Bremworth Limited · NZX:BRW
Bremworth — Cavalier — Shareholder Meeting (November 2019)
31 slides from Bremworth's shareholder meeting presentation, Nov 27, 2019
Slide 1: Annual Shareholders' Meeting
ANNUAL SHAREHOLDERS’ MEETING 27 November 2019
Slide 2: Experienced Board and Leadership Team
Experienced Board and Leadership Leadership Team Team Alan Clarke George Adams Dianne Williams CEO: Paul Alston Chairman Deputy Chair CFO: Victor Tan GM Marketing and International Operations: Rochelle Flint GM New Zealand: Dean Chandler GM Elco Direct: Shane Eades GM Health & Safety: Kirstine Hulse
Slide 3: Alan Clarke, Chairman
Alan Clarke Chairman Cavalier Corporation | ASM Presentation November 2019 3
Slide 4: The Bremworth brand is created, Cavalier Carpets is born
Growth and success as 1959: 1972: a world leader in The Bremworth brand Cavalier Carpets is born beautiful NZ wool is created carpets 2010 on: 2015 – 2019: LOOKING FORWARD: Competitive challenges Restructuring the An exciting new world from synthetics and business for the new for Cavalier hard floor
Slide 5: Business Structure
Business Structure Cavalier Sales Offices and Showrooms in all major regions in Australia and OUR New Zealand Whanganui CUSTOMERS Manufacturing Auckland Wool Felted Yarn Carpet Making & Distribution Napier CAVALIER Manufacturing R&D and design Wool Yarn Marketing and sales Finance and admin Nationwi
Slide 6: Creating A World Of Difference
Creating A World Of Difference We are focussed on creating “A World of Difference” in everything we do. This means we don’t just sell carpets and rugs; our efforts have been borne from the desire to make a genuine difference, for our shareholders, our customers, our people, our suppliers, our commun
Slide 7: It's A New World: Market Trends
It’s A New World: Market Trends • Hard flooring continues to grow at the expense of soft flooring. • Synthetic carpets presently the first choice for many consumers. • Pressure on lower margin synthetic carpets. Only the largest manufacturers will be able to compete in this sector. • Wool carpets ha
Slide 8: The Rise of Conscious Consumerism
The Rise of Conscious Consumerism • Consumers considering the social, ecological, environmental and other impacts of products when purchasing. • More awareness of the impact of plastics in the environment …. and on health. • Growing demand for eco-friendly, sustainable products. Cavalier Corporation
Slide 9: Barkers/Max Clothing: Building on a heritage brand
Barkers/Max Clothing: Building on a heritage brand and transitioning to sustainable fashion “It’s a project which is now nearly two years old, and one which has consumed much of that time with questions which are a kind of business philosophy. It’s been as hard and draining as anything I’ve ever don
Slide 10: Lanaco: Natural Clean Air Technology Using NZ Wool
Lanaco: Natural Clean Air Technology Using NZ Wool Cavalier Corporation | ASM Presentation November 2019 10
Slide 11: All Birds
All Birds Cavalier Corporation | ASM Presentation November 2019 11
Slide 12: The Journey Begins
The Journey Begins We are transforming to a wool focused, design-led business • Transformational shift underway • Building on Cavalier’s 50-year heritage and expertise in the wool flooring market • Leveraging our reputation for quality, brand strength and new product innovation • Collaboration with
Slide 13: Paul Alston, Chief Executive Officer
Paul Alston Chief Executive Officer Cavalier Corporation | ASM Presentation November 2019 13
Slide 14: Our Company And Strengths
Our Company And Strengths Cavalier Corporation is a leader in the soft flooring market in Australasia • Cavalier Bremworth is the most recognised and trusted carpet brand in New Zealand market and very highly regarded in Australia. • We design and manufacture a range of beautiful broadloom carpets,
Slide 15: FY19 Key Events
FY19 Key Events • Increased focus on wool carpets vs synthetic fibres. • Significant investment into customer relationship activity including rollout of Cavalier’s successful World of Difference instore displays which provide a unique retail experience. • Focus on innovative new product development
Slide 16: FY19 Results Snapshot
FY19 Results Snapshot $millions FY19 FY18 Results in line with May 2019 guidance. Reflects only 3-month contribution from CWH compared to 12-months in prior year. REVENUE $135.2 $148.1 Revenue impacted by challenging market conditions in Australia throughout the year and softening in NZ in 2H19. EBI
