Fluidra, S.a. · BME:FDR
Fluidra — Debt Investor Presentation (February 2018)
45 slides from Fluidra's debt investor presentation, February 2018
Slide 1: Presentation to Lenders
Presentation to Lenders February 2018
Slide 2: Disclaimer
Disclaimer The information and opinions contained in this Presentation (the “Presentation ”) speak only as of the date identified on cover page of this Presentation or as of the date specified herein. They are subject to change without notice and neither Fluidra, S.A. (“Fluidra”) and Piscine Luxembo
Slide 3: Agenda
Agenda Transaction Overview Citi/Credit Suisse Combination Rationale Eloi Planes, Executive Chairman Structurally Attractive Industry Bruce Brooks, Chief Executive Officer A Global Leader in Pool Equipment and Solutions Compelling Risk Profile and Value Creation Plan Xavier Tintoré, Chief Financial
Slide 4: Transaction Overview
Transaction Overview
Slide 5: Executive Summary
Executive Summary ■ On November 3, 2017, Fluidra and Zodiac entered into and announced a definitive merger agreement − Since announcement, Fluidra’s share price has increased by ~25%, reflecting the strategic value of the pending merger − The merger is expected to be completed in the first half of 2
Slide 6: Transaction Overview
Tr a n s a c t i o n Overview 2 Structure Statutory merger; Fluidra to issue 83 million new shares to Zodiac’s shareholder, Piscine 42% Piscine / 29% Families / 29% free float Ownership Piscine and the Families have entered into a shareholders’ agreement (“SHA”) Transfer Restriction Restrictions on
Slide 7: Sources and Uses & Pro Forma Capitalization Table
Sources and Uses & Pro Forma Capitalization Table (€ in millions) Sources Amount Uses Amount ■ Since Zodiac was acquired in December 2016 by Rhône, it $230m ABL(1) – Existing $516m Zodiac first lien term loan €437 €130m RCF(1) – Existing $150m Zodiac second lien term loan 127 has deleveraged from 6.
Slide 8: Combination Rationale
Combination Rationale
Slide 9: Fluidra’s Top Management Present at Meeting
Fluidra’s Top Management Present at Meeting Eloi Planes Bruce Brooks Xavier Tintoré Mike Allan Executive Chairman CEO CFO Zodiac CFO ■ Over 20 years of ■ Over 30 years of ■ Over 25 years ■ Over 30 years of experience in the experience in experience in experience in sector global consumer corporate f
Slide 10: Introducing the New Fluidra
Introducing the New Fluidra The combination of Fluidra’s leading European platform with Zodiac’s leading presence in the U.S. sets the foundation for the new Fluidra: a global pool equipment and solutions leader with one of the industry’s most comprehensive portfolios Overview Highly Profitable and
Slide 11: Key Credit Highlights
Key Credit Highlights 1 Structurally Attractive Industry ■ Large installed base drives annuity-like aftermarket ■ Growing new pool construction across the globe 2 A Global Leader in Pool Equipment and Solutions ■ Globally recognized, iconic brands allow market segmentation and channel optimization ■
Slide 12: Structurally Attractive Industry
1 Structurally Attractive Industry 2
Slide 13: Comprehensive Portfolio of Pool Equipment and Solutions
Comprehensive Portfolio of Pool Equipment and Solutions Max1, Polaris, Zodiac, Pulit Advance Baracuda, and Top Access Caretaker and Caretaker Pool Access Pool Cleaners pool Cleaners Jandy and Design and Micro Ladders Savi lighting Projector LumiPlus Equipment Pad Cantabric Filter Pumps Victoria Plus
Slide 14: Global Pool Equipment Market Overview
Global Pool Equipment Market Overview ~€8 Billion Market Size 2017 Market Size Large, Global Asia/Middle East US ■ ~€8 billion market size Market 5% ■ Installed base of ~16 million in-ground RoW South Africa 4% 1% pools Australia ~€3.5bn 6% LatAm US 7% 44% Attractive Market ■ Equipment replacement d
Slide 15: The Combination Creates an Industry Leading Player
The Combination of Fluidra and Zodiac Creates an Industry Leading Player Estimated Residential Market Position Value Company Proposition Strengths North America Europe RoW Estimated Market Size ~€3.5bn ~€2.5bn ~€1.8bn Strong in Europe Premium / User- Centric / Solution- Strongest in emerging mar
Slide 16: Structurally Attractive Industry
Structurally Attractive Industry Steady growth of installed pool base and new pool build expected to continue across the board Large Installed Base Drives Annuity-Like Aftermarket(1) Growing New Pool Construction(1) (In millions) (In millions) 64% of 36% of 21 Sales 0.60 Sales 18 0.50 Prior peak 200
