Dialight plc · LSE:DIA
Dialight — H1 2009 Earnings Presentation
35 slides from Dialight's earnings presentation, Jul 27, 2009
Slide 1: 2009 Interim Results
2009 Interim Results 27 July 2009
Slide 2: Financial Highlights
Financial Highlights • Group revenue unchanged at £34.6m (2008: £34.5m) • Strong growth of obstruction sales underpinned by major new contract • Operating profit of £0.6m (2008: £2m) • Good cash generation • Cash balance £7m-No debt • Interim dividend increased by 10% to 2.3p
Slide 3: Financial Highlights
Financial Highlights £’000 Pence (Share) Basic EPS 2,261 7.3p Adjustment to profit on Prior year disposals 1,939 (6.3p) Underlying EPS 322 1.0p Note: Adjustment relates to the non-cash release of provisions no longer required on 2003/2005 businesses sold
Slide 4: Financial Highlights
Financial Highlights 2009 2008* % . • Revenue £34.6m £42.5m (18)% Split by operating segment: • Signals/Illumination £21.2m £23.8m (11)% • Electromagnetic components £5.4m £6.1m (11)% • Indication business £8.0m £12.6m (36)% * Restated to 2009 exchange rates
Slide 5: Operating Segment Results
Operating Segment Results Signals / Illumination 2009 2008* £m £m • Revenue 21.2 23.8 • Contribution 7.5 7.5 • Overhead costs (7.2) (7.2) • Segment result 0.3 0.3 Contribution % 35.5% 31.3% * Restated to 2009 exchange rates
Slide 6: Signals/Illumination Revenue
Signals/Illumination Revenue 2009 2008* Revenue £21.2m £23.8m Split as: • Traffic £11.0m £13.0m • Obstruction £3.1m £2.5m • Transportation £4.8m £5.0m • Lighting £2.3m £3.3m * Restated to 2009 exchange rates
Slide 7: Segment Results Components
Segment Results Components Electromagnetic Components Indication Business 2009 2008 2009 2008* £m £m £m £m Revenue 5.4 6.1 Revenue 8.0 12.6 Contribution 1.3 1.5 Contribution 3.9 6.6 Overhead costs (1.2) (1.5) Overhead costs (2.9) (3.4) Segment results 0.1 0.0 Segment results 1.0 3.2 Contribution % 2
Slide 8: Working Capital/Cash flow
Working Capital/Cash flow • Inventory – Plan to reduce inventory shows benefit – Plans in place for further improvement • Receivables – Timing of sales • Capex – Lower spend this half after 2008 investment • Cash – Debt free balance sheet – Continuing strong operating cash flow
Slide 9: Summarised Cash flow
Summarised Cash flow £m Operating profit 0.6 Depreciation and amortisation 1.4 Working capital 4.2 Pension payment (0.8) Operating cash flow 5.4 Capital expenditure (0.4) Development spend (0.5) Taxation (0.4) Free cash flow 4.1
Slide 10: Movement in Cash
Movement in Cash £m Free cash flow 4.1 – Other 0.5 – Dividends (1.2) – Interest (0.1) Net cash outflow 3.3 – Opening net cash 4.1 – Exchange (0.4) Closing net cash 7.0
Slide 11: Taxation
Taxation • Effective tax rate 39% due to overseas rates
Slide 12: Dividends and Earnings Per Share
Dividends and Earnings Per Share 2009 2008 • Dividends per share 2.3p 2.1p • Basic EPS 7.3p 4.2p • Underlying EPS 1.0p 4.2p • Dividend cover 3.14 times 1.99 times
Slide 13: Defined Benefit Pension Schemes
Defined Benefit Pension Schemes • 2 closed defined benefit schemes in UK and 1 closed defined benefit scheme in US • Full Actuarial Valuation at 30 June 2009 • Movement in key assumptions: – US Discount Rate reduced to 5.7% from 6% – UK Discount Rate reduced to 6.05% from 6.25% – UK Inflation Rate i
Slide 14: Indication Components
Indication Components • Market position unchanged • Volumes down 36% on 2008 in line with market • Demand stabilised in the half • Modest recovery • Continued quality earnings
Slide 15: Electromagnetic Components
Electromagnetic Components • Sales down 11% on 2008 • Continued business with three major AMI customers • Looking to expand customer base • Recently announced orders support H2 growth • Continued growth of “smart” meter adoption in US • More than 100 million meters to be converted
Slide 16: Signals/Illumination Revenue
Signals/Illumination Revenue 2009 H1 2008 H1* Revenue £21.2m £23.8m Traffic £11.0m £13.0m Obstruction £3.1m £2.5m Transportation £4.8m £5.0m Lighting £2.3m £3.3m * Restated to 2009 exchange rates
Slide 17: LED Traffic Signals
LED Traffic Signals World leader in LED Traffic Signals US Market - 70% adoption to date (mature) European Market emerging <10% adopted Over 7 million lights to be replaced Over €350m market size in Europe
Slide 18: Signals - Traffic
Signals - Traffic • Traffic up 8% on 2008 (down 16% constant currency) • Both Europe and US down on strong 2008 H1 • Reduced sales to Eastern Europe partially offset by increased sales in UK • Improved margins in both geographies • Second half starting confidently
Slide 19: Signals – Obstruction Lighting
Signals – Obstruction Lighting • 54% year on year growth (23% at constant currency) despite some slowdown in US Wind Turbines • Three level White Strobe introduced • Volume shipments started in H1 • Significant contract win announced with major cellular operator • Strong growth expected with acceler
Slide 20: Obstruction Lighting
Obstruction Lighting White LED Strobe replaces over 80,000 conventional strobes in the US alone Sales to operators covering more than two thirds of the market Major contract win Potential market over $250m Sales in 2009 H1 less than 1% of market
Slide 21: Signals - Vehicle
Signals - Vehicle • 28% Growth in 2009 ( flat at constant currency) • Continued Federal Government spending on Transit Buses -stimulus • Enhanced penetration of Heavy Duty Vehicle Market as LED lights become standard • Continued potential for interior white lighting
Slide 22: Illumination
Illumination • Sales down 22% in 2009 • Architectural sales affected most by economic downturn • Industrial sales showing growth • Safesite sales run rate up 50% over 2008 • Customer base broadened with more reference sales to more key customers • Safesite qualified to “ATEX” allowing worldwide sale
Slide 23: White Industrial Lighting
White Industrial Lighting Estimated market to be over $500m per year Highly Regulated Standards Extremely Rugged Environments But what is so special about LEDs??
