Slide 1: TIL Logistics Group Limited FY20 Results Presentation
TIL LOGISTICS GROUP LIMITED FY20 Results Presentation for the year ended 30 June 2020 TIL Logistics Group FY20 Results Presentation
Slide 2: TIL Logistics Group
TIL LOGISTICS GROUP • One of New Zealand’s largest domestic freight and logistics platforms. • Nationwide network of branches, depots and warehouses and dedicated team of employees and contractors. • Delivering product to over 3,500 customers with a low level of churn and concentration. • Over 220,0
Slide 3: Our Vision and Values
OUR VISION AND VALUES Our Vision is to be Oceania’s premier transport and logistics company CUSTOMER. INNOVATION. We are focused on the needs of our customers We recognise We strive to be leaders in logistics innovation and welcome without customers we have no business and do what it takes to new te
Slide 4: FY20 Operating Environment
FY20 OPERATING ENVIRONMENT First half: Impact on TIL: • Adverse market conditions including softening business confidence as well as slower than • Adverse market conditions contributed expected pre-Christmas period. to significant underperformance of • Particularly wet winter impacting construction
Slide 5: Our Response to COVID-19
OUR RESPONSE TO COVID-19 • A number of TIL’s businesses continued to operate and support essential services during the lockdown, albeit at reduced levels. • Actions taken to respond to COVID-19 include: - Government wage subsidy of $10.7m, partially offsetting ¬$17m revenue drop and allowing TIL Log
Slide 6: FY20 Key Events
FY20 KEY EVENTS • Detailed review and reset of underperforming Freight division; early benefits now being seen. • Continuing refresh of the Senior Leadership Team; new Executive GM appointed to lead the Transport division. • Acquisition of remaining 50% in ATL joint venture in February 2020, Cromwel
Slide 7: Freight Improvement Plan
FREIGHT IMPROVEMENT PLAN 100 day review revealed: Actions being taken: • Strong regional brands and employee and • New management team - Executive General customer loyalty to those brands. Manager, GM Sales, Quality Manager, Owner However, lack of cohesiveness and Driver Manager. synergy. • Introduc
Slide 8: FY20 Results Snapshot
FY20 RESULTS SNAPSHOT $Millions FY19 Actual FY20 FY20 Actual Pre-NZ IFRS 16 NZ IFRS 16 NZ IFRS 16 adjustments Sales Revenue 354.6 333.8 - 333.8 Total Income 360.1 348.0 - 348.0 Operating Expenses 334.7 321.5 (30.9) 290.6 EBITDA 25.4* 26.5 30.9 57.4 NPAT 4.0 6.0 (4.0) 2.0 Net Operating Cashflow 19.4
Slide 9: FY20 Results Overview
FY20 RESULTS OVERVIEW NZ IFRS 16 for Leases was adopted from 1 July 2019. To provide a like for like comparative to the prior year, all comparatives below are on a pre-IFRS16 basis: • Results within updated guidance range provided in June 2020, with EBITDA (pre-NZ IFRS16) of $26.5m (guidance $25m to
Slide 10: FY20 Group Sales by Industry Segment
FY20 GROUP SALES BY INDUSTRY SEGMENT % of Sales TIL has a diverse customer base and industry exposure, with low churn. Sub-contract Other Transport Services Other comprises: Household & Personal Products Forestry Commercial & Professional Services Food & Beverage Container Transport Building Product
Slide 11: Sales Revenue
SALES REVENUE Sales revenue of $333.8m, with 2H20 impacted by COVID-19 and reduced customer volumes. • Q4 FY20 sales down approx. $17m compared to pcp, due to COVID restrictions. 354.6 350 333.8 • Freight – disappointing performance in 1H20, and 325.6 material impact on 2H20 as customers’ volumes 30
Slide 12: Operating Expenses
OPERATING EXPENSES Adjusted Operating Expenses (excluding D&A and NZ IFRS16) Adjusted operating expenses reduced by $10.6m. • Primarily due to the decrease in operating costs during the COVID-restricted trading periods, and a decrease in the price of fuel. 350 332.1 321.5 305.5 • Partially offset by
