Slide 1: Close to you worldwide
Close to you worldwide
Slide 2: RAK Ceramics PSC Q1 2016 Results Presentation
RAK CERAMICS PSC Q1 2016 RESULTS PRESENTATION
Slide 3: Disclaimer
Disclaimer This information contained in the enclosed presentation summarizes preliminary and introductory information on RAK Ceramics PSC (the Company). This presentation has been prepared for information purposes only and is not and does not form part of or constitute any prospectus, offering memo
Slide 4: Q1 2016 Highlights
Q1 2016 HIGHLIGHTS Mr. Abdallah Massaad, Chief Executive Officer RAK Ceramics. Copyright 2015.
Slide 5: Q1 2016 Operational Highlights
Q1 2016 OPERATIONAL HIGHLIGHTS Group Revenue Consolidated GM Core Gross Margins AED736mn, -1.1% YoY 30.2%, +170 bps YoY 30.2%, +40bps YoY Net Profit CAPEX Gearing Core Business CAPEX AED66mn, +10.8% YoY AED100mn 3.1x Net Debt/EBITDA Private & Confidential. RAK Ceramics. Copyright 5 2015.
Slide 6: Value Creation Plan Progress
VALUE CREATION PLAN PROGRESS MEDIUM TERM QUICK WINS HIGH BREAK THROUGH INITIATIVES GREATEST POTENTIAL India Strengthen China UAE Materials / Strategy B2B sales Non-core restructuri expansion Energy ng Assets Distributor FINANCIAL IMPACT Banglades Tableware JVs & h strategy Strategy receivable Iran s
Slide 7: Segment Highlights
SEGMENT HIGHLIGHTS
Slide 8: Tile - Revenues
TILE - REVENUES Q1/16 tile revenues rose 3.3% YoY. Domestic sales registered 7.3% YoY Tile Revenues by End Market growth while export sales rose 11.5% AED Mns Q1/15 Q1/16 YoY despite weakness in Saudi Arabia. Revenues also benefited from United Arab Emirates 120.3 129.0 7.3% consolidation of our UK
Slide 9: Tile - Margins
TILE - MARGINS Q1/16 tile margins rose 70ps YoY and 320 bps QoQ. Tile Gross Margins Results demonstrate raw material procurement, transportation and 31.3% packaging savings and favorable LPG costs in India. Consolidated results still reflect ongoing losses (though lower YoY) from the China 27.0% ope
Slide 10: Sanitaryware - Revenues
SANITARYWARE - REVENUES Q1/16 Sanitaryware sales rose 0.5% YoY. Sales to the UAE rose 0.8% while Sanitaryware Revenues by End Market exports fell. Sales to Europe which rose AED Mns Q1/15 Q1/16 YoY 4.9% YoY benefitted from consolidation of our European distribution JVs , see United Arab Emirates 32.
Slide 11: Sanitaryware - Margins
SANITARYWARE - MARGINS Q1/16 sanitaryware margins fell 260bps YoY to 40.5% from 43.1%. Sanitaryware Gross Margins In terms of production location, UAE margins fell from 42.9% to 40.6% in the quarter. The decline in sanitaryware 45.8% margin resulted from lower volumes, higher labor costs, higher dep
Slide 12: Tableware
TABLEWARE Q1/16 tableware revenues rose 6.0% YoY. Volumes fell 4.2% while ASPs rose 10.3% YoY. Tableware Revenues The decision to focus on higher value 39.0 added product led to a substantial improvement in tableware 36.8 profitability. Q1/16 Gross Margin was 34.5 38.3 62.8% versus 56.1% in Q1/15. 3
Slide 13: Non Core
NON CORE Q1/16 non core revenue were AED91.0mn versus AED117.7mn in Q1/15 or -22.6% YoY. Q1/15 non core revenues reflect the contribution of RAK Logistics by the order of AED14mn; RAK Logistics was sold in Q4/15 and did not contribute to Q1/16 revenues. Excluding the contribution of RAK Logistics, n
Slide 14: Non Core Margins
NON CORE MARGINS Q1/16 non core gross margin was 30.3% vs. 22.1%, an 820bps Non Core EBITDA by Segment improvement YoY. AED Mns Q1/15 Q1/16 YoY Once again, the improvement in profitability was driven by AHCC, our AHCC Group 20.6 25.3 23.2% construction. “Others & share in results” also rose reflecti
Slide 15: Q1 2016 Financial Review
Q1 2016 FINANCIAL REVIEW Mr. PK Chand, Chief Financial Officer RAK Ceramics. Copyright 2015.
