Slide 1: Bodycote FY24 Results
BODYCOTE. FY24 RESULTS. 14 March 2025
Slide 2: Disclaimer
Disclaimer Bodycote plc (the ‘Group’) is providing the following cautionary statement: this presentation has been prepared solely to provide additional information to shareholders to assess the Group’s strategies and the potential for those strategies to succeed. The presentation should not be relie
Slide 3: Agenda
AGENDA 01 INTRODUCTION 02 FY24 RESULTS 03 STRATEGY UPDATE 04 Q & A Bodycote plc Full Year 2024 Results 3
Slide 4: Introduction. Jim Fairbairn
INTRODUCTION. JIM FAIRBAIRN. Bodycote plc Full Year 2024 Results 4
Slide 5: Resilient performance & new strategy in place
01 INTRODUCTION Resilient performance & new strategy in place Key highlights: Improved financial performance in 2024 despite 01 challenging market conditions New reporting structure: two leading divisions delivering 02 performance metallurgy for critical applications Strategic clarity with new Optim
Slide 6: Early progress on strategic targets
01 INTRODUCTION Early progress on strategic targets Strong growth Improved mix Higher margin Attractive returns Converting to cash TARGET Mid-single-digit 35-40% >20% 15-20% 80-90% total revenue growth return on capital average through cycle revenue from Specialist adjusted operating employed throug
Slide 7: Resilient performance in 2024
01 INTRODUCTION Resilient performance in 2024 +1.0% Core organic growth, excluding surcharges: ▪ Led by Specialist Technologies: process adoption, strong Aerospace and Energy demand and market share gains ▪ Precision Heat Treatment resilient despite challenging conditions in Automotive and Industria
Slide 8: FY Results. Ben Fidler
FY RESULTS. BEN FIDLER. Bodycote plc Full Year 2024 Results 8
Slide 9: Key highlights
02 FY24 RESULTS Key highlights Improved performance in 2024 across key metrics Core revenue growth Core operating margin Cash conversion +1.0% 17.9% 90% (organic1, excluding surcharges) +120bps vs 2023 Operating cash flow conversion (2023: 88%) Return on capital Carbon reduction Shareholder returns
Slide 10: Results summary
02 FY24 RESULTS Results summary Core organic revenue growth (ex. surcharges) and good margin progress delivered Growth Growth £m, unless stated FY 2024 FY 2023 Organic Total CORE Revenue 712.5 747.3 -2.9% -4.7% +1.0% organic Core revenue growth (ex. surcharges) Revenue ex. surcharges 679.6 685.5 1.0
Slide 11: Increased profit despite challenging markets
02 FY24 RESULTS Increased profit despite challenging markets ▪ Revenue growth and better operational performance driving profit and margin improvement in Specialist Technologies ▪ Lower volumes impacting Precision Heat Treatment, with margins held broadly stable through cost actions ▪ Lower Central
Slide 12: Good progress towards >20% margin
02 FY24 RESULTS Good progress towards >20% margin ▪ Significant margin improvement delivered in 2024 for both Core and total Group ▪ Optimise, Perform and Grow initiatives in place to drive improvement to >20% by 2028 Adjusted operating margin including surcharges) FY 2024 improvement Grow Core >20%
Slide 13: Specialist Technologies
02 FY24 RESULTS Specialist Technologies Continued growth and significant expansion in operating margins FY FY Growth Growth ▪ Total growth of 5.5%, with positive contribution from Lake City £m 2024 2023 Organic Total (c.£10m) partly offset by FX headwinds (-£5m) Revenue 224.2 212.4 3.3% 5.5% ▪ 3.3%
Slide 14: Precision Heat Treatment
02 FY24 RESULTS Precision Heat Treatment Proactive cost base management in response to challenging market backdrop FY FY Growth Growth ▪ Organic revenue decline of 5.3% driven by surcharges. Resilient £m 2024 2023 Organic Total underlying performance, down 0.8% excluding surcharges Revenue 488.3 534
Slide 15: Exceptional Items
02 FY24 RESULTS Exceptional Items £m, unless stated FY 2024 FY 2023 Adjusted operating profit 129.0 127.6 Amortisation of acquired intangible assets (10.4) (8.1) Acquisition costs (2.4) (0.3) Exceptional items (78.3) - Operating profit 37.9 119.2 £78.3m total exceptional charge £31.9m £18.0m £28.4m
Slide 16: Strong cash conversion
02 FY24 RESULTS Strong cash conversion £m FY 2024 FY 2023 Change Adjusted operating profit 129.0 127.6 +1.4 Depreciation & amortisation 75.3 74.0 +1.3 Other (5.6) (2.7) -2.9 Adjusted EBITDA 198.7 198.9 -0.2 Adjusted EBITDA stable year-on-year Capital expenditure (60.5) (72.0) +11.5 Principal element
Slide 17: Disciplined and balanced capital allocation
02 FY24 RESULTS Disciplined and balanced capital allocation ▪ Net debt (excluding leases) of £68.3m at year-end; leverage remains low at ~0.3x net debt/EBITDA ▪ Continued capex investment and successful acquisition of Lake City ▪ Return on capital employed up 90bps to 15.7% (2023: 14.8%), reflecting
Slide 18: Technical guidance