Slide 13: Strong Recovery in EBITDA in Second Half
STRONG RECOVERY IN EBITDA IN SECOND HALF 1H20 2H20 % change • Improvements in EBITDA in the second half $m $m (particularly in Freight and Bulk Liquids), after a disappointing first half performance. Freight 0.8 5.8 625% Warehousing 3.6 4.3 19% • Results for all divisions well ahead of the second Bu
Slide 14: FY19: FY20 EBITDA Bridge
FY19: FY20 EBITDA BRIDGE • Disappointing performance from Freight division in 1H20. Management review undertaken and improvement initiatives underway with stronger 2H20. • Growing utilisation partially offsetting the increased costs associated with the expanded warehouse facilities. • Bulk Liquids i
Slide 15: FY19: FY20 NPAT Bridge
FY19: FY20 NPAT BRIDGE NPAT of $2.0m for full year. Pre-IFRS NPAT of $6.0m. Compared to FY19, the FY20 result reflects: - Full year of depreciation following the acquisition of the Specialist business - FY19 included $2.6m of contingent consideration relating to an acquisition made in FY17 - FY20 in
Slide 16: Capital Management
CAPITAL MANAGEMENT $ Millions FY20 FY19 Pre-IFRS16 Capital Expenditure: Operating cashflow 17.9 19.4 • Prudent management and minimisation of capex in COVID environment. Net Debt 74.4 77.9 • Investment into new trucks and equipment to Net Capex 10.5 11.4 resource customer projects. • Increased Plant
Slide 17: Balance Sheet
BALANCE SHEET $Millions FY20 FY19 Sound working capital disciplines, with solid cash position of $11.9m at end-June 2020. Cash and cash equivalents 11.9 6.4 Trade and other receivables 43.7 51.0 • FY20 reflects the adoption of IFRS16. Property, plant and equipment 94.2 92.3 • Working capital focus r
Slide 18: IFRS 16: Adoption Impact in FY20
IFRS 16: ADOPTION IMPACT IN FY20 • TIL has a large number of vehicle leases, as well as long term property leases. • Upon adoption from 1 July 2019, NZ IFRS 16 had a material impact on a number of elements of the Group’s balance sheet and income statement, but no material impact on the Group’s cash
Slide 19: Division Review
Freight Warehousing & Logistics Bulk Liquids DIVISION REVIEW International Specialist TIL Logistics Group FY20 Results Presentation 19
Slide 20: Our Business
OUR BUSINESS TIL LOGISTICS GROUP WAREHOUSING & FREIGHT BULK LIQUIDS INTERNATIONAL SPECIALIST LOGISTICS TIL Logistics Group FY20 Results Presentation 20
Slide 21: TIL Operates Across Five Divisions
TIL OPERATES ACROSS FIVE DIVISIONS WAREHOUSING & FREIGHT BULK LIQUIDS INTERNATIONAL SPECIALIST LOGISTICS One of NZ’s largest Specialists in New Zealand’s International Group of general freight and transporting fuel, largest 3PL freight forwarding businesses line haul transport LPG and industrial ope
Slide 22: Division Revenue and EBITDA
DIVISION REVENUE AND EBITDA Excluding NZ IFRS 16 DIVISION REVENUE FY19 1H20 FY20 FY20 REVENUE Freighting* 179.7 84.1 161.2 Warehousing & Logistics* 76.2 37.9 71.3 Bulk Liquids 78.1 39.1 73.9 International 7.4 4.2 9.0 Specialist 13.1 8.7 18.4 DIVISION EBITDA FY20 ADJ EBITDA FY19 1H20 FY20 pre-IFRS 16
Slide 23: Freight
FREIGHT Revenue $161.2m, -10% EBITDA $6.6m, -33% Freighting Revenue FY20 250.0 • Environment of increasing competitive pricing pressure, lower sales 200.0 across a range of customers and a softer Christmas trading period than 150.0 anticipated, as well as the loss of a large customer for NZL. Furthe
Slide 24: Warehousing & Logistics
WAREHOUSING & LOGISTICS Revenue $71.3m, -6% Warehousing Revenue EBITDA $7.9m, +6% 120 100 80 FY20: 60 40 • Continued investment into new warehouses, resulting in 20 additional capacity which is expected to cater for future sales. 0 FY18 FY19 FY20 • Additional overheads and operating expenses in FY20
Slide 25: Bulk Liquids
BULK LIQUIDS Revenue $73.9m, -5% Bulk Liquid Revenue EBITDA $8.0m, -4% 90 80 70 FY20: 60 50 • Bulk Liquids primarily services large fuel and gas customers. 40 30 20 • Material impact on fuel volumes due to COVID-19, with flow on 10 effect on Pacific Fuel Haul. 0 FY18 FY19 FY20 • Additional costs inc
