Hill & Smith Plc · LSE:HILS
Hill & Smith — FY2024 Earnings Presentation
26 slides from Hill & Smith's earnings presentation, March 2025
Slide 1: Preliminary results • FY 2024
Preliminary results • FY 2024 For the year ended 31 December 2024 Hill & Smith PLC
Slide 2: Highlights
Hill & Smith PLC • FY 2024 Results 2 Highlights Strong results, continued momentum, refreshed framework Record FY24 trading performance Active portfolio management • 5% revenue and 20% profit growth at constant • Four value enhancing US acquisitions for currency aggregate expected consideration of c
Slide 3: 2024 results
Hill & Smith PLC • FY 2024 Results 3 2024 results Record results underpinned by strong growth in Engineered Solutions and Galvanizing Services businesses in the US Revenue Operating profit £855.1m +5% £143.5m +20% (2023: £829.8m) constant currency (2023: £122.5m) constant currency Operating margin P
Slide 4: Group overview
Hill & Smith PLC • FY 2024 Results 4 Group overview Our faster growing, higher margin US businesses contributed 76% of operating profit in 2024 By geography 3% 2% 22% 38% US Operating Revenue £855.1m UK profit 76% 59% £143.5m Rest of World By division 11% 28% Engineered Solutions Operating R
Slide 5: Engineered Solutions
Hill & Smith PLC • FY 2024 Results 5 Engineered Solutions Excellent performance, reflecting strong organic growth in US and contribution of recent acquisitions Constant 2024 2023 Currency OCC US Revenue (£m) 418.7 367.0 +17% +5% • Strong demand for composite solutions across Operating profit (£m) 77
Slide 6: Galvanizing Services
Hill & Smith PLC • FY 2024 Results 6 Galvanizing Services Record performance driven by volume growth in our higher margin Constant US business 2024 2023 Currency OCC Revenue (£m) 197.8 196.7 +2% +2% US Operating profit (£m) 50.3 45.7 +13% +12% • Impressive performance, with 9% volume growth and good
Slide 7: Roads & Security
Hill & Smith PLC • FY 2024 Results 7 Roads & Security Lower revenue due to subdued demand, but improved profitability Constant due to non repeat of certain FY23 2024 2023 Currency OCC one-off charges Revenue (£m) 238.6 266.1 -9% -9% UK Operating profit (£m) 15.4 12.4 +26% +26% Operating margin 6.5%
Slide 8: Cash generation and financial position
Hill & Smith PLC • FY 2024 Results 8 Cash generation and financial position Hill & Smith continues to be highly cash generative with £100.2m of free cash flow £m 2024 2023 Underlying operating profit 143.5 122.5 Depreciation and amortisation 32.4 30.2 Strong cash conversion Underlying EBITDA 175.9 1
Slide 9: Good progress on M&A
Hill & Smith PLC • FY 2024 Results 9 Good progress on M&A We completed four highly complementary US acquisitions in 2024 for aggregate expected consideration of £58.5m Whitlow Electric Trident Industries • Acquired September 2024: $30.2m (9.7x EBIT) • Acquired July 2024: initial consideration $13.5m
Slide 10: Our 2025 reporting structure
Hill & Smith PLC • FY 2024 Results 10 Our 2025 reporting structure We have changed our divisional reporting structure for 2025 to better reflect the way the Group is now managed, enabling closer focus on geographic end markets and growth opportunities Indicative FY24 divisional split under new repor
Slide 11: Strategic update: initial observations
Hill & Smith PLC • FY 2024 Results 11 Strategic update: initial observations Hill & Smith is a fantastic business with strong foundations and exciting growth potential Attractive end markets Talented teams We are exposed to attractive infrastructure and Our local operating company teams are hard bui
Slide 12: Our refreshed purpose and operating company framework
Hill & Smith PLC • FY 2024 Results 12 Our refreshed purpose and operating company framework Informing our portfolio management approach Our purpose We create value by providing solutions that enhance the resilience of vital infrastructure and the built environment Market Dynamics Business Model Mana
Slide 13: Market cyclicality: an enhanced focus on priority end markets
