Oxford Instruments Plc · LSE:OXIG
Oxford Instruments — H1 FY2023 Earnings Presentation
29 slides from Oxford Instruments's earnings presentation, Nov 8, 2022
Slide 1: Interim results presentation
Interim results presentation to 30 September 2022 Ian Barkshire Chief Executive Gavin Hill Chief Financial Officer
Slide 2: Highlights
Highlights Strong financial Structural growth markets driving strong performance order, revenue and profit growth Strategy delivering Resilience of business model underpinned by continued growth depth of market intimacy and relentless momentum product innovation Well positioned in Major markets and
Slide 3: Driving sustainable growth and margin expansion
Driving sustainable growth and margin expansion Enabling a greener, healthier, more connected advanced society Well positioned in global markets with long-term structural growth drivers • Scale and differentiation within our markets: Advanced Materials, Semiconductor, Healthcare & Life Science, Ener
Slide 4: Horizon strategy driving continued progress
Horizon strategy driving continued progress Market Heightened market intimacy driving strong growth to existing customers and intimacy expansion to adjacent markets, particularly in the commercial sector Innovation and Investment in new products maintaining differentiation and disruptive growth into
Slide 5: Group performance – end markets
Group performance – end markets Orders • Structural growth markets driving double digit order growth: Research & Fundamental Semiconductor & Communications, Advanced Materials, Energy & Science Environment and Quantum Technologies +(30%)* Healthcare & Lifescience +5%* 4% • Ongoing successful impleme
Slide 6: Shaping a sustainable future
Shaping a sustainable future Sustainability is embedded in our business model and throughout our own operations through the delivery of our purpose: to enable a greener, healthier, more connected advanced society Executing our sustainability agenda People at the heart of our strategy Inclusive Innov
Slide 7: Finance review
Finance review Gavin Hill Chief Financial Officer © Oxford Instruments 2022 7
Slide 8: Income statement
Income statement Constant Reported currency £m 2022/23 2021/22 change change Revenue 200.5 170.1 +17.9% +10.2% Adjusted1 operating profit 36.8 30.6 +20.3% +4.6% Amortisation of acquired intangibles (4.3) (3.8) Non-recurring items (0.1) (1.2) Mark-to-market of currency hedges (6.1) (3.8) Statutory op
Slide 9: Revenue by sector
Revenue by sector £200.5m +17.9%2 reported +10.2%2 constant currency (+5.7%2 organic constant currency) £170.1m Currency Research & Service & +7.7%2 Discovery Healthcare Materials & +10.7%1 Characterisation (4.4%)1 +19.7%1 (+10.8%1 organic) HY 21/22 HY 22/23 1 Constant currency growth rate compared
Slide 10: Adjusted operating profit by sector
Adjusted operating profit by sector £36.8m +20.3%2 reported +4.6%2 constant currency Group £30.6m margin HY22/23: 18.4% Currency Materials & Research & Service & 15.7%2 CC margin HY21/22: 17.1% Discovery Healthcare Characterisation margin HY21/22: 18.0%% +23.1%1 (34.5%)1 +15.7%1 Materials & Characte
Slide 11: Materials & Characterisation
Materials & Characterisation 54% Group revenue (Academic: 41% Commercial: 59%) Research & Fundamental Science Healthcare & Lifescience +463%* +26%* Constant 2022/23 2021/22 currency 2% £m £m Growth growth 5% Orders 135.4 102.9 +31.6% +25.9% Advanced Revenue 108.7 84.9 +28.0% +19.7% Materials +24%* A
Slide 12: Research & Discovery
Research & Discovery 29% Group revenue (67% academic; 33% commercial) Research & Constant Fundamental Science 5% 2022/23 2021/22 currency (48%*) £m £m Growth growth Orders 62.8 60.5 +3.8% (2.1%) 7% Healthcare & Lifescience Revenue 58.1 56.3 +3.2% (4.4%) Advanced +5%* Materials Adjusted1 operating pr
Slide 13: Service & Healthcare
Service & Healthcare 17% Group revenue Constant 2022/23 2021/22 currency £m £m Growth growth Orders 37.1 34.9 +6.3% +0.9% Revenue 33.7 28.9 +16.6% +10.7% Adjusted1 operating profit 10.9 8.9 +22.5% +15.7% Adjusted1 operating margin 32.3% 30.8% Statutory operating profit 11.3 8.9 +27.0% Key performanc
Slide 14: Revenue and order growth by region
Revenue and order growth by region Order growth Europe North America reported +12% reported +41% 29% constant currency +12% constant currency +23% North America Asia reported +26% reported +10% constant currency +4% constant currency +11% Revenue Asia £200.5m 48% reported +17% constant currency +13%
