Slide 1: Our Journey to Greatness
Our Journey to Greatness Results for the full year ended 31 March 2022 24 May 2022 Formerly Electrocomponents plc
Slide 2: Disclaimer
Business (Not Public) Disclaimer Forward-looking statements: This presentation contains certain statements, statistics and projections that are or may be forward-looking. The accuracy and completeness of all such statements, including, without limitation, statements regarding the future financial po
Slide 3: Welcome to RS Group
Business (Not Public) Welcome to RS Group Lindsley Ruth CEO RS PRO, RS Integrated Supply, RS Safety Solutions, RS DesignSpark, OKdo One brand |One team |One culture 2021/22 Full Year Results 3 24 May 2022 Business (Not Public)
Slide 4: A year of strong outperformance
Business (Not Public) A year of strong outperformance Our revenue growth versus nominal Very strong like-for-like growth industrial production growth1 Increased profitability and margins in all three 30% regions 25% Strong free cash flow generation despite additional 20% inventory investment 1
Slide 5: Our people are making RS Group an amazing place to work
Business (Not Public) Our people are making RS Group an amazing place to work − thank you Clear market outperformance driven by: ⚫ Our people: hard work, dedication and humour ⚫ Cultural change: investment, empowerment and incentivisation of our teams ⚫ Our ability to adapt: our people, systems, pro
Slide 6: Financial performance
Business (Not Public) Financial performance David Egan CFO 2021/22 Full Year Results 6 24 May 2022 Business (Not Public)
Slide 7: Strong profitable revenue growth and cash performance
Business (Not Public) Strong profitable revenue growth and cash performance Revenue growth Profitability Returns and cash Total revenue (£m) Adjusted operating profit (£m) Adjusted free cash flow (£m) 31% 101% 45% 1,954 2,003 2,554 221 188 320 81 145 163 2019/20 2020/21 2021/22 2019/20 2020/21 2021/
Slide 8: Three non-financial KPIs linked to our sustainability-linked loan
Business (Not Public) Three non-financial KPIs linked to our sustainability-linked loan Carbon emissions Packaging intensity Gender diversity in management Tonnes of CO2e due to Scope 1 and 2 Tonnes / £m revenue emissions 13,500 12,400 11,900 7,500 6,000 2.3 2.6 2.5 2.4 2.1 26% 32% 30% 32% 17/18 18/
Slide 9: Strong profit performance
Business (Not Public) Strong profit performance Income statement Like-for-like £m 2021/22 2020/21 Change change Revenue 2,554 2,003 28% 26% Gross margin 44.2% 42.7% 1.5 pts 1.7 pts Operating profit 309 167 85% 97% Adjusted operating profit 320 188 70% 78% Adjusted operating profit margin 12.5% 9.4%
Slide 10: Revenue growth is driven largely by volume and average order value
Business (Not Public) Revenue growth is driven largely by volume and average order value 2,700 £2,554m 2,500 2,300 2,100 £2,003m £1,954m 1,900 1,700 1,500 2019/20 2020/21 Volume Basket size Price Acquisitions FX Day 2021/22 /mix inflation impact 2021/22 Full Year Results 10 24 May 2022 Business (Not
Slide 11: Key and corporate customers are our core focus
Business (Not Public) Key and corporate customers are our core focus Customer numbers Average order value (AOV) (£) Net Promoter Score (NPS)2 (rolling 12 month) Our Group revenue split by customer Other1 c.25% £2,554m 190 191 211 55.7 54.4 50.6 2019/20 2020/21 2021/22 2019/20 2020/21 2021/22 Our Key
Slide 12: Adjusted operating profit margin growth despite cost pressures and investment
Business (Not Public) Adjusted operating profit margin growth despite cost pressures and investment 1 3 2 4 Notes: 2021/22 Full Year Results See basis of preparation on slide 40 for definitions of adjusted. 12 1. Includes pay inflation and general cost inflation. 24 May 2022 2. Includes higher freig
Slide 13: Regional performance
Business (Not Public) Regional performance Revenue (£m) Adj. operating profit (£m) Regional profitability driven by: and margin (%) ⚫ Stronger volumes Revenue split Profit split 10% 8% ⚫ Product margin work 28% 27% ⚫ Price optimisation 62% 65% ⚫ Reduced discounting ⚫ Operational efficiencies ⚫ RISE
