Slide 1: Genuit Group plc 2023 Full Year Results Presentation
Genuit Group plc 2023 Full Year Results Presentation 12 March 2024
Slide 2: Disclaimer
Disclaimer The information contained in this presentation has not been independently verified and this presentation contains various forward- looking statements that reflect management’s current views with respect to future events and financial and operational performance. The words “growing”, “scop
Slide 3: Agenda and Presenters
Agenda and Presenters Introduction – Joe Vorih, CEO Financial Results – Tim Pullen, CFO Strategic Progress and Outlook – Joe Vorih, CEO Q&A Joe Vorih, CEO Tim Pullen, CFO 3
Slide 4: Our Business
Our Business At Genuit we are enabling our customers to mitigate climate change and adapt to its effects Climate Management Solutions Water Management Solutions Sustainable Building Solutions (CMS) (WMS) (SBS) Addressing the need for clean healthy Driving climate adaptation and Providing a range of
Slide 5: FY23 Key Highlights
FY23 Key Highlights • Increase in underlying operating margin (15.8% to 16.0%) despite reduction in revenue of 5.7% • Strong progress on business simplification - £15m annualised savings now announced, underpinning results • Deployment of Genuit Business System on a continuous, multi-year basis acro
Slide 6: Financial Results
Financial Results Tim Pullen, CFO 6
Slide 7: Financial Highlights
Financial Highlights Increased margin despite challenging market backdrop Cash Revenue EBIT Margin EBIT Conversion DPS Net Debt £586.5m 16.0% £94.1m 87.7% 12.4p £149m Down Up Down Up Up Reduced 5.7% 20bps 4.2% 30.3pps 0.1p 10.2% Volume Leverage Improved reduction Progress Delivering Market reduced f
Slide 8: Financial Results - Revenue
Financial Results - Revenue Resilience in a challenging market Group Revenue FY23 Revenue Breakdown £7.4m £m 11.5% 29.9% FY23 586.5 £170.4m £242.8m 28.4% 30.2% £165.9m FY22 622.2 UK New Build UK RMI UK Commercial International SBS CMS WMS Other 8
Slide 9: Financial Results - Profit
Financial Results - Profit Proactive cost action increasing margins despite market headwinds Group Underlying Profit And Underlying Operating Margin § £15m of annualised savings secured from business £m simplification 17.5 § £8m announced in 2022 FY23 16.0% 94.1 § Further £7m announced in 2023 § 6 s
Slide 10: Business Units Overview 2023
Financial Results Business Units Overview 2023 Revenue (£m) Underlying Operating 13.7% Profit (£m) 7.3 622.2 -2.0 3.6 98.2 15.9% -2.5 1.0 94.1 -6.2 586.5 -39.7 -1.3 2022 CMS WMS SBS Other 2023 2022 CMS WMS SBS Other 2023 10
Slide 11: Climate Management Solutions (CMS)
Financial Results Climate Management Solutions (CMS) £m FY23 13.7% 22.7 § Revenue growth of 4.6% year-on-year 165.9 § Strong growth for Nuaire in residential ventilation due to structural growth drivers in social housing 15.9% 25.2 FY22 § Continued strength for Nuaire in commercial 158.6 ventilation
Slide 12: Water Management Solutions (WMS)
Financial Results Water Management Solutions (WMS) £m 10.4% 17.7 FY23 170.4 § Revenue approximately flat year-on-year § Strong H2 performance with 2% revenue growth 8.2% 14.1 year-on-year FY22 172.4 § Structural growth drivers in climate adaptation § Year-on-year growth in international business 0 5
Slide 13: Sustainable Building Solutions (SBS)
Financial Results Sustainable Building Solutions (SBS) £m 21.9% 53.1 FY23 242.8 § Revenue reduction of 14% year-on-year § New house building volume decline in line with 21.0% 59.3 the market FY22 282.5 § Commercial revenues from building services broadly flat year-on-year 0 100 200 300 Underlying Op
Slide 14: Summary P&L
Summary P&L Delivering a strong platform for future growth £m 2023 2022 Change Revenue 586.5 622.2 (5.7)% § Underlying operating margin growth to Cost of sales (338.7) (372.1) 9.0% 16.0% (+20 bps) year-on-year despite Gross profit 247.8 250.1 (0.9)% market-driven softness in volumes Gross margin 42.
