CVS Group plc · LSE:CVSG

CVS — FY2009 Earnings Presentation

18 slides from CVS's earnings presentation, September 2009

  1. Slide 1: CVS Group plc Final Results

    CVS Group plc Final Results Year to 30 June 2009 September 2009

  2. Slide 2: Highlights

    Highlights  Revenue growth + 23%  EBITDA (adjusted) growth + 30%  PBT (adjusted) growth + 53%  EPS (adjusted) growth + 44%  £12.4m of cash generated from operations + 90%  Acquisition growth, 17 surgeries and first pet crematorium and cemetery added in year 2

  3. Slide 3: Financial Highlights

    Financial Highlights Year Ended 30 June 2009 30 June 2008 % change Revenue £76.6m £62.2m +23% EBITDA (adjusted) £12.5m £9.6m +30% PBT (adjusted) £8.4m £5.5m +53% PBT £4.4m £0.1m - Cashflow from operations £12.4m £6.5m +90% EPS (adjusted) 11.5p 8.0p +44% EPS (Basic) 5.9p (0.7p) - 3

  4. Slide 4: Market Leading Position

    Market Leading Position  UK’s largest national operator and consolidator of veterinary practices 1,750 employees  Market leading position and reputation 393 vets makes CVS the acquirer of choice  Funding firepower positions the Group for 168 surgeries nationwide future growth by acquisition  Com

  5. Slide 5: High Growth Opportunity

    High Growth Opportunity Acquisitions  Large opportunity with still only 7-8% market share in small animal sector  Demographic change in the profession continues to drive acquisition model  Willing vendors see CVS as acquirer of choice  First mover advantage – increasing daylight between CVS and

  6. Slide 6: Successful Growth by Acquisition

    Successful Growth by Acquisition  42 surgeries, 4 laboratories and one pet crematorium acquired since IPO in Oct 2007  Multiples paid remain stable and earnings enhancing  Consistent margin improvement of acquired practices:  Provision of lower cost central services  Significant group purchasin

  7. Slide 7: Veterinary Surgeries

    Veterinary Surgeries  Surgeries contributed £67.9m of revenue (88.6% of total) and £14.4m of EBITDA in FY to 30 Jun 09  The 167 small animal and 1 equine surgery offer a full range of veterinary services including referral expertise from a number of sites  Enhanced margin rates of return driven b

  8. Slide 8: Veterinary Laboratories

    Veterinary Laboratories  Laboratories contributed £8.3m of revenue (10.8% of total) and £1.4m of EBITDA in FY to 30 Jun 09  The laboratories offer a wide range of diagnostic services including histopathology, microbiology and clinical chemistry  20% of business done by labs is intra-group and 80%

  9. Slide 9: Rossendale Animal Crematorium/Cemetery

    Rossendale Animal Crematorium/Cemetery  Crematorium acquired in October 2008  Internalisation of margin and increased range of service offering  Contributed £0.4m of revenue (0.6% of total) and £0.2m of EBITDA in FY 09  Proportion of referred business within CVS Group increasing – 23% in July 20

  10. Slide 10: Debt Financing

    Debt Financing  £44m bank facilities now fully drawn down  Debt repayments are as follows:  £2m unutilised working capital facility £m Term Loan Acquisition Total Facility  Cash balance at 30 June 2009 - £2.8m 2009/10 1.9 - 1.9 2010/11 2.6 2.5 5.1  Cash balance at 31 August 2009 - £4.8m, 2011/1

  11. Slide 11: Delivery on Stated Strategy

    Delivery on Stated Strategy  CVS has delivered on goals set at IPO:  Identification and completion of acquisitions  Integration of acquired businesses with significant margin uplift  Strict management of cashflow and available finance  High ROIC Year to 30 June, £m IPO forecast Actual Performan

  12. Slide 12: Profit & Loss

    Profit & Loss £000s Year Ended % change 30 June 2009 30 June 2008 Revenue +23.3% 76,605 62,150 Cost of Sales (45,657) (38,121) Administrative Expenses (18,452) (14,416) EBITDA +30.0% 12,496 9,613 EBITDA margin 16.3% 15.5% Depreciation & Amortisation (5,368) (3,976) Exceptional costs / share option e

  13. Slide 13: Balance Sheet

    Balance Sheet £000s 30 June 2009 30 June 2008 30 June 2007 Intangible assets 41,886 37,272 26,283 Property, plant and equipment 7,467 6,757 4,245 Financial instruments/Investments 67 1,012 396 Current assets (excl. cash) 7,403 6,937 4,130 Cash 2,792 392 2,622 Total assets 59,615 52,370 37,676 Curren

  14. Slide 14: Cashflow

    Cashflow £000s Year Ended % change 30 June 2009 30 June 2008 EBITDA +59.2% 12,496 7,849 Net working capital movement (116) (1,345) Cash generated from operations +90.3% 12,380 6,504 Proceeds from sale of investment 316 - Interest (2,597) (3,286) Taxation (828) (95) Capex (1,581) (2,105) Repayment of

  15. Slide 15: Summary

    Summary  Ideally positioned to benefit from changing demographics in profession  Largest operator and consolidator, highly respected within profession  Well managed with a proven track record in financial performance delivery  High historic ROIC, strong gross and net margins, resilient like for

  16. Slide 16: Appendices

    Appendices 16

  17. Slide 17: Corporate Owned Surgeries

    Corporate Owned Surgeries  Corporate ownership currently represents just 19% of small animal surgeries  CVS is the only corporate with a strong nationwide presence 168 66 53 48 36 27 CVS Medivet Goddards Pet Doctor Companion Vets4Pets Care Source: Individual business websites CVS is the recognised

  18. Slide 18: Margin Analysis

    Margin Analysis Years ended 30 June 2004 2005 2006 2007 2008 2009 Margin (%) - Practices 78.1 78.7 79.7 80.4 82.2 83.7 - Laboratories 88.0 89.1 87.8 87.2 74.0 68.6 Employment costs 48.9 47.3 45.1 43.8 43.2 42.9 Other costs (incl depreciation) 19.0 18.6 19.1 20.1 20.1 20.9 Head Office 7.5 6.6 6.3 5.4

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