Slide 1: Full Year Results for the year ended 31 December 2022
Full Year Results For the year ended 31 December 2022 2nd March 2023 1
Slide 2: Introduction and FY22 summary
Introduction and FY22 summary Ignacio Garat Group CEO 2
Slide 3: Introduction and highlights of 2022
Introduction and highlights of 2022 Sustained momentum and progress against our key priorities Strong sequential • Group revenue of £2.8bn (+29%), above pre-pandemic levels revenue growth • Driven by sustained and continuing underlying demand growth Rebuilding profit with • Operating profit of £197.
Slide 4: Delivering the Evolve strategy
Delivering the evolve strategy Making good progress Safest Most reliable Safety FWI On Time Performance OTP (%) 1.844 2.847 1.638 92.5 93.9 91.1 in 2020 in 2021 in 2022 in 2020 in 2021 in 2022 Environmental leader GHG Scope 1&2 (emissions/mpkm) 24.29 25.26 24.17 in 2020 in 2021 in 2022 4
Slide 5: Delivering the Evolve strategy: ZEV rollout
Delivering the evolve strategy ZEV Rollout continues at pace Target: 1,500 ZEVs by 2024 Safety Collisions down 27% Improved Range Vehicle range is 15% better than manufacturer expectations Fewer Breakdowns Breakdowns reduced by 62% compared to our diesel fleet 5
Slide 6: Delivering the Evolve strategy: making good progress
Delivering the evolve strategy Making good progress Safest Most reliable Safety FWI On Time Performance OTP (%) 1.844 2.847 1.638 92.5 93.9 91.1 in 2020 in 2021 in 2022 in 2020 in 2021 in 2022 Environmental leader Most satisfied customers GHG Scope 1&2 (emissions/mpkm) Passenger journeys (m) 24.29 2
Slide 7: Sequential growth continues despite challenging environment
Introduction and FY22 Summary Sequential growth continues despite challenging environment Revenue1 (£m) EBITDA (£m) H1 H2 H1 H2 1483 220 1324 198 1250 172 999 949 1013 128 89 97 2020 2021 2022 2020 2021 2022 Note 1: Revenue is presented on a constant currency basis; 2021 and 2020 revenue is reinstat
Slide 8: Sustained underlying recovery across the business
Introduction and FY22 Summary Sustained underlying recovery across the business - rolling two month average Coach passengers Urban bus passengers1 Shuttle services2 UK Coach and ALSA Long Haul UK Bus and ALSA Urban Bus Summer peaks Note 1: Spain Urban bus excludes Rober Note 2: Measured as number of
Slide 9: Resilience and agility in a challenging operating environment
Introduction and FY22 Summary Resilience and agility in a challenging operating environment In the face of volatility we have taken decisive action including: ALSA NORTH AMERICA UK & GERMANY +Restructured +Restructured NA +Restructured PEOPLE in Morocco management UK Coach and Spain OPERATIONS +Sche
Slide 10: UK Coach network rebuild
Introduction and FY22 Summary UK Coach network rebuild 100% revenue from 80% of the network Higher frequency, faster, direct journeys 6% improvement in cost per pax mile (normalised for inflation) Driver duties optimised 10
Slide 11: Resilience and agility in a challenging operating environment
Introduction and FY22 Summary Resilience and agility in a challenging operating environment In the face of volatility we have taken decisive action including: ALSA NORTH AMERICA UK & GERMANY +Restructured +Restructured NA +Restructured PEOPLE in Morocco management UK Coach and Spain OPERATIONS +Sche
Slide 12: Financial review
Financial review James Stamp Group CFO 12
Slide 13: 2022 full year financial review: introduction and priorities
2022 full year financial review Introduction and priorities Delivering quality Near-term priority Whilst focusing growth in the to strengthen the relentlessly on business balance sheet returns A diverse and resilient Prioritising strong Achieved through portfolio and a strategy to cash generation ri
Slide 14: 2022 full year financial review: summary
2022 full year financial review Summary Underlying £m 2022 2021 Change Revenue 2,807.5 2,170.3 +29.4% Group Operating Profit/(Loss) 197.3 87.0 n/m Basic EPS 15.0p 0.2p n/m DPS 5.0p n/a n/m Key Metrics 2022 2021 Change Free cash flow 160.5 123.4 +30.0% ROCE 7.7% 3.4% +430bps Covenant Gearing 2.8x 3.6
