Slide 1: Revenue Growth Acceleration, Margin Progression and Higher ROIC
REVENUE GROWTH ACCELERATION, MARGIN PROGRESSION AND HIGHER ROIC 2023 HALF YEAR RESULTS PRESENTATION 28 July 2023
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This presentation contains certain forward-looking statements with respect to the financial condition, results, operations and business of Intertek Group plc. These statements and forecasts involve risk and uncertainty because they relate to
Slide 3: Key Takeaways
KEY TAKEAWAYS AAA growth Strong LFL growth Margin Higher strategy in operational acceleration progression ROIC place cash flow 3
Slide 4: Performance Highlights
01 02 03 04 05 Performance H1 23 Financial Business Lines AAA Strategy 2023 Highlights Results Review in Action Outlook
Slide 5: Robust Financial Performance in H1 23
ROBUST FINANCIAL PERFORMANCE IN H1 23 YoY YoY H1 23 H1 22 (Actual rates) (Constant rates) Revenue £1,640.0m £1,491.7m 9.9% 8.3% Like-for-like revenue £1,621.7m £1,491.7m 8.7% 7.1% Operating Profit1 £245.4m £217.3m 12.9% 13.3% Operating Margin1 15.0% 14.6% 40bps 70bps EPS¹ 95.2p 86.5p 10.1% 10.6% ROI
Slide 6: LFL Revenue Growth Acceleration
LFL REVENUE GROWTH ACCELERATION LFL growth1 at constant currency H1 LFL growth2 by division H1 LFL growth2 by division 7.1% 6.3% 5.8% 4.9% 12.7% 12.5% 10.5% 3.4% 3.0% 8.4% 1.7% 6.2% 6.5% 5.9% 0.9% 0.5% 1.1% (0.5%) Products Trade Resources Consumer Corporate Health & Industry & World of Products Assu
Slide 7: Broad-Based Growth Geographically
BROAD-BASED GROWTH GEOGRAPHICALLY H1 23 revenue by region H1 23 revenue YoY H1 23 revenue YoY Region (actual rates) (constant rates) 34.8% 38.6% Americas 12.7% 7.8% EMEA 8.0% 7.6% 26.7% APAC 8.5% 9.4% Total 9.9% 8.3% Americas EMEA APAC 7
Slide 8: Margin Progression
MARGIN PROGRESSION Adjusted Operating Margin1 +40bps +70bps 15.0% 15.0% 14.6% H1 22 H1 23 H1 23 (actual rates) (constant rates) Adjusted Operating Margin1 Adjusted Operating Margin1 26.7% 25.0% 19.3% 19.9% 20.8% 17.8% 11.5% 10.5% 7.6% 5.9% 4.7% 7.8% 7.0% 8.7% 7.5% 4.7% Products Trade Resources Consu
Slide 9: Recent Acquisitions Performing Well
RECENT ACQUISITIONS PERFORMING WELL Australia │ May 2021 Brazil │ July 2021 and April 2023 USA │ July 2022 Corporate Assurance Health & Safety World of Energy Leading provider of assurance services Providers of food and environmental Provider of assurance services to solar testing in Brazil en
Slide 10: Financial Results
01 02 03 04 05 Performance H1 23 Financial Business Lines AAA Strategy 2023 Highlights Results Review in Action Outlook
Slide 11: Key P&L Financials
KEY P&L FINANCIALS YoY YoY H1 2023 (Actual rates) (Constant rates) Revenue £1,640.0m 9.9% 8.3% Like-for-like revenue £1,621.7m 8.7% 7.1% Operating Profit1 £245.4m 12.9% 13.3% Operating Margin1 15.0% 40bps 70bps EPS¹ 95.2p 10.1% 10.6% Note: (1) Before separately disclosed items 11
Slide 12: Cash Flow & Net Debt
CASH FLOW & NET DEBT £m @ actual exchange rates H1 2023 H1 2022 Adjusted operating profit1 245.4 217.3 Depreciation/amortisation 89.7 87.2 Change in working capital (75.3) (74.4) Other2 10.7 8.0 Adjusted cash flow from operations 270.5 238.1 Capex (51.4) (41.1) Income taxes paid (56.0) (50.8) Other3
Slide 13: Financial Guidance
