022 Discussions underway for new facilities in Tota
Slide 15: Net cash/(debt) year trend
Net cash/(debt) 5 year trend (excluding restricted cash and cash equivalents): Net cash/(debt) (excl restricted cash and cash equivalents) Deferred payment Net debt (excl restricted cash) Reporting period 200 98 52 - 0 - - - - - - - - Feb 2017 Aug 2017 Feb 2018 Aug 2018 Feb 2019 Aug 2019 Feb 2020 Au
Slide 16: Operational Review
Operational Review PRESENTED BY Bruce Toerien DATE 28 Oct 2021
Slide 17: Industrial – SA
Industrial services Industrial – SA Operational review 6 months ended 31 August 2021 6 months ended 31 August 2021 2 251 2 235 Contingent staffing revenues and gross profits stabilized. New business being won at higher margins as a consequence of client and sector focus as well as a reinvestment
Slide 18: Professional – SA
Professional – SA Operational review 6 months ended 31 August 2021 6 months ended 31 August 2021 Contraction in IT resourcing headcounts and 1 038 997 projects due to a COVID lag on high-end projects. Permanent recruitment limited in an uncertain economic environment. Growth of large scale MSP
Slide 19: Training – SA
Industrial services Training – SA Operational review 6 months ended 31 August 2021 6 months ended 31 August 2021 A solid half-year performance under new leadership. Realisation of improved revenues and gross profits as a consequence of the shift to Virtual Instructor Led Training (VILT). Manag
Slide 20: Australia
Australia Operational review 6 months ended 31 August 2021 6 months ended 31 August 2021 2 732 2 423 Margin increases across the brands due to sector diversification and improved new business margins. Significant recovery in permanent placements post economic shutdowns. Scarce skills driving m
Slide 21: Outlook
Outlook PRESENTED BY Dr John Wentzel DATE 28 Oct 2021
Slide 22: Outlook
Outlook • Australia more upside opportunity but LSA supply constraints persist • Professional constrained but Charisma & Quest more upside • Industrial outsourcing upside with BLU maintaining performance “We enable agile, focused and skilled • Training performance to continue with further product ex
Slide 23: Q&A Thank you
Q&A Thank you