4imprint Group Plc · LSE:FOUR
4imprint — H1 2015 Earnings Presentation
24 slides from 4imprint's earnings presentation, September 2015
Slide 1: Results presentation for the half year ended 27 June 2015
Results presentation for the half year ended 27 June 2015
Slide 2: Half Year Results 2015
Half Year Results 2015 1. Background 2. Highlights 3. Financial review 4. Operational review 5. Outlook Kevin Lyons-Tarr CEO David Seekings CFO
Slide 3: Background
Background • 4imprint is the leading direct marketer of promotional products in the USA, Canada, the UK and Ireland • 96% of revenue is generated in the USA and Canada from its headquarters in Wisconsin, USA • UK and Irish customers are served out of its base in Manchester, England. • 4imprint’s str
Slide 4: Highlights
Highlights ® | e | 8
Slide 5: Highlights
Highlights • Group revenue† up 20% to $231.03m • Underlying* profit before tax † up 25% to $12.19m • Underlying* basic EPS † up 17% to 31.25c • Interim dividend 12.09c up 15%; 7.75p up 25% • Net cash $28.13m • US infrastructure investment of $9m on target for completion in September 2015 † Continuin
Slide 6: Financial Review
Financial Review % 8
Slide 7: Results Summary – Continuing Operations
Results Summary – Continuing Operations Revenue ($m) +20% Underlying* profit before tax ($m) +25% 450 415.77 30 27.86 400 332.94 25 350 19.55 300 20 231.03 250 193.06 15 12.19 200 156.54 9.77 150 10 6.62 100 5 50 0 0 2013 FY 2014 FY 2013 H1 2014 H1 2015 H1 2013 FY 2014 FY 2013 H1 2014 H1 2015 H1 Und
Slide 8: Group Income Statement (Underlying)
Group Income Statement (Underlying) H1 2015 H1 2014 Change FY 2014 Continuing operations $'000 $'000 % $'000 • Revenue up 20% Revenue 231,028 193,058 20% 415,773 • Gross profit % remains Gross profit 76,370 63,896 20% 137,210 stable Gross profit % 33.1% 33.1% 33.0% • 23% increase in Marketing costs
Slide 9: Group Income Statement (Other items)
Group Income Statement (Other items) H1 2015 H1 2014 FY 2014 • 2015 Incentive Plan Continuing operations $'000 $'000 $'000 implemented Underlying profit before tax 12,191 9,772 27,859 • No exceptional items charged in H1 i) Share option related charges (140) (526) (666) 2015. Exceptional ii) Excepti
Slide 10: Cash Flow
Cash Flow H1 2015 H1 2014 FY 2014 Continuing operations $m $m $m At start of period 18,301 25,990 25,990 • Capital expenditure Underlying operating profit 12,173 9,689 27,759 includes $2.4m in H1 for office and Depreciation and amortisation 894 831 1,705 Distribution Centre Change in working capital
Slide 11: Balance Sheet
Balance Sheet 27 Jun 28 Jun 27 Dec 2015 2014 2014 $'000 $'000 $'000 • Net assets $17.53m, Fixed assets 12,827 10,448 10,403 increase of $3.46m Deferred tax asset 4,837 7,257 4,794 17,664 17,705 15,197 • Negative working capital Inventories 4,127 3,373 4,353 due to timing of payments Receivables 39,6
Slide 12: Pension Deficit
Pension Deficit Total Uninsured • Legacy scheme, no future accrual liability liability $'000 $'000 • 1,130 pensioners (including 957 with insured benefits); 518 Liability (152,573) (33,028) deferred pensioners Assets 128,341 8,796 Deficit (24,232) (24,232) • 78% of total liability insured Deferred T
Slide 13: 2015 Guidance
2015 Guidance • Continue to drive organic revenue growth through investment in marketing • Operating profit margin higher in H2 than H1 due to phasing of marketing spend; but consistent with prior years • Oshkosh office and Distribution Centre projects: Cash cost $2.4m in H1; $6.6m in H2 • FY 2015 t
Slide 14: Operational Review
Operational Review % 8
Slide 15: Direct Marketing Strategy
Direct Marketing Strategy • Continue to deliver market share growth in large, highly fragmented market • On target to double the business in five years (2011 – 2016) at stable operating profit margin % • Equivalent to c.15% CAGR in sales • Consistent with achievement in previous five years (2006 – 2
Slide 16: Revenue & Order Intake
Revenue & Order Intake Revenue ($m) 500 • Strong overall H1 450 415.77 performance 400 332.94 350 • North American revenue 300 250 231.03 $223m, +20%; Industry 193.06 200 156.54 up circa 3-4% 150 100 • UK revenue $8m, +4% 50 (14% in constant 0 2013 FY 2014 FY 2013 H1 2014 H1 2015 H1 currency) Direct
Slide 17: Customers Acquired & Retention Percentage
Customers Acquired & Retention Percentage 50% 60,000 • Strong new customer 45% growth - more than 40% 50,000 100k customers 35% acquired 40,000 30% 25% 30,000 • Consistent customer 20% retention 20,000 15% 10% • Marketing spend 10,000 5% +23% • Online spend 0% 0 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3
Slide 18: Operational Highlights
Operational Highlights • Expansion projects announced at start of year progressing as planned: • Oshkosh office expansion complete • Distribution Centre construction will be completed in September • Staff added in customer-facing positions to support growth; selling costs still rising at less than t
Slide 19: Marketing Driving Growth – H2
Marketing Driving Growth – H2 Catalogue: • Circulation growth continues at similar pace with targeted increases driven by data analytics/insights Internet: • Benefit of addition and acceleration of new techniques in late H1 last year now in the run rate; shift more to optimisation than pure expansio
Slide 20: Outlook
Outlook Indications for the balance of the year are for a good performance in keeping with our strategic growth objectives, despite the strong growth comparator in the second half of 2014. The Group expects a good outcome for the year as a whole. 19
Slide 21: Appendices
Appendices
Slide 22: 4imprint Direct Marketing Model
4imprint Direct Marketing Model • Sale of custom-printed merchandise, used to promote a brand, service or product • Purchases by individuals within businesses and organisations of all sizes • Product customised and shipped to customer directly from suppliers • Investment in marketing, technology and
Slide 23: Shareholder List
Shareholder List As at 14/07/2015 No. of shares % BlackRock Investment Management 4,220,923 15.1 Standard Life Investments 2,751,189 9.8 Mr K.J. Minton 1,619,488 5.8 JP Morgan Asset Management 1,540,192 5.5 GVQ Investment Management 1,426,775 5.1 Artemis Fund Managers 1,300,000 4.6 Fidelity Worldwid
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