Johnson Service Group Plc · LSE:JSG
Johnson Service — H1 2024 Earnings Presentation
31 slides from Johnson Service's earnings presentation, September 2024
Slide 1: Service Group PLC
Service Group PLC
Slide 2: Contents
“= JOHNSON Service Group PLC CONTENTS 1) 2) 3) 4) )) ) 7) Operational Highlights Financials Investment Sustainability Operational Performance Outlook Investment Case Appendices
Slide 3: Operational Highlights
“aT wy ¢ < JOHNSON Service Group PLC OPERATIONAL HIGHLIGHTS “Continuing strong organic growth and £20.6m acquisition of Empire..." ~ we
Slide 4: Organic revenue up 5.7% compared to H1 2023
Organic revenue up 5.7% compared to H1 2023 Increasing new sales activity and strengthening pipeline in both HORECA and Workwear Energy costs reducing as a % of revenue; costs largely fixed for remainder of 2024 Margin improvement on track for target of 14% in 2026 New Crawley site expected to comme
Slide 5: 5
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Slide 6: Financial Highlights
2024 Interim Results Financial Highlights % Increase Revenue (£m) 244.1 215.0 13.5% 4653 Adjusted EBITDA (£m)'? 69.2 577 19.9% 131.5 Adjusted EBITDA margin (%)'2 28.3 268 - 28.3 Adjusted operating profit (Em) 25.2 19.0 32.6% 50.5 Adjusted operating margin (%)* 10.3 88 - 10.9 Adjusted PBT (£m) 21.5 1
Slide 7: Strong and sustainable organic growth supplemented by targeted M&A
Excluding FY20 (impacted by Covid) the Group has delivered strong and sustainable organic growth… Organic Revenue (%) 70.9% 42.1% 39.0% 18.1% 21.9%16.3% 5.0% 7.4% 6.5% 3.7% 5.9% FY19 -4.4% FY20 -0.5% FY21 FY22 FY23 -37.6% -57.0% Workwear HORECA Group …which has been supplemented by targeted M&A acti
Slide 8: Energy and Employment Costs
Energy • Energy continued to be a significantly higher cost than experienced historically 2024 HY Cost Analysis • 2024 H1 energy costs represented 9.4% of revenue (2023 H1: 10.3%; 2023 FY: 10.0%; 2019 H1: 6.5%) • Anticipate further reduction in this % in H2, such that 2024 FY will be approximately 9
Slide 9: Cash Flow
2024 Interim Results Cash Flow JOHNSON Service Group PLC 2023 H1 | 2023 FY £ £ Adjusted operating profit 19.0 50.5 Depreciation impairmentane software 387 81.0 Working capital (2.6) (0.3) fixed assets and software (12.9) (31.1) Capital expenditure | rental stocks (net) (29.6) (58.6) fixed asset proc
Slide 10: Other Financial Information
2024 Interim Results Other Financial Information wy JOHNSON Service Group PLC Interest Pensions & « Interest cost of £3.7m including £1.1m relating to IFRS 16 + Net pension asset of £2.6m (Dec 2023: Enil) lease liabilities (2023 H1: £2.6m and £1.0m respectively; . « Improvement due to a higher disco
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Slide 12: Acquisition of Empire Linen Services
2024 Interim Results te JOHNSON q j Service Group PLC Acquisition of Empire Linen Services = Transaction completed on 2 September 2024 = £20.6m consideration on a debt free, cash free, basis = Provides linen services to luxury hotels in London and the South East = 26,000 sq ft leasehold processing f
Slide 13: Crawley Opening
2024 Interim Results te. Crawley Opening ww JOHNSON Service Group PLC = £16.0m investment now completed = Expected to commence processing in the final quarter of 2024 = One of the most sustainable and energy efficient laundries of scale in the UK = Additional costs of some £1.0m incurred in H1, expe
Slide 14: Bourne
2024 Interim Results JOHNSON Service Group PLC Bourne Investment in capacity Croupllitc New commercial vehicles
Slide 15: Sustainability
JOHNSON Service Group PLC SUSTAINABILITY “We are committed to developing our responsible business agenda and continue to make excellent progress with embedding our sustainability programme across the Group and establishing the standards to which others aspire.” ~ 15
Slide 16: Sustainability
2024 Interim Results Sustainability JOHNSON * Working with customers and prospects to promote the Service Group PLC sustainability benefits of our service as being a differentiator which can help reduce their own carbon footprint * Recently published our third SustainabilityReport * Implemented a ne
Slide 17: Operational Performance