Slide 15: Divisional summary
2022 full year financial review Divisional summary Underlying Operating Profit/(Loss) Revenue YOY % change1 ALSA 2022 % change 2021 £962.5m +35.1% ALSA £103.9m £56.6m +85% North America North America £68.4m £74.4m (8)% 34% 37% £1,048.2m +8.3% UK £25.6m (£22.6m) n/a UK Germany £17.6m £5.0m +252% 10%
Slide 16: Strong portfolio underpinned by contracts
2022 full year financial review Strong portfolio underpinned by contracts 70% of revenues are underpinned by 85% of our contracts have a high or contracts, of which 74% have a high or medium level of cost inflation medium level of income protection protection 34% 42% High High 40% 43% Medium Medium
Slide 17: Disciplined capital allocation: risk vs reward
Disciplined capital allocation: risk vs reward Illustrative financials Return on Capital Employed (5-year contract example) Contract 1 Contract 2 (Base Case) (Base Case) 35% Revenue £550M £700M 27% Operating Profit £28M £100M Operating Profit Margin 5% 14% 17% Capex £10M £150M 9% IRR 29% 15% CONTRAC
Slide 18: ALSA
ALSA Record revenue and strong profits growth Business % Contracted Income Owned Key stats Line Revenue Protection Assets 2 2022 2021 % change Long Haul 15% 1 Revenue €1,129.3m €835.8m +35% Underlying Op profit €121.8m €65.9m +85% Regional 33% Underlying Op margin 10.8% 7.9% +290bps ROCE 15.5% 8.7%
Slide 19: North America
North America Overview Business % Contracted Income Owned Key stats Line Revenue Protection Assets 2022 2021 % change School bus1 69% Revenue $1,296.8m $1,199.7m +8% Underlying Op profit $84.7m $102.3m (17)% Transit 16% Underlying Op margin 6.5% 8.5% -200bps ROCE 5.2% 6.1% -90bps Shuttle 15% Key poi
Slide 20: North America School Bus
North America School Bus In isolation, pricing recovery of wage investment …profits in FY23 impacted by removal of CERTS will happen over two school years… funding, price recovery and timing of route reinstatement COST PRICING COST PRICING GOVERNMENT PRICING ROUTE SY 21/22 SY 22/23 SY 23/24 EBITDA E
Slide 21: UK: Sustained recovery and strong momentum
UK Sustained recovery and strong momentum Business % Contracted Income Owned Returns Line Revenue1 Protection Assets 2022 2021 % change Scheduled coach Revenue £528.3m £397.8m 33% 53% Underlying Op profit £25.6m £(22.6)m n/a NXTS Underlying Op margin 4.8% (5.7%)% n/a 2 ROCE 8.1% (6.2)% n/a Bus 45% K
Slide 22: Germany: Significant growth from contract wins
Germany Significant growth from contract wins Business % Contracted Income Owned Returns Line Revenue Protection Assets 2022 2021 % change RRX1 67% Revenue €315.0m €211.8m +49% Underlying Op profit €20.7m €5.8m +255% RME 33% Underlying Op margin 6.6% 2.7% +390bps ROCE 61.4% 10.6% n/a Note 1: Secured
Slide 23: Separately disclosed items: dominated by non-cash items
2022 full year financial review Separately disclosed items: dominated by non-cash items Income Cash flow Key Points statement impact £m • Non-cash impairment in ALSA Underlying Operating Profit 197.3 due to rise in discount rates. No Goodwill impairment of ALSA (260.6) 0.0 change to outlook Amortisa
Slide 24: Free cash flow conversion of 81%
2022 full year financial review Free cash flow conversion of 81% £m FY 2022 FY 2021 £118m £42m EBITDA 418.1 300.0 (+39%) improvement in Increased maintenance Net maintenance capex (184.5) (142.1) EBITDA capex spend of £42m Working capital (1.1) 33.0 Pension deficit (7.4) (7.2) Operating cash flow 22
Slide 25: Progress towards our long-term target gearing range
2022 full year financial review Progress towards our long-term target gearing range FCF conversion Covenant Gearing (%) 6.6 142 77 81 3.6 64 61 61 2.8 2.5 2.3 2.3 2.4 0 1 2 3 2016 2017 2018 2019 2020 2021 2022 2016 2017 2018 2019 2020 2021 2022 Note 1: FCF in 2020 was negative and, therefore, is exc
Slide 26: Significant liquidity headroom
