Rak Ceramics Pjsc · ADX:RAKCEC

Rak Ceramics Pjsc — EFG Hermes 16th One on One Investor Conference 2022

37 slides from Rak Ceramics Pjsc's conference presentation, September 2022

  1. Slide 1: EFG Hermes Investor Conference September 2022

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 EFG HERMES 16 TH ONE ON ONE INVESTOR CONFERENCE 2022 Scan to Download SEPTEMBER 2022 RAK Ceramics PJSC © 2022. All rights reserved 1

  2. Slide 2: Contents and Disclaimer

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Contents DISCLAIMER This information contained in the enclosed presentation summarizes 01 | Company in Brief preliminary and introductory information on RAK Ceramics PJSC (the Company). This presentation has been prepared for information purposes only an

  3. Slide 3: Attendees

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Attendees Abdallah Massaad PK Chand Group Chief Executive Officer Group Chief Financial Officer Abdallah Massaad is Group CEO of RAK Ceramics and has more than 25 years Pramod Kumar Chand is Group CFO of RAK Ceramics. Mr. Chand has wide experience experi

  4. Slide 4: Company in Brief

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Company in Brief RAK Ceramics PJSC © 2022. All rights reserved 4

  5. Slide 5: RAK Ceramics at a glance

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 RAK Ceramics at a glance Leading lifestyle brand offering premium ceramic solutions 30YEARS 13,000 OWNERSHIP % + ~ 33.5% 28.9% Ceramic expertise Global workforce 6.4% ~US$800 ~US$ 900M 16.1% 8.3% 7.0% Annual group LTM H.H. Sheikh Saud Bin Saqr Al Qasimi

  6. Slide 6: Eras of RAK Ceramics

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Eras of RAK Ceramics 1990-2000 2000-2010 2010-PRESENT FOUNDATION EXPANSION ENHANCEMENT 1989 2004 2013 Founded by H.H. Sheikh Saud Bin RAK Porcelain was established Samena Capital acquired 31% stake Saqr Al Qasimi in RAK Ceramics 1991 2006 2014 First tile

  7. Slide 7: Product offering

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Product offering TILES SANITARYWARE TABLEWARE FAUCETS We offer one of the largest collection of ceramic wall and Products supplied to over floor tiles, gres porcelain and 40,000 hotels in more than super-sized slabs in the 165 countries with clients indu

  8. Slide 8: Manufacturing footprint

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Manufacturing footprint GLOBAL PRODUCTION 24 plants worldwide GERMANY 1 24  15 Tiles Plants in UAE (10), India (3), AUSTRIA 1 Bangladesh (1) and Iran (1). 1 HUNGARY PLANTS WORLDWIDE  4 Sanitaryware Plants in UAE (2), India (1), and Bangladesh (1)  Tab

  9. Slide 9: Vision and key strengths

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Vision and key strengths To become the world’s leading ceramic lifestyle solution provider LIFESTYLE BRAND INNOVATION HIGH-END QUALITY SUSTAINABILITY We are a globally Innovation is at the heart of We are known for our wide We operate in harmony with our

  10. Slide 10: Business Strategy Update

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Business Strategy Update RAK Ceramics PJSC © 2022. All rights reserved 10

  11. Slide 11: 2022 Priorities

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 2022 Priorities Protect market share Production expansion Explore untapped market potential Protect market share across all core Build, acquire and enhance production Increase market share in nascent markets markets and segments albeit increased plants t

  12. Slide 12: Short-term initiatives prioritized

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Short-term initiatives prioritized Protecting core Increasing digital businesses adoption Assuring seamless integration of KLUDI Tapping further into the e-commerce Group realizing immediate synergies world by incorporating further by consolidating core

  13. Slide 13: 2022 Key marketing updates

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 2022 Key marketing updates • E-commerce platform • Salone del Mobile for the UAE market in Milano in June 2022, January 2022; roll-out exhibition for to gradually include international furniture further business lines and design industries and focus mark

