Lpa Group Plc · LSE:LPA
Lpa — Shareholder Meeting (March 2015)
18 slides from Lpa's shareholder meeting presentation, Mar 26, 2015
Slide 1: Long Life Reliability does not cost the earth
Long Life Reliability does not cost the earth
Slide 2: Building a strong base to exploit current and imminent opportunities for growth
Building a strong base to exploit current and imminent opportunities for growth AGM presentation to shareholders, analysts and investors 26th March 2015
Slide 3: Agenda - Building Strength to pursue Growth
Agenda- Building Strength to pursue Growth • Challenges confronted – Relocation from Tudor Works – Address subcontract profitability and Clacton leases – Address Defined Benefit Pension Scheme – Address lack of critical mass in activities • Challenge to be confronted – Replacement of a temporary bui
Slide 4: Challenges Confronted
Challenges Confronted • Relocation from Tudor Works to Light and Power House – Ageing Tudor Works premises a turn off for customers – Flawed Title took ten years in confidence to resolve – Long planning process • to convert from employment to residential use • to maximise potential site value – Exte
Slide 5: Summary of Light and Power House
Summary of Light and Power House • Approximately 44,000sqft on 1.4 acre site plus 0.5 acre separate car park. • Approximately 34,000sqft manufacturing space housing LPA Connection Systems (LPACS), LPA Transport+ (LPAT+) and LPA Haswell Engineers (LPAHE) • Approximately 8,000sqft office space housing
Slide 6: Challenges Confronted
Challenges Confronted • Address Subcontract profitability and Clacton leases – LPA Haswell Engineers sheet metal workshop is located in leasehold premises in Clacton – Weak UK demand for rail vehicle underframe structures increased reliance on subcontract work – ‘Blue Chip’ subcontract customer base
Slide 7: Challenges Confronted
Challenges Confronted • Address Defined Benefit Pension Scheme potential risks – Progress has been reported in detail in the Annual Report over several years and includes • Closure to new entrants • Cessation of liability accrual – Full Actuarial Valuation carried out at 31st March 2012 revealed a d
Slide 8: Challenges Confronted
Challenges Confronted • Address lack of critical mass in activities – The consolidation of LPACS, LPAT+ and LPAHE at LPH creates a very potent electro- mechanical business capable of delivering £10+m annual sales. Current ‘Order Book’, which includes Inter City Express Programme (IEP) and CrossRail
Slide 9: Challenge to be Confronted
Challenge to be Confronted • Replacement of Temporary building and increase in capacity at LPA Excil Electronics (LPAEE) • A temporary building which houses goods inwards, stores, engineering, test, purchasing and production control is beyond its design life and deteriorating rapidly. • LPAEE’s offi
Slide 10: Opportunities to be Grasped
Opportunities to be Grasped • UK Rail Market is extremely complex, comprising inter alia, • Department for Transport (DfT), Transport for London (TfL), London Underground Limited (LUL), Office of the Rail Regulator (ORR), Railway Safety Standards Board (RSSB), • Rail Delivery Group (RDG), Network Ra
Slide 11: Opportunities to be Grasped
Opportunities to be Grasped • UK Rail Market is currently huge. • Network Rail’s budget for Control Period 5, which commences now and lasts 5 years is c.£35bn. • RDG estimate the current surface fleet of vehicles to be 12,775 and this is expected to rise to 15,000 net of retirements by 2019 as a con
Slide 12: Opportunities to be Grasped
Opportunities to be Grasped • We also have developed a new flame proof connection box which could have applications in CrossRail Tunnels, London Underground and HS2. • The CrossRail rolling stock will be based on BT’s Aventra platform, which will be offered by BT for other applications. • The Hitach
Slide 13: Opportunities to be Grasped
Opportunities to be Grasped • Our success in supplying inter-car jumpers arises from our new Ethernet backbone technology. LPACS designed and manufactured and LPAT+ installed an Ethernet backbone and CCTV system on a train fleet used for the London Olympics in 16 weeks from order to completion. The
Slide 14: Opportunities to be Grasped
Opportunities to be Grasped • Adoption of the Digital Railway concept in this manner would not be universally popular. Increasing capacity on existing track would undermine the case for new lines particularly such as HS2, which argues that capacity on West Coast Mainline is so short that a new line
Slide 15: Opportunities to be Grasped
Opportunities to be Grasped • UK Other products • We have also developed a drop-in LumiMatrix module to fit in TfL’s existing light fittings in passenger underground walkways. This is a universal module which has also been adopted by local authorities • Aerospace and Airports are also important mark
Slide 16: Exports
Opportunities to be Grasped • Exports • When Alstom closed their UK plant in 2002 LPA lost about 40% of sales. We had just expanded capacity in the expectation of consistent orders, when HMG suddenly changed policy and sourced trains from Germany. The impact on the supplier base in the West Midlands
Slide 17: Opportunities to be Grasped
Opportunities to be Grasped • We maintained the effort in these markets and periodically visited New Zealand as well. When Hyundai Rotem won a contract to supply trains to new Zealand, they found that the local engineer had specified LPA Connectors! • This continuing effort culminated in LPA winning
Slide 18: Opportunities to be Grasped
Opportunities to be Grasped • While the fall in the oil price has reduced activity generally in the region, Qatar is committed to the forthcoming Football World Cup. We are building relationships in the country and the region, which we hope will be fruitful in the near term. • When Alstom closed the