Avingtrans Plc · LSE:AVG
Avingtrans — Merger or Acquisition (September 2004)
19 slides from Avingtrans's merger presentation, September 2004
Slide 1: Investor presentation September 2004
Investor presentation September 2004 1 1
Slide 2: Confidentiality and important notice
•The Presentation is confidential and is being supplied to you for your own information. It may not directly or indirectly be reproduced, further distributed to any person or published, in whole or in part, for any purposes whatsoever. The distribution of this document in other jurisdictions may be
Slide 3: Agenda
Agenda • The Proposition • Metalcraft • Strategic benefits of the Acquisition • Financial Effect of the Acquisition • Avingtrans results for year to 31 May 2004 • Conclusion Appendices • I Avingtrans PLC • II Avingtrans Board • III Share Price Performance • IV The Crown Acquisition • V The Boneham &
Slide 4: The Proposition
The Proposition • A reverse acquisition of Stainless Metalcraft (Chatteris) Limited from Ferraris Group PLC for £8.1m, including the assumption of £0.5m of hire purchase debt facility 4 £7.5m cash on completion, £0.1m deferred (payable after 12 months) • Total funds to be raised of £8.7 million 4 £4
Slide 5: Metalcraft
Metalcraft • Producer of fabricated and machined products to major suppliers of diagnostic imagery and Magnetic Resonance Imaging (MRI) • Other products include: 4 pressure and vacuum containment vessels 4 inertia tubes and shields used for particle accelerators, nuclear magnetic resonance systems,
Slide 6: Strategic benefits of the Acquisition
Strategic benefits of the Acquisition • In line with Avingtrans’ acquisition strategy 4 Involved in precision engineering sector 4 Strong presence within a growing market sector 4 Track record of profitability 4 Strong asset backing • Increases scale of Avingtrans business 4 Metalcraft revenue of £1
Slide 7: Magnetic Resonance Imaging (MRI)
Magnetic Resonance Imaging (MRI) • Customer estimates predict the installed MRI base to Number of MRI scanners 14 ,0 0 0 increase to over 18,000 by 2007 12 ,0 0 0 10 ,0 0 0 • 8 ,0 0 0 MRI scan volume could increase at CAGR of 10.4%, 2004-2007 (Frost & Sullivan) 6 ,0 0 0 4 ,0 0 0 2 ,0 0 0 • The direc
Slide 8: Key customers
Key customers • Metalcraft customers include • Siemens Magnet Technology is Metalcraft’s • BNFL are a recurring customer largest customer • Metalcraft have an annual £1m contract to • Siemens expanded their manufacturing capacity supply class 1 pressure systems in their Oxford facility in 2004 • Acc
Slide 9: Other Technology Markets
Other Technology Markets • The superconductivity engineering capabilities of Metalcraft provide opportunities to cross-sell into markets other than MRI • Government research funding is on the increase – particularly on new astronomical telescopes which has fuelled demand • Key high energy physics pr
Slide 10: Group Structure
Group Structure • The proposed group structure of Avingtrans will be as follows Jena Group C&H Precision Crown (UK) Metalcraft (including B & T Finishers Limited Spindles) - + Revenue (£m) 4.8* 0.7* 2.7 14.7 - + Operating Profit (£m) 0.2* 0.0* 0.6 1.6 Activity Design and Final polishing and Manufact
Slide 11: Financial Effect of the Acquisition
Financial Effect of the Acquisition • Metalcraft Profit and Loss Account Stainless Metalcraft (Chatteris) Limited 11months £m 2002 2003 2004 Revenue 15.3 16.0 14.7 Adjusted EBITDA 1.8 1.7 2.0 Adjusted EBIT 1.3 1.2 1.6 Source : Metalcraft 2002, 2003 Statutory and 2002, 2003, 2004 management accounts
Slide 12: Avingtrans results for year to May 2004
Avingtrans results for year to 31 May 2004 • Highlights 4 Turnover of £5.5m (2003: £4.6m) 4 EBITDA of £0.53m (2003: £0.56m) 4 EPS of 3.1p (2003: 4.2p) 4 Net cash of £0.5m (2003: £0.9m) 4 The board are not recommending a dividend (2003: nil) 1212
Slide 13: Conclusion
Conclusion • The Metalcraft acquisition represents the continuing execution of Avingtrans’ strategy • It will bring increased 4 Revenue 4 Profitability 4 Scale • The equity fundraising represents an opportunity to participate in future growth of Avingtrans 1313
Slide 14: Appendices
Appendices Avingtrans ple
Slide 15: Appendix I: Avingtrans PLC
Appendix I : Avingtrans PLC • Avingtrans is AIM listed and has a market capitalisation of £4.3m • Avingtrans produces precision engineered components used in medical and scientific devices and industrial machinery • Avingtrans’ customer base includes overseas customers throughout the US and Germany
Slide 16: Appendix II: Avingtrans Board
Appendix II: Avingtrans Board Executive Directors Non-executive Directors • Ken Baker (Chairman, 69) • Jeremy Hamer (Non executive Director, 52) 4 Ken Baker joined the Board in 2000 and 4 Jeremy Hamer was Chairman of Avingtrans became Chairman in June 2002. Ken has been from 1998 to 2002. He is a No
Slide 17: Appendix III: Share Price Performance
Appendix III: Share Price Performance 2 Year 70 Growth Avingtrans 71.8% 60 FTSE Fledgling 67.7% 50 FTSE Eng & Mach 34.3% 40 p 30 20 10 0 Sep -0 2 Dec-0 2 Mar-0 3 J un-0 3 Sep -0 3 Dec-0 3 Mar-0 4 J un-0 4 Sep -0 4 Source : Datastream 1717
Slide 18: Appendix IV: The Crown acquisition
Appendix IV : The Crown acquisition • Crown was acquired for £1.56 million cash in June 2004 through debt finance (provided by HSBC) Crown Financial Performance 4 Cash balance of £0.25 million received with the acquisition Year to 31 Dec 2003 £'000 2002 £'000 Sales 2,798 1,796 EBIT 612 265 • Busines
Slide 19: Appendix V: The Boneham & Turner Spindles Acquisition
Appendix V : The Boneham & Turner Spindles Acquisition • Avingtrans purchased the assets of Boneham & Turner Spindles for £400,000 in August 2003 • Boneham & Turner Spindles are a supplier and service provider of precision spindles • Boneham & Turner Spindles was purchased for the synergies availabl