Slide 1: Delivering Performance and Strategy
DELIVERING PERFORMANCE AND STRATEGY NWF GROUP PLC FINAL RESULTS TO MAY 2019
Slide 2: Leadership Team
GROUP OVERVIEW LEADERSHIP TEAM Richard Whiting Chris Belsham Chief Executive Finance Director Key skills Key skills » Strategy and leadership » Finance » Sales and marketing » Mergers and acquisitions » Operations » Strategy » Finance » Mergers and acquisitions Joined as Finance Director in 2017. Pr
Slide 3: Key Highlights
GROUP OVERVIEW KEY HIGHLIGHTS Summary » NWF is a specialist distributor of fuel, food and feed across the UK » Strong track record of delivering increased shareholder returns » Group operates in large stable markets » Strongly cash generative with dividend growth » Clear growth strategy Fuels Food F
Slide 4: Results Summary
GROUP OVERVIEW RESULTS SUMMARY Strong results ahead of expectations Revenue Headline operating profit1 Headline profit before tax1 £671.3m +9.9% £10.2m -3.8% £9.7m -4.9% 2019 £671.3m 2019 £10.2m 2019 £9.7m 2018 £611.0m 2018 £10.6m 2018 £10.2m 2017 £555.8m 2017 £9.0m 2017 £8.5m Headline earnings per
Slide 5: Fuels Operating Highlights
FUELS OPERATING HIGHLIGHTS Delivering on the strategy to grow the network » New leadership team led by Richard Huxley focusing on growth opportunities » Managed oil price volatility effectively » Increased gas oil sales to offset lower heating oil demand following the record cold winter in the prior
Slide 6: Food Operating Highlights
FOOD OPERATING HIGHLIGHTS Strong performance from new customers and operational effectiveness » New customers won in 2018 and 2019 – strong service delivery » Price increases offsetting inflationary pressure » Increased operating effectiveness in warehouses and distribution » Seven customers utilisi
Slide 7: Feeds Operating Highlights
FEEDS OPERATING HIGHLIGHTS Stable performance » Demand volatility across the year » High demand in the summer with low forage availability – feeding advice essential » Lower winter demand with mild conditions and good forage » Pricing aligned to commodity prices » Continued focus on operational effi
Slide 8: Financial Review: Income Statement Summary
GROUP OVERVIEW FINANCIAL REVIEW Income statement summary May 2019 May 2018 £m £m Revenue Fuels 443.0 400.7 » Revenue increased by £60 million (9.9%): Food 47.9 40.4 » £45 million from increased commodity costs across Fuels and Feeds Feeds 180.4 169.9 » £8 million from higher activity levels Total re
Slide 9: Financial Review: Income Statement Summary
GROUP OVERVIEW FINANCIAL REVIEW Income statement summary May 2019 May 2018 £m £m Operating profit 9.6 10.6 Finance costs (0.9) (0.9) » Headline PBT of £9.7 million Headline profit before tax* 9.7 10.2 » Bank interest increased by £0.1 million as a result of acquisitions Exceptional items (0.5) - » P
Slide 10: Financial Review: Balance Sheet Summary
GROUP OVERVIEW FINANCIAL REVIEW Balance sheet summary May 2019 May 2018 £m £m Fixed assets 70.2 67.9 » Fixed assets increased due to acquisitions Net working capital 6.3 2.5 » Higher net working capital due to commodity prices and a high level of trading in May 2019 Assets employed 76.5 70.4 » Net d
Slide 11: Financial Review: Pension Summary
GROUP OVERVIEW FINANCIAL REVIEW Pension summary May 2019 May 2018 £m £m Assets 38.0 36.3 » Single defined benefit pension scheme Liabilities (55.3) (53.4) » Closed to new members in 2002 and future accrual in 2016 » Slight increase in deficit since May 2018 – primarily the Deficit (17.3) (17.1) impa
Slide 12: Financial Review: Cash Flow Summary
GROUP OVERVIEW FINANCIAL REVIEW Cash flow summary May 2019 May 2018 £m £m Operating profit 9.6 10.6 » Headline EBITDA* of £14.8 million (2018: £15.1 million) Depreciation and amortisation 4.7 4.5 » Working capital movement as a result of commodity prices and a high level of trading in May 2019 Profi
Slide 13: Financial Review: Net Debt Summary
GROUP OVERVIEW FINANCIAL REVIEW Net debt summary 15.0 » Facilities of £65 million with RBS until October 2023 3.5 10.4 » Net debt of £10.4 million at May 2019 with substantial 10.0 facility and covenant headroom 0.8 6.4 14.3 0.2 2.8 Facility Drawn 5.0 £m £m 3.1 £m Facility 1.4 - 2.6 Invoice discount
Slide 14: Development Strategy: Summary
GROUP OVERVIEW DEVELOPMENT STRATEGY Summary » Diversified source of earnings » Cash generative businesses » Experienced capable Board » Group operates in large stable markets » Focus on total shareholder return » Strong track record Fuels Food Feeds » Consolidate a highly fragmented » Optimise the c
Slide 15: Fuels: Very Attractive Market with Consolidation Potential
FUELS DEVELOPMENT STRATEGY Very attractive market with significant consolidation potential » Fragmented market for oil distribution » Top 10 players only 25%, over 150 small players » NWF No. 3 with 2% market share » Stable demand for oil supply » Customers purchase fuel from local depots, expanding
Slide 16: Fuels: Acquisition Activity