2022 full year financial review Significant liquidity headroom Liquidity profile – committed facilities £0.8bn cash and Leases RCF Hybrid Divisional bank loans Bonds/USPP committed headroom: 530 541 • RCF undrawn £527m 572 • Cash £241m • Average maturity of 3.7 years 268 332 121 77 53 2023 2024 2025
Slide 27: Disciplined capital allocation
2022 full year financial review Disciplined capital allocation Maintain a prudent Invest for growth Return to balance sheet (targeting investments that Shareholders (net debt to EBITDA in a deliver 15% returns) (dividend at least range of 1.5 to 2.0 times) 2.0x covered) Net Debt to EBITDA improved N
Slide 28: Strategic progress
Strategic progress Ignacio Garat Group CEO 28
Slide 29: Five customer propositions developing at pace
Business and strategic update Five customer propositions developing at pace Reinvigorate public transport Multi-modal expansion • Successful start-up of our first urban • Awarded an all-electric urban bus bus contract in Portugal contract in Geneva • Expansion of Transport Solutions to West Midlands
Slide 30: Customer propositions case study – RRX Lot 1
Business and strategic update Customer propositions case study – RRX Lot 1 • RRX Lot 1 emergency award was made at the end of 2021 • Successful mobilisations, at very short notice and on time • Led to 10 year RRX Lot 1 award in early 2023 • c60 million passenger use service 2022 We plan, mobilise an
Slide 31: Five customer propositions developing at pace
Business and strategic update Five customer propositions developing at pace Reinvigorate public transport Multi-modal expansion • Successful start-up of our first urban • Awarded an all-electric urban bus bus contract in Portugal contract in Geneva • Expansion of Transport Solutions to West Midlands
Slide 32: Digitally enabled improving experience for customers and colleagues
Business and strategic update Digitally enabled improving experience for customers and colleagues • Timetable optimisation platform • Outcomes: • AI and machine learning to predict journey times 7% reduction in Excess Wait Time • Allows better matching of service provision to 45% reduction in late r
Slide 33: £2.5bn pipeline contains a mix of large and small opportunities
Business and strategic update £2.5bn pipeline contains a mix of large and small opportunities 18-month pipeline distribution by size 18-month pipeline value by size of opportunity (# contracts) of opportunity (£bn) Bid M&A Bid M&A 184 £1.6bn 98 £0.7bn £0.2bn 9 Small Medium Large Small Medium Large (
Slide 34: Pipeline conversion rates and contract wins
Business and strategic update Pipeline conversion rates 35 contract wins worth £150m of annualised revenue Large Medium Small Total win value (>£50m) (£5-50m) (£0-5m) Actual FY22 # won 1 3 31 £150m 2 Pipeline conversion rate1 20% 10% 25% 15% Note 1: Wins are the number of contracts awarded in 2022 N
Slide 35: Summary: Continued delivery in a challenging environment
Summary Continued delivery in a challenging environment Strong sequential revenue growth Rebuilding profit with strong cash conversion Rebuilding the balance sheet Progress against Evolve strategy Dividend reinstated 35
Slide 36: Q&A
Q&A 36
Slide 37: Appendix
Appendix 37
Slide 38: Gearing targets progress
2022 full year financial review Gearing targets progress £m Contracts £49m FY 2022 FY 2021 Growth capex primarily £49m of cash costs in reflect new contracts respect of separately Free cash flow 160.5 123.4 in ALSA and North disclosed items, America (prior year principally associated Net growth capi
Slide 39: We expect more of a shift to asset light over time
We expect more of a shift to asset light over time 35% of our operations are currently Bid Pipeline contains a higher mix of asset light asset light in nature Capex Light Asset Heavy 35% 26% Capex Heavy Asset Light 65% 74% 39
Slide 40: Disclaimer
The information in this presentation is general information and background only, and is not intended to be relied upon as advice to investors or potential investors as it does not take into account their particular investment objectives, financial situation or needs. The contents of this presentatio