Hill & Smith PLC • FY 2024 Results 13 An enhanced focus on priority end markets Increasing our exposure to high growth markets with low cyclicality c.19% FY24 revenue c.45% FY24 revenue 3 Transport 2 +30% YoY products -1% YoY Low Public construction Data centres Other T&D Semiconductors Transport In
Slide 14: Refreshed financial framework
Hill & Smith PLC • FY 2024 Results 14 Refreshed financial framework Our strong financial performance and the positive outlook provide confidence to upgrade certain targets Updated FY24 FY23 FY22 Framework Organic revenue growth 5-7% flat 5% 14% Total revenue growth 10%+ 3% 13% 17% Operating profit m
Slide 15: Our updated capital allocation framework
Hill & Smith PLC • FY 2024 Results 15 Our updated capital allocation framework Effective deployment of capital to support growth ambitions Organic growth Inorganic investment Dividends Return surplus capital • Disciplined investment in • Structured approach • Provide a growing • Return surplus capit
Slide 16: Sustainability
Hill & Smith PLC • FY 2024 Results 16 Sustainability Sustainability underpins our growth strategy Protecting the world Focus areas: Health and safety • Greenhouse gas emissions and • 23% reduction in LTIR in 2024 energy efficiency • Enhancements to risk identification and assessment processes • Sust
Slide 17: Our investment case
Hill & Smith PLC • FY 2024 Results 17 Our investment case Structural growth High and improving underpinned by the need for returns profile infrastructure investment in delivering superior value our core markets for shareholders Market leader Strong balance sheet with a strong track record supported
Slide 18: Outlook
Hill & Smith PLC • FY 2024 Results 18 Outlook We expect another year of good progress in 2025 Strong trading momentum in US expected to continue • Underpinned by investment to upgrade and onshore vital infrastructure and technology change • We are closely monitoring the effect of current trade tensi
Slide 19: Appendices
Hill & Smith PLC • FY 2024 Results 19 Appendices
Slide 20: 2025 guidance
Hill & Smith PLC • FY 2024 Results 20 2025 guidance Key financial modelling assumptions Capital expenditure Interest c.£40m c.£9m Assumes base rates are maintained at end Feb 2025 rates. Includes aggregate c.£3m for IFRS16 lease and pension deficit interest and amortisation of refinancing fees Cash
Slide 21: 2024: divisional analysis
Hill & Smith PLC • FY 2024 Results 21 2024: divisional analysis Constant 2024 Organic M&A FX 2023 currency OCC Engineered Solutions Revenue (£m) 418.7 16.6 44.1 (9.0) 367.0 +17% +5% Operating profit (£m) 77.8 6.1 9.4 (2.1) 64.4 +25% +10% Operating margin 18.6% 17.5% Galvanizing Services Revenue (£m)
Slide 22: New reporting structure: 2024 indicative
Hill & Smith PLC • FY 2024 Results 22 New reporting structure: 2024 indicative Constant 2024 Organic M&A FX 2023 currency OCC US Engineered Solutions Revenue (£m) 390.3 7.6 44.1 (10.9) 349.5 +15% +2% Operating profit (£m) 69.4 4.3 9.4 (2.0) 57.7 +25% +8% Operating margin 17.8% 16.5% UK & India Engin
Slide 23: Non-underlying items
Hill & Smith PLC • FY 2024 Results 23 Non-underlying items 2024 2023 Business reorganisation costs - (0.2) Expenses relating to acquisitions and disposals (1.9) (5.3) Amortisation of acquisition related intangibles (9.9) (8.4) Impairments (FY24: principally H&S Inc.) (13.2) (0.6) Loss on remeasureme
Slide 24: Financial capacity: facilities and usage
Hill & Smith PLC • FY 2024 Results 24 Financial capacity: facilities and usage £m Net debt Facility Principal debt facilities Committed 100.7 308.1 • Revolving credit facility: £250m maturing H2 2027 On demand 0.3 6.7 • Senior notes: $70m unsecured notes mature 2026/29 Cash (51.6) - • c.55% of drawn
Slide 25: Disclaimer
Hill & Smith PLC • FY 2024 Results 25 Disclaimer Cautionary statement This presentation contains forward looking statements which are made in good faith based on the information available at the time of its publication. It is believed that the expectations reflected in these statements are reasonabl
Slide 26: Hill & Smith PLC
Hill & Smith PLC