Ama Group Limited · ASX:AMA
Ama — Investor Presentation (September 2021)
38 slides from Ama's investor presentation, Sep 10, 2021
Slide 1: Capital Raising and Enhanced Banking Structure
Capital Raising and Enhanced Banking Structure Investor Presentation 10 SEPTEMBER 2021 Not for release to US wire services or distribution in the United States 1
Slide 2: Important Notice and Disclaimer
Important Notice and Disclaimer The following notice and disclaimer apply to this investor presentation (Presentation) and you are therefore advised to read this carefully before reading or making any other use of this Presentation or any information contained in this Presentation. By accepting this
Slide 3: Important Notice and Disclaimer (cont’d)
Important Notice and Disclaimer (cont’d) The Retail Entitlement Offer will be made on the basis of the information contained in the retail offer booklet to be prepared for eligible retail shareholders in Australia and New Zealand (Retail Offer Booklet) and made available following its lodgement with
Slide 4: Important Notice and Disclaimer (cont’d)
Important Notice and Disclaimer (cont’d) Investment risk An investment in the New Shares or the Notes is subject to known and unknown risks, some of which are beyond the control of the Group, including possible delays in repayment and loss of principal and income invested. The Company does not guara
Slide 5: Important Notice and Disclaimer (cont’d)
Important Notice and Disclaimer (cont’d) Going concern basis of preparation The Group has experienced severe disruptions to its business as a result of the impacts of the COVID-19 pandemic. The Financial Information has been prepared on a going concern basis, which contemplates continuity of the Com
Slide 6: Important Notice and Disclaimer (cont’d)
Important Notice and Disclaimer (cont’d) Past performance This Presentation contains a pro forma historical balance sheet. Past performance and pro forma historical financial information given in this Presentation is given for illustrative purposes only and should not be relied upon as (and is not)
Slide 7: Capital Raising and successful bank debt restructure
Capital Raising and successful bank debt restructure • AMA Group Ltd (“AMA Group”) today announces it is raising $150m (the “Capital Raising”) • The Capital Raising is comprised of two concurrent offerings: ‒ $100m fully underwritten accelerated 1 for 2.8 pro rata non-renounceable entitlement offer
Slide 8: Strengthened balance sheet positioned for growth
Strengthened balance sheet positioned for growth Decrease in total net debt Improved liquidity position Net senior secured debt ($m)(1) Undrawn facilities and cash on balance sheet ($m)(4) Net debt including Convertible Notes 82(3) 134 173 122 50 32 Prior to capital raising / Post capital raising /
Slide 9: AMA Group is the leading collision repairer in Australia and New Zealand
AMA Group is the leading collision repairer in Australia(1) and New Zealand AMA Group is the leading collision repair business in Sites by business unit Australia(1), repairing vehicles for major insurers across 178 Business unit Sites (as at Jun-2021) sites in Australia and New Zealand Drive 72 Non
Slide 10: AMA Group’s business fundamentals remain strong
AMA Group’s business fundamentals remain strong Market Attractive Defined strategic values leader tailwinds to unlock growth Leading position and ~14%(1) market share Vehicle repair market is a ~$7bn(1) market Clearly defined, three dimensions of value to opportunity expand margins and scale • Longs
Slide 11: AMA Group’s focus and opportunity to unlock growth
AMA Group’s focus and opportunity to unlock growth ▪ Securing the quality products needed to execute operations on industry leading terms – Margin expansion through optimised sourcing of collision parts (~$350m annual cost at full run rate), which currently remains largely Procurement intermediated
Slide 12: AMA Group’s medium-term target
AMA Group’s medium-term target Metric FY19A(1) FY19 CS(2) FY19PF(3) FY20A(4) FY21A(4) Medium-Term Target (FY23+) * Number of sites Medium-term focus remains on margin expansion and revenue growth 130 sites 50 sites 180 sites 181 sites 178 sites ~180 sites (at end of 30 June) through: Revenue from ex
Slide 13: Disruption from COVID-19 and our response
Disruption from COVID-19 and our response ▪ COVID-19 restrictions have impacted kilometres travelled and had a subsequent direct impact on Sydney road traffic volumes(1) repair volumes. This is expected to continue throughout 1H22 Initial national 1.6 lockdowns ▪ Lower repair volumes affect site pro
Slide 14: Strengthening AMA Group’s balance sheet
Strengthening AMA Group’s balance sheet Sources and uses ($m) Net debt and leverage prior to and post Capital Raising(1) Sources $m NSLR (3) 2.7x 0.5x Convertible Note 50.0 Entitlement Offer 100.0 Net debt inc. Total sources 150.0 Convertible Notes 82(5) Uses $m 173 Permanent repayment of bank debt
Slide 15: Pro-forma capitalisation
Pro-forma capitalisation PROFORMA BALANCE SHEET JUN-21(1) BANK DEBT IMPACT OF JUN-21 A$ millions RESTRUCTURE(2) CAPITAL RAISING(3) PRO-FORMA Cash and cash equivalents 64.2 (75.2) 144.5 133.5 Receivables and other assets 112.8 - - 112.8 Non-current assets 950.1 - - 950.1 Total assets 1,127.1 (75.2) 1
Slide 16: Recap – FY21 summary financial performance
Recap – FY21 summary financial performance(1) SUMMARY FINANCIAL PERFORMANCE FY 2021 FY 2020 CHANGE FOR THE YEAR ENDED 30 JUNE PRE-AASB 16 PRE-AASB 16 AUD $'000 AUD $'000 AUD $'000 % • Increase in revenue and EBITDAI is largely due to the benefit of a full twelve months trading for acquisitions Reven
Slide 17: Capital Raising
Capital Raising 17
Slide 18: Offer details – Entitlement Offer
Offer details – Entitlement Offer • Fully underwritten(1) 1 for 2.80 accelerated, non-renounceable Entitlement Offer to raise gross proceeds of $100m Offer structure and size • Approximately 267m New Shares to be issued • Entitlement Offer will be offered at a fixed price of $0.375 per new share (Of
