Slide 1: Investor presentation: Full year results to 30 June 2018
Investor presentation Full year results to 30 June 2018
Slide 2: Contents
Contents 1. Overview 2. Financials 3. Strategy 4. Summary and outlook 2
Slide 3: 1. Overview
1. Overview Robert Bulluss, CEO & MD
Slide 4: Company overview
Company overview Coventry Group Ltd (ASX: CYG) delivers innovative industrial solutions to the mining, construction and manufacturing sectors. We supply a We value the health, safety range of fastening systems, cabinet hardware systems and hydraulics, and well being of our people lubrication, fire s
Slide 5: Market overview
Market overview • Core markets = attractive and growing ➢ Mining and resources • Increase in service, repair and maintenance work expected to continue ➢ Construction/infrastructure • Significant infrastructure spend underway and commercial construction market remains strong ➢ Industrial • Increased
Slide 6: FY18 overview
FY18 overview • The Group is committed to the health, safety and well being of our personnel ❶ People & safety • 8 minor Lost Time Injuries in FY18 • Strengthened with the appointments of Rod Jackson (Chief Financial Officer) and Tracey Gibbins ❷ Leadership team (General Manager – People, Safety, We
Slide 7: Share price
Share price • Operational improvement has Coventry Group translated to significant 12 month share price shareholder value creation 1.60 1.2 • 125% share price increase to 1.40 1.0 $1.35 at 30 June 18 • Compared to $0.60 at 30 June 2017 1.20 0.8 Share price ($) Volume (m) • Market capitalisation impr
Slide 8: 2. Financials
2. Financials Rod Jackson, CFO
Slide 9: FY18 financial highlights
FY18 financial highlights • Sales +11.7% ➢ Up to $168.7m ($151.0m FY17) ($m) FY18 (1) (2) FY17 ➢ Increased average stock availability across all branches of 96% (FY17: <75%) Revenue from sale of goods 168.7 151.0 • Underlying EBIT improvement of +$6.4m Underlying EBITDA -4.7 -9.7 ➢ Full year loss of
Slide 10: Positive trends for KPIs
Positive trends for KPIs Group revenue % change Underlying EBIT $ m Loss from Continuing Operations $m -3.2 -12.5 -6.1 -1.8 -37.7 -8.3 11.7% -7.3% -4.3% FY16 FY17 FY18 FY16 FY17 FY18 FY16 FY17 FY18 The discontinuing operations of AA Gaskets have not been included in Group Revenue %, Underlying EBIT,
Slide 11: Trade Distribution
Trade Distribution ($m) FY17 FY18 % change Revenue 97.0 103.0 6.6% EBIT (underlying) -5.2 -3.0 43.2% Improvement in both Australia (TDA) and New Zealand (TDNZ) • TDNZ is performing strongly • TDA is continuing to show encouraging signs as service levels improve • Sales up 6.6% on FY17 ➢ Both TDA and
Slide 12: Trade Distribution - Australia
Trade Distribution - Australia ($m) FY17 FY18 % change Revenue 70.9 73.4 3.5% EBIT (underlying) -7.5 -6.1 18.9% TDA continues to show signs of improvement – more to do… • Sales up 3.5% on FY17 ➢ First positive year-on-year improvement in 10 years • Underlying EBIT improvement of $1.4m on FY17 ➢ Stil
Slide 13: Trade Distribution - New Zealand
Trade Distribution - New Zealand ($m) FY17 FY18 % change Revenue 26.1 30.0 15.1% EBIT (underlying) 2.3 3.1 36.3% Excellent result from TDNZ with improvement in all key metrics • Sales up 15.1% on FY17 • Underlying EBIT up 36.3% on FY17 • EBIT margin of 10.5% 13
Slide 14: Cooper Fluid Systems
Cooper Fluid Systems ($m) FY17 FY18 % change Revenue 54.1 65.4 20.9% EBIT (underlying) 2.6 5.0 89.8% Overall an outstanding result from CFS • Sales up 20.9% on FY17 • Underlying EBIT up 89.8% on FY17 • EBIT margin of 7.6% 14
Slide 15: Corporate
Corporate ($m) FY17 FY18 % change Corporate costs -10.6 -8.1 -33.3% Property costs -2.2 -2.4 Other income (includes rent and one-off insurance claim) 2.9 2.4 Net corporate costs -9.9 -8.1 -17.8% • Corporate costs are 4.8% of sales ➢ 17.8% reduction in corporate costs achieved in FY18 across a range
Slide 16: Balance sheet
Balance sheet ($m) Jun-16 Jun-17 Jun-18 • Net Assets maintained Cash & cash equivalents 3.5 5.1 5.0 Inventories 57.4 49.3 46.4 ➢ $60.6m (Jun 17: $61.6m) Trade and other receivables 30.8 29.3 30.5 ➢ NTA per share of $1.30 close to current share price (Jun 17: $1.30) Total current assets 91.7 83.7 81.
