Slide 1: Polypipe Group plc Full Year Results 2014
Polypipe Group plc Full Year Results Year ended 31 December 2014 1
Slide 2: Disclaimer
Disclaimer The information contained in this presentation has not been independently verified and this presentation contains various forward-looking statements that reflect management’s current views with respect to future events and financial and operational performance. The words “growing”, “scope
Slide 3: Agenda
Agenda Highlights David Hall Presentation Team David Hall Peter Shepherd Chief Executive Officer Chief Financial Officer 3
Slide 4: Highlights
Highlights Delivering the strategy set out during the Group’s successful IPO in April 2014 UK construction market recovery, combined with our strategic focus on structural growth opportunities, generated above market revenue growth from UK operations of 12.4% over 2013 Improved UK volumes resu
Slide 5: Agenda
Agenda Highlights Financial Review David Hall Peter Shepherd 5
Slide 6: Financial highlights
Financial highlights Revenue £327.0m 8.7% Operating profit* £46.3m 16.6% Adjusted EPS * * 16.11p 61.9% Operating cashflow* after Capex £48.0m 26.3% Net Debt to EBITDA 1.26x Final proposed dividend 3.0p * Before operating exceptional items * * Before operating exceptional items, exceptional finance c
Slide 7: 2014 results summary
2014 results summary £m 2014 2013 change % change Revenue 327.0 300.8 26.2 8.7% Cost of sales (202.4) (188.3) (14.1) Gross profit 124.6 112.5 12.1 10.8% Gross profit margin 38.1% 37.4% Distribution costs (49.8) (46.9) (2.9) SG&A (28.5) (25.9) (2.6) Operating profit pre exceptionals 46.3 39.7 6.6 16.
Slide 8: Revenue and operating profit bridge
Revenue and operating profit bridge 350 Revenue £m 340 330 320 310 +2.3 +27.6 (3.7) 327.0 300 290 280 300.8 270 260 250 2013 Price Volume Currency 2014 50 Operating Profit* £m 48 +7.3 (1.5) (0.8) 46 +1.1 (0.6) (1.1) 44 42 +2.3 46.3 40 38 36 39.7 34 32 30 2013 Price Material Volume Payroll "Plc costs
Slide 9: Balance sheet summary
Balance sheet summary £m 2014 2013 change Non Current Assets – property, plant & equipment 89.2 89.0 0.2 – intangibles 235.0 234.4 0.6 Net Working Capital (4.4) (1.7) (2.7) Cash 43.1 65.9 (22.8) Long term debt – senior secured notes - (150.0) 150.0 – bank debt (120.0) - (120.0) Taxation (2.9) (4.0)
Slide 10: Net working capital
Net working capital £m 2014 2013 change Inventories 39.9 38.9 1.0 Trade & Other receivables 20.9 21.4 (0.5) Trade & Other payables (65.2) (62.0) (3.2) Net operating working capital (4.4) (1.7) (2.7) Net operating working capital to revenue -1.3% -0.6% 10
Slide 11: Cashflow
Cashflow £m 2014 2013 EBITDA (before operating exceptional items) 60.8 53.6 Capital expenditure (15.1) (21.1) Working capital 2.3 5.5 Operating Cashflow 48.0 38.0 Financing costs – net interest paid (10.4) (14.3) Taxation (3.7) (4.9) Dividend paid (3.0) - Purchase of own shares / other (1.8) 0.1 Cas
Slide 12: Taxation
Taxation Tax rate £m £m % Profit before tax (before exceptional IPO listing and refinancing costs) and related tax 37.7 5.4 14.3 Exceptional IPO listing (£12.2m) and refinancing costs (£8.6m) and related tax relief (20.8) (2.0) Profit before tax and related tax – current year 16.9 3.4 20.1 Prior yea
Slide 13: Proposed final dividend
Proposed final dividend Proposed final dividend: 3.0p per share Timetable May 2015 S M T W T F S Policy: 1 2 Minimum 40% of PAT 3 4 5 6 7 8 9 (excluding exceptionals) 10 11 12 13 14 15 16 17 18 19 20 21 22 23 One third Interim/two 24 25 26 27 28 29 30 thirds Final 31 Ex-Dividend date Record date P
Slide 14: Agenda
Agenda Highlights Financial Review Business Review David Hall Peter Shepherd David Hall 14
Slide 15: Focused strategy continuing to drive growth
Focused strategy continuing to drive growth Positioning to benefit from the market recovery Continued product development Leverage leading brand position and end-user relationships Continuous investment in processes and efficiency initiatives Selective development in the Middle East Selective Two sm
Slide 16: Improving market backdrop
Improving market backdrop 21% Housing Completions (GB) New Work Output 33% Thousands £m CAGR +7.0% CAGR +5.4% Note: New Work Output used as proxy for commercial, public non-housing & infrastructure works. Source: DCLG, Construction Products Association 2011 constant prices 16% Housing RM&I Output 30
Slide 17: Strategic growth drivers
Strategic growth drivers Water Management Solutions Carbon Efficient Solutions • SUDS legislation and total installation cost benefits driving strong • Legislation continuing to drive growth for carbon efficient growth for water management systems heating and ventilation systems • Good demand from r
Slide 18: Strategic growth drivers
Strategic growth drivers Substituting Legacy Materials Middle East, Gulf & Export • Plastic plumbing growth underpinned by use in nearly all • Middle East distributors re-stocking in the first half residential new build • Region continuing to develop on the global map – World Expo • Infrastructure r
Slide 19: Acquisitions Update
Acquisitions Update Ferrob Surestop • Acquired October 2014. Consideration £0.3m cash and contingent • Acquired January 2015 for consideration of £5.2m. 2014 consideration based on sales growth estimated to be £0.4m operating profit £0.7m on sales of £2.1m • Manufacturer of extract and positive inpu
Slide 20: Operating segment review - Residential
Operating segment review - Residential Residential 2014 2013 % Growth Revenue £173.3m £158.7m up 9.2% Operating profit* £28.4m £26.0m up 9.2% Operating profit margin 16.4% 16.4% Strong growth in private residential new build driven largely by national housebuilders Signs that smaller regional de
Slide 21: Operating segment review – C&I UK
Operating segment review – C&I UK Commercial & Infrastructure - UK 2014 2013 % Growth Revenue £111.1m £94.3m up 17.8% Operating profit* £17.0m £12.4m up 37.1% Operating profit margin 15.3% 13.1% Road and rail volumes strong High rise developments continued in London but also other cities Growt
Slide 22: Operating segment review – C&I Mainland Europe
Operating segment review – C&I Mainland Europe Commercial & Infrastructure – Mainland Europe 2014 2013 % Growth Revenue £53.9m £58.3m down 7.5% Operating profit* £0.9m £1.3m down 30.8% Operating profit margin 1.7% 2.2% Revenue down 2.1% in local currency reflecting weak conditions in our main Fren
Slide 23: Summary & outlook
Summary & outlook Positive start to life as a public company, delivering on our strategy UK market recovery expected to continue, more geographic balance across a broader base Construction, new build housing and planning reforms - key themes for all political parties running into the 2015 Gene
Slide 24: Questions & Answers
Questions & Answers 2 Polypipe 24