Rak Ceramics Pjsc · ADX:RAKCEC
Rak Ceramics Pjsc — RAK Ceramics — EFG Hermes Investor Conference March 2024
38 slides from Rak Ceramics Pjsc's conference presentation, March 2024
Slide 1: EFG Hermes Investor Conference
EFG HERMES INVESTOR CONFERENCE MARCH 2024
Slide 2: Contents
Contents 1 Company Overview 2 Segmental Overview 3 Business Update 4 Sustainability Overview 5 Financial Highlights 6 Stock Profile 7 Appendix
Slide 3: Company Overview
COMPANY OVERVIEW
Slide 4: RAK Ceramics at a glance
INVESTOR PRESENTATION – FY 2023 RAK Ceramics at a glance Leading lifestyle brand offering premium home, bath & kitchen solutions Shareholding Structure +30 YEARS ~ 12,000 33.9% 23.9% Ceramic expertise Global workforce 6.4% 11.6% 16.7% 7.6% ~US$ 800MN ~US$ 1BN H.H. Sheikh Saud Bin Saqr Al Qasimi RAK
Slide 5: Eras of RAK Ceramics
INVESTOR PRESENTATION – FY 2023 Eras of RAK Ceramics 1990-2000 | FOUNDATION 1989 1991 1993 2000 Founded by H.H. Sheikh First tile plant First sanitaryware plant Tile plant set-up in Saud Bin Saqr Al Qasimi, operational with annual operational with annual Bangladesh with annual Ruler of Ras Al Khaima
Slide 6: Manufacturing Process
INVESTOR PRESENTATION – FY 2023 Manufacturing Process 118MN 5MN 36MN 2.6MN Square metres of tiles Pieces of sanitaryware Pieces of tableware Pieces of faucets and taps GERMANY GLOBAL PRODUCTION LAYOUT AUSTRIA 24 plants worldwide IRAN HUNGARY INDIA BANGLADESH UAE 15 Tiles Plant 4 Sanitaryware Plant U
Slide 7: Our Philosophy
INVESTOR PRESENTATION – FY 2023 Our Philosophy To become the world’s leading lifestyle solution provider for home, bath & kitchen solutions LIFESTYLE BRAND INNOVATION HIGH-END QUALITY SUSTAINABILITY We are globally recognized Innovation is at the heart of We are known for our wide We operate in harm
Slide 8: Segmental Overview
SEGMENTAL OVERVIEW
Slide 9: Product offering
INVESTOR PRESENTATION – FY 2023 Product offering TILES SANITARYWARE We offer one of the largest Complete solutions provider collection of Ceramic and Gres offering products designed Porcelain wall and floor tiles, to suit all budgets and tastes super-sized slabs in the with accessories and industry.
Slide 10: Tiles
INVESTOR PRESENTATION – FY 2023 Tiles RAK Ceramics offers one of the largest collections of high quality Ceramic and Gres TILES Porcelain Wall and Floor Tiles and Super-Sized Slabs in the industry. 6,000 SANITARYWARE 10x10 The current number 135x305 Our Smallest tile. of production Our largest tile.
