Slide 1: McBride plc Results Presentation: 29 September 2022
McBride plc Results Presentation: 29 September 2022
Slide 2: Our speakers today / Agenda
Our speakers today Chris Smith Agenda Chief Executive Officer 1. Overview 2. Financial review 3. Outlook Mark Strickland 4. Q&A Chief Financial Officer 1 McBride plc Results Presentation: 29 September 2022
Slide 3: Overview
Overview 2 McBride plc Results Presentation: 29 September 2022
Slide 4: Business review summary
Business review summary Group’s performance and prospects improving after difficult year Significant operating losses in year Supporting recovery and strategic direction • Management actions required to tackle over • Significant progress with price and margin £200m of annualised inflationary cost ef
Slide 5: Business response to inflationary pressures
Business response to inflationary pressures Multiple waves of margin recovery actions • Strict cost and capex management Unprecedented increase in long term RMPI • Materials cost forecasting improvements for pace and agility • Multiple waves of price rises, negotiation time lag – shelf prices, brand
Slide 6: General market overview
General market overview Volumes lower across the board Total market: Total category volumes: Total market Laundry volumes (6)% vs 2021 +1% vs 2019 – total (3)% vs 2021 (4)% vs 2019 Branded Cleaners volumes (6)% vs 2021 +3% vs 2019 – total (9)% vs 2021 +4% vs 2019 Private label Dishwash volumes (6)%
Slide 7: Divisional strategic update
Divisional strategic update 56.6% 25.3% of Group sales of Group sales Driving the cost and volume agenda Innovation progress sets the tone for • Strengthening market position despite PL market future growth volumes lower by 6% • Innovation and customer engagement developing well: • Contract manufact
Slide 8: Divisional strategic update
Divisional strategic update 10.1% 4.7% of Group sales of Group sales Cost leadership and technical step up securing wins Expanding reputation for specialist supplier • Overall trend for market decline slowing; cost • Niche player reputation; strong partnerships with proposition attractive in inflati
Slide 9: Programme Compass strategy update
Programme Compass strategy update Despite difficult last year, early Compass actions progressing, new initiative launch in FY23 • Compass structure implemented and Despite difficult last year, early Compass operational actions progressing, new initiative launch in FY23 • Divisional strategies update
Slide 10: ESG
ESG Environmental • Corporate carbon footprint completed Selected KPIs 2025 target FY22 FY21 • Chemicals vs packaging impact FSC® sourced 100% 91.4% 90.6% • Net Zero ambition to be defined in FY23 100% recyclable 100% 98.5% 98.5% • Good progress made on green electricity; 50% PCR in our plastic pack
Slide 11: Financial review
Financial review 10 McBride plc Results Presentation: 29 September 2022
Slide 12: Group revenue
Group revenue • Revenue fell by 0.6% vs FY21, but was 2.9% FY21 to FY22 revenue higher when excluding £23.3m adverse impact from currency translation 682.3 59.0 5.7 678.3 • Volume reductions, mainly in Liquids and (23.3) Unit Dosing divisions, drove £45.4m decline (45.4) (65% first half, 35% second
Slide 13: Group adjusted operating profit/(loss) bridge
Group adjusted operating profit/(loss) bridge £m 59.0 24.1 0.9 (11.5) 9.1 (94.6) (3.2) (24.5) (8.3) FY21 Adjusted Volume Mix Pricing Raw material Distribution Operations Divisional FY22 Adjusted operating profit input costs overheads operating loss • Key drivers of the £48.6m reduction in adjusted –
Slide 14: Compass cost reduction progress
Compass cost reduction progress • On track to save committed £20m annualised by the end of FY23 • £11.6m cost savings achieved in FY22 • Cost savings from: – operations £10.2m – distribution £0.9m – divisional overheads £0.4m 13 McBride plc Results Presentation: 29 September 2022
Slide 15: Divisional performance
Divisional performance Revenue £m Adjusted operating profit £m Constant currency variances Constant currency variances 4.6 22.6 20.4 678.3 (0.7) (1.6) (3.4) (9.4) 323.4 (26.9) 659.0 (16.8) (0.2) (2.2) (1.2) (24.5) FY21 Liquids Unit Powders Aerosols Asia FY22 Adjusted Dosing Pacific Adjusted FY21 Liq
Slide 16: Costs
Costs Divisional input costs index – largest divisions Distribution costs as Administrative (overhead) % of sales costs as % of sales 0.8% 0.7% 0.7% 3.5% 3.4% 3.4% 8.1% 8.2% 9.5% 18.2% 18.9% 18.2% FY20 FY21 FY22 FY20 FY21 FY22 Divisional direct Central recharge Dec Jun Dec Jun PLC costs 2020 2021 20
Slide 17: Other financials
