Pennant International Group Plc · LSE:PEN
Pennant International — H1 2020 Earnings Presentation
38 slides from Pennant International's earnings presentation, September 2020
Slide 1: Important Notice
Important Notice This presentation is issued on behalf of Pennant International Group plc (the “Company”) solely for the purposes of providing existing and prospective investors in the Company with information primarily concerning the Company’s financial performance for the period ended 30 June 2020
Slide 2: Company Briefing
Company Briefing Pennant International Group Plc Cheltenham | Manchester | Fareham | Brisbane | Ottawa | Melbourne | Wagga Wagga
Slide 3: Highlights
Highlights First half results impacted by Covid-19 and related restrictions; Revenue £6.3m, underlying EBITA loss of £2m; Cost reduction exercise completed; £1m annualised savings to be realised in 2021; realign cost base with baseline revenues; Improved cash & working capital position; new banking
Slide 4: Strategic framework
Strategic framework STRATEGIC OBJECTIVES Continuously review and enhance To grow and improve our Accelerate the Group’s presence Expand the Group’s the Group’s product range service offering in civilian training and regulated business in innovative ways engineering markets OUR STRATEGY IN ACTION Lau
Slide 5: Summary – 30th June 2020
Summary – 30th June 2020 Group revenues for the Period of £6.3 million (H1 2019: £7.2 million); Cash generated from operations of £3.8 million (H1 2019: cash used in operations of (£2.7million)); Net cash at Period end of £2 million (H1 2019: net debt of £0.4 million and FY2019 net debt of £2.2 mill
Slide 6: Consolidated Income Statement
Consolidated Income Statement £000 30 June 2020 30 June 2019 31 Dec 2019 (Unaudited) (Unaudited) (Audited) Revenue 6.26 7.25 20.43 Gross profit 1.11 1.81 7.35 Administrative expenses (3.64) (3.57) (9.21) EBITA / PBITA (loss) (2.53) (1.76) 0.10 Amortisation (0.63) (0.03) (1.64) Operating (loss) (3.16
Slide 7: Underlying EBITA for H1
Underlying EBITA for H1 £m EBIT (3.16) Restructuring expense 0.40 Aborted Transaction costs 0.09 Amortisation 0.62 Underlying EBITA (2.05) Restructuring expense - achieved through the removal and re-organisation of various roles across all business units, the benefits of which will predominantly be
Slide 8: Consolidated Balance Sheet
Consolidated Balance Sheet £m 30 June 2020 30 June 2019 31 Dec 2019 (Audited) (Unaudited) (Unaudited) Non-current assets 14.5 12.3 11.6 Current assets 6.8 7.9 11.3 Current liabilities (6.1) (4.9) (6.9) Non-current liabilities (3.4) (0.9) (1.2) Shareholders funds 11.8 14.4 14.9 Non-current assets ref
Slide 9: Consolidated Cash Flow
Consolidated Cash Flow £m Six months ended 30 June Six months ended 30 June 2020 (Unaudited) 2019 (Unaudited) Net cash generated from / (used in) operations 4.50 (2.71) Investing activities (0.32) (1.33) Financing activities (0.04) 1.78 Net increase / (decrease) in cash and cash equivalents 4.14 (2.
Slide 10: Net cash generated from operations
Net cash generated from operations Cash generated from operations (£m) Six months ended 30 June Six months ended 30 June 2020 (Unaudited) 2019 (Unaudited) (Loss) for the period (3.23) (1.81) Depreciation 0.37 0.38 Amortisation 0.63 0.27 Share based payments 0.05 0.05 Other – finance, tax, profit on
Slide 11: Outlook & Order Book
Outlook & Order Book ‘© Copyright Pennant international Group pic. All rights rosorvod.
Slide 12: Three year “period end” order book - aggregate £36m
Three year “period end” order book - aggregate £36m Scheduled for delivery Contract 2020 2023 2021 2022 H2 H1 BAE Systems Australia 5 Year Rolling Term / 20 Year Framework – secured until 2023 £0.75m £1.6m £1.6m £0.75m HMRC – rolling annual supply arrangement, commenced 2009 £0.4m £0.8m £0.8m £0.4m
Slide 13: Selected Group Opportunities – active pipeline >£40m
Selected Group Opportunities – active pipeline >£40m TECHNICAL TRAINING SOLUTIONS INTEGRATED SOLUTIONS & SUPPORT Single Source / Formally notified Single Source Major programme – circa £15m - £20m, Canadian DND – extension of LSA / OmegaPS meaningful progress achieved services contract, circa £3.5m
Slide 14: Outlook
Outlook Financial performance expected to improve significantly in H2; Forecasting circa £1m EBITA profit for the period (£300k operating profit); Full benefit of cost reduction exercise to be realised in 2021; Meaningful progress made on active pipeline; post period contracts secured of circa £3m+;
Slide 15: About Pennant
About Pennant 15
Slide 16: History
History Pennant International Limited was established 60 years ago. The company has evolved over the past six decades to become a market-leading, technology inspired business with a truly global customer base. Pennant first formed Sir Christopher Cockerell produced first prototype of the SRN hovercr
Slide 17: Ownership and Management
Ownership and Management 5p Ordinary Shares Significant Shareholders Total shares in issue 36,446,385 Stakeholder Percentage holding AIM securities held in treasury NIL C C Powell Concert Party 17.23% Percentage of AIM securities not 53.36% Canaccord Genuity Group 14.86% held in public hands BGF Inv
Slide 18: Group Legal Structure
Group Legal Structure PENNANT INTERNATIONAL GROUP PLC (AIM Listed) UK AVIATION SKILLS PENNANT PENNANT PENNANT PENNANT SIP HOLDINGS INTERNATIONAL AUSTRALASIA PTY PENNANT INC. CANADA LIMITED TRUSTEE LIMITED LIMITED LIMITED LIMITED US CANADA UK UK UK AUSTRALIA PENNANT SOFTWARE THE AVIATION ABSOLUTE DAT
