Van Elle Holdings Plc · LSE:VANL
Van Elle — FY2019 Earnings Presentation
22 slides from Van Elle's earnings presentation, July 2019
Slide 1: Preliminary Results FY19
PRELIMINARY RESULTS FY19 JULY 2019
Slide 2: Summary
Summary Results for the year ended 30 April 2019 • Transitional year for the Group • Sales and profitability impacted by end-market volatility and project slippages • Expect market headwinds to continue through FY20 • Progress in delivering the strategy through parallel transition plan: Performanc
Slide 3: Financial Review
Financial Review Paul Pearson, CFO 1 3
Slide 4: Summary Financial results for the period
Summary Financial results for the period Income statement for the year ended 30 April 2019 Commentary Year ended 30 April FY2019 FY2018 Movement £’m Group revenues decreased by 14.8% Revenue 88.5 103.9 (14.8%) due to subdued market conditions Cost of Goods (60.3) (69.5) (13.2%) Gross margin was impa
Slide 5: Financial results for the period: divisional performance
Financial results for the period Divisional performance for the year ended 30 April 2019 Commentary Year ended 30 April General Piling FY2019 FY2018 Movement £’m Reduced revenue as a result of challenging Revenue 88.5 103.9 (14.8%) market conditions General Piling 37.2 44.1 (15.6%) Low utilisation o
Slide 6: Financial results for the period: cash flow
Financial results for the period Cash flow statement for the year ended 30 April 2019 Commentary Year ended 30 April FY2019 FY2018 £’m Operating cash conversion of 106.3% in the year Operating profit 4.6 9.7 (2018: 85.9%) Depreciation & amortisation 4.5 5.7 Operating cash flow down £3.3m (30.0%) as
Slide 7: Operational & Strategic Review
Operational & Strategic Review Mark Cutler, CEO 7
Slide 8: Business Review and Performance Stabilisation
Business Review and Performance Stabilisation Progress within the year: 1. Significantly strengthened leadership team 2. Business streamlining and simplification; eight divisions down to five 3. Annualised cost savings of c£1.0m 4. Operational weaknesses being addressed by ‘back to basics’ improveme
Slide 9: Operational Review - General Piling
Operational Review - General Piling • 15% drop in revenues • Larger CFA and rotary projects impacted by market uncertainties and increased competition and fewer, large multi-storey housing projects • Operational performance weaknesses being addressed by back to basics approach, being rolled out grou
Slide 10: Operational Review - Specialist Piling
Operational Review - Specialist Piling • Project delays experienced throughout the year. Overall revenues down by 25% • Former Ground Stabilisation activity (previously c£7m pa revenues) under strategic review • Ongoing restructuring to support cost efficiencies and operational performance improveme
Slide 11: Operational Review - Ground Engineering Services
Operational Review - Ground Engineering Services • Revenues up 5% • Strong demand for integrated piling and Smartfoot solutions to Housing sector – activities integrated under single leadership structure and assets diverted from General Piling • Good progress on regional penetration with national ho
Slide 12: Parallel Strategy
Parallel Strategy Twin approach, FY19 & FY20 - addressing performance issues and re-focus on enablers for growth 1. Simplified structure, strengthened leadership, maturing culture 2. Enhanced operational performance, deeper commercial Improving capability, strengthened compliance and governance perf
Slide 13: Three-phase implementation programme
Three-phase implementation programme Phase Three Sustainable annual growth Profit before tax Phase Two Predictable performance and margin improvement Phase One Business review and performance stabilisation Medium term Phase 1 continues through FY20 Medium term target; double-digit operating margins
Slide 14: Upgraded Leadership Team
Upgraded Leadership Team CEO Mark Cutler General Specialist Housing Strata Group Pre- CFO Piling Piling & Rail Tony Peter Services construction Paul Malcolm Dave Pontiero Handley Mick Mason Matt Love Pearson O’Sullivan Warner • Blending sector leading external appointments with long serving incumben
Slide 15: Improving Operational Performance
Improving Operational Performance Internal Training Perfect Delivery Programmes Performance Model Back to basics & lessons Targeting excellence on every learned project Operational and quality Dave Warner Peter Handley Bidding Commercial Matt Love Mick Mason 15
Slide 16: People & culture
People & culture Upgrading leadership Teamworking culture • Peter Handley – returned to Van Elle • Fully inclusive bonus scheme • Malcolm O’Sullivan – former BBGE MD • Co-location on single site in Kirkby Retention strategies • Re-vamped appraisal process • Annual employee survey • Succession planni
Slide 17: Strategic review: three core growth sectors
Strategic review undertaken – targeting three core growth sectors, underpinned by closer customer relationships Housing Infrastructure Commercial & Industrial • Housebuilders seeking faster • Cross party support for • Regional investment key and increasingly modular conurbations Market infrastructur
Slide 18: Top Strategic Customer Development
Top 15 Strategic Customer Development Commercial & Housing Infrastructure Consultants Industrial Barratt Balfour Beatty Careys Motts Persimmon Bam Nuttall Buckingham AECOM Taylor Wimpey Story Wates Arup Bellway Amey SRM Atkins/CH2M Redrow Siemens/SPL Kier WSP Robertson Volker Brookfield Jacobs Berke
Slide 19: Housing sector progress
Housing sector progress In FY19: - Heads of Terms or generic rates agreed with eight national housebuilders (increased from three) Over the last 6 months: - 168 client BD meetings - Orders from 16 new regional offices 1 19
Slide 20: Case study - Smart Motorways strategic progress
Case study - Smart Motorways strategic progress Recent and current schemes: Scheme Customer Est £m Status M1 jct 23-25 Costain/Galliford JV 3.0 Delivered FY18 M23 jct 8-10 Kier 1.5 Complete FY20 M20 jct 3-5 Kier 0.2 Complete FY20 M4 jct 3-12 BB/Vinci JV 3.0 On site started Q1 M6 jct 13-15 Kier 1.5 O
Slide 21: £20bn spend in Network Rail CP6
£20bn spend in Network Rail CP6 - devolved to routes, greater focus on renewals, track record with all tier 1 winners Highways 2019 -marketing • Highways specific 2024 strategy (including case studies) with Highways specific BD. • Currently active on 7 major smart motorways schemes around the UK • D
Slide 22: Summary & Outlook
Summary & Outlook • Disappointing performance in FY19 but a transitional year for the Group • Clear three phase strategy in place to deliver: o Improved operational performance o A platform for sustainable, long term growth • Several key initiatives implemented in FY19 as part of phase 1; initial be