02 FY24 RESULTS Technical guidance FY 2025 Translational foreign exchange1 FY 2024 Guidance Revenue impact £(24.3)m ~£(7)m Expected translational FX impacts for FY 2025 Adjusted operating profit impact £(4.9)m ~£(1)m based on latest FX rates1 Other items FY 2024 FY 2025 Capital expenditure £60.5m ~£
Slide 19: Strategy Update. Jim Fairbairn
STRATEGY UPDATE. JIM FAIRBAIRN. Bodycote plc Full Year 2024 Results 19
Slide 20: Clear strategy now in place
03 STRATEGY UPDATE Clear strategy now in place Two strong platforms with defined focus areas Specialist Technologies Precision Heat Treatment ▪ Highly differentiated processes ▪ Clear market leader ▪ Leading technology positions ▪ Global scale & network ▪ Growing addressable market ▪ Deep customer p
Slide 21: Early progress, with acceleration in 2025 and 2026
03 STRATEGY UPDATE Early progress, with acceleration in 2025 and 2026 Strategic initiative 2024 2025 2026 2027+ Optimise planning Overhead actions largely OPTIMISE complete by end of 2025 Overhead actions Full £12-14m run-rate Optimise benefits by end of 2026 Plant consolidations HEAT development Pi
Slide 22: Progressing at pace with footprint optimisation
03 STRATEGY UPDATE Optimise Progressing at pace with footprint optimisation ▪ Plan to exit non-core activities (retaining a third of revenue at higher margins), and deliver a reduction in overhead costs ▪ Actions underway, with consolidation commenced at >1/3 of target sites and ~1/3 of overhead red
Slide 23: Improving our performance: HEAT
03 STRATEGY UPDATE Perform H E A T Improving our performance H ▪ Employee engagement High ▪ Employee retention Company Impact performance culture ▪ Support enhanced growth & ▪ Training & development improved margins E ▪ Execution rigour ▪ Turnaround time Enhanced ▪ Utilisation service quality Employ
Slide 24: HEAT: Enhanced service quality
03 STRATEGY UPDATE Perform H E A T HEAT: Enhanced service quality ▪ We have a reputation for quality and expertise, but turnaround time, customer experience, and productivity are variable ▪ We are rolling out lean problem-solving tools and training to help local teams to improve performance ▪ Early
Slide 25: HEAT: Transition to a sustainable future
03 STRATEGY UPDATE Perform H E A T HEAT: Transition to a sustainable future ▪ 6% reduction delivered in CO2e emissions in 2024 ▪ Achieved existing SBTi approved target of 28% reduction versus 2019 levels, six years early CASE STUDIES ▪ New target set: 46% lower Scope 1&2 emissions by 2030 Improving
Slide 26: Driving our growth strategy
03 STRATEGY UPDATE Grow Driving our growth strategy ▪ Investment focused on target areas with high growth and margin potential, where Bodycote has a strong ability to win ▪ Organic capital projects either underway or approved to start in the next 6-12 months, aligned to our growth strategy Ongoing o
Slide 27: 2025 Outlook
03 STRATEGY UPDATE 2025 Outlook All guidance is provided on an organic constant currency basis: ▪ End markets remain mixed, with challenging conditions in Automotive and Industrial. Structural demand in Aerospace & Defence remains strong, although there continues to be a temporary impact from indust
Slide 28: Q & A
Q&A Bodycote plc Full Year 2024 Results 28
Slide 29: Appendix
Appendix Bodycote plc Full Year 2024 Results 29
Slide 30: Non-core
APPENDIX Non-core Reduced revenue and profitability; Optimise programme underway to exit activity FY FY Growth Growth ▪ Plan to exit all Non-Core sites as part of the Optimise programme £m 2024 2023 Organic Total ▪ Revenue reduction reflects: Revenue 44.6 55.2 -17.1% -19.2% High exposure to Automoti
Slide 31: FY 2024 Statutory income statement
APPENDIX FY 2024 Statutory income statement £m FY 2024 FY 2023 Revenue 757.1 802.5 Adjusted operating profit 129.0 127.6 Amortisation of acquired intangible assets (10.4) (8.1) Acquisition costs (2.4) (0.3) Exceptional items (78.3) - Operating profit 37.9 119.2 Net finance charge (9.5) (7.5) Profit
Slide 32: FY 2024 Cash flow statement
APPENDIX FY 2024 Cash flow statement £m FY 2024 FY 2023 Adjusted EBITDA 198.7 198.9 Net capital expenditure (60.5) (72.0) Principal element of lease payments (13.5) (13.0) Provisions movement (7.3) (0.9) Cash flow has been restated to: Working capital movement (1.9) (0.8) ▪ Include outflows from exp
Slide 33: Foreign Exchange
APPENDIX Foreign Exchange B/S currency (at closing rates) FY 2024 FY 2023 EUR 1.21 1.15 USD 1.25 1.27 SEK 13.84 12.76 TRY 44.29 37.59 Annual Annual P&L currency % of FY 2024 revenue profit (at average rates) FY 2024 FY 2023 revenue sensitivity1 sensitivity1 EUR 1.18 1.15 34% ~£2.5m ~£0.5m USD 1.27 1
Slide 34: Definitions
APPENDIX Definitions Term Definition Organic measures At constant currency, and excluding corporate acquisition and disposal activities from the current and comparative periods Adjusted operating profit Operating profit before acquisition costs, exceptional items and amortisation of acquired intangi