Galliford Try Holdings PLC · LSE:GFRD
Galliford Try — HY21 Earnings Presentation
35 slides from Galliford Try's earnings presentation, Mar 4, 2021
Slide 1: Half year results
Half year results Six months ended 31 December 2020 4 March 2021
Slide 2: Agenda
Bill Agenda Hocking Half year results to 31 December 2020 Highlights Chief Executive Financial review Business update Q&A 2
Slide 3: Highlights
Highlights £542m Revenue £158m Average month-end cash (HY20: pre-exceptional £636m) (H2 20: £141m) § Excellent operational progress with robust Covid secure measures; strong safety £4.1m Profit before tax 1.6% Divisional operating margin performance. (HY20: pre-exceptional loss £5.6m) (HY20: pre-exc
Slide 4: Financial review
Andrew Financial Duxbury review Finance Director 4
Slide 5: Improved financial performance
Improved financial Continuing operations HY21 HY201 Var performance Revenue £542m £636m £(94)m Operating profit/(loss) before £3.9m £(6.7)m +£10.6m amortisation § Return to profitability. Profit/(loss) before tax £4.1m £(5.6)m +£9.7m § Half year results in line with expectations; full year targets o
Slide 6: Segmental analysis
£m HY21 HY201 Var Revenue 541.7 636.2 (15)% Segmental analysis Building 374.5 423.5 (12)% Infrastructure 164.1 208.7 (21)% Improved profit performance PPP Investments 3.1 3.8 (18)% HY21 HY201 Var Operating profit2 (£m) 3.9 (6.7) +10.6 § Revenue in line with expectations. Building 6.0 2.4 +3.6 § Marg
Slide 7: Strong balance sheet
Strong balance 31 Dec 30 June Balance sheet £m 2020 2020 sheet Intangible assets & goodwill PPP & other investments 84.0 44.1 85.0 40.7 Other non-current assets 31.1 32.1 Working capital § Well-capitalised. Working capital (241.0) (211.3) § Average month-end cash £158m. IFRS 16 (19.4) (22.3) • No de
Slide 8: Cashflow
Cashflow Average month-end cash £158m; operating cash inflow £28m 250 £12m £6m 225 (£1m) £211m £10m £197m 200 (£13m) £m 175 Operating cash inflow in the period £28m £158m 150 £141m 125 Opening Openingnet netcash cash1 Cash from operating Other working capital Interest & tax Other Discops Discontinue
Slide 9: Working with our supply chain
Working with Average days Invoices paid Invoices paid in our supply chain 6 months to 31 Dec 20 to pay to terms 60 days Galliford Try Construction Ltd 41 87% 92% Compared to 31 Dec 2019 (2) +9% +7% § Advantage through Alignment drives supply chain engagement. § Resilience despite Covid-19 and Gallif
Slide 10: Reinstatement of dividend
Reinstatement of dividend Enhanced dividend policy 1.2p Interim dividend (HY20: 0.0p) § Revised dividend policy. § Driven by strong balance sheet, financial performance and outlook. § Reduced dividend cover to 2.0 - 2.5x. § Interim dividend declared 1.2p. 2.0 -2.5x Dividend cover (Previously 3.0x) 1
Slide 11: Business update
Bill Business Hocking update Chief Executive 11
Slide 12: Our purpose, vision and values
Our Our Our purpose vision values To improve lives by sustainably To be a people-orientated, Excellence, Passion, building the facilities and progressive business, driven by Integrity and Collaboration. infrastructure that our values to deliver for our communities need. stakeholders. 12
Slide 13: Our business model
Our business model Delivering sustainably for our stakeholders Our approach Focused on two § Ensure safe and sustainable market segments Our construction practices. Generating purpose § Disciplined focus on risk Building returns Funding management. § Education, Health, Defence organic To improve liv
Slide 14: Our strategy
Our strategy Delivering long-term value S1 S2 S3 Retain Improve Deliver Existing platform for Operations to drive margin Strong, predictable performance. sustainable growth. progression. § Sustainable business. § Maintain a robust balance sheet. § Great people. § Health and safety. § Deliver predict
Slide 15: ESG
0.06 ESG Accident Frequency Rate (HY20: 0.10). 83.2% Embedded in our culture customer satisfaction score and net promoter score of 89 (HY20: 85.3% and 91). § Underpinned by high standards of 2,721 training days provided for our people corporate governance and Code of (HY20: 3,240). Conduct – Doing t
Slide 16: Carbon reduction case studies
Company fleet Low carbon buildings Carbon § Company vehicles are one of the main areas that contribute to our energy use. § Constructing low carbon buildings for several clients across the UK. reduction § More than 35% of fleet is now electric or hybrid. § Evaluating two buildings in parallel to und
Slide 17: Our market: Building
Planned Government investment Building order book Our market EDUCATION £547m Education £14bn for primary and Defence £393m and custodial § Contributing to UK economic secondary education. recovery from Covid-19. £272m Health § Build the economy of the future. • Growing and ageing population. DEFENCE
Slide 18: Our market: Infrastructure