Slide 14: Strong focus on cash returns
Business (Not Public) Strong focus on cash returns ⚫ Strong adjusted free cash Adjusted free cash flow (£m) Working capital / revenue (%) flow includes £100 million inventory investment ⚫ Adjusted operating cash flow conversion of 70.8% ⚫ Lower capital expenditure 81 145 163 23.9 21.9 21.1 as US and
Slide 15: Capital flexibility to invest in growth opportunities
Business (Not Public) Capital flexibility to invest in growth opportunities ⚫ Net debt reduced to Net debt (£m) EBITA to interest (x) £42 million ⚫ Restructured our £300 million three-year revolving credit facility to be sustainability linked 190 122 42 33.6 26.7 44.6 1 ⚫ Progressive dividend 2019/2
Slide 16: Capital allocation will prioritise investment to accelerate high-quality profitable growth
Business (Not Public) Capital allocation will prioritise investment to accelerate high-quality profitable growth ⚫ Targeted investment to accelerate high-quality profitable growth, prioritising: 1. Organic investment Investment for future growth opportunities 2. Inorganic opportunities with required
Slide 17: Exciting opportunities to accelerate growth ambitions
Business (Not Public) Exciting opportunities to accelerate growth ambitions ⚫ Many attractive ⚫ Best opportunities regional opportunities: with £2bn+ of with very few global EBITDA coming to the market from more than 20 businesses over the next 18 ⚫ See greatest opportunity months today in: On our r
Slide 18: Current trading
Business (Not Public) Current trading Growth has Good remained momentum Strong growth over first seven weeks of 2022/23. strong into 2022/23 Challenging Uncertainties remain and we are mindful of the ongoing external difficulties many are experiencing and external environment headwinds our Group cou
Slide 19: Our Journey to Greatness
Business (Not Public) Our Journey to Greatness Lindsley Ruth CEO 2021/22 Full Year Results 19 24 May 2022 Business (Not Public)
Slide 20: Becoming great requires:
Business (Not Public) Becoming great requires: Galvanising a Realising a Extending our Accelerating to a Transforming our high-performance world-class wisdom, insight solutions-led executional purpose-led customer and data innovative capabilities culture experience business Powered by systems, proce
Slide 21: Developing a purpose-led culture
Business (Not Public) Cultural transformation Developing a Employee engagement purpose-led culture 90% employee ⚫ Creating a high-performance, purpose-led retention rate culture that empowers and excites 71 71 72 74 75 ⚫ Investing in our people: wellbeing, training 17/18 18/19 19/20 20/21 21/22 and
Slide 22: Becoming the go-to sustainability partner
Business (Not Public) Cultural transformation Becoming the go-to sustainability partner DesignSpark supports engineers to bring RS sustainable product solutions help our RS Safety Solutions provides consultancy innovative and sustainable products customers reduce their energy and solutions on how to
Slide 23: Driving world-class execution
Business (Not Public) Operational efficiency 2021/22 our order dispatch (on time to promise) Driving world-class versus inbound supplier delivery performance 95% execution 90% 85% RS on time to promise 80% ⚫ Global industrial expert 75% ⚫ Worldwide distribution network (14 DCs) 70% Supplier delivery
Slide 24: Our differentiated product offer
Business (Not Public) Growth Accelerator The RS Group Product Range Our differentiated product offer ⚫ Specialist product offer for industrial customers ⚫ Data and insight driven product offer ⚫ Long tail of low inventory-turn products 2017/18 2018/19 2019/20 2020/21 2021/22 ⚫ Many products offer su
Slide 25: We offer solutions to unlock efficiencies
Business (Not Public) Growth Accelerator We offer solutions to unlock efficiencies ⚫ Customers seek simplicity and fewer processes ⚫ Solutions improve operational efficiencies ⚫ Offer spans customers’ asset lifecycle ⚫ Innovative and digitally-led proposition ⚫ Increases customer lifetime value Serv
