Mannai Corporation Q.p.s.c. · QSE:MCCS
Mannai Corporation Q.p.s.c — FY2019 Earnings Presentation
24 slides from Mannai Corporation Q.p.s.c's earnings presentation, March 2020
Slide 1: Mannai Corporation QPSC FY'19 Financial Summary
Mannai Corporation QPSC FY’19 Financial Summary
Slide 2: Disclaimer
Disclaimer Mannai Corporation Q.P.S.C. cautions investors that certain statements contained in this document state Mannai Corporation’s management's intentions, hopes, beliefs, expectations, or predictions of the future and, as such, are forward-looking statements. Mannai Corporation management wish
Slide 3: Underlying EBITDA Growth of 11% Impacted by Financial Leverage
Underlying EBITDA Growth of 11% Impacted by Financial Leverage QAR m EBITDA 850 1,006 1,081 724 773 • Consistent EBITDA growth averaging 11% over 5 years FY '15 FY '16 FY '17 FY '18 FY '19 • Acquisition strategy Finance Costs funded by leverage has increased finance costs by 318 405 310m per year 95
Slide 4: Net Profits Impacted by Higher Finance Costs and Damas Provisions
Net Profits Impacted by Higher Finance Costs and Damas Provisions QAR m Net Profit • ICT Qatar Up 8% to 228m; strong year of orders and revenue growth across all business units 407 • Gfi Informatique profits up 7% to 175m; IT delivers 94% of Group EBIT • Gain on sale of investment boosted FY ‘18 by
Slide 5: Financial Highlights
Financial Highlights QAR m FY’18 FY’19 Revenues 10,774m 11,592m 8% EBITDA 1,006 1,081 8% General & Admin Expenses 1,254 1,126 (10)% Selling & Distribution Expenses 514 471 (8)% Finance Cost 318 405 27% Net Profit 407m 203m (50)% Capital Employed 8,384m 8,197m (2)% Earnings Per Share 0.89 0.44 (50)%
Slide 6: Revenues Up 8% Driven by IT Segment Growth of 12%
Revenues Up 8% Driven by IT Segment Growth of 12% QAR m Revenue • ICT Qatar revenues up 21% to 2,656m driven by large government-related orders 8% 11,592 • Gfi revenues up 8% to 6,523m 10,774 • IT Revenues growth of 12% increases share to 79% of group revenues • Damas revenues down 10% as soft UAE t
Slide 7: Gfi Informatique Drives Geographic Diversification of Revenues
Gfi Informatique Drives Geographic Diversification of Revenues Revenue Mix FY ‘18 FY ‘19 Qatar 31% Qatar 33% Europe Europe 55% 56% GCC / Other 14% Other GCC 11% 7
Slide 8: Gfi & ICT Qatar Drives IT Mix to 79% of Group Revenues
Gfi & ICT Qatar Drives IT Mix to 79% of Group Revenues Revenue Mix FY ‘18 FY ‘19 Other Qatar Auto Group Other Qatar Auto Group 8% 5% 7% 7% Damas Damas 13% 11% ICT Group ICT Group 23% 20% Gfi 55% Gfi 56% 8
Slide 9: Gross Profits Impacted by Damas
Gross Profits Impacted by Damas QAR m Gross Profit Gross Margin % (3)% 2,585 2,501 (2.4) pts 24.0% 21.6% FY '18 FY '19 FY '18 FY '19 • Decrease in Gross Profit driven by Damas down 39%, FY ’19 V pts Offset by ICT up 58m, up 17% Gfi 23.8% (2.0) pts • Damas margins impacted by trading conditions and o
Slide 10: Other Income Decrease Due to One-off Gain Recognised in 2018
Other Income Decrease Due to One-off Gain Recognised in 2018 QAR m Other Income 141 • One-off gain on sale of investment recognised in FY ’18 for 81m is the (32)% primary driver of decrease in FY ‘19 96 • Gain on disposal of investment property of 17m recognised in FY ‘19 FY '18 FY ' 19 10
Slide 11: Debt Reduction Driven by Strong Cash Flows and Working Capital Reduction
Debt Reduction Driven by Strong Cash Flows and Working Capital Reduction QAR m Net Debt Gearing Ratio 5,771 (3)% 5,578 1.60 1.54 FY '18 FY '19 FY '18 FY '19 11
Slide 12: IFRS16 Impact on Key Income Statement Lines
IFRS16 Impact on Key Income Statement Lines QAR m G&A Expenses S&D Expenses EBITDA* Depreciation & Amortisation Rent Expenses transferred to Depreciation and Finance Costs +8% -% 2% 1081 371 1,259 1,257 514 520 IFRS 1006 +86% IFRS 16 131 IFRS 49 16 One-off 81 16 213 gain IFRS 16 193 200 1,259 514 1,
Slide 13: Gfi and ICT Growth Increases IT Segment to 76%
