Bodycote Plc · LSE:BOY
Bodycote — FY2004 Earnings Presentation
19 slides from Bodycote's earnings presentation, 2005
Slide 1: 2004 Preliminary Results
[Bodycote 2004 PRELIMINARY RESULTS
Slide 2: Highlights
Highlights 1,2 • Sales +9% • Operating Profit 1,2,3 +20% • Free Cash Flow +88% 3 • Headline EPS +24% • ROCE Improved +46% • Divestiture of Electroplating • Joint Venture • Four Small Acquisitions 1 Excluding electroplating and PVD 2 At constant currency rates 3 Pre exceptional items and pre Goodwill
Slide 3: Preliminary Results
Preliminary Results 2004 2003 Change £m £m % Restated Sales 457.2 448.4 +2 EBITDA* 95.8 87.4 +10 Operating Profit* 52.1 41.7 +25 Profit before Tax* 44.2 32.0 +38 Profit/(loss) before Tax 24.5 (11.1) - Tax (5.6) (6.2) -10 Profit/(loss) after tax 18.9 (17.3) - Free cashflow 57.1 30.3 +88 Headline EPS*
Slide 4: Profit Bridge
Profit Bridge £m Operating Profit** 2003 41.4 Selling Prices 2.0 Sales Volume 13.1 Salary/Wage Inflation (4.0) Energy Costs (0.7) Maintenance Costs (1.5) Acquisitions 0.5 Electroplating Reduced Losses 3.8 Operating Profit 2004 at constant exchange rates 54.6 Currency Translation (2.5) Operating Prof
Slide 5: Impact Of Exchange Rates
Impact Of Exchange Rates Sales Operating Profit* £m £m 2004 As Reported 457.2 52.1 2004 Using 2003 Rates 476.6 54.6 Impact (19.4) (2.5) * Pre Goodwill and Exceptional items 5 2004 Preliminary Results
Slide 6: Exceptional Items
Exceptional Items 2004 2003 Exceptional Items £m £m Electroplating - Goodwill - (11.1) - Fixed Assets - (18.9) - Costs (7.4) - (7.4) (30.0) PVD transfer to IonBond - Assets (2.8) - - Costs (1.0) - (3.8) Profit on disposal of discontinued operations - 3.5 Operating Exceptional Items Plant Restructuri
Slide 7: Sales and Operating Profit - By Region
Sales and Operating Profit - By Region 2003 2004 Europe North America UK Rest of World £m £m £m £m £m £m Sales 302.5 Heat Treatment 309.0 178.3 101.9 28.8 - 61.2 Materials Testing 65.6 9.7 30.3 20.5 5.1 27.6 Hot Isostatic Pressing 32.1 9.0 18.4 4.7 - 18.4 Surface Engineering 19.4 14.4 1.4 3.6 - 409.
Slide 8: Sales By Market
Sales By Market 2004 2003 % % Sector Automotive - Cars & Light Truck 24 24 - Heavy Truck & Bus 5 4 Aerospace/Defence 17 17 Construction, Agricultural, Railways & Marine 15 15 Tooling 11 13 Oil & Gas 6 6 Power Generation 5 4 Consumer Products 4 4 Health Science & Environmental 5 4 Electronics & Telec
Slide 9: Summary Cash Flow and Financial Ratios
Summary Cash Flow and Financial Ratios 2004 2003 £m £m EBITDA* 95.8 87.4 Working Capital Movement 8.5 (3.6) CAPEX (34.0) (38.3) Interest (7.8) (10.3) Tax (5.4) (4.9) Free Cash Flow 57.1 30.3 Net Debt/EBITDA 0.9x 2.4x Interest Cover* 6.6x 4.3x Gearing 20% 56% Free Cash Flow 12% 7% Capex/Depreciation
Slide 10: Balance Sheet
Balance Sheet 2004 2003 £m £m Goodwill 131.4 137.5 Tangible Fixed Assets 428.7 478.7 Investments 6.2 0.9 Trading Working Capital 26.3 35.8 Other Net Current Assets (68.2) (70.8) 524.4 582.1 Shareholders’ Funds 434.9 370.9 Minority Interests 1.0 0.9 Net Borrowings 88.5 210.3 524.4 582.1 10 2004 Preli
Slide 11: IFRS Implementation
IFRS Implementation Work to date has identified the following areas of impact: £m • Retirement Benefits - Liability increase Dec 04 22.0 • Proposed Dividends - Liability reduction Dec 04 12.3 • Deferred Tax - Liability increase Dec 04 17.3 • Goodwill - No amortisation in 2004 P&L 8.5 • Share Based P
Slide 12: Strategy Implementation
Strategy Implementation • Bodycote positioned as subcontractor of choice • Focused on core businesses • Competitive advantages being exploited • Roll-out proprietary value added processes • Infill existing markets • Follow customer expansion into low cost areas • Development of people 12 2004 Prelim
Slide 13: Heat Treatment
Heat Treatment Revenue (₤m) 400 350 337.1 302.1 302.5 309.0 • France/USA 300 250 228.7 200 150 • Leveraging customer base 100 50 0 • Rolling out proprietary 2000 2001 2002 2003 2004 processes Operating Profit (₤m) 70 60.0 60 • Danish acquisition 50 53.2 40 36.4 34.2 31.5 30 • Eastern Europe 20 10 0
Slide 14: Materials Testing
Materials Testing Revenue (₤m) 70 65.6 61.2 60 56.6 52.3 50 43.7 • Spreading technologies 40 30 20 10 • Outsourcing 0 2000 2001 2002 2003 2004 Operating Profit (₤m) • Two acquisitions: UK and Canada 14 12.4 12 11.4 10.9 9.9 10 8.7 8 6 4 2 0 2000 2001 2002 2003 2004 14 2004 Preliminary Results
Slide 15: Hot Isostatic Pressing
Hot Isostatic Pressing Revenue (₤m) 40 36.5 35 32.0 32.1 • Volume growth plus operational 30 28.5 27.6 gearing 25 20 15 • Applications being developed: 10 • Densal II® 5 • ALON 0 • Metal Matrix Composites 2000 2001 2002 2003 2004 • Extruded duplex pipe Operating Profit (₤m) • 2000 impacted by Busine
Slide 16: Surface Engineering
Surface Engineering Revenue (₤ m) 25 19.4 20 18.4 17.0 17.3 • Diffusion bonding 15 • K Tech 10 • CoatAlloy® 5.7 5 • Sherardizing 0 • Thermal Spray 2000 2001 2002 2003 2004 • Anodising and organics Operating Profit (₤ m) 4 3.3 2.9 3 2.2 2.3 2 1.1 1 0 2000 2001 2002 2003 2004 16 2004 Preliminary Resul
Slide 17: Current Trading and Prospects
Current Trading and Prospects • 05 started in line with expectations • Aerospace and IGT markets exhibiting encouraging signs • Automotive and tooling sectors soft • Impact of energy costs being managed • Outsourcing demand continues • Confident of further progress in 05 17 2004 Preliminary Results
Slide 18: Highlights
Highlights 1,2 • Sales +9% • Operating Profit 1,2,3 +20% • Free Cash Flow +88% 3 • Headline EPS +24% • ROCE Improved +46% • Divestiture of Electroplating • Joint Venture • Four Small Acquisitions 1 Excluding electroplating and PVD 2 At constant currency rates 3 Pre exceptional items and pre Goodwill
Slide 19: Slide 19