Novus Holdings Ltd. · JSE:NVS
Novus — H1 FY2018 Earnings Presentation
23 slides from Novus's earnings presentation, Nov 14, 2017
Slide 1: Interim Financial Results
Presentation Tuesday, 14 November 2017 INTERIM FINANCIAL RESULTS For the six months ended 30 September 2017
Slide 2: Contents
Contents EXECUTIVE OVERVIEW FINANCIAL REVIEW OPERATIONAL REVIEW OUTLOOK & STRATEGY Presented by: Keith Vroon, Chief Executive Officer Edrich Fivaz, Chief Financial Officer CONTENTS 2
Slide 3: Executive Overview
EXECUTIVE OVERVIEW © novus holdings al “t pois ¥ eet. oF = D LF ee
Slide 4: Business Features – for six months ended 30 September 2017
Business Features – for six months ended 30 September 2017 • High volume throughput due to DBE printing being expedited. • Balance of print volume under continued pressure. Core business • Merge of Heatset and Coldset divisions brought forward. • H2 not expected to yield similar volumes or results.
Slide 5: Results Summary
Results Summary Revenue R2 295m (Sep ‘16: R2 177m) 5,4 % Operating profit excl. impairments and profit/(loss) on disposal of assets R332m (Sep ’16: R304m) 9,2 % Headline earnings per share 71,7c (Sep ’16: 63,3c) 13,3 % EXECUTIVE OVERVIEW 5
Slide 6: Financial Review
FINANCIAL REVIEW 6
Slide 7: Group Overview
Group Overview Revenue • Turnover increased by 5,4% to R2,29bn. • Timing of DBE volume 2 impacted results positively. R’000 FY15 FY16 FY17 FY18 Gross margin • Gross profit margin increased by 2,2% . 2 500 000 • Mostly driven by Print segment, however assisted by stronger 2 294 583 performance in Lab
Slide 8: Print Segment: Commentary
Print Segment: Commentary Revenue • Print revenue increased by 4,3% to R2,13bn, shaped by good throughput in print volumes. • Increase was due to the full workbook tender being printed in the first six months of the year – no further R’000 FY15 FY16 FY17 FY18 DBE work expected to accrue in second si
Slide 9: Other Segment: Commentary
Other Segment: Commentary Revenue • Growth in Label volumes pleasing on the back of gravure label revenues doubling compared to the previous period. • Tissue volumes increased by 5,1% compared to the previous period, assisted by TM2 being operational for the six month R’000 FY15 FY16 FY17 FY18 perio
Slide 10: Group Income Statement Summary (Six months ended 30 Sep 2017)
Group Income Statement Summary (Six months ended 30 Sep 2017) 2017 2016 % Change (Rounded) Revenue R 2 295 m R 2 177 m 5,4 % ▲ Gross profit R 659 m R 576 m 14,4% ▲ Gross margin 28,7 % 26,5 % 2,2 % ▲ Fixed overheads R 327 m R 272 m 20,2 % ▲ Operating profit R 332 m R 304m 9,2 % ▲ (Excluding impairmen
Slide 11: Cash Position Analysis
Cash Position Analysis Six months ended Six months ended Free cash flow 30 Sep 2017 (R’m) 30 Sep 2016 (R’m) • Timing of the workbook project Cash generated from operations -37 ▼ 49 cash receipts reduced cash Net property, plant, equipment and intangibles -76 ▲ -138 generated from operations. Taxatio
Slide 12: Capital Expenditure
Capital Expenditure Print segment Other segment R137m Tissue • Expansion capex of R60m incurred to date related to TM2 project completion and refurbishment of TM1. • Proceeds of R8,3m was realised on the sale of Printing segment converting equipment (impaired during March 2017). • Expenditure of R14
Slide 13: Operating Review
OPERATING REVIEW © novus holdings
Slide 14: Revenue Contribution: Print Product Category
Revenue Contribution: Print Product Category Share of Group Share of Group Volume Category Revenue Sep 2017 Revenue Sep 2016 Growth/(Decline) YTD YTD Magazines 15,6 % 19,7% (18,3%) ▼ The Print division remains at the core ▼ of Novus Holdings and Newspapers 18,3% 21,9% (15,5%) contributed 92% to Grou
Slide 15: Revenue Contribution: Other Product Category
Revenue Contribution: Other Product Category Share of Group Share of Group Volume Category Revenue Sep 2017 Revenue Sep 2016 Growth/(Decline) YTD YTD Labels 4,1% 2,6% 97,0% ▲ This segment currently contributes 8,0% of revenue, but is the area Tissue 3,2% 3,7% 5,1% ▲ of biggest potential for the Grou
Slide 16: Current Matters & Outlook
CURRENT MATTERS & OUTLOOK © novus holdings
Slide 17: Status Update on Current Matters
Status Update on Implementation of Media24 unbundling Current Matters • The unbundling was implemented on 26 September 2017. • 35 141 309 Novus Holdings shares were placed at R6,15, a 1,3 % premium to the closing price on that day. • Good spread of shareholders. • Existing shareholders retaining or
Slide 18: Acquisitions
Acquisitions ITB Acquisition • Novus Holdings acquired ITB, effective 1 October 2017. • Initial amount of R180m paid. • Earn out capped at R300m. Management • Earn out process to 28 February 2018. • Current management remain beyond earn out. • Operational and advisory capacity. Operational update •
Slide 19: Segment Focus Areas
Segment Focus Areas Print Tissue Labels / Packaging • Continued publication volume • Projects successfully completed: • Significant tenders adding good decline. • Expansion; volume. • Retail season imminent. • Upgrade / refurbishment; • Seasonality upside. • Forex situation volatile, but Novus • Con
Slide 20: Group Outlook
Group Outlook 1 2 3 Challenging operating Continued volume Match operational environment and decline in most traditional print capacity to market depressed economic market segments. demand through continuous outlook with currency (Media24 pricing pressure) evaluation of operations, and volatility re
Slide 21: Questions
‘or QUESTIONS © novus holdings
Slide 22: Appendix
APPENDIX 22
Slide 23: Investor Relations Contacts
Investor Relations Contacts +27 21 550 2500 Investor.Relations@novus.holdings