Slide 26: RS Integrated Supply - adding significant value
Business (Not Public) Growth Case study Accelerator RS Integrated Supply − IESA / Synovos adding significant value ⚫ Only integrated supply provider globally ⚫ Contract wins includes large global multinationals and existing customers expanding globally ⚫ Global platform provides efficiency, consolid
Slide 27: We are truly omni-channel
Business (Not Public) Growth Accelerator Returns from digital marketing spend We are truly omni-channel ⚫ >95% of new customer journeys start online ⚫ We have seven high-touch service channels H1 H2 H1 H2 H1 H2 ⚫ Data and insight anticipates customer needs 2019/20 2020/21 2021/22 Return on digial ma
Slide 28: The building blocks of our Journey to Greatness
Business (Not Public) The building blocks of our Journey to Greatness Expansion of solutions Pricing tools Global DC automation Data driven Integrated insight Supply Expanded Stronger centres of Procurement Innovation Share of wallet engine revenue expertise Range to drive expans
Slide 29: History of resilience: turning challenges into opportunities
Business (Not Public) History of resilience: turning challenges into opportunities Inflation Supply Economic We have the expertise and Our strong supplier relationships We see the opportunity for insight to be responsive and and DC network delivers superior strengthening our growth agile with our pr
Slide 30: We are well positioned to generate significant sustainable value
Business (Not Public) We are well positioned to generate significant sustainable value 1. 2. 3. 4. There is enormous Our differentiated We are making Acquisitions will growth opportunity business model amazing happen for a accelerate with <1% share will improve further on better world organic growth
Slide 31: Q&A
Business (Not Public) Q&A 2021/22 Full Year Results 31 24 May 2022 Business (Not Public)
Slide 32: Appendix
Business (Not Public) Appendix 2021/22 Full Year Results 32 24 May 2022 Business (Not Public)
Slide 33: We know who we are
Business (Not Public) We know We know who who we we are are We are a global integrated omni-channel solutions partner for industrial B2B customers We help designers, builders and maintainers of industrial equipment and operations work safely and sustainably >1.2m >2,500 14 >700,000 3m >60,000 c.75%
Slide 34: Specialist product breadth, depth and expertise
Business (Not Public) Specialist product breadth, depth and expertise Providing product and …across a broad range of service solutions… industries 2021/22 2021/22 Group Group revenue revenue split: split: ⚫ Electrical 21% ⚫ Original equipment manufacturing 24% ⚫ Automation and control 23% ⚫ Commerci
Slide 35: Our 2030 ESG action plan - For a Better World
Business (Not Public) Our 2030 ESG action plan – For a Better World Operational efficiency: World-class capability and execution 2021/22 Full Year Results Notes: 35 24 May 2022 1. Scope 1 and 2 CO2e emissions updated to reflect changes in reporting and emissions factors. 2. Percentage of total elect
Slide 36: Top tier ESG ratings recognise our progress
Business (Not Public) Top tier ESG ratings recognise our progress ESG ratings and disclosures Frameworks and disclosures • Sustainalytics rating: Global top 50 ESG companies • MSCI ESG rating: A • CDP Climate change leadership score: A- • EcoVadis rating: Gold medal • FTSE4Good Index score: 3.2/5 20
Slide 37: Our roadmap to net zero
Business (Not Public) OUR ROADMAP TO NET ZERO NET ZERO IN DIRECT OPERATIONS BY 2030 AND • We announced our WIDER VALUE CHAIN BY 2050 ambition to become a net zero business by 2030 in November 2021 • Since our baseline year of 2019/20, we have already achieved a 50% reduction in our Scope 1 and 2 car
Slide 38: Outperforming our markets
Business (Not Public) Outperforming our markets Like-for-like revenue growth1 Distribution sector sales per day RS Group 179 growth indexed to March 2015 175 Q1 to Q2 to Q3 to Q4 to Year to Region Jun 2021 Sep 2021 Dec 2021 Mar 2022 Mar 2022 165 EMEA 37% 22% 14% 19% 22% 155 145 Americas 40% 35% 37%
