Enx Group Limited · JSE:ENX
Enx — H1 2023 Earnings Presentation
31 slides from Enx's earnings presentation, Feb 28, 2023
Slide 1: Results Presentation for the six months ended 28 February 2023
RESULTS PRESENTATION for the six months ended 28 February 2023
Slide 2: Contents
CONTENTS 01 WHO WE ARE 02 OUR PURPOSE AND WHO WE REPRESENT 03 HIGHLIGHTS AND KEY FOCUS AREAS 04 FINANCIAL PERFORMANCE 05 BUILDING OUR BUSINESS UNITS 06 DISPOSAL GROUP HELD FOR SALE – PRIOR YEAR 07 FINANCIAL REVIEW 08 OUTLOOK 2
Slide 3: Who We Are
WHO WE ARE
Slide 4: Who We Are
WHO WE ARE enX FLEET FLEET MANAGEMENT SOLUTIONS ACROSS ALL VEHICLE CLASSES: Rental, tracking, insurance INTEGRATED FLEET and remarketing MANAGEMENT SOLUTIONS enX PETROCHEMICALS Headcount (2022: 415) Software-as-a-Service 320 MANUFACTURING AND DISTRIBUTION OF PETROCHEMICALS: Oil lubricants and base o
Slide 5: Our Purpose and Who We Represent
OUR PURPOSE AND WHO WE REPRESENT
Slide 6: Our Purpose
OUR PURPOSE enX Group is an integrated fleet management solutions provider and distributor of quality branded equipment and petrochemical products • Integrated solutions-based leveraging off technology - Kynite - Specialist products and solutions in AG Lubricants & WAG • Grow asset light • Drive eff
Slide 7: Who We Represent
WHO WE REPRESENT BRAND RECOGNITION MARKETING EXPERTISE RESEARCH AND DEVELOPMENT GROWTH OPPORTUNITIES SUPPORTED WITH CONFIDENCE BY GLOBAL TOP 10 AND LEADING INTERNATIONAL BRANDS enX PETROCHEMICALS enX EQUIPMENT #1 #1 #1 #1 7
Slide 8: Highlights and Key Focus Areas
HIGHLIGHTS AND KEY FOCUS AREAS
Slide 9: Highlights and Key Focus Areas
HIGHLIGHTS AND KEY FOCUS AREAS 1. Continued robust performance for six months ended 28 February 2023 - Despite challenging economic conditions, solid profitability in continuing operations - Strong financial position 2. Clover exit - Clover contract terminated end June 2022 - Contract was negatively
Slide 10: Highlights and Key Focus Areas
HIGHLIGHTS AND KEY FOCUS AREAS 5. enX Trading Investment refinancing amounting to R370 million - enX Trading Investment facilities repaid at the end of March 2023, post period end - Dedicated financing secured for WAG, AG Lubricants and New Way Power 6. New Way Power turnaround - Base for sustainabl
Slide 11: Highlights and Key Focus Areas
HIGHLIGHTS AND KEY FOCUS AREAS 8. Securing a sustainable and robust capability for AG Lubricants - In 2021, secured a six-year supply and distribution agreement with ExxonMobil - In 2022, implemented a transaction between AGL and Abakhulu to secure base oil supply - In December 2022, acquired the sp
Slide 12: Financial Performance
FINANCIAL PERFORMANCE
Slide 13: Financial Performance
FINANCIAL PERFORMANCE • Revenue from continuing operations of R2.917 billion (2022: R2.386 billion), up 22% • Operating profit ¹ of R216 million (2022: R206 million), up 5% - Increasing demand for power solutions and services arising from load-shedding - Robust Eqstra performance - Once-off items of
Slide 14: Building Our Business Units
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Slide 15: Business Unit Analysis – Eqstra
BUSINESS UNIT ANALYSIS – EQSTRA enX FLEET Rm H1 2023 H1 2022 REVENUE VALUE CHAIN Revenue 898 915 40% EBIT ¹ 140 123 PBT ¹ 83 67 Leasing assets 2 368 2 726 32% H1 RENTAL Net working capital 153 128 Total assets 2 808 3 145 2023 VALUE ADD SERVICES REMARKETING Interest-bearing liabilities 1 285 1 408 N
Slide 16: Business Unit Analysis – Eqstra Leasing Book
BUSINESS UNIT ANALYSIS – EQSTRA LEASING BOOK Leasing book remains healthy with risks well managed: • Credit risk: The book remains well diversified in terms of industry exposure and primarily blue-chip customers. The top 5 customers account for around 19% of the Leasing assets net book value • Inter
Slide 17: Business Unit Analysis – AG Lubricants