  14. Slide 14: 2022 Key strategic updates

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 2022 Key strategic updates KLUDI Group 100% Greenfield Expansion RAK Porcelain Land Allocation in Acquisition in Bangladesh Minority Buy-out Saudi Arabia On the 31st of May 2022, RAK RAK Ceramics Bangladesh is RAK Ceramics is currently in RAK Ceramics si

  15. Slide 15: Closer look… KLUDI Group acquisition

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Closer look… KLUDI Group acquisition MANAGEMENT COMMENTS The strategic acquisition of KLUDI Group represents an opportunity for RAK Ceramics to spearhead expansion and strengthen its core Strategic initiatives businesses across European markets. The bran

  16. Slide 16: Closer look… RAK Porcelain acquisition

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Closer look… RAK Porcelain acquisition MANAGEMENT COMMENTS RAK Ceramics has completed the acquisition of 41% minority shareholders in RAK Porcelain and thus increased its holdings to 91% till the 31st of August, 2022, for a consideration of AED 225.5m. A

  17. Slide 17: 2022 Key sustainability updates

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 2022 Key sustainability updates Online mosaic production system enabling the Introducing Online efficient production of mosaic tiles using less Mosaic Process energy and less manpower Recycling equipment, allowing for the 100% reuse of fine powder genera

  18. Slide 18: 2022 Key challenges

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 2022 Key challenges Critical Parameters Key Challenges Our Action • Translate increase in costs onto selling prices while Inflation surge across the globe fueled by remaining in line with the market increase in cost of living and challenging Rising Infla

  19. Slide 19: Stock Profile

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Stock Profile RAK Ceramics PJSC © 2022. All rights reserved 19

  20. Slide 20: RAK Ceramics stock profile

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 RAK Ceramics stock profile AED CURRENT VALUATION (AED M) RAK CERAMICS (RAKCEC) SHARE PRICE PERFORMANCE (AED) WAP 2.88 12/09/2022 31/12/2021 52 week high 3.27 Amount Amount 52 week low 2.69 Share price 2.95 2.85 3.5 As of 12th September 2022 Number of sha

  21. Slide 21: Dividend update

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Dividend update MANAGEMENT COMMENTS HISTORICAL ANNUAL DIVIDEND PAID 2022 (%) RAK Ceramics is committed to returning capital to shareholders via a sustainable dividend policy, aiming at a minimum payout of 20 fils on a semi-annual basis for FY 2022 subjec

  22. Slide 22: Supplementary Financial Slides

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Supplementary Financial Slides RAK Ceramics PJSC © 2022. All rights reserved 22

  23. Slide 23: Financial performance trend

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Financial performance trend REVENUE (AED BN) EBITDA (AED MN) AND MARGIN (%) 533.4 482.8 501.3 443.2 377.9 294.0 256.0 2.8 2.7 2.6 2.9 2.4 1.4 1.7 19.0% 16.2% 18.8% 16.1% 17.5% 18.0% 17.2% 2017 2018 2019 2020 2021 H1 2021 H1 2022 2017 2018 2019 2020 2021

  24. Slide 24: H1 2022 Performance snapshot

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 H1 2022 Performance snapshot Total revenue increased by +20.1% Total gross profit margin increased by Total EBITDA increased to AED 294.0m YoY to AED 1.71bn due to increase in +1.2% YoY at 37.8% even after charging compared to AED 256.0m in last year. ti

  25. Slide 25: H1 2022 Revenue highlights

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 H1 2022 Revenue highlights MANAGEMENT COMMENTS TOTAL REVENUE (AEDM) YEARLY COMPARISON Total revenue in H1 2022 increased by +20.1% H1 21 H1 22 Tiles TW Others YoY at AED 1.7bn driven by tiles (+11.9%), SW (+10.3%) and TW (+70.3%) YoY. SW Faucets Amount A

  26. Slide 26: Gross Profit margins trend

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Gross Profit margins trend MANAGEMENT COMMENTS TOTAL GROSS MARGINS (%) TILES GROSS MARGINS (%) Total gross profit margin increased in H1 2022 by +120bps YoY to 37.8% despite higher production costs and the imposition of the 12% customs duty in Saudi Arab