Slide 24: So what is so special about LEDs?
So what is so special about LEDs? ‘Wt VS.
Slide 25: How do LEDs compare to the competition?
How do LEDs compare to the competition ? Type Efficiency Life -hours Cost Per Colour lm/W x1000 lumen $ Rendering Ra High Pressure 60 -120 10 - 20 0.0004 30 Sodium Ceramic Metal 60 -100 6 -12 0.0010 70 - 95 Halide Fluorescent 40 -100 6 - 45 0.0005 60 - 90 Halogen & 8 -22 2 - 10 0.0002 100 Tungsten C
Slide 26: SafeSite LED Lighting Fixture
SafeSite® LED Lighting Fixture •Energy Per LED Fixture= 100W •HPS = 250W •60% Energy Savings •Mercury & CO2 Savings •Efficient optics •No light pollution •Shock and Vibration proof •Guaranteed long lifetime avoid replacement of conventional bulbs
Slide 27: Case Study: Valero Refinery
Case Study: 60% Energy Savings Valero Refinery 30% Fewer Fixtures Paulsboro, NJ over $5,000 (1% Retrofit) 180 Tons of CO2 (per year) Dialight SafeSite LED High Pressure Sodium Lighting Dialight
Slide 28: Hazardous Location Lighting
Hazardous Location Lighting 717 Refineries Worldwide •3,000 fixtures per refinery •Annual Energy Savings $175 Million •1.75 Billion KWh Saved •1.5 Billion Tons of CO2 Saved •150 Pounds of Mercury •Potential $1bn in replacement lights
Slide 29: Case Study: Henkel
Case Study: Henkel 75% Energy Savings 25% Plant Puerto Rico Fewer Fixtures $4,000 (1% Retrofit) saving | ™~ High Pressure Sodium Dialight SafeSite® LED Lighting
Slide 30: Advantages of LED
SafeSite® High Bay Series Features & Benefits: Mercury Free Low Power Consumption Operating Temperature: -40˚ F to 133˚ F Instant On / Off Operation 70% lumen maintenance; 60,000 hours Superior CRI versus HPS, MH, MV Resistant to Shock & Vibration Advantages of LED
Slide 31: SafeSite High Bay Series Case Study: Project Scope
SafeSite® High Bay Series Case Study: - Project Scope Project Information: Building: 400,000 sq/ft refrigerated distribution warehouse Mounting Height: 37 feet Floor Plan: 25ft racks, spaced 10ft apart Current Fixture: 54W 6 Lamp T5 High Output Fluorescent System Wattage: 363 Watts # of Fixtures: 1,
Slide 32: SafeSite High Bay Series Design - Photometric Narrow Optic
SafeSite® High Bay Series Design - Photometric Narrow Optic
Slide 33: SafeSite High Bay Series Design - Photometric Wide Optic
SafeSite® High Bay Series Design - Photometric Wide Optic
Slide 34: SafeSite High Bay Series Case Study: Results & Savings
SafeSite® High Bay Series Case Study:– Results & Savings SafeSite High Bay Results: # of Fixtures: 793 (Reduced by 264 fixtures) Foot Candles: 15-17 Foot Candles (aisle) 16-19 Foot Candles (loading docks) Annual Savings: Energy Savings: $185,530 Relamp & Maintenance: $162,073 kWh Savings: 2,319,131
Slide 35: Dialight poised for sustained and profitable growth
Dialight poised for sustained and profitable growth Number one in LED Traffic Lights with Europe yet to adopt technology Number one in Aircraft Obstruction Lights with unique White LED Strobe and $250m plus market potential First in Industrial White LED Lighting with market ready to adopt Smart Mete