Slide 26: International
INTERNATIONAL Revenue $9.0m, +22% EBITDA $2.4m, +60% International Revenue 10 8 FY20: 6 • Positive year with increased activity in the sector. 4 • ISO Tank & Shipping services increased revenue with greater 2 demand for ISO equipment & services. 0 FY18 FY19 FY20 • Exploring acquisitions opportunitie
Slide 27: Specialist
SPECIALIST Revenue $18.4m, +40% Specialist Revenue EBITDA $4.6m, +77% 20 16 FY20: 12 • Specialised Lifting and Transport continues to be a solid acquisition. 8 • Major windfarm transport contract secured in February, with some 4 work undertaken in 2H20 but majority deferred to FY21. 0 FY18 FY19 FY20
Slide 28: Health & Safety
Winner of the Chartered Institute of Logistics & Transport Award for Implementation and Practice. HEALTH & SAFETY • We take the safety and wellbeing of our employees, contractors, owner drivers and communities very seriously. It is an essential component to everything we do. • Unfortunately a seriou
Slide 29: Environment
ENVIRONMENT FY20 Greenhouse gas emissions • TIL is committed to the reduction of carbon emissions through our membership of the Climate Leaders Coalition. 63,405 • CEMARS review completed in July 2019 (recertified in August 2020). tCO2e Developed Emissions Management and Reduction Plan with annual t
Slide 30: People
PEOPLE • Experienced Board; appointment of Peter Dryden in FY20. • Further changes to strengthen the Executive team. Establishment of a centralised HR team. • Demanding year dealing with the impact of Covid 19, and the various impacts from Government policy, managing entitlements and leave issues. •
Slide 31: Outlook
OUTLOOK • Expect continuing challenges from COVID-19 with recessionary economic conditions expected in FY21. • Flow on effects will be felt for some time, and TIL retains a cautious outlook. • COVID-19-related Government fiscal stimulus likely to support increasing freight volumes • Global trend of
Slide 32: Strategic Priorities
STRATEGIC PRIORITIES • Continue turnaround programme FREIGHT TURNAROUND • Priority focus on lifting margins • Expansion of Bulk Liquids into non-fuel sectors ORGANIC GROWTH • Expansion Specialist services into a broader weight range • Optimise utilisation of MOVE’s new warehousing capacity ACQUISITI
Slide 33: Contact
CONTACT Alan Pearson TIL Logistics Group Limited Chief Executive Officer Tel: 021 806 678 Email: alan.pearson@til.kiwi TIL Logistics Group FY20 Results Presentation 33
Slide 34: Board and Management
BOARD AND MANAGEMENT BOARD GROUP EXECUTIVE TEAM • Trevor Janes, Chair • Alan Pearson, CEO • Lorraine Witten • Lee Banks, CFO • Danny Chan • Charles Bolt, General Counsel • Peter Dryden • Maurice Corkery, CIO • Jim Ramsay • Peter Simone, Acting Group HR, H&S Manager Divisional CEOs TIL Logistics’ Boa
Slide 35: Glossary
GLOSSARY • Non-GAAP financial information: TIL Logistics Group uses several non-GAAP measures when discussing financial performance. These include Earnings Before Interest, Tax, Depreciation and Amortisation, Share of (Loss)/Profit of Associates and Impairment of Goodwill (EBITDA), adjusted EBITDA e
Slide 36: Non-GAAP Reconciliation
NON-GAAP RECONCILIATION $Millions FY20 FY19 Net profit before income tax (GAAP measure) 3.5 7.4 Add back: Share of loss of associates - 0.4 Finance costs/(interest income) 11.8 4.1 Impairment of investment in associates 0.4 - Bargain on acquisition (1.1) - Depreciation & Amortisation 42.9 13.6 Defer
Slide 37: Disclaimer
DISCLAIMER This presentation has been prepared by TIL Logistics Group Limited (“TLL”). The information in this presentation is of a general nature only. It is not a complete description of TLL. This presentation is not a recommendation or offer of financial products for subscription, purchase or sal