Slide 39: Gaining share across our markets
Business (Not Public) Gaining share across our markets UK France Germany Apr-20 Jun-20 Aug-20 Oct-20 Dec-20 Feb-21 Apr-21 Jun-21 Aug-21 Oct-21 Dec-21 Feb-22 Apr-20 Jun-20 Aug-20 Oct-20 Dec-20 Feb-21 Apr-21 Jun-21 Aug-21 Oct-21 Dec-21 Feb-22 Apr-20 Jun-20 Aug-20 Oct-20 Dec-20 Feb-21 Apr-21 Jun-21 Aug
Slide 40: Basis of preparation
Business (Not Public) Basis of preparation Unless otherwise stated ⚫ Figures have been prepared using UK-adopted international accounting standards (IFRS) ⚫ Adjusted excludes amortisation of intangible assets arising on acquisition of businesses, acquisition-related items, substantial reorganisation
Slide 41: EMEA: Improved operational model and sales focus
Business (Not Public) EMEA: Improved operational model and sales focus Revenue (£m) Our performance in 2021/22: ⚫ Digital like-for-like +23% benefiting from improvements to search engine optimisation marketing, the mobile-responsive website and 1,240 1,277 1,580 improving content 2019/20 2020/21 202
Slide 42: Americas: Invested in our people, product offer and distribution centre
Business (Not Public) Americas: Invested in our people, product offer and distribution centre Revenue (£m) Our performance in 2021/22: ⚫ Revenue benefited from strong growth in automation & control and our extended maintenance, repair & operations offer 516 517 719 ⚫ Digital like-for-like +37%, with
Slide 43: Asia Pacific: Greater focus on revenue and margin opportunities
Business (Not Public) Asia Pacific: Greater focus on revenue and margin opportunities Revenue (£m) Our performance in 2021/22: ⚫ Revenue growth benefited from greater focus on higher revenue generating opportunities and stronger electronic sales 198 208 256 ⚫ Taking share in industrial product marke
Slide 44: Cash generation strong despite additional inventory investment
Business (Not Public) Cash generation strong despite additional inventory investment Cash flow £m 2021/22 2020/21 EBITDA 372.5 223.7 Add back loss on disposal of non-current assets 2.4 0.3 Movement in working capital (116.2) (1.5) Movement in provisions (1.7) 1.6 Other 10.1 7.0 Cash generated from o
Slide 45: Net debt fell to £42.1m
Business (Not Public) Net debt fell to £42.1m Net debt ⚫ We have maintained a strong financial position £m 2021/22 2020/21 Net debt at 1 April (122.0) (189.8) ⚫ Lease liabilities of £48.7 million (2020/21: £61.5 million) Adjusted free cash flow 162.9 145.4 ⚫ Net debt to adjusted EBITDA 0.1x Acquisit
Slide 46: Financial key performance indicators
Business (Not Public) Financial key performance indicators Like-for-like 2021/22 2020/21 Change change Like-for-like revenue growth 26% 1% Adjusted operating profit conversion 28.4% 22.0% 6.4 pts 7.5 pts Adjusted operating profit margin 12.5% 9.4% 3.1 pts 3.7 pts Adjusted earnings per share 51.3 p 3
Slide 47: Non-financial key performance indicators
Business (Not Public) Non-financial key performance indicators 2021/22 2020/21 Change Carbon intensity 2.3 3.9 (41)% (tonnes of CO2e due to Scope 1 and 2 emissions / £m revenue) Internal carbon footprint 6,000 7,500 (20)% (tonnes of CO2e due to Scope 1 and 2 emission) Packaging intensity 2.11 2.43 (
Slide 48: Net Promoter Score methodology to change from 2022/23
Business (Not Public) Net Promoter Score methodology to change from 2022/23 ⚫ Net Promoter Score measures our customer Monthly NPS Effect of proposed NPS change on monthly NPS score experience and shapes our strategic decisions 60 and actions 58 56 ⚫ Measure not reviewed since 2015 and no longer 54
Slide 49: Guidance points
Business (Not Public) Guidance points Trading days > ⚫ Fewer trading days in 2022/23 are expected to reduce revenue by around £7 million Other guidance points ⚫ Net capital expenditure forecast to be c. £50 - 60 million in 2022/23 > ⚫ We expect the effective tax rate to rise due to corporate income