Coventry Group Limited · ASX:CYG
Coventry — H1 2023 Earnings Presentation
29 slides from Coventry's earnings presentation, Feb 24, 2023
Slide 1: FY23 Half Year Result
FY23 Half Year Result Delivering innovative industrial solutions
Slide 2: H1 FY23 financial performance snapshot
H1 FY23 financial performance snapshot Financial performance Strong revenue and profit growth Revenue Underlying EBITDA 1 Underlying EBIT 1 Statutory net profit $175.8m $8.3m $6.5m $1.5m +12.0% on H1 FY22 +13.2% on H1 FY22 +13.1% on H1 FY22 $2.4m H1 FY22 Cash conversion 3 Net Assets Net Debt Net Deb
Slide 3: Agenda
Agenda 01 HY22 summary 02 03 About Markets + H1 Coventry industries performance 04 05 06 Business update and Strategy H2 outlook update priorities
Slide 4: About Coventry
01 About Coventry
Slide 5: Who is Coventry
Who is Coventry QLD 84 locations across Fluid Systems: 5 KAA: 13 Australia and New 1929 Zealand 18 Coventry Group founded 12 NSW Fluid Systems: 1 4 KAA: 9 SA 10 WA Fluid Systems: 1 Fluid Systems: 4 KAA: 3 ACT KAA: 7 1 950 DC: 1 11 KAA: 1 VIC 18 Fluid Systems: 3 TAS KAA: 7 Fluid Systems: 1 10 DC: 1 N
Slide 6: What we do
What we do We provide specialised industrial products, services and customised solutions to our wide network of customers through two business segments Fluid Systems • Fluid Systems designs, manufactures and sells hydraulics, lubrication, fire suppression and refuelling systems and products through
Slide 7: Specialisation is how we win
Specialisation is how we win Our operating business units provide specialised industrial products and services and customised solutions to a wide range of customers from blue chips to tradespeople We operate across a wide range of growing markets where we have small market share Specialisation diffe
Slide 8: Markets + industries
02 Markets + industries
Slide 9: The market + our industries
The market + our industries 1 2 3 4 Our markets are Supply Labour and skills Macroeconomic performing chain issues are shortages remain volatility continuing strongly easing challenging
Slide 10: Coventry (CYG) operates in high growth markets
Coventry (CYG) operates in high growth markets CYG has small market share in large high growth markets with significant opportunity for organic and acquisition growth Mining and resources Infrastructure Building and Industrial and Other markets construction manufacturing Continued strong $100b commi
Slide 11: H1 performance
03 H1 performance
Slide 12: H1 FY23 Overview: Revenue and EBITDA
H1 FY23 Overview Group Revenue up 12.0% to $175.8m Revenue ($157.0m H1 FY22). Group Underlying EBITDA1 up 13.2% to $8.3m EBITDA1 ($7.3m H1 FY22). Note 1: Underlying EBITDA is earnings before interest, tax, depreciation, amortisation and has been adjusted to exclude the impact of AASB 16 Leases and s
Slide 13: Profit and loss
Profit and loss Summary profit and loss 84 $m H1 FY23 H1 FY22 % change Revenue 175.8 157.0 +12.0% • Underlying EBITDA up +1.0m Underlying EBITDA 1 8.3 7.3 +13.2% (+13.2%) on prior year Depreciation and amortisation 1.8 1.5 • Underlying EBIT up +0.7m Underlying EBIT 1 6.5 5.8 +13.1% (+13.1%) on prior
Slide 14: Balance sheet
Balance sheet Solid balance sheet position 84 $m As at 31 Dec As at 30 June • The Group has a solid balance sheet 2022 2022 with Net Tangible Assets of $35.8m Total current assets 137.0 144.4 and Net Assets of $112.7m as at 31 December 2022 Total non-current assets 139.0 134.4 • The Group has a soli
Slide 15: Cash flow
Cash flow Cash conversion of 80.6% H1 FY23 84 $m H1 FY23 H1 FY22 Underlying cash from operations 12.3 1.1 • Cash conversion target of 80.0% less Lease payments (8.0) (7.7) • Significant improvement in cash conversion in H1 FY23 add back Significant items 2.4 0.4 • As supply chain issues and stock Un
Slide 16: H1 FY23 Segment performance
H1 FY23 Segment performance Trading performance improved during H1 FY23 with both business segments delivering Sales and underlying profit year 84 on year growth Fluid Systems • Fluid Systems EBITDA 1 % to sales of Revenue EBITDA 1 10.7% $70.5m $7.6m • Trade Distribution EBITDA 1 % to sales of 8.1%
Slide 17: Business update and outlook
04 Business update and outlook
Slide 18: Business overview Fluid Systems
Business overview Fluid Systems Fluid Systems is an innovative service provider to the Mining and Resources, Renewable Energy, Agriculture and 84 Aquaculture, Defence and Food & Beverage Manufacturing and allied industries Fluid Systems specialises in hydraulics, lubrication, fire suppression, refue
Slide 19: Business overview Trade Distribution
Business overview Trade Distribution Trade Distribution comprises Konnect and Artia Australia (KAA), Konnect and Artia New Zealand (KANZ), and Nubco 84 supplying a range of fastening systems, cabinet hardware systems, industrial and construction products through a network of 48 branches in Australia
Slide 20: Business update
Business update 84 Key strategic initiatives ERP upgrade project Cash conversion project ERP upgrade progressing well Cash conversion project delivered positive results • Project on schedule and under budget • Experienced project team and implementation • Inventory optimization project accelerating
Slide 21: Strategy update
05 Strategy update
Slide 22: Our Strategy
Our Strategy Our Purpose Our Values Our Vision Strategic priorities Customer promise Safety first In three years Build our time we will have: talent pipeline To provide Do the right thing $500m revenue Exceptional specialised (Fairness, Integrity Cash conversion specialist services industrial produc
Slide 23: Our organic growth opportunities
Our organic growth opportunities Expand Improving the Improve value Service and Digitalisation network network proposition product extensions Expanding product Trade store ranges makeovers and Enhance stud bolt relocations in capability E-commerce Greenfield Konnect Konnect Australia Improving our v
Slide 24: H2 priorities
06 H2 priorities
Slide 25: Strategic Priorities H2 FY23
Strategic Priorities H2 FY23 • Continue focus on rightsizing inventories and cash conversion • Accelerate organic growth in Trade Distribution • Deliver ERP upgrade project to schedule and on budget • Reinforce with customers our focus on specialist industrial products, services and customised solut
Slide 26: Summary
Solid H1 performance Double digit sales growth continuing Summary 6 weeks into H2 FY23 Operating in resilient markets and industries Specialisation will help us win
Slide 27: Disclaimer
Disclaimer Reliance on third party information Forward looking statements The information and views expressed in this presentation were prepared by Coventry This presentation may include forward-looking statements. Although the Company believes Group Ltd (the Company) and may contain information tha
Slide 28: Appendix
Appendix & Coventry Group Ltd
Slide 29: AASB16 Reconciliation
AASB16 Reconciliation Dec 22 Dec 21 Variance Variance $’000 YTD YTD ($) (%) Profit before financial income and tax 1 5,060 6,143 (1,083) Significant items 2,426 410 2,016 Add: Depreciation ROU Asset – Property and Vehicle 2 6,141 5,772 369 less: Lease payments - Property and vehicle (AASB 16 only) 3