Stealth Group Holdings Ltd. · ASX:SGI
Stealth — H1 2023 Earnings Presentation
35 slides from Stealth's earnings presentation, Mar 8, 2023
Slide 1: 2023 Half-year results briefing presentation
A leading Australian Industrial Distribution Company ASX CODE : SGI www.stealthgi.com 8 March 2023 2023 Half-year results briefing presentation 1
Slide 2: Disclaimer
DISCLAIMER This document has been prepared by Stealth Global Holdings Ltd (the Company) and is provided for information purposes only. This forecasts, reports or other matters, express or implied, contained in, arising out of or derived from, or for omissions from, this document including, For perso
Slide 3: Raising Breast Cancer Awareness
STEALTH GLOBAL HALF-YEAR RESULTS 2023 Acknowledgement Breast cancer is the second most commonly diagnosed cancer in Australia, with nine people Raising Breast Cancer losing their lives to the virulent disease every day. Medical experts estimate that an individual Awareness has a 1 in 15 (or 6.7%) ri
Slide 4: Table of Content
TABLE OF CONTENT Reasons to invest in Stealth Group highlights 1H23 Financial review Business Objectives Outlook Supplementary information 8 MARCH 2023 - 1H23 RESULT S STEALTH GLOBAL HOLDINGS ASX : SGI www.stealthgi.com | 4
Slide 5: Reasons to Invest in Stealth
KEY FACTORS DRIVING GROWTH REASONS TO INVEST IN STEALTH 1 Large, fragmented, resilient $52b addressable market. 6 Long-term relationships with blue-chip customers and generate repeat business across all customer types. 2 Diverse exposure across attractive end markets with secular tailwinds. 7 Tiered
Slide 6: We are one of Australia's largest industrial distribution companies
WE ARE ONE OF AUSTRALIA’S LARGEST INDUSTRIAL DISTRIBUTION COMPANIES 300,000 instock products >95% of products sold by Stealth are non-discretionary. Building a large market-leading platform with complementary services and solutions. Industrial, Tooling, MRO Safety & PPE Truck & Automotive Workplace
Slide 7: Performance Overview
PERFORMANCE OVERVIEW 1H2023 RESULTS Investor Presentation • 8 M a r c h 2023 8 MARCH 2023 - 1H23 RESULT S STEALTH GLOBAL HOLDINGS ASX : SGI www.stealthgi.com |
Slide 8: Business Recap FY22
BUSINESS RECAP FY22 FY22 major events that flow into FY23 Completed three (3) acquisitions The Group increased its scale, breadth across geographical, customer and product range. 7 new company owned and operated stores and 33 independent partner stores (United Tools), expanding store footprint a
Slide 9: 1H23 Introduction Summary
1H23 INTRODUCTION SUMMARY Resilient business model drives record 1H sales and earnings to deliver strong first half result. 1H23 performance Summary • Strong performance in a challenging economic environment of cost inflation, a tight labour market, and supply chain disruptions. • Positive supply an
Slide 10: Performance Summary
PERFORMANCE SUMMARY • All divisions performed strongly. Ongoing momentum ‘high demand’ for Stealth products. • Merger and synergy benefits from acquisitions starting to deliver. 1H23 • Secured multiple new customer contract wins in Western Australia in Mining & Infrastructure sector. A result of exp
Slide 11: 1H23 Group Performance Summary
1H23 GROUP PERFORMANCE SUMMARY Half-year ended 31 December ($m) 1H FY23 1H FY222 Change $m’s Change % Revenue 52.4 44.3 +8.1 18% Up 18% to $52.4 million Underlying1 EBITDA 2.4 1.7 +0.7 41% Up 41% to $2.4 million Underlying NPAT 0.4 0.1 +0.3 300% EBITDA 2.2 1.0 +1.2 120% Up 120% to $2.2 million NPAT
Slide 12: Divisional Performance