Slide 17: FY19 Performance
FY19 Performance Gearing Gross Profit % Return (normalised 80% 30% EBITDA) on assets % 59% 24% 24% 60% 19% 4% 3% 41% 20% 2% 40% 32% 2% 10% 20% 0% 0% 0% FY17 FY18 FY19 FY17 FY18 FY19 FY17 FY18 FY19 -2% -1% Days Sales in Inventory Turnover Current Ratio Receivables 180 170 4 60 170 2.87 39 37 160 154
Slide 18: Capital Management: Debt position continues to improve
Capital Management Net Debt $m Debt position continues to improve 70 60 58.8 53.9 50 40.2 40 36.5 29.4 • 71% reduction in debt since FY14. 30 20 17.8 17.0 10 • Renegotiated bank terms and tenure in FY19. 0 Jun-14 Jun-15 Jun-16 Jun-17 Jun-18 Jun-19 End-Oct Company has support of banking partner. 19 C
Slide 19: Outlook for FY20
OUTLOOK FOR FY20 • Well positioned to capture the demand from consumers seeking a more natural, more sustainable, healthier alternative without compromising quality or style. • Market conditions remain challenging. Continuing to explore opportunities to expand market presence and range. • Transforma
Slide 20: 1H20 Guidance
1H20 Guidance (for the six months to 31 December 2019) • MARKET CONDITIONS: Continuation of challenging trading conditions. Slowdown in carpet sales, particularly lower end synthetic carpet. Demand for Cavalier’s premium wool carpets continues to grow and whilst these are a small part of total sales
Slide 21: Our Aspirations
Our Aspirations To be recognised as: ➢ A world leader in beautiful wool carpets, made from New Zealand wool ➢ A pioneer in design and craftsmanship ➢ Delivering uncompromising quality ➢ Exceeding our customers’ expectations ➢ Committed to operational and manufacturing excellence ➢ A culture that har
Slide 22: Wool is the Natural Choice
Wool is the Natural Choice ✓ Sustainable and 100% renewable ✓ Optimal carpet performance ✓ Design innovation and craftsmanship ✓ Healthier alternative ✓ Less odorous ✓ Warm in winter, cool in summer ✓ Fire resistant ✓ Naturally stain resistant ✓ Takes moisture out of the air ✓ Noise insulator WHY WO
Slide 23: The Value Story
The Value Story Wool vs Synthetic Margin Wool margins Percentage Percentage 2014 2015 2016 2017 2018 2019 2014 2015 2016 2017 2018 2019 Wool Synthetic Premium Mid-range Low end Cavalier Corporation | ASM Presentation November 2019 23
Slide 24: Opportunity In The Global Flooring Market
Opportunity In The Global Flooring Market • Global flooring market estimated at US$380B. Expected to grow to US$450B Percentage of sales by 2025. • Approx. 40% - 50% of floor surface is Rest of World 3% carpet. • Majority of current sales into Australia 42% and New Zealand. Floor coverings market es
Slide 25: Partnership with The NZ Merino Company
Partnership with The NZ Merino Company • Cavalier is a leader in the production of beautiful wool carpets. • While we make great carpet, our story telling needs to improve. • Collaboration with The New Zealand Merino Company – Helping us tell our story to the world. • NZM have had success in assisti
Slide 26: Cavalier Corporation | ASM Presentation November 2019
Cavalier Corporation | ASM Presentation November 2019 26
Slide 27: Shareholder Discussion
Shareholder Discussion 27
Slide 28: Resolutions
Resolutions Resolution 1: Re-election of John Rae as a Director Resolution 2: Record the reappointment of KPMG as auditors of the Company and authorise the directors to fix the auditors’ remuneration Resolution 3: To approve the amendment of the Company’s Constitution Cavalier Corporation | ASM Pres
Slide 29: Other Business, Close of the Meeting
Other Business Close of the Meeting Cavalier Corporation | ASM Presentation November 2019 29
Slide 30: Non-GAAP Measures
Non-GAAP Measures Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) is a non-GAAP measure and excludes net finance expenses, non-controlling interests, tax, depreciation and amortisation costs. Normalised EBITDA and Net Profit/Loss After Tax (NPAT/NLAT): Cavalier reports on norma
Slide 31: Disclaimer
Disclaimer This presentation has been prepared by Cavalier Corporation Limited (“CAV”). The information in this presentation is of a general nature only. It is not a complete description of CAV. This presentation is not a recommendation or offer of financial products for subscription, purchase or sa