Slide 19: Offer details – Convertible Notes Offer
Offer details – Convertible Notes Offer Issuer AMA Group Limited Offering Senior convertible notes (the “Notes”) convertible into AMA ordinary shares (“Ordinary Shares”) in accordance with the final terms and conditions of the notes The Net Proceeds from the offering of the Notes will be approximate
Slide 20: Offer timetable
Offer timetable Event Date(1) Trading halt and voluntary suspension Monday, 6 September 2021 Capital Raising announced and investor presentation lodged to the ASX Friday, 10 September 2021 Convertible Notes Offer and Institutional Entitlement Offer open Friday, 10 September 2021 Trading halt and vol
Slide 21: Risk Factors
Risk Factors 21
Slide 22: Key risks – Business risks
Key risks – Business risks Risk Summary Impact of COVID-19 • AMA Group observes continuing uncertainty as to the duration and further impact of the COVID-19 pandemic, including the timing and extent of government approaches to lockdowns and containment measures (including travel restrictions affecti
Slide 23: Key risks – Business risks (cont’d)
Key risks – Business risks (cont’d) Risk Summary People risk • AMA Group is a highly focused customer service business and its team members and senior management are key to maintaining the level of operational service to its customers, as well as executing AMA Group’s strategy and growing its busine
Slide 24: Key risks – Business risks (cont’d)
Key risks – Business risks (cont’d) Risk Summary Property Leases • AMA Group has a large number of leased premises. Accordingly, there may be adverse impacts to AMA Group’s financial performance and ability to provide services for customers if AMA Group is unable to renegotiate acceptable lease term
Slide 25: Key risks – Business risks (cont’d)
Key risks – Business risks (cont’d) Risk Summary Credit risk • AMA Group is required to comply with financial covenants under the terms of its borrowing facilities, including a senior secured net leverage ratio and a fixed charge cover ratio, both of which are tested on a quarterly basis. AMA Group’
Slide 26: Key risks – General risks
Key risks – General risks Risk Summary Investment in equity capital and COVID-19 • There are general risks associated with investments in equity capital. The trading price of AMA Group’s ordinary shares on ASX may fluctuate with movements and limited liquidity in equity capital markets in Australia
Slide 27: Key risks – General risks (cont’d)
Key risks – General risks (cont’d) Risk Summary Interest rate risk • AMA Group is subject to the risk of rising interest rates associated with bearing liabilities with variable interest rates where interest rate movements can impact AMA Group's cash flow exposures. AMA Group seeks to manage part of
Slide 28: Key risks – Transaction and offer risks
Key risks – Transaction and offer risks Risk Summary Equity raising risk • UBS AG, Australia Branch (ABN 47 088 129 613) (the “Underwriter”) will be acting as underwriter, lead manager and bookrunner to the Entitlement Offer and the Convertible Notes Offer. AMA Group entered into an underwriting agr
Slide 29: Foreign Selling Restrictions
Foreign Selling Restrictions 29
Slide 30: Foreign selling restrictions
Foreign selling restrictions Canada (British Columbia, Ontario and Quebec provinces) This document constitutes an offering of New Shares only in the Provinces of British Columbia, Ontario and Quebec (the "Provinces"), only to persons to whom New Shares may be lawfully distributed in the Provinces, a
Slide 31: Foreign selling restrictions (cont’d)
Foreign selling restrictions (cont’d) Hong Kong WARNING: This document has not been, and will not be, registered as a prospectus under the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32) of Hong Kong, nor has it been authorised by the Securities and Futures Commission in Hong
Slide 32: Foreign selling restrictions (cont’d)
Foreign selling restrictions (cont’d) Norway This document has not been approved by, or registered with, any Norwegian securities regulator under the Norwegian Securities Trading Act of 29 June 2007 no. 75. Accordingly, this document shall not be deemed to constitute an offer to the public in Norway
Slide 33: Foreign selling restrictions (cont’d)
Foreign selling restrictions (cont’d) United Kingdom Neither this document nor any other document relating to the offer has been delivered for approval to the Financial Conduct Authority in the United Kingdom and no prospectus (within the meaning of section 85 of the Financial Services and Markets A
Slide 34: Underwriting Agreement
Underwriting Agreement 34
Slide 35: Underwriting Agreement
Underwriting Agreement AMA Group has entered into an underwriting agreement with UBS AG, Australia Branch (“Underwriter”) in respect of the Entitlement Offer, pursuant to which the Underwriter has agreed to fully underwrite the Entitlement Offer on the terms and conditions of the Underwriting Agreem
Slide 36: Underwriting Agreement (cont’d)
Underwriting Agreement (cont’d) ▪ AMA Group is prevented from allotting and issuing the New Shares under the Entitlement Offer in accordance with the Underwriting Agreement; ▪ ASX makes an official statement to any person or indicates to AMA Group or the Underwriter that official quotation of the Ne
Slide 37: Underwriting Agreement (cont’d)
Underwriting Agreement (cont’d) In addition, the Underwriter may terminate the underwriting Agreement on the occurrence of the following events if, in the reasonable opinion of the Underwriter, the event (a) has had, or is likely to have, a material adverse effect on (i) the success of the offer, (i
Slide 38: Underwriting Agreement (cont’d)
Underwriting Agreement (cont’d) ▪ in respect of its debt facilities: – AMA Group breaches, or defaults under, any provision, undertaking covenant or ratio of any material financing arrangement which has a material adverse effect on AMA Group; – an event of default, potential event of default, review