Slide 19: Our Facilities
Our Facilities Head Office Manchester, UK Fareham, UK Hertfordshire, UK Cheltenham, UK Ottawa Canada Pennant Australia Pennant Australia Pennant Australia Brisbane Wagga, Wagga Melbourne
Slide 20: Operations
Operations 20
Slide 21: Core Capabilities
Core Capabilities Translating and developing complex training requirements into a deliverable product Providing subject matter expertise in specialist and technical areas Operator and maintainer training within an engineering or related environment Hardware and Software capabilities Through Life Sup
Slide 22: Operational Delivery
Operational Delivery TECHNICAL TRAINING TECHNICAL TRAINING SOLUTIONS TECHNICAL SERVICES & SUPPORT INTEGRATED SOLUTIONS & SERVICES * GENERIC PRODUCTS + BESPOKE (ENGINEERED) MAPPING & CONSULTANCY SUPPORT & MAINTENANCE INSTRUCTION & TRAINING TECHNICAL PUBLICATIONS SOLUTIONS * MANAGES LOGISTICS SUPPORT
Slide 23: Technical Training
Technical Training 23
Slide 24: Generic Trainers
Generic Trainers Modern, off the shelf training aids Major safety gains Operation & maintenance savings Includes hand skill devices, VR procedure trainers & desktop emulators
Slide 25: Engineered Solutions
Engineered Solutions Bespoke engineering solutions Can be simulators, part-task trainers and procedural trainers Platform specific or custom-built Defence and Civil customer base
Slide 26: Computer Based Training (CBT)
Computer Based Training (CBT) Web & server-based e-learning Collaboration with government departments & global industry Provides consultancy & develops new strategies Access to anytime, anywhere training modules
Slide 27: Virtual Reality Trainers
Virtual Reality Trainers Award winning suite of solutions to provide effective training Ability to record responses & review activity Multiple users at one time Training in a safe environment Real-time faults and emergency solutions Multiple scenarios to improve learning
Slide 28: Track Access Systems (TAS)
Track Access Systems (TAS) Operating in the UK since 2002 Products & Services include: - Track Access Portal - Railway Survey - Signal Sighting - Railway Simulation - Driver training Complementary to Pennants existing rail capabilities which include Technical publications, Rail Sims, OmegaPS Rail et
Slide 29: Technical Publications
Technical Publications Compiling technical documentation and procedural data can be complex and time-consuming, yet it is crucial to the understanding and delivery of a product, having a major impact on the image, reliability and value of an organisation. User guides We have worked in partnership wi
Slide 30: Integrated Solutions & Services (ISS)
Integrated Solutions & Services (ISS) Pennant own the rights to two of the market leading LSAR & S1000D software products: Omega PS and R4i, both being sold world-wide and used in major defence contracts and by defence authorities in Canada and Australia.
Slide 31: ILS - OmegaPS LSAR
ILS - OmegaPS LSAR Database Tool which: Manages Logistics Support Analysis (LSA) data in accordance with relevant standards: - GEIA 0007, - Mil Std 1388-2B, - Def Stan 0060 - Def Aust 5692; and - Compatible with S3000L Standards Maintain detailed configuration of complex assets Identifies how to fix
Slide 32: Major Contracts
Major Contracts Consultancy agreement with Canadian Department of Defence to maximise the use of Omega PS in the DND - 5 year contract to December 2023 Consultancy agreement with Babcock in support of their property for the Royal Canadian Navy - 3 year contract to September 2021 Support contract wit
Slide 33: OmegaPS - Current Users
OmegaPS - Current Users OmegaPS OmegaPS Analyzer AIRBUS Qi SOEING FUJITSU 4€ LEONARDO ORS PF eneimerau 3.) SAAB f —Z eetway cosHam CAR MBBRA_ P- Systems: BAE SYSTEMS ogee m i E> sandra AWE ecco! DAMEN = @isnarriss 4" STADLER aselsa n LOCKHEED MARTIN A Hisns logistics THALES L3) Technologies Australi
Slide 34: R4i Product Suite
R4i Product Suite Specializes in creating, managing and leveraging technical data and maintenance information for clients across a variety of industries. Helps customers to create, manage and leverage information vital to the build, operation and maintenance of their complex assets.
Slide 35: R4i – Product Suite
R4i – Product Suite The R4i Suite includes: R4i Common Source Database (CSDB) Server R4i Binder R4i Viewer R4i ReViewer R4i MobieTP R4i Content Distribution Management System (CDMS) R4i Writer R4i IPD Manager R4i LTS
Slide 36: R4i Air
R4i Air The R4i AIR S1000D hosted solution provides authoring teams with a turnkey, ready to write S1000D product suite without the upfront costs. Features of R4i Air: Fast and robust Operating in the Amazon Cloud instead of installed on the customers servers Has the same S1000D capability that cust
Slide 37: R4i - Current Users
R4i - Current Users AIRBUS GROUP LOGISTIC SOLUTIONS. AUSTRALASIA Raytheon © Lufthansa Technik Australia \f australia 4@z S SAFRAN Gas Galactic KES m TREL © a |r | MacLean Engineering S SAFRAN Engineering Services SONOVISION °° ORIEC cr ovr SOLUTIONS 1 GENERAL HERSTAL (rou) BOP a ATOMICcS qa THE NORT
Slide 38: Thank you for your attention
Thank you for your attention Cheltenham | Manchester | Fareham | Ottawa | Brisbane | Melbourne | Wagga Wagga
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