Slide 11: Sanitaryware
INVESTOR PRESENTATION – FY 2023 Sanitaryware RAK Ceramics is internationally recognized for the high quality of its sanitaryware. This TILES quality comes from carefully selected premium raw materials that ensure a perfect finish of the products. SANITARYWARE 15,616 100 DAYS 100% Sanitaryware pieces
Slide 12: Tableware
INVESTOR PRESENTATION – FY 2023 Tableware Ceramic tableware Industry added a new chapter with launch of RAK Porcelain LLC in TILES United Arab Emirates. This company quickly went on to become the World’s leading supplier of professional grade Porcelain tableware in HORECA Industry SANITARYWARE 2005
Slide 13: Faucets
INVESTOR PRESENTATION – FY 2023 Faucets Kludi GmbH & Co. KG – founded in 1926 in the Sauerland region of Germany – TILES manufacturing high-quality faucets & fittings for bathrooms and kitchens 100 Top 100 Years of 170 100 Innovators SANITARYWARE Inventions Patents In German Experience SME sector TA
Slide 14: Business Update
BUSINESS UPDATE
Slide 15: Business Highlight - 2023
INVESTOR PRESENTATION – FY 2023 Business Highlight - 2023 UAE: Achieved 22% YoY KSA: Experienced a 40% YoY revenue growth in 2023. revenue decline in 2023 but improved gross margins by 1.2% Tiles revenue decreased by 8.3% YoY to AED 1988.0 million, impacted by intensified competition from regional p
Slide 16: Marketing updates - 2023
INVESTOR PRESENTATION – FY 2023 Marketing updates - 2023 Presence and Footprint Launch of the new rakceramics.com Strong relations with the 9 New Showrooms opened in 2023 website. Website metrics: 8% increase majority of the specialized adding to total of 32 showrooms in total users, 52% increase in
Slide 17: Key Challenges - 2023
INVESTOR PRESENTATION – FY 2023 Key Challenges - 2023 Core Markets Key Challenges Our Actions Imports of cheaper products has increased on account of • Strategic approach centers on adaptability, customer-centric UAE free trade agreements signed between UAE and other solutions, and a relentless purs
Slide 18: Expansion Plans – 2023/24
INVESTOR PRESENTATION – FY 2023 Expansion Plans – 2023/24 Plans include upgrading the tiles production facility for improved efficiency and capacity. We are upgrading our Tiles production facility to UAE Simultaneously, a sanitaryware upgradation project is India allow us to add new models and desig
Slide 19: Priorities
INVESTOR PRESENTATION – FY 2023 Priorities Protect Market Production Operational Digital Share Capabilities Diversification Acceleration Growth Maintain healthy Explore and diversify Improve operating competition across Rationalize footprint into new markets in model practicing all core markets and
Slide 20: Sustainability Overview
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Slide 21: Sustainability updates - 2023
INVESTOR PRESENTATION – FY 2023 Sustainability updates - 2023 Introducing Online Recycling Upgrading Design Enhancing Introducing Mosaic Process Rejected Tiles Scanning Solutions glazing system E-bikes Online mosaic Recycling Design Digital glazing 70 e-bikes production system equipment, development
Slide 22: Sustainability Highlights - 2023
INVESTOR PRESENTATION – FY 2023 Sustainability Highlights - 2023 100% 17,700 MMBTU savings in gas as a result of 8 ~70% of all our wastewater is treated thermal savings initiatives of water consumption across all our and partially used on-site manufacturing processes is from recycled water 100% 75%
Slide 23: Financial Highlights
FINANCIAL HIGHLIGHTS
Slide 24: Financial Snapshot - 2023
INVESTOR PRESENTATION – FY 2023 Financial Snapshot - 2023 REVENUE GROSS MARGIN EBITDA AED 3.45 BN 37.9% AED 647.4 M 1.7% YoY 30 bps YoY 12.2% YoY NET PROFIT NET PROFIT After Minority NET DEBT AED 320.9 M AED 290.9 M AED 1.42 BN 3.7% YoY* 3.9% YoY 120.3 M Net Debt to EBITDA 2.20x vs 2.26x * Net profi
Slide 25: Revenue Highlights - 2023
INVESTOR PRESENTATION – FY 2023 Revenue Highlights - 2023 MANAGEMENT COMMENTS TOTAL REVENUE (AED MN) YEARLY COMPARISON • 2023 revenue at AED 3,457.8m, down by 2022 2023 1.7% YoY, reflecting global geopolitical Tiles SW TW Faucets Others Amount Amount YoY Growth tensions, market volatility, higher in
Slide 26: Revenue Contribution - 2023
INVESTOR PRESENTATION – FY 2023 Revenue Contribution - 2023 REVENUE CONTRIBUTION BY TILES & SANITARYWARE REVENUE TOTAL REVENUE CONTRIBUTION BY SEGMENT 2023% CONTRIBUTION BY REGION 2023% REGION 2023 % 13.0% 3.0% 4.5% 3.4% 10.3% 10.6% 9.5% 31.4% 11.0% 31.5% 15.4% 58.0% 21.9% 10.5% 15.0% 14.0% 14.5% 6.
