Redcentric Plc · LSE:RCN
Redcentric — H1 2021 Earnings Presentation
16 slides from Redcentric's earnings presentation, November 2020
Slide 1: Half Year Results
Slide 2: Disclaimer
DISCLAIMER IMPORTANT NOTICE This document contains statements that are, or may be deemed to be, “forward-looking statements” which are prospective in nature. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Forward-looking state
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Slide 4: Financial highlights
Revenue of £87.5m • Gross margin increased •by 2.7% • Adjusted EBITDA of £20.6m • Adjusted EBITDA margin• increase of 2.1% • Operating cash flow of £18.8m • Net debt reduction of £4.1m • Operating cash conversion of 97% • Strategic capital investments of £2.5m • • • • • • • • 4
Slide 5: Financials
FINANCIALS HALF YEAR ENDED 30'™ SEPTEMBER 2020 (HY-21) David Senior — Chief Financial Officer redcentric
Slide 6: HY-21 Financial Performance — Revenue and Profitability
HY-21 FINANCIAL PERFORMANCE — REVENUE AND PROFITABILITY TOTAL REVENUE £46.2m (+7.2%) Recurring revenue (RMR) of £41.0m RECURRING REVENUE (EXCE Five consecutive quarters of growth. CROWN HOSTING) £40.5m (+9.4%) ADJUSTED EBITDA* £12.3m (+19%) Adjusted EBITDA margins increased to 26.5% (H1-20: (ADJUSTE
Slide 7: HY-21 Financial Performance — Liquidity & Earnings
HY-21 FINANCIAL PERFORMANCE — LIQUIDUITY & EARNINGS INNORMALISED NET DEBT ADJUSTED EARNINGS PER £10m (+136%) £17.0m (-51%) £7.3m (-19%) £3.61P (+50%) £5.8m increase on H1-20, Reduction of £17.5m reflecting, Trade debt ageing Profit growth drives reflecting £2.6m improvement net benefit from restitut
Slide 8: Group Income Statement
GROUP INCOME STATEMENT n C db and 4.3% on H1 and H2 of FY20 ecurt d to 89% (H2 (£m) (£m) (£m) % Revenue 43,152 44,333 46,241 7.2% Cost of Sales (15,319) (16,978) (17,588) 14.8% Gross Profit 27,833 27,355, 28,653 2.9% Gross Margin 645% 61% 620% 25% Operating Costs (17,503) (17,081) (16,392) (6.39% Ad
Slide 9: Adjusted Net Debt
ADJUSTED NET DEBT 1-20 2.20 H1-21 ot pre IFRS16 reduction of £12.4m reflecting excellent cas! oa S 4 a an e restit é Adjusted EBITDA 70.330 027A 12.261 rcap an efit from the restitution sch Working Capital movements (43) (14) 654 Cash Generated from operations 10,287 9,360 12,915 Fixed assets - cash
Slide 10: Operational Review
OPERATIONAL REVIEW Peter Brotherton — Chief Executive Officer redcentric AGILE * AVAILABLE » ASSURED
Slide 11: Operational Highlights
OPERATIONAL HIGHLIGHTS Revenues for the first half of the year are up 7% on last year, recurring revenues account for 89% of total revenues and increased by 6% on H1-20. The increase in recurring revenues has largely been driven by growth in the public sector. All of the HSCN contract wins are now f
Slide 12: Operational Highlights
OPERATIONAL HIGHLIGHTS * On 13 June 2020, following a three year investigation into historical accounting misstatements, the company reached a full and final settlement with the Financial Conduct Authority ("FCA"). + As part of the FCA settlement, the Company launched a restitution scheme to compens
Slide 13: Dividend Policy & Share Buyback
DIVIDEND POLICY & SHARE BUYBACK * The Board has decided to reinstate dividend payments and announces an interim dividend of 1.2p per share which will be paid on 31 December 2020 to shareholders on the register at the close of business on 20 November 2020. + As part of its review of strategy going fo
Slide 14: Growth Strategy, Summary & Outlook
GROWTH STRATEGY, SUMMARY & OUTLOOK redcentric
Slide 15: Growth Strategy
GROWTH STRATEGY * Build on recent success in the public sector by cross- * Over the last two years the management team has successfully integrated selling additional products into our existing customer historical acquisitions and extracted significant savings through efficiency base and attracting n
Slide 16: Summary and Outlook
SUMMARY AND OUTLOOK During the year the business has delivered on all key aspects of its strategy: * Strong revenue and adjusted EBITDA growth reflecting success in public sector and completion of the network and data centre efficiency programme. * Sector leading adjusted EBITDA less capex margins w