Slide 17: Cash flow
Cash flow ($m) Jun-16 Jun-17 Jun-18 Net cash from operating activities -1.9 -5.0 -4.1 Net cash from investing activities -1.7 -0.2 19.4 Net cash used in financing activities -2.6 7.6 -14.5 Net (decrease)/increase in cash and cash equivalents -6.2 2.4 0.9 Effect of movement in exchange rates -0.8 -1.
Slide 18: 3. Strategy
3. Strategy Robert Bulluss, CEO & MD
Slide 19: Coventry's value proposition
Coventry’s value proposition Renewed focus on our people Deliver service excellence Improved financial outcomes and our customers ➢ Quality products ➢ Grow sales ➢ Training ➢ Stock availability ➢ Improve margins ➢ Business Development ➢ Employee expertise ➢ Reduce DC infrastructure costs ➢ Technolog
Slide 20: TDA – FY18 turnaround evidence
TDA – FY18 turnaround evidence In addition to sales growth turnaround: Employees engagement Stock availability Customers Improvement in net promoter score Average stock availability of 96% Net promoter score improved to of 40.1% (FY17: -31.2%) (FY17: <75%) 33.9% (FY17: 4.3%) Product class No of prod
Slide 21: Geographic coverage – Trade Distribution
Geographic coverage – Trade Distribution Branch consolidations • Gympie and Caloundra merged into Sunshine Coast • Inner City Brisbane merged into Morningside • Geebung and North Brisbane merged into a new larger location in Brendale • Thomastown merged into Campbellfield $723k in annual cost saving
Slide 22: Growth strategy – TDA
Growth strategy – TDA ❶ Increase market share • Invest in sales and business development resources • Improving service and value proposition • Investing in branch network layouts and resourcing • Growth in the Construction, Cabinet Making, Industrial Customers and Manufacturers (OEM markets) ❷ Joint
Slide 23: Growth strategy – TDNZ
Growth strategy – TDNZ ❶ Increase market share • Invest in sales and business development resources • Improving service and value proposition • Investing in branch network layouts and resourcing • Growth in the Construction, Cabinet Making, Industrial Customers and Manufacturers (OEM markets) ❷ Gree
Slide 24: Geographic coverage – CFS
Geographic coverage – CFS Branch network • No recent consolidation • New geographic branch opportunities exist 24
Slide 25: Growth strategy – CFS
Growth strategy – CFS ❶ Increase market share • Delivering service and value proposition • Growth in the Hydraulics, Fuel Dispensing, Re-fueling, Technical Services and Training markets • Further diversification into Agriculture, Oil and Gas, Forestry, Defense, Manufacturing and Transportation Growt
Slide 26: Acquisition strategy
Acquisition strategy • Coventry has rationalised its business structure and the core business units remain well placed heading into FY19 Key acquisition criteria: ➢ Sale of AA Gaskets • Industrial supply market (both CFS and TD) ➢ TDNZ and CFS performing well • >A$10m turnover ➢ Strategies in place
Slide 27: 4. Summary and outlook
4. Summary and outlook Robert Bulluss, CEO & MD
Slide 28: Summary and outlook
Summary and outlook ❶ Experienced team is in place Focus on sales growth and sustainable profitable growth ❷ Group is achieving solid sales growth Has continued in early stages of FY19 ❸ Our key markets are performing well In mining and resources, construction and industrial sectors ❹ Strong balance
Slide 29: Disclaimer
Disclaimer Reliance on third party information The information and views expressed in this Presentation were prepared by Coventry Group Ltd (the Company) and may contain information that has been derived from publicly available sources that have not been independently verified. No representation or