Slide 1: FY20 Results Presentation
ASX Announcement 26 August 2020 FY20 Results Presentation Proudly essential for 100 years Reece Limited (“Reece Group”; ASX:REH) announces record financial results for the year ending 30 June 2020. Please find attached the FY20 Results presentation. For further information contact: Andrew Hewett Sco
Slide 2: Full Year Results 2020
Full Year Results 2020 26 August 2020
Slide 3: Presenters
Reece Group - Full Year Results 2020 2 Presenters Peter Wilson Andrew Cowlishaw Group Chief Executive Officer Group Chief Financial Officer & Managing Director since 2008 20+ years' experience in finance 25+ years' experience at Reece, roles. Former Partner at EY including roles as General Manager o
Slide 4: Disclaimer
Reece Group - Full Year Results 2020 3 Disclaimer The material in this presentation has been prepared by Reece Limited (ABN 49 004 313 133) (“Reece") (ASX:REH) and is general background information about Reece's activities current as at the date of this presentation. The information is given in summ
Slide 5: Agenda
Reece Group - Full Year Results 2020 4 Agenda 01 02 03 04 Our focus Financial Business FY20 financial summary highlights performance
Slide 6: Agenda
Reece Group - Full Year Results 2020 5 Agenda 01 02 03 04 Financial Business FY20 financial summary highlights performance Our focus
Slide 7: Proudly essential for 100 years
Reece Group - Full Year Results 2020 Proudly essential for 100 years Supporting our customers to carry out an essential service - home comfort and sanitation has never been more important Experienced all phases of the cycle – focus on what we can control Strong balance sheet, clear plan and strategy
Slide 8: Our purpose and values have guided us now more than ever
Reece Group - Full Year Results 2020 7 Our purpose and values have guided us now more than ever Improving the lives of our customers and people by striving for greatness every day. Customers Discover Grow as Innovate Try. Try. Try. for life. your best. a team. big and small. Own it. Keep it Do the B
Slide 9: Our long-term regional approach
Reece Group - Full Year Results 2020 8 Our long-term regional approach Australia & United New Zealand States Customised service in Growth platform a digital landscape
Slide 10: Protect and accelerate through COVID-19
Reece Group - Full Year Results 2020 9 Protect and accelerate through COVID-19 Protect and preserve Accelerate for the long-term Look after our Strengthen Renewed Accelerate people and our balance senior investment customers sheet leadership
Slide 11: Protecting our business through COVID-19
Reece Group - Full Year Results 2020 10 Protecting our business through COVID-19 Protect and preserve Taking action early to Kept our doors open to Equity raise managed protect our people, our support the essential work risk and fortified the customers and the of our customers balance sheet communit
Slide 12: Accelerating our strategy
Reece Group - Full Year Results 2020 11 Accelerating our strategy Accelerate for the long-term Renewed talent in Digitising the customer Continuing to build leadership teams experience the foundations for growth in the US
Slide 13: Agenda
Reece Group - Full Year Results 2020 12 Agenda 01 02 03 04 Our focus Business FY20 financial Financial highlights performance summary
Slide 14: Financial highlights
Reece Group - Full Year Results 2020 13 Financial highlights Including Sales Normalised NPAT impact of AASB Revenue EBITDA* 16 Leases up 10% up 25% up 13% to $6,010m to $650m to $229m Excluding Sales Normalised NPAT impact of AASB Revenue EBITDA* 16 Leases up 10% up 3% up 19% to $6,010m to $537m to
Slide 15: Segment performance
Reece Group - Full Year Results 2020 14 Segment performance ANZ 6,010 • Sales increased by 1% Sales Revenue 5,464 in a challenging year US • Sales revenue grew 20% 3,122 • Up 13% on a constant 2,866 2,888 2,598 currency basis Group / COVID-19 information • FY20 Q4 sales above last year • No Governme
Slide 16: Agenda
Reece Group - Full Year Results 2020 15 Agenda 01 02 03 04 Our focus Financial FY20 financial summary Business performance highlights
Slide 17: Business highlights
Business highlights Continuing Digitising to build the the customer foundations for experience growth in the US
Slide 18: Digitising the customer experience
Business highlights Digitising the customer experience
Slide 19: Digitising the customer experience
Reece Group - Full Year Results 2020 18 Digitising the customer experience Accelerated customer interaction with maX Integration with key job management platforms Creating seamless interactions for small to big customers Introduction of virtual bathroom consultations
Slide 20: Innovation bringing digital platforms to life
Reece Group - Full Year Results 2020 19 Innovation bringing digital platforms to life Strategic partnership with job management platform, FieldPulse Empowering future leaders through a blended learning approach