FUELS DEVELOPMENT STRATEGY Acquisition activity » Last 12 months activity: Fuels Volume (million litres) » Acquired three businesses across the UK 600 » Over 110 million litres of business added 500 » £8 million consideration paid 400 » Clear post acquisition integration plan 300 » Retained the bran
Slide 17: Fuels: Acquisition Process
FUELS DEVELOPMENT STRATEGY 23 Fuel depots Acquisition process » Targeting oil distribution businesses in the UK » Clear valuation and pricing strategy » Effective transaction process: » Established legal, environmental and financial due diligence process and advisors » In-house operational and comme
Slide 18: Summary and Outlook: The NWF Proposition
GROUP OVERVIEW SUMMARY AND OUTLOOK The NWF proposition Strong management team Growth opportunities Asset backing Focus on return on capital Good cash generation Growing dividend NWF GROUP PLC FINAL RESULTS TO 31 MAY 2019 18
Slide 19: Summary and Outlook: Good Platform for Development
GROUP OVERVIEW SUMMARY AND OUTLOOK Good platform for development » Strong result in 2019 – outperforming original expectations » Demonstrable delivery of strategic plan with three fuels acquisitions in the last 12 months » Strong balance sheet with long term funding in place » Brexit » NWF operates
Slide 20: Additional Information
GROUP OVERVIEW ADDITIONAL INFORMATION » Analyst coverage and consensus forecasts » Business overview » Locations » Organisation » Main site photo » Group financial performance » Divisional track record » Additional market data NWF GROUP PLC FINAL RESULTS TO 31 MAY 2019 20
Slide 21: Analyst Coverage and Consensus Forecasts
GROUP OVERVIEW ANALYST COVERAGE AND CONSENSUS FORECASTS Actual Consensus forecasts Analysts 2019 2019 2020 2021 Peel Hunt* Charles Hall Revenue £671.3m £662.6m £689.0m £671.0m Panmure Adrian Gordon Kearsey Headline operating £10.2m £10.0m £10.1m £10.2m Shore Capital Akhil Patel profit * Corporate br
Slide 22: Business Overview: Fuels
FUELS BUSINESS OVERVIEW NWF Fuels is a leading distributor of fuel oil and fuel cards delivering over 550 million litres across the UK to 63,000 customers. It is one of the largest authorised distributors of Texaco and is a major customer of other fuel suppliers including Shell and Jet. Key figures
Slide 23: Business Overview: Food
FOOD BUSINESS OVERVIEW Boughey Distribution is a leading consolidator of ambient grocery products to UK supermarkets with over 800,000ft2 of warehousing and significant distribution assets. It works with over 200 customers including Arla and Typhoo. Key figures 100,000 612 127 252 PALLET SPACES PEOP
Slide 24: Business Overview: Feeds
FEEDS BUSINESS OVERVIEW NWF Agriculture has grown to be a leading national supplier of ruminant animal feed to 4,750 customers in the UK, feeding 1 in 6 dairy cows in Britain. It operates from sites in Cumbria, Lancashire, Cheshire and Devon. Key figures 591,000 203 38 13 TONNES PEOPLE TRUCKS TRAILE
Slide 25: Business Locations
GROUP OVERVIEW BUSINESS LOCATIONS Feeds Aspatria Longtown Wardle* Wixland Food Wardle* Fuels Ammanford Babbinswood Bangor Boston Burnley Burwell Droitwich Dyserth Fishers Pond Great Yarmouth Halifax Home Counties Kenilworth Kirkby Lonsdale Long Marston Mansfield Preston Redruth Southport Staffordshi
Slide 26: Organisation
GROUP OVERVIEW ORGANISATION Non Executives Chief Executive Chairman: Philip Acton Richard Whiting Yvonne Monaghan David Downie Finance Director Company Secretary Chris Belsham Rob Andrew Fuels Food Feeds Richard Huxley Keith Forster Andrew Downie 233 employees 612 employees 203 employees NWF GROUP P
Slide 27: Wardle – Main Operating Site
GROUP OVERVIEW WARDLE – MAIN OPERATING SITE NWF GROUP PLC FINAL RESULTS TO 31 MAY 2019 27
Slide 28: Track Record
GROUP OVERVIEW TRACK RECORD Revenue Headline PBT 800 12 671.3 10.2 700 9.7 611.0 10 600 555.8 8.1 8.3 8.5 537.7 7.7 492.3 465.9 8 500 £m £m 400 6 300 4 200 2 100 - - 2014 2015 2016 2017 2018 2019 2014 2015 2016 2017 2018 2019 Headline EPS Dividend 18 16.7 7 6.6 15.8 6.3 6.0 16 6 5.7 13.5 14.0 5.4 14
Slide 29: Divisional Track Record
GROUP OVERVIEW DIVISIONAL TRACK RECORD Fuels Food 500 8.0 60 3.5 450 7.0 50 3.0 400 6.0 Operating profit £m 350 2.5 Operating profit £m Revenue £m 40 Revenue £m 300 5.0 2.0 250 4.0 30 200 1.5 3.0 20 150 1.0 2.0 100 10 0.5 50 1.0 - - - - 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 201
Slide 30: Fuels Additional Market Data
FUELS GROUP OVERVIEW Fuels additional market data Oil Prices – Brent crude $ per barrel Oil Market Journal 95 90 85 80 75 70 65 60 55 50 $ 45 40 35 30 25 20 15 10 5 0 NWF GROUP PLC FINAL RESULTS TO 31 MAY 2019 30
Slide 31: Feeds Additional Market Data
Price per tonne £ Price per tonne $ 0 50 100 150 200 250 300 350 400 450 500 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 100.0 110.0 120.0 130.0 140.0 150.0 160.0 170.0 180.0 190.0 200.0 210.0 0.0 FEEDS 01/12/2017 12/1/17 15/12/2017 12/13/17 29/12/2017 12/25/17 12/01/2018 1/6/18 1/18/18 26/01/2018