Slide 17: U.S. and Europe are the Key Residential Pool Markets
U.S. and Europe are the Key Residential Pool Markets The expansive installed pool base demands continual aftermarket service, which drives market resilience to economic downturns U.S. Installed Residential Pool Base(1) Private Pool Installed Base in Key EU Countries(2) (In millions) (In millions) In
Slide 18: A Global Leader in Pool Equipment and Solutions
2 A Global Leader in Pool Equipment and Solutions
Slide 19: Globally Recognized, Iconic Brands Allow Market Segmentation and Channel Optimization
Globally Recognized, Iconic Brands Allow Market Segmentation and Channel Optimization 4 Industry’s best brands for each segment and channel Industry Leading Brand Portfolio 19
Slide 20: High Geographic Complementarity Reduces Risk Profile
High Geographic Complementarity Reduces Risk Profile Geographically diversified footprint with presence in over 45 countries 18 ■ €1.3bn of pro forma sales, with local presence in over 45 countries and sales in more than 150 countries ■ Access to virtually all major pool markets ■ Limited geographic
Slide 21: North America Commercial Approach
North America Commercial Approach Prescribers are the main focus of the North America commercial strategies to pull demand from prescribers Distribution Channel Prescribers End Users Pool Builders Distributors Maintenance Pool Owners Services Remodelers Retailers Buying Groups Direct Customers (Reta
Slide 22: Europe and RoW Commercial Approach
Europe and RoW Commercial Approach Europe and RoW driven by a push strategy through Fluidra’s own distribution network of cash and carry’s and traditional branches Distribution Channel Prescribers End Users Own distribution Installers Retailers Pool Owners Builders Maintainers Other Distributors B2B
Slide 23: Complementary Product Offering and Strong Competency in Product Development
Complementary Product Offering and Strong Competency in Product Development with Minimal Direct Overlap Fluidra and Zodiac are present in diverse product categories, geographies, segments and price points with minimal direct overlap Automation / Connectivity Commercial Equipment Heaters & Dehumidifi
Slide 24: World Class Management Team Comprised of Industry and Functional Experts
World Class Management Team Comprised of Industry and Functional Experts ■ Over 30 years of experience in ■ Over 20 years of experience in global consumer and industrial the sector products industries Eloi Planes ■ Fluidra’s CEO since 2006 and Bruce Brooks ■ Previously spent over 20 years at Executi
Slide 25: Compelling Risk Profile and Value Creation Plan
3 Compelling Risk Profile and Value Creation Plan
Slide 26: Pro Forma Historical Financials
Pro Forma Historical Financials Sales Combined EBITDA and Margin FYE ending December 31 €300 (€ in millions) 80% (€ in millions) 11% 24% €247 70% CAGR CAGR €250 €1,291 €35 €1,185 60% €1,082 €200 €184 €967 50% €513 €155 €471 €137 €108 €434 €150 40% €373 €98 €82 30% €100 €71 19% 14% 14% 16% 20% €713 €
Slide 27: A Double-Engine Model: Resilience & Growth
A Double-Engine Model: Resilience & Growth Annual Sales Growth Combined Business is 90% Resilient Growth Contributors Range LTM Sept-2017A 10% New Build sales over all-time low Installed Base Growth 3.5-4.5% 26% New Build sales at all-time low New Construction 1.0-1.5% Growth Sales 64% Aftermarket s
Slide 28: High Resiliency Factor with Strong Industry Fundamentals
High Resiliency Factor with Strong Industry Fundamentals Recurring Sales Base Drives High Resiliency The pool equipment industry demonstrated tremendous resiliency during and through the 2009 recession − Recurring aftermarket equipment sales continued to be stable during recessionary environments
Slide 29: Significant Cost Synergies that Derisk the Platform
Significant Cost Synergies that Derisk the Platform 11 ■ Manufacturing consolidation ~€35m of run-rate cost ■ Procurement opportunities synergies by 2020, with one-off costs to achieve ■ Optimization of logistics operations synergies of ~€30m Cost Synergies ■ Reduction in indirect operating expenses
Slide 30: Compelling Business Model with a Strong and Growing Cash Generation Profile
Compelling Business Model with a Strong and Growing Cash Generation Profile LTM Sept-2017 Key Drivers Long-term Target ■ Steady aftermarket growth driven by installed Sales base ■ 6-7% organic annual growth rate 1,291 (€m) ■ New construction recovery in Europe and US ■ Upside from sales synergies ■