DIVISIONAL PERFORMANCE Growing vertical expertise and prominent customers. % 1H23 1 YEAR REVENUE 2 YEAR REVENUE DEEP EXPERTISE OPERATING VERTICALS REVENUE SPLIT GROWTH GROWTH Comprehensive wide range products, services and solutions to business DISTRIBUTION SOLUTIONS 73% 10% 41% customers. RETAIL 17
Slide 13: 1H23 Key Metrics
1H23 KEY METRICS Strategic investments delivering positive outcomes. Movement over 12 months Daily transaction sales volume + 21% Daily transaction gross profit volume + 18% Average sales value per order in trading divisions + 7.8% Average gross profit value per order in trading divisions + 5.4% Ave
Slide 14: Sales Mix by Product Segment
SALES MIX BY PRODUCT SEGMENT 2,200 4% spend from largest supplier, low suppliers concentration risk 22.50% 20.00% 17.50% 15.00% 12.50% 10.00% 7.50% 5.00% 2.50% 0.00% 8 MARCH 2023 - 1H23 RESULT S STEALTH GLOBAL HOLDINGS ASX : SGI www.stealthgi.com | 14
Slide 15: Sales by End Market Segment
SALES BY END MARKET SEGMENT 8,000 4% revenue customers as of from largest customer, low 31 December 2022 concentration risk 40.0% 37.5% 36.6% 35.0% Customer sample 32.5% 30.0% 27.5% 25.0% 22.5% 20.0% 17.5% 16.6% 16.9% 15.0% 12.5% 9.6% 10.0% 8.7% 7.5% 5.0% 3.7% 2.4% 2.5% 2.5% 0.9% 1.4% 0.2% 0.4% 0.5%
Slide 16: Financial Overview
FINANCIAL OVERVIEW 1 H 2 0 2 3 R E S U LT S Investor Presentation • 8 M a r c h 2023 8 MARCH 2023 - 1H23 RESULT S STEALTH GLOBAL HOLDINGS ASX : SGI www.stealthgi.com |
Slide 17: Income Statement
INCOME STATEMENT $m 1H FY23 1H FY221 Change $ Change % • Record first-half performance achieved across all metrics. Revenue 52.4 44.3 8.1 18% • Revenue growth of 18% ($8.1m) on 1H22 and up 83% ($23.7m on Gross profit 15.2 13.2 2.0 15% 1H21. Underlying EBITDA1 2.4 1.7 0.7 41% – Positive demand across
Slide 18: Balance Sheet
BALANCE SHEET 31 Dec 22 30 Jun 22 Cash 5.1 4.7 Receivables 14.7 17.3 • Lower net working capital (NWC) as % of sales driven by strong capital Inventory 15.1 14.1 management disciplines, as growth in sales outperformed working capital PP&E 2.2 2.2 funding requirements, positive operating cash flow be
Slide 19: Cash Flow and Investments
CASH FLOW AND INVESTMENTS NET CASH FLOW TABLE Half-year end 31 December ($m) 31 Dec 22 30 Jun 22 30 Jun 21 • Operating cash flow of $1.77m (1H FY22: $0.25m), driven by a stronger Operating cash flow 1.77 0.88 2.02 focus on Working capital management. The Group reduced its net working capital as a %
Slide 20: Debt Management
DEBT MANAGEMENT Net Debt Composition Trend 1H FY23 FY22 FY21 FY20 $m $m $m $m Gross Debt Gross debt 15.1 14.9 7.3 2.5 16.0 Cash and cash equivalents (5.1) (4.7) (3.1) (1.1) 14.0 12.0 Net debt 10.0 10.2 4.2 1.4 10.0 8.0 – Acquisition debt 6.6 7.3 2.2 n/a 6.0 4.0 – Net working capital debt 3.4 2.9 2.0
Slide 21: Strategy & Focus Areas
STRATEGY & FOCUS AREAS 1H2023 RESULTS Investor Presentation • 8 M a r c h 2023 8 MARCH 2023 - 1H23 RESULT S STEALTH GLOBAL HOLDINGS ASX : SGI www.stealthgi.com |
Slide 22: Business Objectives
B US I N E S S OB J E C T IVE S Short term Medium term Long-term ( current year ) ( next 1 – 2 years ) ( 3 years and beyond) Optimise pricing Drivers of profit growth to 2025 Market leader – company of choice Gain market share Expanding network capacity 150+ Stores in network Leverage
Slide 23: Three Pillars of Stealth's Growth Plan
THREE PILLARS OF STEALTH'S GROWTH PLAN Future Developments OPERATIONAL EXCELLENCE GAIN MARKET SHARE OPTIMISE PRICING • Utilise technology to optimise all parts • Capitalise on industry dynamics • Pricing reset over inflation of the supply chain lifecycle • Volume gain leverage • Grow capacity to acc
Slide 24: Outlook
OUTLOOK 1H2023 RESULTS Investor Presentation • 8 M a r c h 2023 8 MARCH 2023 - 1H23 RESULT S STEALTH GLOBAL HOLDINGS ASX : SGI www.stealthgi.com |
