Breedon Group Plc · LSE:BREE
Breedon — Breedon Aggregates — H1 2013 Earnings Presentation
27 slides from Breedon's earnings presentation, 2013
Slide 1: Interim results
Breedon Aggregates Interim results
Slide 2: Introduction
Introduction Peter Tom CBE Chairman Introduction Peter Tom CBE Chairman 2
Slide 3: 2013 H1 presentation
2013 H1 presentation ! Results overview Peter Tom, Chairman ! Financial review Ian Peters, Finance Director ! Operational review, summary & outlook Simon Vivian, Group CEO ! Q&A 3
Slide 4: Self-help and value-adding acquisitions
Self-help and value-adding acquisitions ! Improved EBITDA, margins & PBT, despite lower market volumes ! Continuing focus on self-help ! Further fixed-asset investment ! Transformational acquisitions completed ! £61m raised from new & existing shareholders 4
Slide 5: 2013 H1 Highlights
2013 H1 Highlights Sales Revenue EBITDA PBT £100.2m £13.0m £5.3m +20.8% +34.0% +£3.2m EBITDA margin Acquisitions Net Debt 12.9% EBITDA £72.2m +1.2pt £1.6m -£1.9m EBITDA, PBT and EBITDA margin all exclude non-underlying items 5
Slide 6: Financial Review
Financial Review Ian Peters Group Finance Director Financial Review Ian Peters Group Finance Director 6
Slide 7: Detailed Profit & Loss Half-Year to June 2013
Detailed Profit & Loss Half-Year to June 2013 Variance Variance 2012 2013 v 2012 v 2012 £’000 £’000 £’000 % Revenue 82,977 100,205 17,228 +20.8% EBITDA 9,684 12,973 3,289 +34.0% Depreciation & Amortisation (5,764) (6,329) (565) (9.8)% Underlying Operating Profit 3,920 6,644 2,724 +69.5% Share of Ass
Slide 8: Analysis by Division Half-Year to June 2013
Analysis by Division Half-Year to June 2013 Variance Variance 2012 2013 v 2012 v 2012 £’000 £’000 £’000 % Revenue England 44,043 50,821 6,778 +15.4% Scotland 38,934 49,384 10,450 +26.8% Total 82,977 100,205 17,228 +20.8% EBITDA England 5,451 7,166 1,715 +31.5% Scotland 5,737 7,317 1,580 +27.5% Head
Slide 9: Volumes Half-Year to June 2013
Volumes Half-Year to June 2013 2012 2013 Variance ’000 ’000 v 2012 tonnes tonnes % England 1,124 1,561 +38.9% Scotland 951 1,176 +23.7% Aggregates 2,075 2,737 +31.9% England 367 373 +1.6% Scotland 219 243 +11.0% Asphalt 586 616 +5.1% England 117 160 +36.8% Scotland 90 122 +35.6% Concrete (’000m3) 20
Slide 10: Closing Balance Sheet at 30 June 2013
Closing Balance Sheet at 30 June 2013 June 2012 Dec 2012 June 2013 £’000 £’000 £’000 Tangible Fixed Assets 147,027 144,895 187,198 Investments 914 887 1,422 Goodwill 2,143 2,143 13,772 Intangible Assets 162 152 444 Total Non-Current Assets 150,246 148,077 202,836 Current Assets 48,595 49,547 68,527
Slide 11: Half-Year to June 2013 Analysis - Cashflow
Half-Year to June 2013 Analysis - Cashflow 2012 2013 2012 2013 £’000 £’000 £’000 £’000 Profit before Interest and Tax 4,987 6,203 Interest Paid (2,165) (1,671) Income from associate (497) (535) Taxation (-) (-) Gain on asset sales (719) (1,282) Dividends Received / (Paid) 375 (50) Depreciation and a
Slide 12: Analysis of Net Debt at 30 June 2013
Analysis of Net Debt at 30 June 2013 Dec 2011 June 2012 Dec 2012 June 2013 £’m £’m £’m £’m Term Loans 72,607 63,111 62,822 62,733 Bank overdrafts 3,115 1,561 - - Cash (921) (712) (5,048) (4,817) Bank Debt 74,801 63,960 57,774 57,916 Finance Leases (over 1 year) 16,262 12,606 11,468 9,618 Finance lea
Slide 13: Operational Review
Operational Simon Vivian Review Simon Group Chief Vivian Executive Group Chief Executive 13
Slide 14: 2013 H1 key achievements
2013 H1 key achievements ! Strong financial performance ! Overall volumes up, against lower MPA volumes ! Continuing progress on health and safety ! Further investment in fixed asset base ! Key strategic acquisitions completed 14