Slide 15: Non-underlying Items
Financial Results Non-underlying Items 2023 £m 2023 2022 cash impact Non-underlying items: § Non-underlying items decreased to £32.1m (14.8) (15.2) - Amortisation of intangible assets (2022: £45.2m) before tax Impairment of goodwill - (12.0) - § Non-cash items of £17.3m represent 54% of Impairment o
Slide 16: Cashflow
Financial Results Cashflow £m 2023 2022 Change § Underlying cash generated from operations of £82.5m EBITDA (before non-underlying items) 119.8 123.2 (3.4) (33.8) (40.9) 7.1 with an operating cash conversion of 87.7% * Capex Leases (7.6) (6.2) (1.4) § Continued investment in key strategic and innova
Slide 17: Capital Allocation
Financial Results Capital Allocation Maximising value through efficient capital deployment § Continued investment in the business – Investment in innovation, Organic efficiency and sustainability investment £34.5m gross capital expenditure in 2023 to deliver future growth with a similar level antici
Slide 18: Strategic Progress and Outlook
Strategic Progress and Outlook Joe Vorih, CEO 18
Slide 19: Together, we create sustainable living
Our purpose Together, we create sustainable living 19
Slide 20: Our Strategy
Our Strategy Sustainable Solutions for Growth 1. Growth 3. Genuit Business System Focus on higher-growth, Create value through sustainability-driven lean transformation markets, via organic and operational growth and disciplined excellence M&A opportunities 2. Sustainability 4. People and Culture Co
Slide 21: Significant Progress On Our Strategic Objectives
Significant Progress On Our Strategic Objectives 3. Genuit Business 4. People and 1. Growth 2. Sustainability System Culture • Secured revenue • Progress on SBTi’s and • Undertook ‘lean • Genuit Leadership Team opportunities afforded Pathway to net-zero by lighthouse’ projects (top c.70) established
Slide 22: Climate Management Solutions
Climate Management Solutions Well-positioned to benefit from legislative and environmental tailwinds Key Achievements FY23 • Strong sales growth into UK residential driven by the need for better ventilation in social housing • Deployment of GBS at ADEY delivered improvements to inventory, productivi
Slide 23: Water Management Solutions
Water Management Solutions Improved business performance through effective self-help measures Key Achievements FY23 • Significant improvement towards 15%+ EBIT driven by structural simplification and cost controls • Site consolidation programme, with no capacity reduction • Continued growth in Polyp
Slide 24: Sustainable Building Solutions
Sustainable Building Solutions Strong progress despite challenging market Key Achievements FY23 • Resilient volume performance against backdrop of low housebuilding • Site consolidation programme, with no capacity reduction • Successful launch of PolyPlumb Enhanced range • Deployment of GBS has cont
Slide 25: Our Investment Case
Our Investment Case Delivering compound earnings growth from sustainability-driven growth markets Operating in built Differentiated, Leading positions Margin expansion Opportunity to Highly cash environment innovative, low - across diverse potential, including expand solution generative business sec
Slide 26: Outlook
Outlook Well-positioned for market recovery • Trading for 2024 has started in line with our expectations, despite continued market uncertainty • Current softness in UK construction expected to continue into the year but will vary by end market • New housebuilding volumes continue to be challenging •
Slide 27: Summary
Summary • Further progress towards our medium-term targets • Simplification programme nearing completion and Genuit Business System roll out continuing • Focused on sustainability-driven growth drivers 27
Slide 28: Genuit Group plc 2023 Full Year Results Presentation Q&A
Genuit Group plc 2023 Full Year Results Presentation Q&A 12 March 2024
Slide 29: Appendix
Appendix 29
Slide 30: Financing
Financial Results Financing Drawn as at 31 £m Facility Headroom Dec-23 Sustainability Linked Loan 120.0 350.0 230.0 Cash and cash equivalents (17.0) - 17.0 Net debt excluding unamortised debt issue costs 103.0 350.0 247.0 Private placement loan notes 25.0 Unamortised debt issue costs (2.1) Net debt