Slide 1: Polypipe Group PLC Interim results, August 2018
Polypipe Group PLC Interim results, August 2018
Slide 2: Agenda
Agenda 1 INTRODUCTION 2 FINANCIAL REVIEW 3 BUSINESS REVIEW 4 SUMMARY & OUTLOOK
Slide 3: Highlights
Highlights ▪ Group revenue 0.1% higher despite adverse weather and mixed market conditions ▪ UK revenue up 0.9% ▪ Margins remain strong ▪ Improved cash generation ▪ Disposal of Polypipe France completed March 2018 ▪ Dubai factory closure and alternative manufacturing strategy, using sub-contracted p
Slide 4: Agenda: Financial Review
Agenda 1 INTRODUCTION 2 FINANCIAL REVIEW 3 BUSINESS REVIEW 4 SUMMARY & OUTLOOK
Slide 5: Financial highlights
Financial highlights ▪ UK revenue 0.9% ahead ▪ UK growth excluding the £8m estimated impact of adverse weather in February and March approximately 5% ▪ Basic earnings per share from continuing operations down 4.3% at 13.5 pence ▪ Cash generated from operations 5.7% higher at £22.3m ▪ Net debt of £14
Slide 6: Underlying results summary
Underlying results summary £m H1 2018 H1 2017 * % Change Revenue 210.2 210.0 0.1% Cost of sales (121.4) (119.1) Gross profit 88.8 90.9 (2.3)% Gross margin 42.2% 43.3% Selling & distribution costs (34.3) (33.2) Administrative expenses (18.2) (19.8) Underlying operating profit 36.3 37.9 (4.2)% Operati
Slide 7: Revenue and underlying operating profit bridge
Revenue and underlying operating profit bridge – organic growth impacted by adverse weather Revenue (£m) +5.6 +0.2 (5.6) 210.0 210.2 H1 2017 Selling price Currency Organic H1 2018 352.9 Underlying operating profit (£m) +0.2 +0.3 37.9 (2.1) 36.3 H1 2017 Selling price net of cost inflation Currency Or
Slide 8: Balance sheet summary
Balance sheet summary £m H1 2018 H1 2017 Change 31 December 2017 Non-current assets ▪ property, plant & equipment 101.3 94.9 6.4 98.6 ▪ goodwill 319.7 319.7 - 319.7 ▪ other intangible assets 34.0 39.5 (5.5) 36.8 Net assets classified as held-for-sale 0.7 26.2 (25.5) 13.1 Net working capital 20.2 16.
Slide 9: Net working capital
Net working capital £m H1 2018 H1 2017 * Change 31 December 2017 Inventories 52.7 50.9 1.8 53.5 Trade and other receivables 44.2 44.7 (0.5) 34.5 Trade and other payables (76.7) (79.1) 2.4 (87.6) Net working capital 20.2 16.5 3.7 0.4 * H1 2017 restated to exclude discontinued operations (Polypipe Fra
Slide 10: Cash flows
Cash flows £m H1 2018 H1 2017 Change 31 December 2017 EBITDA (before non-underlying items) 1 44.5 47.0 (2.5) 90.2 Capital expenditure, net of disposals of property, plant & equipment (10.7) (11.1) 0.4 (23.2) Profit on disposal of property, plant & equipment (0.2) (0.1) (0.1) (0.1) Movement in net wo
Slide 11: Banking facilities
Banking facilities Headroom at H1 2018: £m Drawn as at H1 2018 Facility Headroom Bank loan 185.0 290.0 105.0 Cash and cash equivalents (38.5) - 38.5 Net debt excluding unamortised debt issue costs 146.5 143.5 Unamortised debt issue costs (0.7) Net debt 145.8 Covenant Covenant requirement Position at
Slide 12: Agenda: Business Review
Agenda 1 INTRODUCTION 2 FINANCIAL REVIEW 3 BUSINESS REVIEW 4 SUMMARY & OUTLOOK
Slide 13: UK Construction Market: Total Output
UK Construction Market Total Output % change on y-1 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% 2015 2016 2017 2018 (e) 2019 (f) 2020 (p) -1.0% Source: Construction Products Association (CPA) Summer forecast 2018 POLYPIPE © 2018 | 13
Slide 14: UK Construction Market
UK Construction Market New housebuild Commercial Total TotalNew housebuild Housing % change % change on y-1 on y-1 Commercial % change on y-1 12.0% 10.0% 8.0% 10.0% 6.0% 8.0% 4.0% 2.0% 6.0% 0.0% 4.0% -2.0% 2015 2016 2017 2018 (e) 2019 (f) 2020 (p) -4.0% 2.0% -6.0% 0.0% -8.0% 2015 2016 2017 2018 (e)
Slide 15: Demand drivers
Demand drivers June-2018 LTM demand drivers RoW 7% Europe 4% UK Infrastructure UK RMI 6% 26% UK 89% UK Commercial 23% UK New Build 34% POLYPIPE © 2018 | 15
Slide 16: Operating segment review – Residential Systems
Operating segment review – Residential Systems Residential Systems H1 2018 H1 2017 % Growth Segmental revenue £121.3m £115.0m Inter segment revenue (£2.3m) (£2.6m) H1-2018 geographic revenue split Revenue £119.0m £112.4m 5.9% Europe 3% Underlying operating profit £23.8m £22.9m 3.9% Underlying operat
Slide 17: Operating segment review – Commercial and Infrastructure Systems
Operating segment review – Commercial and Infrastructure Systems Commercial and Infrastructure Systems H1 2018 H1 2017 % Growth Segmental revenue £95.0m £102.0m Inter segment revenue (£3.8m) (£4.4m) H1-2018 geographic revenue split Revenue £91.2m £97.6m (6.6)% RoW Underlying operating profit £12.5m
Slide 18: Agenda: Summary & Outlook
Agenda 1 INTRODUCTION 2 FINANCIAL REVIEW 3 BUSINESS REVIEW 4 SUMMARY & OUTLOOK
Slide 19: Summary & outlook
Summary & outlook ▪ Resilient performance in first half despite mixed market conditions and adverse weather ▪ Improved cash generation ▪ Good outlook for UK new housebuild, some signs of H2 improvement in Commercial and Infrastructure ▪ France disposal completed ▪ Second half started well, on track
Slide 20: Questions & Answers
Questions & Answers © Polypipe
Slide 21: Appendix
Appendix © Polypipe
Slide 22: Statutory results
Statutory results £m H1 2018 H1 2017 31 December 2017 Underlying profit after tax 26.9 27.9 53.9 Non-underlying items: - Middle East closure and other projects - (1.2) (4.6) - Amortisation of intangible assets (2.8) (2.8) (5.5) Tax effect of non-underlying items 0.5 0.5 1.2 Profit/(loss) from discon
Slide 23: Disclaimer
Disclaimer The information contained in this presentation has not been independently verified and this presentation contains various forward-looking statements that reflect management’s current views with respect to future events and financial and operational performance. The words “growing”, “scope