FINANCIAL GUIDANCE FY 2023 Guidance Net finance cost (pre-fx) £40-42m Effective tax rate 25.5%-26.5% Minority interest £22-23m Diluted shares (as at 30 June 2023) 162.1 Capex £115-125m Financial Net Debt¹ £630-680m Note: (1) Net debt guidance before any material change in FX rates and any M&A 13
Slide 14: Business Lines Review
01 02 03 04 05 Performance H1 23 Financial Business Lines AAA Strategy 2023 Highlights Results Review in Action Outlook
Slide 15: Low-Single Digit LFL Growth in Consumer Products
LOW-SINGLE DIGIT LFL GROWTH IN CONSUMER PRODUCTS Revenue (£m) Like-for-like Revenue (£m) Operating Profit1 (£m) Operating Margin1 (%) 467.9 467.9 123.7 26.7 462.9 462.9 116.8 25.0 H1 22 H1 23 H1 22 H1 23 H1 22 H1 23 H1 22 H1 23 1.1% CCR 1.1% CCR (4.3%) CCR (140bps) CCR 1.1% 1.1% (5.6%) (170bps) HY 2
Slide 16: Double-Digit LFL Growth in Corporate Assurance
DOUBLE-DIGIT LFL GROWTH IN CORPORATE ASSURANCE Revenue (£m) Like-for-like Revenue (£m) Operating Profit1 (£m) Operating Margin1 (%) 204.2 231.8 204.2 231.8 20.8 36.3 48.2 17.8 H1 22 H1 23 H1 22 H1 23 H1 22 H1 23 H1 22 H1 23 12.5% CCR 12.5% CCR 31.7% CCR 300bps CCR 13.5% 13.5% 32.8% 300bps HY 22 Actu
Slide 17: Mid-Single Digit LFL Growth in Health and Safety
MID-SINGLE DIGIT LFL GROWTH IN HEALTH AND SAFETY Revenue (£m) Like-for-like Revenue (£m) Operating Profit1 (£m) Operating Margin1 (%) 142.4 154.6 142.4 156.7 16.4 16.5 11.5 10.5 H1 22 H1 23 H1 22 H1 23 H1 22 H1 23 H1 22 H1 23 7.9% CCR 6.5% CCR 1.2% CCR (70bps) CCR 10.0% 8.6% 0.6% (100bps) HY 22 Actu
Slide 18: Double-Digit LFL Growth in Industry and Infrastructure
DOUBLE-DIGIT LFL GROWTH IN INDUSTRY AND INFRASTRUCTURE Revenue (£m) Like-for-like Revenue (£m) Operating Profit1 (£m) Operating Margin1 (%) 7.0 8.7 427.0 427.0 26.4 37.3 375.2 375.2 H1 22 H1 23 H1 22 H1 23 H1 22 H1 23 H1 22 H1 23 10.5% CCR 10.5% CCR 36.1% CCR 160bps CCR 13.8% 13.8% 41.3% 170bps HY 2
Slide 19: High-Single Digit LFL Growth in World of Energy
HIGH-SINGLE DIGIT LFL GROWTH IN WORLD OF ENERGY Revenue (£m) Like-for-like Revenue (£m) Operating Profit1 (£m) Operating Margin1 (%) 7.5 307.0 356.6 307.0 340.4 4.7 14.5 26.6 H1 22 H1 23 H1 22 H1 23 H1 22 H1 23 H1 22 H1 23 13.5% CCR 8.4% CCR 87.3% CCR 300bps CCR 16.2% 10.9% 83.4% 280bps HY 22 Actual
Slide 20: AAA Strategy in Action
01 02 03 04 05 Performance H1 23 Financial Business Lines AAA Strategy 2023 Highlights Results Review in Action Outlook
Slide 21: Our Good to Great Journey Continues
OUR GOOD TO GREAT JOURNEY CONTINUES Metric1 20142 2022 Change Revenue £2,093m £3,193m 53% EBITDA £400.9m £700.6m 75% Operating Profit £324.6m £520.1m 60% Operating Margin 15.5% 16.3% 80bps Diluted earnings per share 132.1p 211.1p 60% ATIC Dividend 49.1p 105.8p 115% WC as % Revenue 9.3% (1.5%) (10.8p
Slide 22: Faster growth for our ATIC solutions
Faster growth for our ATIC solutions
Slide 23: Being the best for every stakeholder. All the time
Customers Be the most trusted TQA partner Being the best for every stakeholder. All the time AAA Employees Shareholders Sustainable growth Corporate Employer of Choice and value Goals Every Day Community Sustainability Excellence Everywhere
Slide 24: Our AAA Growth Strategy Is Laser Focused