Slide 25: Outlook Remains Very Positive
OUTLOOK REMAINS VERY POSITIVE • Expect ongoing macro softening in FY23. • >95 per cent of Stealth’s products are non-discretionary, placing Stealth in a strong position to withstand an economic downturn and repeat demand for Stealth products. • We expect trading conditions in the second half to rema
Slide 26: Key Takeaways
KEY TAKEAWAYS Resilient business model drives record 1H results across all key metrics. 1 Strong performance in a challenging economic environment of cost inflation, a tight labour market, and supply chain disruptions. 5 Merger, synergies, restructuring related activities well underway and supported
Slide 27: Appendix & Supplementary Information
APPENDIX & SUPPLEMENTARY INFORMATION 1H2023 RESULTS Investor Presentation • 8 M a r c h 2023 8 MARCH 2023 - 1H23 RESULT S STEALTH GLOBAL HOLDINGS ASX : SGI www.stealthgi.com |
Slide 28: Corporate Profile
CORPORATE PROFILE Stealth Global Holdings (ASX : SGI) is one of Australia’s largest Industrial distributors providing a wide-range of industrial, tooling, safety, PPE, truck, automotive and workplace supplies and related services and solutions. Headquartered in Perth, Western Australia, Stealth prov
Slide 29: Multi-year Transformation Capturing Organic Share and Accretive M&A
MULTI-YEAR TRANSFORMATION CAPTURING ORGANIC SHARE AND ACCRETIVE M&A 7 Acquisitions completed between 2018 and 2022 We are past the halfway mark to 2025 Company Acquired Heatleys Acquired Industrial Acquired Queensland Acquired Skipper Acquired United Tools Founded Safety & Industrial Supply Buying G
Slide 30: Growth Engine Blueprint
GROWTH ENGINE BLUEPRINT ALIGNING OUR BUSINESS TO THE CHANGING NEEDS OF OUR CUSTOMERS 1 2 3 4 5 6 7 ORGANIC AND BALANCE ACROSS DECENTRALISED VERTICAL DEPLOYING AND DISTRIBUTION OPERATING INORGANIC BUSINESS ORGANISATION INTEGRATION CREATING EXCELLENCE LEVERAGE GROWTH SEGMENTS AND SYNERGIES GEOGRAPHIES
Slide 31: Stock Market Performance
STOCK MARKET PERFORMANCE STOCK MARKET DATA 1H23 2022 2021 2020 1 July share price (start-of-year) cents 10.0 10.5 6.9 9.0 High (mid-session) 14.0 17.5 11.5 11.5 Low (mid-session) 9.7 9.7 6.4 5.0 30 June share price (year-end) 10.5 10.0 10.5 6.9 31 Dec (half-year) cents Change during the year (%) +5.
Slide 32: Balance Sheet and Debt Management
BALANCE SHEET AND DEBT MANAGEMENT Year ended 30 June ($m) 1H FY23 COMMENTS 1H FY23 1H FY24 1H FY25 Two individual acquisition-specific debt facilities linked to acquisitions of C&L Tool Centre (December 2020) and Skipper Transport Parts (August 2021). Gross acquisition debt provided was $5.75m. Acqu
Slide 33: Working Capital & Cash Flow
WORKING CAPITAL & CASH FLOW DIVISION WORKING CAPITAL MOVEMENT Half-year end 31 December ($m) 31 Dec 22 30 Jun 22 30 Jun 21 • Divisional operating cash flows reflect growth of the Group during and since FY21, through the acquisitions of C&L Tool Centre, Skipper Parts, United tools Receivables and pre
Slide 34: Capital Expenditure
CAPITAL EXPENDITURE Disciplined approach to capital investments, focused on providing operational or efficiency returns. Half-year ended 31 December1 ($m) 1H FY23 1H FY22 FY22 FY21 Heatley's 221 298 341 394 C&L Tool Centre Gross capital expenditure down on prior corresponding period 48 16 28 165 • 1
Slide 35: Last Slide Contact
PRINCIPAL OFFICE Level 2/43 Cedric Street Stirling, Western Australia 6021 LAST SLIDE CONTACT Michael Arnold Group Managing Director & CEO John Boland Group Chief Financial Officer P: +61 86465 7800 E: investors@stealthgi.com W: www.stealthgi.com ABN: 25 615 518 020 \ Investor Presentation • 8 M a r
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