  27. Slide 27: Closer look… Bangladesh operations

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Closer look… Bangladesh operations MANAGEMENT COMMENTS REVENUE (AED MN) GROSS PROFIT MARGIN (%) Company demonstrated resilience and reported strong year on year growth supported 320 +15.9% 36.3 by differentiated products for premium 297 31.5 29.9 278 282

  28. Slide 28: Closer look… Indian operations

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Closer look… Indian operations MANAGEMENT COMMENTS REVENUE (AED MN)* GROSS PROFIT MARGIN (%) Robust performance on the back of improved margins. Production efficiency have improved 414 339 22.0 and energy consumption was reduced 322 321 38 +22.9% followi

  29. Slide 29: Closer look… Tableware operations

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Closer look… Tableware operations MANAGEMENT COMMENTS REVENUE (AED MN) GROSS PROFIT MARGIN (%) Tableware performance across core markets significantly improved supported by recovery in the hospitality and tourism, the introduction of 56.0 263.7 269.4 254

  30. Slide 30: Balance Sheet evolution

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Balance Sheet evolution MANAGEMENT COMMENTS RETURN ON EQUITY (%) WORKING CAPITAL CYCLE (DAYS) Return on Equity in June 2022 is at 11.3% (annualized) 241 238 242 228 175 155 Inventory days decreased by 12 days in June 227 246 258 246 11.4 11.8 11.3 217 20

  31. Slide 31: Appendix

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Appendix RAK Ceramics PJSC © 2022. All rights reserved 31

  32. Slide 32: Revenue performance contribution

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Revenue performance contribution REVENUE CONTRIBUTION BY SEGMENT H1 2022 % TILES & SANITARYWARE REVENUE CONTRIBUTION BY REGION H1 2022 % 4.1% 3.7% 9.6% 8% 11% 24% 17.6% 16% 21% 65.0% 15% 5% UAE KSA Tiles ME Sanitaryware India Tableware Europe Faucets Ban

  33. Slide 33: Tiles & SW Revenues by end market

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Tiles & SW Revenues by end market TILES SANITARYWARE (SW) H1 21 H1 22 H1 21 H1 22 Amount in AED M Amount Amount Growth YoY Amount Amount Growth YoY United Arab Emirates 238.1 256.9 7.9% 66.2 83.1 25.6% Kingdom of Saudi Arabia 301.9 301.2 (0.2%) 6.9 5.9 (

  34. Slide 34: EBITDA workings

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 EBITDA workings YEARLY COMPARISON H1 21 H1 22 Amount in AED M Amount Amount Net profit/(loss) after tax 157.6 171.9 Tax 7.8 12.3 Interest- net 29.2 27.7 Depreciation & amortizations 84.5 83.9 Gain on KLUDI Group acquisition accounting - (32.4) Extra-ordi

  35. Slide 35: Profitability bridge

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Profitability bridge Q2 2022 H1 2022 vs vs H1 Q22021 2021Profit ProfitBridge Bridge(AEDM) (AEDM) 26.8 89.4 18.4 12.5 3.3 1.9 22.9 52.2 94.9 102.2 71.9 125.7 28.9 Net Less: Net One- NP (Excl. one- Higher Gross Higher freight Higher SG&A - Kludi Group Othe

  36. Slide 36: Like-for-Like Profit workings

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Like-for-Like Profit workings YEARLY COMPARISON H1 21 H1 22 Amount in AED M Net profit /(loss) after tax 157.6 171.9 Add: Extra-ordinary impairment on trade receivables 27.2 27.6 Add: Impairment on Assets - 2.9 Add: Hyper-inflation impact 1.7 3.4 Less: G

  37. Slide 37: Thank you

    EFG HERMES INVESTOR CONFERENCE SEPTEMBER 2022 Thank you CONTACT US If you have any questions or require further information, please do not hesitate to contact our investor relations department. Scan to Download Investor Relations Nadine Nasr Investor Relations Manager T. +971 7 246 7298 | M. +971 52

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