OUR AAA GROWTH STRATEGY IS LASER FOCUSED 3 STRATEGIC PRIORITIES SCIENCE-BASED TQA CUSTOMER EXCELLENCE + BRAND PUSH & PULL + WINNING INNOVATIONS 3 STRATEGIC ENABLERS 10X PURPOSE-BASED ENGAGEMENT + SUSTAINABILITY EXCELLENCE + MARGIN ACCRETIVE INVESTMENTS
Slide 25: High-Quality Portfolio Poised for Faster Growth
HIGH-QUALITY PORTFOLIO POISED FOR FASTER GROWTH ATIC REGIONS 9% 20% Assurance Americas 25% 36% 38% Testing Europe, Middle East and Africa Inspection APAC, Greater China & Rest of World 46% Certification 26% GLOBAL BUSINESS LINES COUNTRY BUSINESS LINES Consumer Products 10% 14% 30% Health & Safety Fa
Slide 26: MSD LFL ATIC Revenue Growth Opportunity
MSD LFL ATIC REVENUE GROWTH OPPORTUNITY Consumer Products Corporate Assurance Health & Safety Industry & Infrastructure World of Energy Better, safer and more Sustainable businesses + Healthier, safer and Better, safer and greener Better and greener fuels and sustainable products more resilient supp
Slide 27: Targeting Return to 17.5% Peak Margin and Beyond
TARGETING RETURN TO 17.5% PEAK MARGIN AND BEYOND INTERTEK ENABLERS We have the tools and • Superior operating platform • Performance management • Group initiatives combined with site discipline processes in place to drive 1 margin accretive revenue level ownership • Cost discipline: fixed & variable
Slide 28: AAA Intertek Virtuous Economics
AAA INTERTEK VIRTUOUS ECONOMICS MSD LfL revenue growth Investments in high- growth and high- Margin-accretive margin sectors revenue growth Sustainable growth and value Disciplined capital Strong free allocation cash flow
Slide 29: Accretive Disciplined Capital Allocation
ACCRETIVE DISCIPLINED CAPITAL ALLOCATION Capex and working capital investment to support organic growth 01 (target c.5% of revenue in capex) Sustainable shareholder returns through payment of progressive 02 dividends based on a target payout ratio of c.50% M&A focused on strong growth and margin pro
Slide 30: Outlook
01 02 03 04 05 Performance H1 23 Financial Business Lines AAA Strategy 2023 Highlights Results Review in Action Outlook
Slide 31: Group Outlook 2023
GROUP OUTLOOK 2023 MSD LFL Revenue growth at CCY Consumer Products: LSD Corporate Assurance: HSD Health and Safety: MSD Industry and Infrastructure: HSD World of Energy: HSD Margin progression year-on-year Strong free cash flow Capex: £115- 125m Financial net debt: £630 -680m1 Note: (1) Net debt gui
Slide 32: Significant Value Growth Opportunity
SIGNIFICANT VALUE GROWTH OPPORTUNITY
Slide 33: High Quality Growth Portfolio
HIGH QUALITY GROWTH PORTFOLIO Services Our Business Lines Softlines, Hardlines, E&CW, Business Business Caleb Brett, Softlines, Hardlines, Caleb Brett,Agri, Government Food, & Trade Industry Services, Assurance, B&C, TransportationAssurance, Tech, Industry Minerals, Building & Services,Transportatio
Slide 34: Appendix
intertek Total Quality. Assured. APPENDIX
Slide 35: H1 23 - Products, Trade, Resources
H1 23 - PRODUCTS, TRADE, RESOURCES
Slide 36: Proforma
PROFORMA £m IFRS 16 basis and growth 2019 at actual rates Full Year Jan-Apr H1 Jul-Oct Full Year Group Revenue 2,987.0 951.3 1,491.7 1,140.7 3,192.9 Revenue growth % 11.2% 13.2% 18.6% 14.6% Adjusted OP 524.2 217.3 520.1 Adjusted OP margin % 17.5% 14.6% 16.3% Consumer Products Revenue 951.9 293.2 462
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