Btg Consulting Plc · LSE:BTG
Btg Consulting — Begbies Traynor Group — H1 2021 Earnings Presentation
29 slides from Btg Consulting's earnings presentation, December 2020
Slide 1: Half year results presentation
Half year results presentation Ric Traynor – Executive Chairman Nick Taylor – Group Finance Director December 2020
Slide 2: A leading professional services consultancy
A leading professional services consultancy Corporate and personal insolvency Corporate finance Financial advisory We handle the largest number of corporate Buy and sell side support on Business and financial restructuring, debt advisory, appointments in the UK, principally serving the corporate tra
Slide 3: Strong first half performance and confidence in full year outlook
Strong first half performance and confidence in full year outlook REVENUE • Strong financial performance £37.5m (+11%) (2019: £33.8m) • All areas of the group performed well • First time contribution from prior year acquisitions ADJUSTED PROFIT BEFORE TAX • Organic growth across both divisions £5.0m
Slide 4: Financial review
Financial review O Begbies Traynor Group
Slide 5: Financial highlights
Financial highlights H1 H2 H1 £m 31 Oct 19 30 Apr 20 31 Oct 20 Revenue 33.8 36.7 37.5 Operating profit (before amortisation and transaction costs) 4.5 5.6 5.5 Margin 13.2% 15.2% 14.6% Adjusted profit before tax 4.0 5.2 5.0 Adjusted basic EPS 2.6p 3.1p 3.1p Net cash (debt) (2.3) (2.8) 0.7 • Solid seq
Slide 6: Business recovery and financial advisory
Business recovery and financial advisory H1 H2 H1 £m 31 Oct 19 30 Apr 20 31 Oct 20 Revenue 23.0 26.6 26.1 Operating profit 4.9 6.7 6.6 Margin 21.1% 25.3% 25.1% 19 • Revenue growth of 13% (9% acquired) • First time contribution from prior year acquisitions (£2.1m) • Solid organic performance has miti
Slide 7: Property advisory and transactional services
Property advisory and transactional services H1 H2 H1 £000’s 31 Oct 19 30 Apr 20 31 Oct 20 Revenue 10.7 10.2 11.3 Operating profit 2.1 1.8 1.6 Margin 19.9% 17.0% 13.7% 19 • Revenue growth of 6% • Acquired growth of 10% - first time contribution from prior year acquisition (£1.1m) • Organic reduction
Slide 8: Maintained our strong financial position
Maintained our strong financial position 4 3 (1.4) 2 (1.1) 1 6.0 0.7 0 (1) (2.8) (2) (3) (4) • Strong free cash flow (FCF) of £6.0m (2019: £3.1m) • FCF before working capital of £4.1m (2019: £2.8m) • Working capital inflow of £1.9m (2019: £0.3m) – deferred VAT payments of £2.7m offset by net working
Slide 9: Full year outlook
Full year outlook • Expect full year results at least in line with current market consensus* • Would represent further year of growth • Short term Government support measures continue to subdue level of insolvencies • Anticipate removal of support will increase distress • Expect to lead to increased
Slide 10: Group developments
Group developments O Begbies Traynor Group
Slide 11: Insolvency market
Insolvency market • Key factors in current market • Significant Government support for corporates • Lack of creditor pressure – HMRC, banks, landlords • Court backlogs due to lockdown • Reduction in national appointments to 5,119* (2019: 7,305) • Legislation changes 19 • Extension from 30 Sep 20 to
Slide 12: Business recovery and financial advisory
Business recovery and financial advisory • Strong organic performance in challenging insolvency market • Total value of new appointments in period maintained • Increase in market share* and average case size mitigated weak market 19 • Benefit of organic growth and recent acquisitions • Ongoing recru
Slide 13: Property services – good recovery from lockdown
Property services – good recovery from lockdown • Property valuations – strong recovery in instructions • Instruction levels recovered from 30% of normal levels to 85% over period • Good levels of commercial property agency transactions and instructions • Property auctions remained on-line in the pe
Slide 14: Property services – development areas
Property services – development areas • Building consultancy • Significant increase in school property funding for clients • Managed projects totalling £28m in the period – 50% increase on prior year • Project fees increased to £2.1m (2019: £1.0m) 19 • Increase in realisations from machinery and bus