Gfi and ICT Growth Increases IT Segment to 76% Profit Mix* FY ‘18 FY ‘19 All Other All Other Axiom 6% 6% Auto Axiom 2% Auto 2% 10% Damas 11% Damas (14)% 8% ICT ICT 42% 35% Gfi Gfi 52% 39% *Profit Before Interest and Tax (EBIT), excluding Other Segment (primarily HQ expenses and director’s fees) 13
Slide 14: Information Technology
Information Technology QAR m Revenue Net Profit 12% +13% • Qatar Revenues up 31% and Gfi 9,179 267 Revenues up 8% 8,180 237 • Strong orders in Qatar driven by large government contracts; leading to margin pressure • Finance Costs up 49m or 24% due to Gfi acquisition funding and increased working cap
Slide 15: Gfi Informatique: European Leader in Digital Services & Solutions
Gfi Informatique : European Leader in Digital Services & Solutions (Euro €m) Revenue • Initial investment of 51% in 2016, 16% remaining stake purchased in 2017 1,595 1,395 and 2018 1,105 1,132 894 • Growth through acquisitions; largest in Spain and Belgium 2015 2016 2017 2018 2019 • Net Profit doubl
Slide 16: Damas Jewellery
Damas Jewellery QAR m Revenue Net Profit 1,360 (10)% • Revenue decline as retail 1,223 20 conditions continue to impact sales • Repositioning of brand and store rationalisation leading to provisions for inventory and store impairments (127) FY '18 FY '19 FY '18 FY '19 GP 386m 234m NP% 8.5% (10.3) %
Slide 17: Auto Division
Auto Division QAR m Revenue Net Profit (5)% • Reduction in sales driven by heavy 729 704 55.0 54.0 (2)% equipment down 25% due to slow projects activity • Offset uptick in new vehicle sales, up 8%, driven by launch of new Sierra pick-up models FY '18 FY '19 FY '18 FY '19 GP 152.9m 159.7m NP% 7.6% 7.
Slide 18: Axiom Telecom
Axiom Telecom QAR m Share of Profit • Underlying trends in core UAE and KSA business encouraging as 16.9 management continue to re- 14.4 (15)% align business to existing market conditions • Profits impacted by investment in new online business channel FY '18 FY '19 18
Slide 19: Energy and Industrial Markets
Energy and Industrial Markets QAR m Revenue Net Profit 197 196 -% 1% 16.6 16.8 • Market affected by run-off of mega projects in Qatar and limited new projects • Revenues driven by ongoing demand for HVAC and parts, repair and services in energy and industrial markets FY '18 FY '19 FY '18 FY '19 GP 4
Slide 20: Travel Division
Travel Division QAR m Revenue Net Profit 8% 26% 34 9.5 31 • Visa Processing Division drove 7.5 growth with revenues up 51% as new missions opened in 2019 • Travel volumes up 4% compared to FY ‘18 helping revenues FY '18 FY '19 FY '18 FY '19 GP 26.7 28.8m NP% 24.1% 26.0% GP% 85.2% 85.3% Cap. Emp. 18m
Slide 21: Logistics
Logistics QAR m Revenue Net Profit 8.9 40 (15)% 36 (11)% 7.6 • Drop in warehouse storage pricing due to over supply in market • Freight business decline during the year; expected to ramp up with FIFA2022 in coming 3 years FY '18 FY '19 FY '18 FY '19 GP 15.1m 13.0m NP% 21.8% 21.0% GP% 36.9% 35.9% Cap
Slide 22: Engineering
Engineering QAR m Revenue Net Profit • Reduced shutdown activity & 78 (9)% reduced demand compared to 71 FY ’18 • Improved operational and sales processes to have an impact in -% FY ’20 0.1 0.1 FY '18 FY '19 FY '18 FY '19 GP 15.3 10.7m NP% 0.2% 0.1% GP% 19.6% 15.1% Cap. Emp. 5m 5m 22
Slide 23: Geotechnical Services
Geotechnical Services QAR m Revenue Net Profit • Fall in revenue as road-building and other mega-projects from 50.7 (21)% 2014-2015 run-off 42.1 • Significant rightsizing of manpower (0.9) during 2019 • Outlook for 2020 positive after 130m of orders achieved in 2019; driven by Ashghal geotechnical (
Slide 24: Mannai Corporation QSC
Mannai Corporation QSC Tel: +974-4455 8888 Fax: +974 4455 8880 www.mannai.com CONTACTS Ewan Cameron Chief Financial Officer Abayazeed Ahmed Investor Relations Officer email: investor.relations@mannai.com.qa 24
Mannai Corporation Q.P.S.C. — FY2019 Earnings Presentation on 6ix