Slide 1: Trellidor Holdings Unaudited Interim Results for Six Months Ended 31 December 2016
TRELLIDOR HOLDINGS LIMITED UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2016
Slide 2: Group Highlights
GROUP HIGHLIGHTS 71% Revenue 40% Profit before interest 71% Cash from operating activities 24% Headline earnings per share – 33.5c 31% Diluted Core Headline earnings per share – 37.7c 14% Interim dividend declared – 10.5 cents per share Slide 2
Slide 3: Group Growth Strategies
GROUP GROWTH STRATEGIES • Acquisitive growth – concluded acquisition of Taylor • Diversified product offering – Trellidor Security Shutter launched • International growth – focus on Africa • Geographic expansion of Taylor – focus on synergies Foundation in place – now to build Slide 3
Slide 4: Group Overview
GROUP OVERVIEW Trellidor Group now consists of Trellidor and Taylor. Trellidor • Trellidor is the market leading manufacturer of custom-made barrier security products • Distribution through dedicated and skilled owner operated franchisees in South Africa and throughout Africa • Further representatio
Slide 5: Group Overview – cont.
GROUP OVERVIEW – cont. Taylor • Acquisition of Taylor Blinds and Shutters and NMC South Africa “Taylor” business effective 7 July 2016 diversifies revenue • Taylor is a major manufacturer and distributor of a range of custom-made blinds, and a range of decorative and security shutters • Strong distr
Slide 6: New Product
NEW PRODUCT Substantive in house developed product Slide 6
Slide 7: Taylor/NMC Acquisition
TAYLOR/NMC ACQUISITION Slide 7
Slide 8: Group Financial Overview
GROUP FINANCIAL OVERVIEW Slide 8
Slide 9: Group Financial Performance
GROUP FINANCIAL PERFORMANCE Audited Unaudited Audited Unaudited Dec-16 12 months 6 months 12 months 6 months Jun-15 Dec-15 Jun-16 Dec-16 v R'm R'm R'm R'm Dec-15 Revenue 293.8 165.3 313.4 282.8 71% Gross Profit 148.9 83.5 157.3 136.0 63% Core EBITDA 72.8 45.6 83.2 67.4 48% EBITDA 72.8 43.9 81.5 63.5
Slide 10: Group Financial Performance
GROUP FINANCIAL PERFORMANCE • The inclusion of Taylor for the Revenue first time boosts H1 turnover by 71% • Tough trading conditions Taylor prevailed through H1 for the H2 H2 H2 H1 contribution H2 Trellidor Group • Some relief is anticipated in H2 H1 H1 H1 H1 H1 with an easing of the drought and im
Slide 11: Group Financial Performance
GROUP FINANCIAL PERFORMANCE • The inclusion of Taylor boosts EBITDA by 45% and Core EBITDA by 48% • Lower volumes in the tough Core EBITDA 90.0 economic conditions hurt margins 80.0 • Super inflationary input costs driven 70.0 by a strongly weaker Rand in early 60.0 H2 Taylor H2 2016, are seen to be
Slide 12: Group Financial Performance
GROUP FINANCIAL PERFORMANCE Audited Unaudited Audited Unaudited 12 months 6 months 12 months 6 months Jun-15 Dec-15 Jun-16 Dec-16 R'm R'm R'm R'm EBITDA 72.8 43.9 81.5 63.5 Adjusted for: Acquisition costs - Taylor - - - 2.5 Fair value adjustment on contingent consideration - Taylor - - - 1.5 Listing
Slide 13: Group Balance Sheet
GROUP BALANCE SHEET • Gearing ratio increased as a result of Taylor acquisition • Interest cover reduction due to increased interest expense • New and acquired debt (FNB) 5 yr amortising loans of R90.0m at prime less 0.5% % % % % • Gearing is 66% (excludes contingent consideration of R28.7 million )
Slide 14: Group Net Working Capital
GROUP NET WORKING CAPITAL Working capital investment has increased mainly due to acquisition of Taylor. • Taylor model requires investment in inventory • Accounts receivable are in line with trading – no significant concerns on recoverability • Working capital levels are Net investment in working ca
Slide 15: Segments
TRELLIDGR ) THE ULTIMATE CRIME BARRIER SEGMENTS
Slide 16: Sales Analysis - Trellidor Division
SALES ANALYSIS - TRELLIDOR DIVISION • Africa sales growth of 17% is pleasing Geographical presence despite currency shortages in several 1.3% countries. 17.2% 38.0% • African economies reliant on oil remain weak, mainly Nigeria, Angola • Subdued trading in South Africa main centres and outlying area
Slide 17: Sales Analysis - Trellidor Division (cont.)