Slide 15: Summary
Summary O Begbies Traynor Group 14
Slide 16: Summary
Summary • Strong financial performance in the period • Expect full year results at least in line with current market consensus • Expect significant increase in market insolvency levels in 2021 • Strong financial position to invest in • Continued development and enhancement of the group • Organic and
Slide 17: Appendix
Appendix O Begbies Traynor Group 16
Slide 18: Investment case
Investment case • Strong track record of cash generative, profitable growth with a well-established progressive dividend policy • AIM listed since 2004 • highly experienced board and senior management team • long-established corporate structure with separation of equity, management and fee earners •
Slide 19: Business recovery
Business recovery • UK’s leading independent business recovery • Basis of remuneration practice • Typically on the basis of hours worked with fees paid from asset realisations • Handle the largest number of corporate appointments in the UK • In limited occasions based on a percentage of asset realis
Slide 20: Marketplace
Marketplace Firms Largest appointment takers 6m to Sep 20 Big 4 accountancy firms American boutiques Begbies Traynor 560 Alvarez & Marsal, FTI, Alix Partners, Duff & Phelps FRP 266 National accountancy firms Grant Thornton, BDO, RSM Quantuma 209 National specialists Leonard Curtis 161 Begbies Trayno
Slide 21: Financial advisory
Financial advisory • Services: • Clients: • Corporate finance - Buy and sell side private company • Businesses transactions • Legal and professional community • Forensic accounting and investigations - fraud and financial • Banks and financial institutions crime investigations, expert witness for di
Slide 22: Property services
Property services • Services • Clients • Valuations • banks and financial institutions, insolvency practitioners, • valuation of property, small to medium sized businesses, commercial property owners and occupiers, property agents, machinery and business assets public sector bodies, property develop
Slide 23: Well placed with counter-cyclical focus
Well placed with counter-cyclical focus 19 22
Slide 24: Acquisition history
Acquisition history 2019 2019 2019 2019 ALJ Ernest Wilson Regeneratus BSM (Insolvency) (Business sales agency) (Advisory) (Chartered surveyors) Revenue: £3.1m Revenue: £2.2m Revenue: £0.6m Revenue: £3.1m Profit: £0.9m Profit: £0.7m Profit: £0.2m Profit: £0.6m 2019 2019 2018 2018 KRE and Dunion Croft
Slide 25: Ownership structure
Ownership structure The group has 127.9m shares in issue. The ownership profile is: Name % holding Ric Traynor 21.3 Other management 5.8 Major institutions: • OVMK Vermogensbeheer 6.9 • Close Brothers 6.8 • Amati Global Investors 5.4 • Hendrik Marius Van Heijst 3.0 • Nordea Asset Management 3.0 • St
Slide 26: H2 financial guidance
H2 financial guidance • Expect results at least in line with current market expectations for the full year • Adjusted tax rate 21% (FY20: 21%) • Average shares in issue FY21 c129.4m; fully diluted c134.0m • Transaction/amortisation costs: • Deemed remuneration £2.8m (Full year: £5.9m) • Amortisation
Slide 27: Segmental analysis
Segmental analysis H1 H2 H1 £000’s 31 Oct 19 30 Apr 20 31 Oct 20 Revenue Business recovery and financial advisory 23,043 26,587 26,146 Property advisory and transactional services 10,736 10,137 11,347 Total 33,779 36,724 37,493 Operating profit Business recovery and financial advisory 4,864 6,724 6,
Slide 28: Balance sheet
Balance sheet £m 31 Oct 20 31 Oct 19 30 Apr 20 Intangible assets 58.3 61.4 59.4 Fixed assets 8.3 8.9 8.8 Acquisition items : deemed remuneration 7.5 9.5 9.1 : deemed remuneration liabilities (0.8) (2.4) (0.3) Working capital: - Assets 34.3 32.2 32.0 - Liabilities (26.0) (20.9) (21.8) Net working cap
Slide 29: Offices across the UK
Offices across the UK. www.begbies-traynorgroup.com Begbies Traynor Group plc; registered in England No: 5120043, registered office: 340 Deansgate, Manchester, M3 4LY, a member of the Begbies Traynor Group; Specialist Professional Services.
Begbies Traynor Group — H1 2021 Earnings Presentation on 6ix