Volex Plc · LSE:VLX
Volex — H1 FY2021 Earnings Presentation
17 slides from Volex's earnings presentation, November 2020
Slide 1: Half Year Results for the 26 Weeks Ended 4 October 2020
HALF YEAR RESULTS FOR THE 26 WEEKS ENDED 4 OCTOBER 2020
Slide 2: Overview
2 OVERVIEW 30.8% increase in Underlying operating Revenue of $202m an underlying operating margin up to 10.3% improvement of 3.5% A diverse and profit to deliver from 8.1% driven by against the previous resilient business $20.8m for the first better sales mix and period half of the year input cost s
Slide 3: What We Do
3 WHAT WE DO KEY DIFFERENTIATORS Quality and Manufacturing Scale reliability footprint Quality and reliability is of critical A global supplier with manufacturing sites In a fragmented market,Volex is a major importance to our premium customer base located across nine countries and three player bene
Slide 4: Manufacturing Expertise
4 MANUFACTURING EXPERTISE FROM POWER CORDS TO COMPLEX BOX BUILDS We make high-quality Our complex cable electronic connectors to assemblies are used in meet international safety performance-critical standards and fit with the industries including aerospace demanding requirements of and medical our c
Slide 5: Global Manufacturing Footprint
5 GLOBAL MANUFACTURING FOOTPRINT We have manufacturing sites across three continents and a global supply capability covering all major markets
Slide 6: Operational and Divisional Highlights
6 OPERATIONAL AND DIVISIONAL HIGHLIGHTS Power Products • Electric Vehicle revenue grew by 78% year-on-year • Automation is delivering greater capacity and vertical integration is transforming our cost base DRAFT Integrated Manufacturing Services • Second site delivering Data Centre Products reducing
Slide 7: Acquisition of DEKA
7 ACQUISITION OF DEKA • DEKA is headquartered in Turkey with 3 production facilities and 450 employees • Consideration of up to €61.8million subject to achieving 2020 and 2021 profit targets • Leading power cord manufacturer for European white • Represents a multiple of 6.9x 2021 EBITDA goods market
Slide 8: Acquisition of DEKA
8 ACQUISITION OF DEKA HQ Cayirova,Turkey Cable Extrusion DRAFT Automated Production Final Inspection DEKA brings additional diversity in terms of customers and end markets
Slide 9: Covid-19 Impact
9 COVID-19 IMPACT People • Response to Covid-19 started in February 2020 following precautionary closures of our Chinese facilities • Put in place sensible best practice measures to protect our people • Our COO, John Molloy, and his team quickly rolled out these measures across our global business D
Slide 10: Financial Results
10 FINANCIAL RESULTS
Slide 11: Financial Highlights
11 FINANCIAL HIGHLIGHTS Improved profitability Extended borrowing facilities Reinvestment and return • Underlying operating profit • Refinanced in November • Interim dividend to increase margins are significantly 2020 with new three-year by 10% better at 10.3% revolving credit facility with HSBC, Ci
Slide 12: Financial Performance
12 FINANCIAL PERFORMANCE $m (except where stated) H1 FY21 H1 FY20 Change Revenue 202.5 195.7 3.5% Underlying operating profit 20.8 15.9 30.8% Underlying operating margin 10.3% 8.1% 220 bps Profit before tax 14.7 9.7 41.2% Underlying basic EPS 13.7 cents 8.8 cents 55.7% Interim dividend per share 1.1
Slide 13: Integrated Manufacturing Services – Financial Overview
13 INTEGRATED MANUFACTURING SERVICES – FINANCIAL OVERVIEW $m (except where stated) H1 FY21 H1 FY20 Change Revenue 114.7 104.6 9.7% Underlying operating profit 15.2 11.7 29.9% Underlying operating margin 13.3% 11.2% 210 bps • Revenue increase includes Data Centre Products where sales were up 57% comp
Slide 14: Power Products – Financial Overview
14 POWER PRODUCTS – FINANCIAL OVERVIEW $m (except where stated) H1 FY21 H1 FY20 Change Revenue 87.7 91.1 -3.7% Underlying operating profit 8.5 7.1 19.7% H1 FY19 H1 FY20 H1 FY18 H1 FY21 Underlying operating margin 9.7% 7.8% 190 bps 2020 2019 • Slow start to the year with some customers having low dem
Slide 15: Group Cash Flow
15 GROUP CASH FLOW $m H1 FY21 H1 FY20 Underlying EBITDA 24.3 17.8 Net capital expenditure (2.5) (1.7) Underlying working capital (11.0) (0.0) Net interest and tax (2.0) (2.8) Other including pension (0.6) (0.3) Underlying Free Cash Flow 8.2 13.0 Acquisitions (1.1) (22.7) Adjusting items (0.2) (1.4)
Slide 16: Outlook
16 OUTLOOK Robust first half We continue to Mindful of the impact The Board remains performance with key monitor the dynamic that future confident in customers increasing and evolving situation Government- demand through the in relation to the imposed restrictions delivering on full period creating
Slide 17: Summary
17 SUMMARY Well positioned with a Compelling range of Strong balance sheet and Ready for further diverse customer base capabilities and assets good cash generation expansion DRAFT • We have long-term • We are moving up the value • Our business is cash generative • Reliable execution of sequential re