Planned Government investment Infrastructure order book Our market HIGHWAYS £576m Highways £28.8bn in the National § Excellent framework position. Roads Fund. § Strong pipeline of framework £681m Environment opportunities. ENVIRONMENT £15bn for new and improved water and £1.3bn Total wastewater serv
Slide 19: Order book
Order book by client type £3.2bn £3.3bn Order 3.5 £2.9bn 3.0 19% 11% 2.5 17% book 2.0 £bn 1.5 89% 83% 81% 1.0 0.5 0.0 FY19 FY20 HY21 § Predominantly public and Public and regulated Private regulated sector work provide stability and maturity of procurement. § Key sectors which align to our risk appe
Slide 20: Risk management
Risk management Assessing and managing risks and uncertainties is the central element of our process and business strategy Robust review and approval Board approval required for Technical, commercial and Contract selection pre-contract all bids over £25m or other financial parameters applied. to avo
Slide 21: Strong and predictable shareholder returns
Strong and predictable shareholder returns Objective FY21 Medium-term KPI Progress Disciplined contract selection and On track, with carefully risk £1,100m - £1,300m revenue. £1,200m - £1,500m revenue. measured revenue growth. managed order book. Focus on bottom line margin 1.6% divisional operating
Slide 22: Summary
Summary Delivering on our strategy § Returned to profitability. § Significant progress achieved. § High-quality, risk managed, order book. § Strongly cash generative. § Very robust balance sheet. § Resumed dividends with a new policy. § On course to meet our full year objectives and confident for th
Slide 23: Questions & answers
Questions & answers 27 Milton Keynes Cancer Centre
Slide 24: Appendices
Appendices 1. Our business 1.1 Management team 1.2 Geography 2. Financial analysis 2.1 FY21 financial guidance 2.2 Net finance income 2.3 Exceptional items 2.4 PPP Investments valuation 3. Order book 3.1 Forward order book 3.2 Contract types 3.3 Key framework positions 28
Slide 25: Management team
Appendices 1.1 Management team A highly-experienced Executive Board § More than 150 years’ construction sector experience. § Supported by a strong plc Board. 29
Slide 26: Geography
Appendices 1.2 Geography National strength, Key local delivery Morrison Construction Highland 1 Morrison Construction North East 2 Building Morrison Construction Central 3 § National coverage through Building North East & Yorkshire 4 nine regions. Building North West 5 § Sector-specific support. Bui
Slide 27: FY21 financial guidance
Appendices 2.1 FY21 financial guidance1 Strategy FY21 Disciplined revenue growth and contract selection. Revenue £1.1bn - £1.3bn Growing operating margin starting in FY21. Operating margin2 • Pre central costs 1.4% - 1.6% • Post central costs 0.4% - 0.7% Control of central costs. Central costs Circa
Slide 28: Net finance income
Appendices £m HY21 HY201 Interest receivable from joint ventures and 2.2 Net finance PPP Investments 1.9 2.4 income Interest receivable on bank deposits - 0.1 Other2 (0.7) (0.4) Total 1.2 2.1 1 Continuing operations. 2 Includes interest resulting from IFRS 16. 32
Slide 29: Exceptional items
Queensferry AWPR Crossing Appendices £(m) charge/(income) charge Other1 Total 2.3 Exceptional FY17 75.0 12.9 1.0 88.9 items FY182 125.0 - - 125.0 FY19 32.3 6.7 11.8 50.8 FY20 (28.0) - 2.9 (25.1) HY21 nil nil nil nil 1 Aborted Bovis merger professional fees (FY17), Construction restructuring costs/GM
Slide 30: PPP Investments valuation
Appendices PPP Investments valuation 2.4 PPP Investments 50 valuation 45 £44.1m Valuation £m 40 35 30 7% 8% 9% 10% Discount rate % 34
Slide 31: Forward order book distribution
Appendices Forward order book distribution – Building (excluding FM) 3.1 Forward order 80 book 70 60 Number of contracts § <£20m average contract 50 size. 40 30 20 10 0 m m m m m m m m m m m 10 10 20 30 40 50 60 70 80 90 0 10 <£ >£ >£ >£ >£ >£ >£ >£ >£ >£ >£ Contract size 35
Slide 32: Contract types
Appendices The overall target contract value is agreed with the client, normally through negotiation, including margin and risk and inflation Target cost/cost 3.2 Contract types reimbursable contingencies. The actual cost of the work plus agreed fee is paid by the client. Any cost savings or overspe
Slide 33: Key framework positions
Appendices § Department for Education’s Construction Framework. Highways and Infrastructure Framework. Generate § LHC Schools and Community § NEUPC Universities Framework. 3.3 Key framework Buildings Framework. § Scottish Procurement Alliance. repeat clients § Crown Commercial Service positions (CCS
Slide 34: Disclaimer
Disclaimer This document contains statements that are, or may be deemed to be, implied in any forward-looking statements in this document will actually “forward-looking statements” which are prospective in nature. These occur. You are cautioned not to place undue reliance on these forward- forward-l
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