Victorian Plumbing Group Plc · LSE:VIC
Victorian Plumbing — FY2022 Earnings Presentation
35 slides from Victorian Plumbing's earnings presentation, Dec 6, 2022
Slide 1: Full Year Results Presentation
Victorian Plumbing Group plc Full Year Results Presentation Year ended 30 September 2022 6 December 2022 victorian plumbing.coux
Slide 2: Agenda
AGENDA Today’s speakers V Overview FY22 full year results Key drivers and strategic progress Current trading and outlook 4 << 4 O&A Paul Meehan, CFO victorian plumbing cou
Slide 3: Overview
OVERVIEW v Results ahead of expectations in a challenging environment and now the UK’s No. 1 retailer for bathroom products across both online and offline channels Strategic increase in H1 marketing activity which led to market share gains Victorian Plumbing’s key strengths remain; market leader, in
Slide 4: FY22 Full Year Results
FY22 FULL YEAR RESULTS Vv victorian plumbing.ou
Slide 5: Financial Highlights
FINANCIAL HIGHLIGHTS £269m 45% £19.5m £45.5m 73% 2.8p victorian plumbing.ou () (2) Revenue of £269.4™m, in line with prior year; stronger H2 with revenue growth of +6%. Revenue growth +78% vs FY19 (pre Covid) Gross profit reduced to £121.0m (2021: £130.5m) with Gross profit margin reducing by Appt t
Slide 6: Operational Highlights
OPERATIONAL HIGHLIGHTS 880k _ Totalorders of 880,000 down 3% (2021: 906,000), with an increase of +2% in H2 £306 Average order value up 3% to £306 (2021: £296) 2 8% Marketing spend as a percentage of revenue increased to 28% (2021: 26%) in ° line with strategy and enabling us to take market share 2
Slide 7: Income Statement
INCOME STATEMENT Strong H2 with Revenue and Adjusted EBITDA for the year ahead of expectations Income statement (£m) FY22 FY21 YoY % Revenue 269.4 268.8 0% Cost of sale (148.4) (138.3) (7%) Y Revenue growth in H2 of +6%, full year Gross profit 121.0 150.5 (7%) broadly unchanged from FY21 Marketing c
Slide 8: Revenue
REVENUE Revenue (£m) YoY% FY22 H1YoY% H2YoY% H1YoY% H2YoY% H1YoY% H2 YoY% Trade 157% 40% 654% MATTE <~< ODE OO © @ victorian plumbing.ou Total orders (O00) YoY% (35%) FY20 Average order value (£) YoY% (2%) 0%) a — pm | FY21 FY22 Active customers (‘O00) YoY% FY20 608 FY21 FY22
Slide 9: Gross Profit
GROSS PROFIT Gross profit (£m) and Gross profit margin (%) YoY% 49% 42% (7%) ~ @ @® FY20 FY21 Gross profit ier @ @ won ae victorian plumbing.ou % of revenue - own brand and 3" party brands 25% 24% 75% 76% 25% 75% FY20 FY21 FY22 mOwn brand = Third party Gross profit - own brand margin % YoY% — 4ppt A
Slide 10: Underlying Costs
UNDERLYING COSTS Underlying costs (£m) YoY% @® Vv Marketing - strategic investment decision in H1 to take market share in a period of lower demand. 1015, Spend normalised in H2. Significant market share =—— goin in year 2 y People - ongoing pay inflation, increase in FTE’s of 8% for warehouse and de
Slide 11: Adjusted EBITDA
ADJUSTED EBITDA Adjusted EBITDA (£m) and Adjusted EBITDA margin (%) Adjusted EBITDA margin (%) bridge YoY% (53%) &® AEBITDA% 13% 15% T% FY20 FY21 FY22 FY21AEBITDA Marginimpact Marketing Other FY22 AEBITDA margin investment. overheads margin m Adjusted EBITDA victorian plumbing cou
Slide 12: Cash Flow Statement
CASH FLOW STATEMENT Cash flow statement FY22 FY21 Adjusted EBITDA TES) 40.1 Changes in working capital (1.2) (3.2) Cash gen. from ops. before exceptionals 18.3 36.9 Cash flows from exceptionals - (9.1) Cash generated from operating activities 18.3 27.8 Tax paid (1.4) (3.4) Net cash generated from op
Slide 13: Capital Allocation
CAPITAL ALLOCATION Victorian Plumbing generates significant operating cashflows y, (— ) . we Most growth Group intends to Underlying priority is in — Where we have . opportunities do not adopt a dividend F to reinvest into the a i a. excess cash, we will , require significant policy aiming to . busi
Slide 14: Statement of Financial Position
STATEMENT OF FINANCIAL POSITION Summary Statement of financial position FY22 FY21 Intangible assets 33 27 PPE & right of use assets 59 7.0 Other non-current assets 0.8 = Total non-current assets 10.0 9.7 Inventories SBS) 32.4 Trade and other receivables 51 49 Tax recoverable = 1.0 Cash and cash equi
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Slide 16: Our Strategy
OUR STRATEGY We think about our strategy with reference to 3 horizons Horizon1 Core B2C v Customer acquisition, new product development and innovation v Further market share gains, ongoing competitor weakness v Increase in addressable market as online penetration continues its upward shift v Opportu
Slide 17: We Are the Overall Market Leader
WE ARE THE OVERALL MARKET LEADER Market share by Revenue” Brand awareness") 15% 1% 7% = a 2015 2017 2019 2020 2021 2020 2021 2022 ® Victorian Plumbing Market share of bathrooms by revenue?) Trustpilot rating(*) reo 1 teppt Epp s2ppt -2ppt s2ppt *3ppt *3ppt I 19% "ag9, 18% I a l 1 £ ! I & Excellent l