Slide 31: Seasonality of Sales
Seasonality of Sales Pro Forma Sales by Quarter FYE ending December 31 (€ in millions) 500 €421 700% €377 400 500% €302 €307 €325 PF(1) €269 300% 300 €237 100% 200 €262 -100% 100 -300% – -500% Q1 Q2 Q3 Q4 Q1 Q2 Q3 2016A 2017A Actual Sales Early Buy Alignment Impact ■ Sales increase in Q1 in anticipa
Slide 32: U.S. Early Buy Alignment Overview
U.S. Early Buy Alignment Overview Early Buy Timing Patterns – Historical vs. Alignment Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Order Zodiac Ship Historical Sunbelt Snowbelt Legend: Order Zodiac Early Order Ship Buy Alignment (FY18) Sunbelt Ship Snowbelt Collect Order Ship Competitors Sunbelt
Slide 33: Strong Corporate Profile
Strong Corporate Profile 1 Attractive industry Positive industry dynamics Attractive market outlook fundamentals Large aftermarket opportunity Comprehensive line of pool solutions Leading global footprint 2 Leading global platform Core competence in product development Experienced mana
Slide 34: Syndication Overview
Syndication Overview
Slide 35: Summary Terms – First Lien Term Loan
Summary Terms – First Lien Term Loan A newly formed wholly-owned subsidiary of Fluidra, Fluidra Finco, S.L.U., that will act as a holding company for Fluidra’s subsidiaries (“Fluidra Borrowers: Finco” or the “Euro Borrower”), and Zodiac Pool Solutions LLC (the “U.S. Borrower”) Bookrunners & Lead Cit
Slide 36: Summary Terms – Revolving Credit Facility
Summary Terms – Revolving Credit Facility Borrower: Fluidra Finco and U.S. Borrower (together the “RCF Borrowers”) Bookrunners & Lead BBVA, Citi, Credit Suisse Arrangers: Administrative Agent: BBVA (“RCF Agent”) Facilities: €130 million revolving credit facility Commitment fee: 35% of applicable mar
Slide 37: Summary Terms – Asset-Based Lending Facility
Summary Terms – Asset-Based Lending Facility Borrowers: U.S. Borrower and material operating subsidiaries in the United States, United Kingdom, Australia, and France (together the “ABL Borrowers”) Bookrunner & Lead Bank of America Merrill Lynch Arranger: Administrative Agent: Bank of America Merrill
Slide 38: Transaction Timeline
Transaction Timeline February 2018 March 2018 S M T W T F S S M T W T F S 1 2 3 1 1 2 3 4 5 6 7 8 9 10 4 5 6 7 8 9 10 11 12 13 14 15 16 17 11 12 13 14 15 16 17 18 19 20 21 22 23 24 18 19 20 21 22 23 24 25 26 27 28 1 25 26 27 28 29 30 31 Holiday Key dates Date Key Event February 15 Launch refinancing
Slide 39: Appendix
Appendix FLUIDRA @eo
Slide 40: Fluidra EBITDA Reconciliation
Fluidra EBITDA Reconciliation Fluidra Standalone EBITDA Summary of adjustments (€ in millions) Fiscal Year Ending December 31, LTM A Non-cash purchase accounting adjustments primarily 2014A 2015A 2016A Sept-2017A relating to intangible assets recognized due to previous acquisitions by Fluidra Sales
Slide 41: Zodiac Standalone EBITDA Reconciliation
Zodiac Standalone EBITDA Reconciliation PF EBITDA Summary of adjustments Fiscal Year Ending September 30, A Non-cash purchase accounting adjustments primarily relating to ($ in millions) 2014A 2015A 2016A 2017A intangible assets recognized due to previous acquisitions by Zodiac; Net Sales $482.4 $
Slide 42: Zodiac Standalone EBITDA Reconciliation (Cont’d)
Zodiac Standalone EBITDA Reconciliation (Cont’d) Non-Recurring & Restructuring (NRE) Expenses Summary of adjustments Fiscal Year Ending September 30, A Various global restructuring initiatives designed to optimize Zodiac’s ($ in millions) 2014A 2015A 2016A 2017A manufacturing footprint Manufacturin
Slide 43: Fluidra’s Global Manufacturing Footprint (Key Facilities)
Fluidra’s Global Manufacturing Footprint (Key Facilities) Spain France Germany Bulgaria 38 ■ 6x Girona ■ 2x Perpignan ■ Stuttgart ■ Plovdiv Manufacturing ■ 5x Barcelona ■ Angers ■ Frankfurt Facilities ■ Huesca ■ Hannover ■ Alicante ■ Castellón 11 ■ Cantabria Countries ■ Vizcaya China ■ 2 x Ningbo ■
Slide 44: Quarterly Net Working Capital Profile
Quarterly Net Working Capital Profile €mm Fluidra Standalone Net Working Capital Profile €450 244 262 269 €300 223 240 234 225 233 Fluidra 210 203 204 220 174 170 184 €150 €0 (1) Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Zodiac Standalon
Slide 45: Thank You
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