Other financials Exceptional costs Capex and depreciation Pensions(1) Returns to shareholders £m £m £m £m 11.1 2.2 31.5 31.9 1.6 5.2 3.7 3.8 4.0 8.0 3.3 6.9 1.7 0.86 6.8 5.2 22.4 18.8 17.1 17.6 16.9 0.81 0.81 16.1 3.5 12.4 2.7 2.7 2.0 0.1 (0.2) FY20 FY21 FY22 FY20 FY21 FY22 FY18 FY19 FY20 FY21 FY22
Slide 18: Cash flow and net debt
Cash flow and net debt Cash flow and net debt £m Total working capital impact £(15.3)m 0.6 (118.4) (3.6) (15.9) (4.0) (0.1) (14.3) (124.9) (3.3) (5.6) (164.4) Net debt Adjusted EBITDA Underlying working Creditor Pensions Exceptional Capital Interest Non-cash Net debt (incl. IFRS 16) capital reductio
Slide 19: Funding arrangement agreed with the lender group
Funding arrangement agreed with the lender group FY22 covenants Refinancing agreed • Our lender group waived the December • New funding arrangements announced 2021 and deferred the 30 June 2022 on 29 September 2022 provides sufficient covenant tests with the following conditions liquidity headroom:
Slide 20: Going concern
Going concern • The Group's base case forecasts throughout – worsening trade working capital the going concern and viability review period – interest rates increasing by a further 100 would result in full compliance with the basis points Group's newly agreed banking covenants – sterling appreciating
Slide 21: Outlook
Outlook 20 McBride plc Results Presentation: 29 September 2022
Slide 22: Outlook
Outlook Inflationary pressures steadying; volumes showing some recovery Following refinancing agreement, management Early trading in FY23 on plan capacity to support business growth Varying outlooks for material costs, Margin recovery still in progress other costs still rising Logistics challenges e
Slide 23: Q&A
Q&A 22 McBride plc Results Presentation: 29 September 2022
Slide 24: Appendices
1. Income statement 2. Segmental reporting 3. Exceptional items 4. Balance sheet Appendices 5. Cash flow 6. Funding headroom 7. Group five-year summary 8. Ten-year adjusted operating profit/loss 23 McBride plc Results Presentation: 29 September 2022
Slide 25: Appendix 1: Income statement
Appendix 1: Income statement Constant currency(1) 2022 2021 2021 Continuing operations £m £m y/y £m y/y Revenue 678.3 682.3 (0.6)% 659.0 2.9% Gross profit 190.8 237.0 (19.5)% 228.2 Gross margin 28.1% 34.7% (6.6) ppt 34.6% (6.5) ppt Distribution costs (64.3) (56.0) 14.8% (53.7) 19.7% Administrative e
Slide 26: Appendix 2: Segmental reporting
Appendix 2: Segmental reporting Constant currency 2022 2021 2021 Revenue £m £m y/y £m y/y Liquids 383.9 376.1 2.1% 363.5 5.6% Unit Dosing 171.5 181.5 (5.5)% 174.9 (1.9)% Powders 68.6 66.3 3.5% 64.0 7.2% Aerosols 31.9 34.0 (6.2)% 32.6 (2.1)% Asia Pacific 22.4 24.4 (8.2)% 24.0 (6.7)% Group total 678.3
Slide 27: Appendix 3: Exceptional items
Appendix 3: Exceptional items 2022 2021 £m £m Reorganisation and restructuring costs/(gains) – UK Aerosols closure 0.1 0.4 – Factory footprint review (1.4) 0.3 – Review of strategy, organisation and operations (0.4) 4.4 – Logistics transformation programme 0.7 1.1 Environmental remediation 0.6 — Tot
Slide 28: Appendix 4: Balance sheet
Appendix 4: Balance sheet 2022 2021 £m £m Goodwill and other intangible assets 27.0 27.9 Property, plant and equipment 122.9 129.8 Right-of-use assets 11.3 10.0 Other non-current assets 31.6 22.9 Working capital 57.5 41.6 Net other (creditors)/debtors (0.9) 1.0 Provisions (7.2) (6.4) Pensions (16.1)
Slide 29: Appendix 5: Cash flow
Appendix 5: Cash flow 2022 2021 £m £m Adjusted operating (loss)/profit (24.5) 24.1 Depreciation property, plant and equipment 16.9 17.6 Depreciation right-of-use assets 4.0 3.8 Share-based payments — 0.3 Additional cash funding on pension scheme (4.0) (4.0) Impairment of property, plant and equipmen
Slide 30: Appendix 6: Funding headroom
Appendix 6: Funding headroom Committed Facility Drawn headroom At 30 June 2022 £m £m £m Committed facilities: – revolving facilities (May 2026) 151.4 (96.4) 55.1 – invoice discounting facility 53.7 (53.7) — – leases 12.0 (12.0) — Total committed facilities 217.1 (162.1) 55.1 Uncommitted facilities 8
Slide 31: Appendix 7: Group five-year summary
Appendix 7: Group five-year summary Year ended 30 June 2022 2021 2020 2019 2018 £m £m £m £m £m Total revenue 678.3 682.3 706.2 743.2 755.0 Continuing revenue 678.3 682.3 706.2 721.3 689.8 Adjusted operating (loss)/profit (from continuing operations) (24.5) 24.1 28.3 28.1 36.2 Amortisation of intangi
Slide 32: Appendix 8: Ten-year adjusted operating profit/(loss)
Appendix 8: Ten-year adjusted operating profit/(loss) £m 41.5 36.2 36.2 28.5 28.1 28.3 23.6 24.1 22.0 2013 2014 2015 2016 2017 2018 2019 2020 2021 (24.5) 2022 31 McBride plc Results Presentation: 29 September 2022