Genuit Group Plc · LSE:GEN

Genuit — Polypipe Group — Merger or Acquisition (February 2021)

20 slides from Genuit's merger presentation, Feb 10, 2021

  1. Slide 1: Acquisition of ADEY

    Polypipe Group plc Acquisition of ADEY 10 February 2021

  2. Slide 2: Disclaimer

    Disclaimer IMPORTANT: You must read the following before continuing. The following disclaimer applies to this document. This document has been prepared and issued by Polypipe Group plc (“Polypipe”, the “Company” or the “Group”) solely for use at a presentation (the “Presentation”) regarding a contem

  3. Slide 3: Disclaimer (Cont'd)

    Disclaimer (Cont’d) The Presentation is not being distributed to, and must not be passed on to, the general public in the EEA or the United Kingdom. This Presentation is being made to, and is directed only at, (a) persons in a member state of the EEA (“Relevant State”) who are qualified investors wi

  4. Slide 4: Well Positioned for the Future

    Well Positioned for the Future  Polypipe has managed the challenges of the COVID-19 crisis by: — Taking significant actions to strengthen our balance sheet and increase strategic and financial flexibility — Continuing to invest in key strategic growth projects  Consistent with the update on 2 Febr

  5. Slide 5: Acquisition of ADEY

    Acquisition of ADEY Market leading manufacturer of filters, chemicals and related products used to protect water-based heating systems  Cash consideration of £210m, acquired on a cash free, debt free basis1 Transaction — Implied acquisition multiple of ~11.8x 2020E ADEY’s Underlying EBITDA2 Overvie

  6. Slide 6: ADEY Overview (1/3)

    ADEY Overview (1/3)  Market leading manufacturer of filters and chemicals used to protect water-based heating systems 2003 >5 million  Strong brand heritage as the pioneer of magnetic Year founded ADEY filters fitted in the filtration technology UK & Ireland  Product offering addresses three core

  7. Slide 7: ADEY Overview (2/3)

    ADEY Overview (2/3) Total system proposition, with a portfolio of products designed to clean, flush, maintain, protect and test residential and commercial heating systems Benefits of ADEY solutions Total System Proposition  Reduce heating system breakdowns ~80% of boiler breakdowns in first five ye

  8. Slide 8: ADEY Overview (3/3)

    ADEY Overview (3/3)  UK focused business with a growing presence in international markets  Considerable exposure to more resilient and generally higher margin UK Residential RMI segment  Extensive range of products and solutions underpinned by continued product and service innovation By Geography

  9. Slide 9: Attractive Market Driven by Regulatory and Environmental Tailwinds

    Attractive Market Driven by Regulatory and Environmental Tailwinds… Existing UK Heating Systems – UK RMI UK New Build  Approximately 21 million (~75%) UK heating systems  Consistent with Future Homes Standard, Building are not adequately protected by a filter Regulation Part L already requires cle

  10. Slide 10: Expected to Support ADEY's Above-Market Growth

    …Expected to Support ADEY’s Above-Market Growth ADEY has consistently outperformed the UK construction market  Residential water-based heating protection market is one of the fastest growing segments of the UK construction market, driven by: — Shift towards more energy-efficient heating systems — B

  11. Slide 11: Core UK Platform with Expanding International Presence

    Core UK Platform with Expanding International Presence APAC United Kingdom <£1m1  Market leading platform in the UK ⁓£44m1  Selected international markets provide growth opportunity  Dedicated international sales team of 18 focused on key accounts  Focused approach on markets whereby heating tec

  12. Slide 12: ADEY is an Excellent Fit with Polypipe Strategy

    ADEY is an Excellent Fit with Polypipe Strategy P Growth driven by environmental and regulatory tailwinds, expected to deliver above-market growth #1 #1 P Investing in a portfolio of market leading brands Market position in UK Residential filters Market position in UK Residential chemicals P Seeking

  13. Slide 13: Financial Summary

    “i Financial Summary ®Polypipe

  14. Slide 14: ADEY – Attractive Financial Profile with Best-in-Class Margins

    ADEY – Attractive Financial Profile with Best-in-Class Margins Net Revenue (£m) EBITDA1 (£m)  Robust revenue growth ahead of EBITDA margin the UK construction market 7% 14% ‘17-’20E CAGR ‘17-’20E CAGR  Strong margins, which have been 35% further expanding in recent years 33% 51 31% 49 45 30%  Str

  15. Slide 15: Attractive Proposition for Shareholders

    Attractive Proposition for Shareholders Net Revenue (£m) EBITDA1 (£m)  Similar to Nu-Heat, the ADEY business is consistent with our focus on low or zero EBITDA margin carbon heating as a growth driver, and 49 514 21% 33% 22% allows us to leverage existing capabilities to support growth 465 16 114 

  16. Slide 16: Next Steps

    Next Steps Financing  Cash consideration of £210m, acquired on a cash free, debt free basis  Transaction financed through a combination of an equity placing and existing committed debt facilities — Equity placing of c.£90m (c.8.2% of existing issued share capital) — Drawdown of c.£120m on £300m ex

  17. Slide 17: Conclusion

    v—®@ Y-£ Conclusion ®Polypipe

  18. Slide 18: Conclusion

    Conclusion An excellent fit with existing strategy and a strong platform for growth P Growth driven by environmental and regulatory tailwinds, expected to deliver above-market growth P Investing in a portfolio of market leading brands P Seeking opportunities consistent with our ESG objectives, and b

  19. Slide 19: Q&A

    Q&A POLYPIPE © 2021 | 19

  20. Slide 20: Q&A

    Q&A To ask a question, please use the below conference line: United Kingdom (Local): 020 3936 2999 All other locations: +44 203 936 2999 Access Code: 032025 To register a question, press *1 on phone keypad. To remove the question, press *2 POLYPIPE © 2021 | 20

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