Slide 21: Offering market-leading products
Reece Group - Full Year Results 2020 20 Offering market-leading products Dimax Geberit Sovent Prefab Hideaway+ Cool-Fit
Slide 22: ANZ branches
Reece Group - Full Year Results 2020 21 ANZ branches 11 122 639 53 44 178 5 182 34 15
Slide 23: Reece Cares
Reece Group - Full Year Results 2020 22 Reece Cares Supporting those who need it most – from bushfires to mental wellbeing
Slide 24: Business highlights
Business highlights Continuing Digitising to build the the customer foundations for experience growth in the US
Slide 25: Continuing to build the foundations for growth in the US
Business highlights Continuing to build the foundations for growth in the US
Slide 26: We've listened and we're starting to invest
Reece Group - Full Year Results 2020 25 We’ve listened and we’re starting to invest Continuing to embed right values Focus on building long-term New store design trials & culture - The Reece Way capability Understanding the local market Commitment to learning and Rebuilding eCommerce approach contin
Slide 27: US branches
Reece Group - Full Year Results 2020 26 US branches 184 9
Slide 28: Economic commentary
v Economic commentary
Slide 29: ANZ economic commentary
Reece Group - Full Year Results 2020 28 ANZ economic commentary Dwelling Approvals Dwelling Completions (000s) (000s) 219 213 216 239 202 197 231 232 193 223 200 162 169 187 161 157 181 145 148 168 165 169 150 156 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY11 FY12 FY13 FY14 FY15 F
Slide 30: US economic commentary
Reece Group - Full Year Results 2020 29 US economic commentary Single + multi-family housing starts Leading indicator of remodeling activity (000s) (US$bn / ROC%) Single -family housing starts Multi-family housing starts 6.4% 6.3% 6.0% 6.1% 6.0% 6.3% 6.7% 6.8% 6.5% 6.2% 5.6% 374 402 330 245 4.5% 3.3
Slide 31: Agenda
Reece Group - Full Year Results 2020 30 Agenda 01 02 03 04 Our focus Financial Business summary highlights FY20 financial performance
Slide 32: Results summary
Reece Group - Full Year Results 2020 31 Results summary Including impact from AASB 16 Leases Excluding impact from AASB 16 Leases Year ended 30 June 2020 Year ended 30 June 2020 (A$m) FY20 FY19 Var. (%) (A$m) FY20 FY19 Var. (%) Sales revenue 6,010 5,464 10% Sales revenue 6,010 5,464 10% Normalised E
Slide 33: Group performance
Reece Group - Full Year Results 2020 32 Group performance • Sales remained strong in 2H20 Excluding AASB 1H20 FY20 second half of FY20 16 Leases (A$m) • Maintained margins • COVID-19 affected our Sales revenue 2,962 3,048 6,010 markets from March including a four week lock down in New Zealand Normal
Slide 34: ANZ segment performance
Reece Group - Full Year Results 2020 33 ANZ segment performance • Revenue solid in COVID- 19 impacted markets Year ending FY20 FY20 FY19 Var. (%) 30 June 2020 (A$m) (post AASB 16) (pre AASB 16) (pre-AASB 16) • Australian operations remained open throughout Sales revenue 2,888 2,888 2,866 1% • New Ze
Slide 35: US segment performance
Reece Group - Full Year Results 2020 34 US segment performance • Sales increased 20% Year ending FY20 FY20 FY19 Var. (%) • Todd Pipe contribution 30 June 2020 (A$m) (post AASB 16) (pre AASB 16) (pre-AASB 16) for 9 months • On a like-for-like Sales revenue 3,122 3,122 2,598 20% constant currency basi
Slide 36: Cashflow
Reece Group - Full Year Results 2020 35 Cashflow Year ending 30 June 2020 (A$m) FY20 FY19 Normalised EBITDA* 650 522 Net Working Capital (FY16A–FY20A) Net movements in working capital 134 (88) Non-cash items in EBITDA (8) (4) 1200 25% Income Tax Paid (90) (92) 1000 Finance Costs (85) (83) 800 20% Ca
Slide 37: Balance sheet
Reece Group - Full Year Results 2020 36 Balance sheet Net Debt* (excluding lease liabilities) Year ending As at 30 As at 30 30 June 2020 (A$m) Jun 2020 Jun 2019 1,482 Cash and cash 1,005 128 equivalents 761 Senior debt 1,765 1,609 Net debt* 761 1,482 40 (2) Net Financial asset 14 13 (FX derivative)
Slide 38: Summary
Summary
Slide 39: Summary
Reece Group - Full Year Results 2020 38 Summary Record result in Focus on what our 100th year we can control Protect and Paying final preserve dividend Accelerate for Quick to learn the long-term and adapt
Slide 40: In final word
Reece Group - Full Year Results 2020 39 A In final word Record result in our 100th year Protect and preserve Accelerate for the long-term
Slide 41: Q&A
Reece Group - Full Year Results 2020 40 Q&A
Slide 42: Appendix - Leasing impact
Reece Group - Full Year Results 2020 41 Appendix - Leasing impact AASB 16 impact on NPAT • Adopted 1 July 2019, 113 with no change to comparative numbers as permitted by AASB 16 • Recognition of right-of-use 240 239 -102 (102) 229 assets and lease liabilities -21 (21) • Reducing NPAT by $11m FY20 NP