Johnson Service Group Plc · LSE:JSG
Johnson Service — FY2020 Earnings Presentation
29 slides from Johnson Service's earnings presentation, March 2021
Slide 1: Final Results – 12 months ended 31 December 2020
Peter Egan Chief Executive Officer Yvonne Monaghan Chief Financial Officer Final Results 12 months ended 31 December 2020
Slide 2: Impact & Management of COVID-19
2020 Final Results Impact & Management of COVID-19 “…the decisive actions taken have protected the future of the business…” 2
Slide 3: Impact & Management of COVID-19
2020 Final Results Impact & Management of COVID-19 Workwear ▪ Continued to operate and service customers throughout the various lockdowns ▪ 12% volume reduction in April 2020 steadily improved to pre-COVID volumes in October ▪ Current volumes at 96% of normalised levels, reflective of customers clos
Slide 4: Financials
2020 Final Results Financials “Strengthened balance sheet and liquidity…” 4
Slide 5: Income Statement
2020 Final Results Income Statement 2020 2019 Revenue (£m) 229.8 350.6 Adjusted EBITDA (£m)1,2,3 53.6 119.0 Adjusted EBITDA margin (%)1,2,3 23.3 33.9 Adjusted operating (loss) / profit (£m)2,3 (12.1) 52.8 Adjusted operating margin (%)2,3 (5.3) 15.1 Exceptional items (£m) (4.3) - Adjusted (LBT) / PBT
Slide 6: Exceptional Items
2020 Final Results Exceptional Items 2020 £m Restructuring costs1 (5.8) Insurance claims2,3 2.5 Impairment losses re insurance claims (1.0) Total Exceptional Items (4.3) Notes 1) Includes £4.7 million of redundancy costs relating to the realignment of the workforce in response to the impact of COVID
Slide 7: Cash Flow
2020 Final Results Cash Flow £m 2020 2019 Adjusted operating (loss) / profit (12.1) 52.8 Depreciation, impairment and software amortisation 66.4 66.2 Working capital 24.4 2.7 Capital expenditure – fixed assets and software (21.4) (20.0) – rental stocks (net) (26.0) (45.9) – fixed asset proceeds 0.2
Slide 8: Other Financial Information
2020 Final Results Other Financial Information Interest & Bank Facility Interest Taxation • Interest cost of £4.9m including £1.7m relating to lease • Effective tax rate1 of 18.5% (2019: 18.8%) liabilities and £0.6m relating to discontinuance of • Benefits from prior year adjustments offset by the i
Slide 9: Operations
2020 Final Results Operations “We continue to take pro-active actions to adapt our operations to ensure the Group can thrive…” 9
Slide 10: JSG's Continuing Commitment to ESG
2020 Final Results JSG’s Continuing Commitment to ESG We aim to Carbon Trust Investment “Remove, Reduce, sponsored in state-of-the-art Reuse, Recycle” wastewater energy efficient wherever we can recycling equipment solution Actively Ongoing recruiting in-house employee Electric vehicle sustainabilit
Slide 11: £21.4m Investment
2020 Final Results “The Group’s continuous investment in state-of-the-art energy efficient capital equipment…not only gives us a competitive advantage but allows us to reduce our environmental impact £21.4m when compared to using older and less efficient machinery.” Investment Leeds Clacton Basingst
Slide 12: Operational Performance: Workwear
2020 Final Results Operational Performance: Workwear 12
Slide 13: Operational Performance: Workwear
2020 Final Results Operational Performance Workwear 2020 2019 Revenue (£m) 129.5 135.3 Adjusted EBITDA (£m)1,2,3 48.7 49.2 1,2,3 Adjusted EBITDA margin (%) 37.6 36.4 Adjusted operating profit (£m)2,3 23.3 24.4 Adjusted operating margin (%)2,3 18.0 18.0 Notes: 1. Adjusted operating profit plus deprec
Slide 14: Operational Performance: Workwear