BUSINESS UNIT ANALYSIS – AG LUBRICANTS enX PETROCHEMICALS Rm H1 2023 H1 2022 H1 2023 Revenue 844 550 AG LUBRICANTS • Year-on-year revenue ↑ 53% underpinned by higher sales EBIT ¹ 34 29 values due to a significant increase in base oil prices period-on- period and higher volumes as demand increased PB
Slide 18: Business Unit Analysis – WAG
BUSINESS UNIT ANALYSIS – WAG enX PETROCHEMICALS Rm H1 2023 H1 2022 H1 2023 Revenue 892 792 WAG • Year-on-year revenue ↑ 13% EBIT ¹ 34 36 • Continued growth in existing customer volumes and higher selling prices arising from increased commodity prices PBT ¹ 26 31 period-on-period Inventory 341 349 •
Slide 19: Business Unit Analysis – New Way
BUSINESS UNIT ANALYSIS – NEW WAY enX EQUIPMENT Rm H1 2023 H1 2022 H1 2023 Revenue 302 148 NEW WAY • Revenue ↑ 104% EBIT 30 (17) ‐ As a result of load-shedding PBT 28 (20) ‐ Strong demand for generators, parts accompanied by maintenance services Inventory 186 97 ‐ Entry into photovoltaic market assis
Slide 20: Disposal Group Held for Sale – Prior Year
DISPOSAL GROUP HELD FOR SALE – PRIOR YEAR
Slide 21: Disposal Group Held for Sale – Prior Year
DISPOSAL GROUP HELD FOR SALE – PRIOR YEAR EIE SA: Shown as an asset held for sale and discontinued operation • EIE SA reported as an asset held for sale and discontinued operation from 31 August 2021 - Depreciation and amortisation of R222 million (after tax R160 million) ceased with effect from 1 S
Slide 22: Financial Review
FINANCIAL REVIEW
Slide 23: Financial Review – Key Performance Indicators
FINANCIAL REVIEW Key performance indicators: Total operations (Rm, unless stated) H1 2023 H1 2022 Revenue 2 917 3 481 Operating profit* 216 508 Operating profit on a like-for-like basis *¹ 216 286 Headline earnings 126 268 Headline earnings on a like-for-like basis ¹ 126 108 Basic earnings per share
Slide 24: Condensed Statement of Financial Position
FINANCIAL REVIEW CONDENSED STATEMENT OF FINANCIAL POSITION Rm Feb 2023 Aug 2022 Goodwill and intangibles 96 100 Leasing assets 2 368 2 350 Inventories 879 854 Trade and other receivables 936 1 057 Property, plant and equipment 188 124 Right-of-use asset (IFRS 16) 24 75 Restricted consideration 135 1
Slide 25: Condensed Statement of Cash Flows
FINANCIAL REVIEW CONDENSED STATEMENT OF CASH FLOWS Rm H1 2023 H1 2022# Cash generated from operations before working capital movements 427 786 Working capital movements (384) (583) Cash generated from operations 43 203 Net interest and taxation paid (107) (152) Net cash flows from operating activiti
Slide 26: Gross Interest-Bearing Borrowings
FINANCIAL REVIEW GROSS INTEREST-BEARING BORROWINGS Funding facilities (Rm) Facility size (Utilised)/Cash Liquidity Eqstra 1 662 (1 279) 383 Term 726 (726) - Revolving 736 (436) 300 General banking 200 (117) 83 Trading ¹ 316 (184) 132 Revolving 45 (45) - General banking 200 (92) 108 Trade finance 65
Slide 27: Material Covenant Levels
FINANCIAL REVIEW MATERIAL COVENANT LEVELS Eqstra Covenants Level February 2023 Net total debt: EBITDA ≤3.0x 1.73 EBITDA: net finance charges ≥1.5x 2.64 Net total debt: equity ≤2.5x 1.19 Loan to value ≤65% 47% enX Trading Covenants Level Last Reporting Date ¹ Net total debt: EBITDA <2.0x 0.45 EBITDA:
Slide 28: Outlook
OUTLOOK
Slide 29: Outlook
OUTLOOK EQSTRA • The diversified customer base with annuity revenue and in-use fleet provides a stable revenue stream • Growth in leasing book units is expected with indications of good replacement levels, customer retention as well as new business opportunities • Continued investment in technologic
Slide 30: Disclaimer
DISCLAIMER Certain statements in this presentation regarding enX’s business operations may constitute “forward- looking statements”. All statements other than statements of historical fact are included in this presentation, including, without limitation, those regarding the financial position, busin
Slide 31: Q&A
Q&A