Slide 16: Results Summary
RESULTS SUMMARY AED Mns Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Revenue (Net) Tiles 539.8 574.3 542.0 524.3 480.3 514.3 531.5 470.8 496.0 SW 110.1 115.0 111.8 111.6 110.9 116.2 108.6 108.2 111.5 Porcelain - - - 35.1 35.1 36.0 36.2 38.3 37.2 Core revenue 649.9 689.3 653.7 670.9 626.2 66
Slide 17: EBITDA
EBITDA EBITDA increased by x% YoY from AEDXmn to AEDXmn. EBITDA and EBITDA MarginTrend – EBITDA Calculation Last 5 Quarters AED Mns Q1/15 Q1/16 YoY Net Profit 59.5 65.9 10.8% Tax 6.7 4.2 -37.3% 180. 27.5% D&A 52.5 47.7 -9.1% 22.0% 135. AED Millions 8.1 12.3 51.9% 16.5% Finance Expense 90. 11.0% Prov
Slide 18: Net Debt & Capex Highlights
NET DEBT & CAPEX HIGHLIGHTS Net Debt During the quarter we converted a AED Mns Q1/15 Q4/15 Q1/16 conventional loan of USD 134 mn (AED 495 mn AED) into an Islamic term loan Long Term Loan 1149.5 1,309.7 1281.9 with same terms & conditions. This has resulted in reduction in conventional STL & TR 705.1
Slide 19: Working Capital Highlights
WORKING CAPITAL HIGHLIGHTS Trade Receivable Days Inventory Days 120 200 115 188 110 175 199 118 117 190 185 187 188 105 163 108 108 108 100 150 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Trade Payables Days 80 73 65 76 79 76 69 71 58 50 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 RAK Ceramics. Co
Slide 20: Closing Comments
CLOSING COMMENTS Mr. Abdallah Massaad, Chief Executive Officer RAK Ceramics. Copyright 2015.
Slide 21: 2016 Focus
2016 FOCUS Branding Project Iran Restart Hired ~200 employees. India Turnaround New design & marketing hires New CEO to join in May. Core Business CAPEX Restructuring of China Plant Sale Distribution JVs Managing Expansion Closed UK and Germany acquisitions. Italy ongoing. Working Capital Opportunis
Slide 22: Appendix
APPENDIX RAK Ceramics. Copyright 2015.
Slide 23: Focus Market Sales Trends
FOCUS MARKET SALES TRENDS India United Arab Emirates 200. 140. 10 160. 105. 10.3 32.6 36.3 34.4 32.7 5.8 8.3 7.1 120. 30.1 29.2 33.6 6.2 5.4 70. 80. 104.9 116.5 93.6 93.8 94.1 119.9 112 120.3 121.8 122.4 118.1 129 35. 82.5 75.7 40. 0. 0. Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Q3/14 Q4/14 Q1/15 Q2
Slide 24: Net Impact of JV Consolidation on Q1/16 Results
NET IMPACT OF JV CONSOLIDATION ON Q1/16 RESULTS During the quarter we acquired the remaining 50% of two distribution joint Net Impact of Acquisition of 50% stake in UK and Germany JVs ventures we have in the UK and AED Mns Q1/16 Germany. Previously only the net contribution from UK and Germany appea
Slide 25: Consolidated Income Statement
CONSOLIDATED INCOME STATEMENT AED Mns Q1/15 Q1/16 YoY Revenue 744.1 735.7 -1.1% Cost of sales (531.7) (513.4) -3.4% Gross profit 212.4 222.4 4.7% Administrative and general expenses (90.7) (64.8) -28.6% Selling and distribution expenses (84.9) (95.4) 12.6% Other income 16.9 15.5 -8.3% Results from o
Slide 26: Cash Flow Statement
CASH FLOW STATEMENT AED Mns Q1/15 Q1/16 Q1/15 Q1/16 Operating activities Investing activities Profit for the period before tax 66.1 70.0 Acquisition of property, plant and equipment and capital work in progress (49.4) (100.1) Adjustments for: Share of profit in equity accounted investees (5.7) (6.2)
Slide 27: Consolidated Balance Sheet
CONSOLIDATED BALANCE SHEET AED Mns Q4/15 Q1/16 Q4/15 Q1/16 Non-current assets Equity Property, plant and equipment Share capital 817.5 858.4 1,065.5 1,079.5 Capital work-in-progress Reserves 1,950.6 1,718.6 182.3 232.5 Goodwill 50.4 68.9 Equity attributable to owners of the Company 2,768.1 2,577.0 I
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