Slide 15: Previously
Previously
Slide 16: Today
Today
Slide 17: England – financials & volumes
England – financials & volumes 2012 H1 2013 H1 % change £’m £’m Turnover 44,043 50,821 +15.4% EBITDA 5,451 7,166 +31.5% Op. Profit 2,615 3,975 +52.0% EBITDA Margin 12.4% 14.1% +1.7pt Op. Margin 5.9% 7.8% +1.9pt Sales Volume Aggregates +38.9% Asphalt +1.6% Concrete +36.8% 17
Slide 18: England – highlights
England – highlights ! No RIDDORs or LTIs ! New tertiary crusher & hot storage bins at Leaton ! Owner-driver fleet up from 78 to 88 ! Contracting overhead further reduced ! 1stMix ahead of budget and extended to new areas ! Supplies to A453 widening & i54 JLR project ! Exclusive supplier in ongoing
Slide 19: Acquisition – former Marshalls quarries
Acquisition – former Marshalls quarries Immediate benefits ! ‘In-it-to-win-it’ culture ! Strongly positioned strategic assets ! Synergies with existing business Issues to be tackled ! Mobile plant investment ! Leadership & strategic direction 19
Slide 20: Acquisition – former Marshalls quarries
Acquisition – former Marshalls quarries Priorities ! Bring health and safety up to Breedon standards ! Extract further synergies ! Address production constraints ! Focus on sales drivers ! improve understanding of customers, routes to market & value-added ! reduce stock excesses ! exploit organic gr
Slide 21: England – opportunities in H2
England – opportunities in H2 ! Increase commercial focus in contracting, extend customer base ! A453 sub-base package (main tonnage in 2014) ! A453 concrete (21km3 still to be supplied in H2 and 2014) ! Further 40k tonnes of asphalt on Phase 2 works at i54 JLR ! Continuing benefits of exclusive sup
Slide 22: Scotland – financials & volumes
Scotland – financials & volumes 2012 H1 2013 H1 % change £’m £’m Turnover 38,934 49,384 +26.8% EBITDA 5,737 7,317 +27.5% Op. Profit 2,814 4,179 +48.5% EBITDA Margin 14.7% 14.8% +0.1pt Op. Margin 7.2% 8.5% +1.3pt Sales Volume Aggregates +23.7% Asphalt +11.0% Concrete +35.6% 22
Slide 23: Scotland – highlights
Scotland – highlights ! Strong H1 performance despite weather impact ! Higher margins on value-added products ! Positive price movements ! Successful negotations with raw material suppliers ! Major supply contracts to Beauly-Denny Super Pylon project ! Developing partnerships with major customers 23
Slide 24: Acquisition – former AI units
Acquisition – former AI units Immediate benefits ! Strong self-managing H&S culture ! A very positive and willing team ! Excellent geographic fit ! Long-term mineral reserves Issues to be tackled ! Investment ! Management ! ‘Silo mentality’ 24
Slide 25: Acquisition – former AI units
Acquisition – former AI units Priorities* ! Deliver a first-class service to customers ! Grow sales out of previously closed units ! Increase profitability ! Develop ‘one team’ working ! Initiate optimum inter-company / unit supplies ! Leverage increased purchasing power ! Plan for big project oppor
Slide 26: Scotland – opportunities in H2
Scotland – opportunities in H2 ! Health & safety continuing top priority ! Pre-qualified for £3m Inverness & Wick Airports contract ! Secured £2.5m civils/surfacing package & asphalt supply contract for Aberdeenshire County Council ! Concrete & aggregates potential with BAM Nuttall on Kildermory Dam
Slide 27: Looking ahead – 2014/15
Looking ahead – 2014/15 ! Medium-term outlook improving ! Steady increase in underlying volumes ! Sustained recovery in housing market ! Support from Government spending review ! Continued encouraging prospects for Midlands markets ! Medium-term prospects good in Scotland ! Modest anticipated increa