2020 Final Results Operational Performance: • All sites continuing to operate during lockdown • Volumes slowly returned to pre-Covid levels from a low of 88% Workwear • Customer retention levels remain high at 94% (2019: 95%) • Existing customer satisfaction at 86%, in line with 2019 • New to rental
Slide 15: Operational Performance: HORECA
2020 Final Results Operational Performance: HORECA Hotel, Restaurant & Catering 15
Slide 16: Operational Performance: HORECA
2020 Final Results Operational Performance HORECA Hotel, Restaurant & Catering Linen Hotel Linen Hotel, Restaurant & Catering 2020 2019 Revenue (£m) 100.3 215.3 Adjusted EBITDA (£m)1,2,3 8.7 74.5 1,2,3 Adjusted EBITDA margin (%) 8.7 34.6 Adjusted operating (loss) / profit (£m)2,3 (31.5) 33.1 Adjuste
Slide 17: Operational Performance: HORECA
2020 Final Results Operational Performance: • Organic growth for the first two months particularly HORECA strong at 9.1%, aided by Gleneagles and Jurys Inn Hotel, Restaurant & contract wins in 2019 Catering • Volumes varying throughout the year dependent on restrictions, reaching a return to c55% of
Slide 18: Our Customers
2020 Final Results Our Customers “Customer communication maintained in order to foster our strong, long-term relationships.” 18
Slide 19: Our Customers
2020 Final Results Our Customers 19
Slide 20: The Future
2020 Final Results The Future “We continue to take proactive actions to adapt our operations to ensure the Group can thrive and is well placed for the recovery” 20
Slide 21: Outlook – Post COVID-19
2020 Final Results Outlook – Post COVID-19 Workwear ▪ Volumes are 96% of normal and all sites continue to operate and service our customers ▪ Continued focus on ‘new to rental’ sales activity ▪ Remaining estate to apply for EN 140651 certification HORECA ▪ Volumes in January and February 2021 were s
Slide 22: Strategic Plan
2020 Final Results Strategic Plan Organic Investment M&A Social & Sustainability ▪ Market leading position within Workwear & HORECA ▪ National coverage; local service ▪ Dedicated to providing first class customer service ▪ Maintaining divisional margins over the medium term ▪ Continuing capital inve
Slide 23: The Future – Confident of Medium-Term Growth
2020 Final Results The Future – Confident of Medium-Term Growth “With our strong balance sheet, established market position and reputation for quality service, we remain confident in the Group’s medium-term growth prospects as the economy and markets we serve recover.” Organic Growth Investment Acqu
Slide 24: Appendices
Service Group PLC Appendices 24
Slide 25: Segmental Analysis
2020 Final Results Appendix 1 Segmental Analysis 2020 2019 Adjusted Adjusted Operating Adjusted Operating Adjusted Revenue Profit / (Loss)1,2 EBITDA1,2,3 Revenue Profit1 EBITDA1,3 £m £m £m £m £m £m Workwear 129.5 23.3 48.7 135.3 24.4 49.2 HORECA 100.3 (31.5) 8.7 215.3 33.1 74.5 Textile Rental 229.8
Slide 26: Financial Track Record
2020 Final Results Appendix 2 Financial Track Record Revenue (£m) Adjusted EBITDA (£m) Adjusted Diluted EPS (p) 350.6 119.0 321.1 10.5 290.9 101.4 9.3 92.3 8.7 256.7 7.6 229.8 82.4 53.6 -3.4 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 Adjusted Operating Profit (£m) Adj
Slide 27: Pre-COVID Performance Built on Buy-and-Build Strategy
2020 Final Results Appendix 3 Pre-COVID Performance Built on Buy-and-Build Strategy 250 200 1st COVID-19 Lockdown Share Price (pence) Placing 150 100 50 27
Slide 28: Our Executive Team
2020 Final Results Appendix 4 Our Executive Team Peter Egan Yvonne Monaghan Chief Executive Officer Chief Financial Officer Industry Experience: 28 Years Industry Experience: 36 Years Mark Woolfenden Donald Smith Helen Wood Tim Morris Steve McKeever MD, Hotel Linen MD, Stalbridge & London Linen MD,
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