Steel & Tube Holdings Limited · NZX:STU
Steel & Tube — Investor Presentation (November 2021)
36 slides from Steel & Tube's investor presentation, November 2021
Slide 1: Welcome: NZX Retail Investor Webinar November 2021
WELCOME NZX Retail Investor Webinar November 2021 [TITLE GOES HERE] Steel & Tube was sub-contracted to Eastbridge to supply approximately 4,000 tonne of steel plate and sections used in the construction of the bridges on SH1 between Pūhoi and Warkworth.
Slide 2: Agenda
Agenda About Steel & Tube Our Performance Growth Strategy Q&A
Slide 3: Steel & Tube is…
Steel & Tube is… • One of New Zealand’s leading providers of steel solutions • A proud New Zealand company, with over 68 years of trading history • We offer New Zealand’s most comprehensive range of steel products, services and solutions • Our stable of best-in-class businesses are some of this coun
Slide 4: Our purpose and vision
Our purpose We will achieve this by: To make life easier for • Providing a one-stop-shop for the most customers needing steel essential steel products – from floor to roof solutions by providing and everywhere in between unparalleled service, experience • Doing everything we can to make it easy for
Slide 5: Site and Structure
Site and Structure
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Slide 7: Stainless Steel
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Slide 8: Enclosure and Cladding
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Slide 10: Outdoors
Outdoors
Slide 11: Interior and Finish
Interior and Finish
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Slide 13: Services
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Slide 15: Sector Exposure
Sector Exposure Non-food Steel & Tube is a diversified Infrastructure, 14% (FY20: 13%) Manufacturing business with limited 19% (FY20: 24%) exposure to any one sector Food • 47% Residential and Non- Manufacturing Commercial Construction Residential 12%, Construction (FY20: 14%) 26%, • 14% Infrastruct
Slide 16: Our business divisions
Our business divisions DISTRIBUTION INFRASTRUCTURE Products sourced from preferred steel mills and Products processed before sale, typically on a contract or distributed through our national network project basis, including onsite installation services 16
Slide 17: Our Goals
Our Goals • To be the best in the business • The preferred choice of for customers • A rewarding place to work • An attractive investment for shareholders 17
Slide 18: Steel is the ideal circular economy material
Steel is the ideal circular economy material • Infinitely recyclable without product degradation • Easily reused and repurposed • Minimum construction waste compared to other building products • Significant proportion of steel is made in New Zealand using renewable energy sources • Steel’s durabilit
Slide 19: Building a sustainable business
Building a sustainable business Customer satisfaction Employee Safety Measure Greenhouse Gas score of 34 TRIFR 1.86 Emissions Down 9% Digital strategy is intrinsic Employee Engagement Range of quality initiatives to our business 7.4/10 and certifications 19
Slide 20: Our journey
Our journey In late 2017, we embarked on an extensive company-wide reset to drive long-term sustainable earnings improvement Moving Forward and rebuild shareholder value - foundation now laid and moving forward. Steel & Tube leadership in the sector and the preferred choice for steel products and Jo
Slide 21: FY21 results at a glance
FY21 results FY20 FY21 at a glance Revenue $417.9m $480.0m Significant and sustainable EBITDA $(37.2)m $40.7m improvement in results EBIT $(57.7)m $21.8m • Material improvement in Normalised EBIT $0.4m1 $19.0m1 earnings NPAT $(60.0)m $16.1m • Increased revenue • Strong balance sheet with Net cash $7
Slide 22: FY21 performance overview
FY21 Benefits of strategic initiatives now becoming clear performance Volumes and revenues have been rebuilt overview • • Focus on margin improvements • Improved customer service and delivery Strong result • Significant structural cost reductions – building a resilient driven by delivery underlying
Slide 23: Continued investment in Quality, Safety and Training
Continued investment in Quality, Safety and Training • Our commitment to Safety remains a stand out Strong improvement in eTRIFR*, strength with employees rating Steel & Tube’s safety down to 1.86, well below industry commitment 8.6/10 in engagement survey average. LTIFR of 0. • Critical risk manage
Slide 24: Network Strategy
Network Strategy Network consolidation programme largely completed – optimised branch network maintaining a regional presence and increased product offering. Annual Lease Cash $18.4* $15.9 Cost ($m) *2017 includes sale & lease back of two properties with lease costs of $3.5m per annum, partially off
Slide 25: Substantial and significant cost savings
Substantial and significant cost savings Variable Cost Metrics $m FY21 FY20 12% Sales 480.0 417.9 Operating Expenses (Excl D&A) 62.4 73.6 7% Operating Expenses/Sales 13.0% 17.6% 2% Depreciation and Amortisation* 17.5 18.8 Operating Expenses (Reported) 79.9 92.4 Freight/Sales % Direct Labour/Sales %
Slide 26: Enhanced focus on inventory and supply chain management
Enhanced focus on inventory and supply chain management Inventory Management Supply Chain Management • Developed capabilities managing • International shipping coordination international supply chain and devanning management congestion • Network design and optimisation – • Developing advanced data a
Slide 27: Positive gains from focus on sales disciplines and customer excellence
Positive gains from focus on sales disciplines and customer excellence Net promoter score measures customer satisfaction and has improved since 2018 • Focus on cross-selling through leveraging national footprint and breadth of products and availability • Infrastructure businesses point of difference
Slide 28: Our digital investment
Our digital investment +628% Webshop, e-commerce, data analytics, customer management, Online Revenue Growth YoY online training modules, new digital tools to make jobs easier • Intrinsic foundation across all areas of +5% the business Average increase in • Benefits: customer revenue as result of on
Slide 29: Building a winning team
Building a winning team • Leadership programme rolled out across the organisation • Over 50 online training modules currently available in our online training library, with 2,000 modules completed by Employee Satisfaction team members in FY21 eNPS • Consistently high Employee Engagement Score of 7.4
Slide 30: FY22: Trading under Covid environment
FY22: Trading under Covid environment Impact of lockdown – substantial drop in revenue while fixed costs remain at same level • Distribution business trading limited to essential Level businesses only 4 • Infrastructure / manufacturing businesses not able to operate; MBIE exemption for Coloursteel i
Slide 31: Strong lift in year on year trading performance
Strong lift in year on year trading performance Significant momentum offsetting impact of Covid restrictions Note weekly sales Monday to Sunday 31
Slide 32: Strategic focus: business growth
Strategic focus: business growth Growth opportunities are driving gross margin dollar improvement Build on New product Business strong business development Growth foundation & innovation 32
Slide 33: Areas of focus
Areas of focus Build on strong business New product development Business growth foundation and innovation • Continue to build best-in- • Continue to develop • Primary focus on class customer experience differentiated expertise organic growth and digital platform • Expand the targeted • Continue to c
Slide 34: FY22 market outlook
FY22 market outlook Positive market backdrop, cycle expected to be stronger for longer • Residential expected to flatten due to expected interest rate rises and supply demand imbalance slowly reducing with borders closed • Commercial seeing positive uplift in consents and significant increase in ten
Slide 35: FY22 business outlook
FY22 business outlook Positive outlook with number of identified opportunities • Long pipeline of secured contract work in place • Well positioned to take advantage of identified opportunities in a range of sectors • Focus remains on continued gross margin dollar improvement, leveraging digital plat
Slide 36: Steel & Tube’s strengths
Steel & Tube’s strengths • Strong governance and sustainability • Trusted customer partner – reliability, focus methodology, technical advisory and safety & quality • Established leadership positions in many categories of the steel market • Investment in product quality systems including Lloyds Regi
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