Slide 1: Polypipe Group plc: Acquisition of Nuaire
Confidential Polypipe Group plc Acquisition of Nuaire 5 August 2015
Slide 2: Important notice
Important notice This document has been prepared by Polypipe Group plc (the "Company") and comprises the slides for a presentation to analysts concerning the Company and the proposed acquisition by the Company’s subsidiary, Polypipe Limited, of the entire issued share capital of Nu-Oval Acquisitions
Slide 3: Introduction
Introduction Polypipe is announcing the acquisition of Nuaire for £145 million on a cash and debt-free basis – Leading UK designer, manufacturer and distributor of ventilation systems – Attractive growth profile and strong cultural fit Strong strategic rationale for a combination of Polypipe and
Slide 4: Leading UK designer, manufacturer and distributor of ventilation systems
Leading UK designer, manufacturer and distributor of ventilation systems The UK Commercial segment (56% of LTM sales) provides Commercial: ventilation systems (with or Heat Recovery: XBOX, Heat Recovery without heat recovery) and XBOXER, XBC Air Handling Units (AHU): energy efficient solutions
Slide 5: UK ventilation market
UK ventilation market Nuaire provides a market Estimated UK ventilation market mix (by value, 2014) leading position in the UK Commercial ventilation sector where Polypipe is currently not present Residential Ventilation Nuaire’s product range is a 35% strong complement to Polypipe in UK Residen
Slide 6: Growth above UK construction
Growth above UK construction Nuaire has a leading position within the UK ventilation market, which is one of the fastest growing segments of the £86bn UK construction market, driven by increased environmental regulation Nuaire sales have therefore been growing ahead of the UK construction sector
Slide 7: Accelerates Polypipe's strategic response to market evolution
Accelerates Polypipe’s strategic response to market evolution Reinforce Polypipe’s role of finding carbon efficient solutions in response to legislative change Helps to move the customer proposition up the value chain from discrete products to complete engineered solutions UK energy usage, 2011
Slide 8: New market and product opportunities
New market and product opportunities Nuaire’s specification-led sales model supported by ability to provide bespoke solutions: – Energy saving controls integrated with Building Management Systems – BIM modelling for architectural design calculations – Heat recovery and acoustic performance optimis
Slide 9: Solid track record of growth, profitability and successful cash flow generation
Solid track record of growth, profitability and successful cash flow generation Historically, Nuaire has Revenue demonstrated robust financial £m 18.8% growth 12.7% CAGR 63.5 performance even through a 58.6 53.5 challenging economic climate 46.1 49.5 During the period 2012 through 2014, Nuaire h
Slide 10: Attractive financial effects
Attractive financial effects Combination of Polypipe and 2014 Pro Forma Revenue Nuaire is expected to provide a £m solid platform for continued 58.6 385.6 profitable growth 327.0 2014 pro forma revenue for the combined entity of £385.6m and EBITDA of £71.6m, representing a c.18% increase EBITD
Slide 11: Key terms of the transaction
Key terms of the transaction Purchase price of £145 million on debt and cash-free basis – Financed using a combination of existing cash from the balance sheet and new debt In connection with the acquisition, the existing £120m term loan will be repaid and £40m revolving credit facility will be e
Slide 12: Acquisition of Nuaire helps Polypipe deliver on 5 out of 6 levers of its focused strategy
Acquisition of Nuaire helps Polypipe deliver on 5 out of 6 levers of its focused strategy Positioning to benefit from the market recovery Continued product development for sustainable construction Leverage brand position and end-user relationships Continuous investment in processes and effic