Slide 27: Gross Profit Margin Trend - 2023
INVESTOR PRESENTATION – FY 2023 Gross Profit Margin Trend - 2023 TOTAL GROSS MARGINS (%) TILES GROSS MARGINS (%) 36.2% 37.6% 37.9% 36.6% 37.9% 38.4% 32.0% 32.2% 32.0% 29.6% 31.4% 27.2% 2018 2019 2020 2021 2022 2023 2018 2019 2020 2021 2022 2023 SANITARYWARE GROSS MARGINS (%) TABLEWARE GROSS MARGINS
Slide 28: Bangladesh Operations - 2023
INVESTOR PRESENTATION – FY 2023 Bangladesh Operations - 2023 MANAGEMENT COMMENTS REVENUE (AED MN) GROSS PROFIT MARGIN (%) • In FY revenue decreased by 9.8% to -9.8% AED 266m due to currency devaluation 278 282 230 297 294 266 31.5 29.8 as in local currency the revenue has 29.2 26.4 25.0 registered a
Slide 29: Indian Operations - 2023
INVESTOR PRESENTATION – FY 2023 Indian Operations - 2023 MANAGEMENT COMMENTS REVENUE (AED MN) GROSS PROFIT MARGIN (%) • In 2023, revenue declined by 13.0% year- -13.0% on-year to AED 382 million, primarily attributed to reduced demand and currency 17.0 321 340 295 414 439 382 39.9 15.0 14.2 devaluat
Slide 30: Tableware performance trend - 2023
INVESTOR PRESENTATION – FY 2023 Tableware performance trend - 2023 MANAGEMENT COMMENTS REVENUE (AED MN) GROSS PROFIT MARGIN (%) • Tableware performance across core markets significantly improved supported 11.0% by recovery in the hospitality and tourism, the introduction of new range of products 56.
Slide 31: Balance Sheet Evolution - 2023
INVESTOR PRESENTATION – FY 2023 Balance Sheet Evolution - 2023 MANAGEMENT COMMENTS WORKING CAPITAL CYCLE (DAYS) RETURN ON EQUITY (%) • Return on Equity in 2022 is highest at 14.8% in last 5 years. 238 242 228 175 146 172 14.8 • Inventory days increased by 24 days in 119 13.2 110 123 11.8 2023 compar
Slide 32: Stock Profile
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Slide 33: RAK Ceramics Share Price Movement
INVESTOR PRESENTATION – FY 2023 RAK Ceramics Share Price Movement RAK Ceramics (RAKCEC) Share Price Performance (AED) 8TH February 2024 4th August 2023 AED 0.10/share cash final AED AED 0.10/share dividend announcement cash interim dividend WAP 2.64 3.000 announcement 2.90 2.900 52 week high 2.90 2.
Slide 34: Dividend Update
INVESTOR PRESENTATION – FY 2023 Dividend Update MANAGEMENT COMMENTS Historical annual Dividend paid (%) • RAK Ceramics is committed to returning capital to shareholders via a sustainable dividend policy, aiming at a minimum payout of 20 fils on a semi-annual basis for FY 2022 subject to consideratio
Slide 35: Appendix
APPENDIX
Slide 36: Profitability Bridge
INVESTOR PRESENTATION – FY 2023 Profitability Bridge 2023 vs 2022 Profit Bridge (AEDM) 3.7% Lower GP due Higher Others Net Profit One-off gain Net Profit Higher Lower freight for Swing from Net Profit to lower Finance (Other 2022 (net) before one-off SG&A –Fixed decreased volumes KLUDI Group 2023 re
Slide 37: EBITDA Working
INVESTOR PRESENTATION – FY 2023 EBITDA Working YEARLY COMPARISON 2022 2023 Amount in AED M Amount Amount Net profit /(loss) after tax 340.1 320.9 Tax 32.2 24.6 Interest- net 70.9 106.8 Depreciation & amortizations 178.5 195.0 Gain on KLUDI Group acquisition accounting (32.4) - Gain on sale of Land i
Slide 38: Thank You
Thank You CONTACT US If you have any questions or require further information, please visit corporate.rakceramics.com or contact investor relations team at ir@rakceramics.com
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