Slide 15: Order book by sector
Order book by sector £316m Service & +36%2 reported Research & Healthcare +29%2 constant currency Discovery £42m (+29%2 organic CC) Materials & £118m +15%1 Characterisation +17%1 £155m +46%1 (+47%1 organic) £232m HY 21/22 HY 22/23 1 Constant currency growth rate compared to prior year sector order b
Slide 16: Cash flow
Cash flow Cash conversion Adj effective 47% (65%1) tax rate HY21: 50% Working 21.4% (53%1) capital HY21: 21.5% Capex & Lease Tax capitalised payments Working development Pensions Pension asset capital Adjusted costs FX, £24.5m EBITDA Dividend outflow interest FY22: £51.7m & other £12.6m HY21: £13.6m
Slide 17: Currency exposure
Currency exposure Revenue (£m equivalent) Adjusted operating profit (£m equivalent) (£30m) Sterling £30m Sterling £113m US Dollar US Dollar £48m Euro £37m Euro £13m Japanese Yen £16m Japanese Yen £5m Chinese £3m Renminbi Chinese Renminbi £1m Other £1m Other £0m Oxford Instruments plc Interim results
Slide 18: FX sensitivity
FX sensitivity • Favourable currency impact in the half year: revenue: +£13.1m ; adjusted operating profit: +£4.8m • Estimated full year 2022/23 currency impact • Assuming current hedges as at 31/03/22 and no change from current forecast rates, approximate currency sensitivity against 2021/22: Reven
Slide 19: Finance summary
Finance summary • Strong growth in orders and order book with a book-to-bill of 117% • Adjusted operating margin dilution at constant currency impacted by order book phasing and shipment delays. Expect some alleviation in the second half with higher output and price rises feeding into revenue • Geop
Slide 20: End market overview
End market overview Ian Barkshire Chief Executive © Oxford Instruments 2022 20
Slide 21: Markets: long-term structural growth drivers
Markets: long-term structural growth drivers Healthcare & Life Science Semiconductor & Advanced Materials (18% of revenue) Communications (31% of revenue) (28% of revenue) • Improved treatments & vaccines • Building blocks of advanced society • Personalised medicine & therapies • Increased chip dema
Slide 22: Supporting fundamental understanding of disease mechanisms to accelerate drug delivery
Healthcare & Life Science Supporting fundamental understanding of disease mechanisms to accelerate drug delivery Our optical microscopy portfolio supports the full spectrum from high-end advanced super resolution research systems to easy-to-use accessible solutions and world-class data analysis Ulti
Slide 23: Driving green transition in the battery market
Energy & Environment Driving green transition in the battery market With batteries playing a critical part in the green transition in everything from cars to phones and electronic devices, our products and solutions are supporting customers at every stage of the battery life cycle Our suite of techn
Slide 24: Enabling research, development and delivery of next generation data communications
Semiconductor & Communications Enabling research, development and delivery of next generation data communications Our compound semiconductor technologies and solutions are supporting increased bandwidth, faster communications and the evolution of the human/machine interface Proprietary etching and d
Slide 25: Summary and outlook
Summary and outlook • Continued strong growth momentum, with increasing demand from structural growth markets and robust pipelines across all end markets • Higher production and positive impact of recent price rises anticipated in second half as record order book is converted • Good visibility for f
Slide 26: Thank you
Thank you Oxford Instruments plc Interim results presentation 2022 26
Slide 27: Disclaimer
Disclaimer This presentation is prepared for and addressed to authorised persons within the meaning of the Financial Services and Markets Act 2000 (FSMA). The information contained in this presentation is not for publication, distribution or reproduction, in whole or in part, to any persons outside
Slide 28: Appendix
Appendix
Slide 29: The Oxford Instruments business model
The Oxford Instruments business model Our core purpose is to enable a greener, healthier, more connected advanced society Our Horizon strategy defines the way we operate, embedding clearly defined core capabilities, processes and procedures across our businesses.