SALES ANALYSIS - TRELLIDOR DIVISION (cont.) Product Type 4% 2% • Growth in new product sales of 5% 18%, including the Trellidor Security 14% Shutter launched in July 2016 • Diversified product range spans income groups which mitigates weak middle and upper middle class economy 75% Traditional Trelli
Slide 18: Trading Margin - Trellidor Division
TRADING MARGIN - TRELLIDOR DIVISION • Relatively stable trading margin despite rand devaluation and muted sales growth • Super inflationary labour costs continue, mitigated by improved utilisation • Manufacturing overhead cost contained • Materials costs have been under pressure but well managed in
Slide 19: Sales Analysis - Taylor
SALES ANALYSIS - TAYLOR • Concentration of sales in the Geographical presence Western and Southern Cape 5% 1% 94% • Branch in Johannesburg • Geographic growth opportunity using proven Trellidor model • Tough trading conditions – 6% growth on prior H1 2015 Main Centres Outlying regions - Taylor Inter
Slide 20: Sales Analysis – Taylor (cont.)
SALES ANALYSIS – TAYLOR (cont.) Product Type • Turnover well spread by 15.8% product 39.1% • Constant innovation and development to keep up with trends • Good growth in Roller Blinds 32.5% and PVC Shutters in the period 12.6% • Custom designed and Aluminium shutters PVC Shutters Blinds NMC manufactu
Slide 21: Sales Analysis – Taylor (cont.)
SALES ANALYSIS – TAYLOR (cont.) • Gross profit margins are relatively stable across the product range • Exposure to Rand fluctuations as most materials imported, offset by management of price • Efficient factory with significant spare capacity in Blinds divisions Well managed margins Slide 21
Slide 22: Group Summarised Cash Flow
GROUP SUMMARISED CASH FLOW Audited Unaudited Audited Unaudited 12 months 6 months 12 months 6 months Jun-15 Dec-15 Jun-16 Dec-16 R'm R'm R'm R'm EBITDA 72.8 43.9 81.5 63.5 Movement in non cash items (incl provisions) 2.8 -5.5 -5.9 1.7 Net working capital movement 2.9 -11.8 -3.3 -19.9 Inventory 0.9 -
Slide 23: Group Summarised Cash Flow
GROUP SUMMARISED CASH FLOW Remains highly cash generative Slide 23
Slide 24: Group Summarised Cash Flow
GROUP SUMMARISED CASH FLOW • Business combination dilutes cash conversion, but remains robust • Debt servicing will use ± R23 m per year • Working capital distorted by seasonal reduction in payables at 31st December 2016 • Interim dividend declared of 10,5 cents per share – up 14% on prior year Divi
Slide 25: Group Summarised Balance Sheet
GROUP SUMMARISED BALANCE SHEET Jun-15 Dec-15 Jun-16 Dec-16 Jun-15 Dec-15 Jun-16 Dec-16 Financial Risk Non current assets Debt/Equity 33% 16% 18% 66% Property, plant and equipment 41.5 42.1 42.6 50.8 Interest Cover 21 31 33 9 Goodwill and other intangibles 3.1 3.0 4.0 112.8 FCF/PAT 118% 41% 81% 62% D
Slide 26: Prospects
PROSPECTS • Bedding down the Taylor acquisition and driving growth opportunities after “earn out” period • Africa remains focus for International growth. Two new Nigeria franchisees now fully trained and paid up and sales activity anticipated in H2. Sales already received from the DRC • Improving ec
Slide 27: Thank You
Thank You TRELLIDGR THE ULTIMATE CRIME BARRIER