JOHNSON Service Group PLC OPERATIONAL PERFORMANCE “We have had some significant independent and group sales wins during the second quarter of 2024 which will positively impact the remainder of the year and into 2025.” 17
Slide 18: Operational Performance
2024 Interim Results Operational Performance JOHNSON Service Group PLC JOHNSONS JOHNSONS ee: CELTIC Cp sonnsons ea tetor Hotel Linen mes urant & Catering Linen Revenue (£m) 172.9 143.9 3227 Adjusted EBITDA (£m)'2 48.1 363 897 Adjusted EBITDA margin (%)'2 27.8 25.2 278 Adjusted operating profit (Em)
Slide 19: Operational Performance
2024 Interim Results Operational Performance JOHNSON Service Group PLC « Organic revenue increased by 8.5% ¢ Significant independent and group sales wins during Q2 2024 will positively impact the remainder of the year and into 2025 « Sales pipeline remains strong ¢ 2023 acquisitions (Regency and Cel
Slide 20: Operational Performance
2024 Interim Results Operational Performance JOHNSON Service Group PLC * JOHNSONS Workwear Revenue (£m) Adjusted EBITDA (£m)! Adjusted EBITDA margin (%)'2 Adjusted operating profit (£m)? 11.1 21.4 Adjusted operating margin (%) 15.6 15.0 Notes: 1. Adjusted operating profit plus depreciation charge fo
Slide 21: Operational Performance
2024 Interim Results Operational Performance JOHNSON Service Group PLC ¢ Trading remained stable during H1 « Positive momentum on sales to both new and existing customers « 25% of new sales in the period came from new-to-rental « Customer retention for the 12 months to June 2024 was 92.4% and is tre
Slide 22: Outlook
JOHNSON Service Group PLC we OUTLOOK “We expect to exit 2024 with strong progression towards previous levels of adjusted operating margin and adjusted operating profit for the year, before the benefit from Empire, in line with current market expectations.” = 22
Slide 23: Strong financial and operational performance
Strong financial and operational performance Strengthening new sales pipeline in both HORECA and Workwear, although softer HORECA market in some regions Investing in our estate gives us an advantage in the market in delivering unrivalled service to our customers in the most efficient way Empire acqu
Slide 24: Investment Case
; a “i ka JOHNSON Service Group PLC INVESTMENT CASE “The Group's objective is to employ a disciplined approach to investment, returns and capital efficiency to deliver sustainable compounding growth whilst also maintaining a strong balance sheet." 24
Slide 25: Disposals and Acquisitions revenue mix
2012 Revenue 2023 Revenue 2012 Revenue 2023 Revenue 21% 22% 31% 53% 26% 69% 78% 100% Textile Services HORECA Drycleaning Workwear Facilities Management Disposals Acquisitions
Slide 26: An Essential Service Provider
An Essential Quality Service A Local Service Service Provider We provide our Our proximity to The services we customers enables us to customers with a provide to our quickly respond to their quality service which customers are essential needs they can rely upon to their business Sustainable Substitu
Slide 27: Key Components of Our Medium-Term Outlook
Key Components of Our Medium-Term Outlook Supported By Exceptional service ▪ Value-added proposition and market leading service supports above underpinned by quality and Organic market growth reliability Revenue Growth ▪ Consistent track record of delivering organic growth Long-term relationships an
Slide 28: Appendices
“6°'@ en? e Wo ~ ee “6 ®, Prt) 3 x) e e @.- eo: “ Oo Service Group PLC Appendices 28
Slide 29: Segmental Analysis
2024 Interim Results Appendix 1 . JOHNSON Segmental Analysis Service Group PLC Ac d Revenue > rofit EBITDA’? te e ’ 3ITDA' Revenue EBITDA’? £m £m E Em Em £m HORECA 172.9 18.4 48.1 Workwear 2 10.2 24.5 4 11.1 24.4 142.6 21.4 48.6 Textile Rental 244.1 28.6 72.6 215.0 22.0 60.7 4653 57.4 138.3 Group Co
Slide 30: Financial Track Record
2024 Interim Results Appendix 2 Financial Track Record Revenue (£m) 4653 2019 2020 2021 2022 2023 Adjusted Operating Profit (£m) 528 505 2019 2021 2022 2023 19 Adjusted EBITDA (£m) Adjusted EBITDA Margin (%) JOHNSON Serv ce Grcup PLC Adjusted Diluted EPS excluding super deduction (p) 10.5 72 77 W7 2
Slide 31: www.jsg.com
JOHNSON Service Group PLC www.jsg.com
Johnson Service Group — H1 2024 Earnings Presentation on 6ix