Slide 18: Bold Creative Marketing and Development of Technology Platform Underpins Future Growth
BOLD CREATIVE MARKETING AND DEVELOPMENT OF TECHNOLOGY PLATFORM UNDERPINS FUTURE GROWTH Vv Vv Bold creative campaigns Target media audience, homeowners aged 25-55 years old Continued dominance in both Paid Search and Organic to drive efficient sales acquisition and resulting in increased market share
Slide 19: Progress in Key Strategic Areas
PROGRESS IN KEY STRATEGIC AREAS Trade Y Competitive discounts for trade consumers alongside dedicated account management encourages a high repeat rate amongst our trade customers (FY22: 82%, FY21: 76%) V Increase in range of smaller plumbing parts to become a one-stop shop for trade Work on trade ap
Slide 20: Supply Chain and Warehouse
SUPPLY CHAIN AND WAREHOUSE Y Far East team allows us to proactively manage our key supplier relationships in those regions Vv High container costs seen in the previous 18 months have started to reduce although currently partially offset by FX Vv Minimal exposure to current energy inflationary pressu
Slide 21: People
PEOPLE onsibilis, edcces, Ss ble a7 ry oy § @0Q@©: 4 (°) % 2 % x Y We have a values-oriented culture that underpins our business performance and we work hard to promote these values Enhonced Matoriy, ‘Adeptlon Leave Employee engagement team established in the year has helped Y todeliver a series of
Slide 22: Making a Splash in ESG
MAKING A SPLASH IN ESG We are progressing on our ESG journey with a continued focus on three core strategic areas Governance and ethics Vv Board continually assesses its compliance with the Code v Ongoing supplier audit programme in China v Suite of policies and tools to further strengthen organisat
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Slide 24: Current Trading and Outlook
CURRENT TRADING AND OUTLOOK Continued trading momentum ¥ The Group has had a strong start to FY23 with 10% revenue growth to date, whilst maintaining H2 gross profit margin and with lower marketing spend versus the comparative period last year ¥ We are conscious of the current macroeconomic conditio
Slide 25: Q&A
Q&A plumbing.co.ux
Slide 26: Disclaimer
DISCLAIMER The information and opinions provided in this presentation are provided as of the date of this presentation. Certain statements in this presentation constitute forward looking statements (including beliefs or opinions). Any statement in this presentation that is not a statement of histori
Slide 27: Appendix
APPENDIX
Slide 28: Milestone events
Listed 24th in The Sunday Times Fast Track 1002 – fastest Tech Hub opened growing private Operations move to Listed 16th in The in Manchester Skelmersdale companies Sunday Times Fast Warehouse Track 1001 – fastest 3 million Over 175k growing private orders(3) Trustpilot reviews companies Digital Gro
Slide 29: Online penetration and market growth
1.4 c.1.4 CAGR 2022-2027: 0.3% Acceleration due to 29 Source: Euromonitor, Mintel Note: (1) Penetration defined as e-commerce share % of total sales (value)
Slide 30: Online Specialists Are Taking Market Share
ONLINE SPECIALISTS ARE TAKING MARKET SHARE, WITH VICTORIAN PLUMBING TAKING AN OUTSIZED SHARE Retail sales by channel CcY2015 cy2019 cyY2021 victorian victorian lumbing.oux plumbing.ou . . p Se victorian plumbing.ou 3% N% 19% victorian plumbing.ou
Slide 31: Victorian Plumbing Is the Online Market Leader
VICTORIAN PLUMBING IS THE ONLINE MARKET LEADER Rapid market share expansion to become No. 1 online specialist bathroom brand and now also the UK’s No. 1 retailer for bathroom products across both online and offline channels Market share of bathrooms by revenue!) (2015 versus 2021) i | 415.2ppt -0.3;
Slide 32: One-Stop Shop for a Customer's Bathroom Needs
ONE-STOP SHOP FOR A CUSTOMER’S BATHROOM NEEDS Bathroom Furniture | Shower Enclosures Showers | FY22 Revenue by product category C1 a tl ~3,500 sius 52 sranas ~1,900 suus 35 branas ~2,100 swus 39 era Bathroom Tiles Basins Cutis le Bathroom Hi Bathroom Suit: Bathroom Accessories Baths Taps Toilets BRE
Slide 33: Strong Stable of Own & 3rd Party Brands
STRONG STABLE OF OWN & 35RD PARTY BRANDS Own brand gross margin significantly higher than third party brands FY22 revenue split Selected own brands >25 brands TURIN. at8720 CHATSWORTH Vv victorian plumbing.<oux Selected third party brands >100 brands GROHE Roca crosswater” mira }ERITAGE® BRISTAN BAT
Slide 34: Our Business Model
OUR BUSINESS MODEL Victorian Plumbing’s business model benefits from a virtuous cycle of investments in NPD & marketing building competitive moats + Invest in. marketing Operating to drive leverage traffic Reinvestment - ; Financial performance PAN Ed Investment in ‘own brand and Better new products
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Victorian Plumbing Group — FY2022 Earnings Presentation on 6ix