Rpm Automotive Group Ltd. · ASX:RPM
Rpm Automotive — Merger or Acquisition (December 2022)
30 slides from Rpm Automotive's merger presentation, Dec 5, 2022
Slide 1: Expanding the National Footprint in the Automotive Aftermarket
EXPANDING THE NATIONAL FOOTPRINT IN THE AUTOMOTIVE AFTERMARKET RPM AUTOMOTIVE GROUP LTD (ASX: RPM) ACQUISITION AND EQUITY RAISING PRESENTATION │ DECEMBER 2022 RPM AUTOMOTIVE GROUP LTD (ASX: RPM) 1
Slide 2: Important Notice & Disclaimer
IMPORTANT NOTICE & DISCLAIMER Overview This document is issued by RPM Automotive Group Limited ACN RPM (“RPM Automotive” or “RPM”) on 02 December 2022 Summary Information This document contains summary information about RPM Automotive and its associated and proposed associated entities and their act
Slide 3: Agenda
AGENDA Executive Summary 4 Overview of Acquisition 6 Equity Raising Overview 11 Financial Overview 14 About RPM 18 Appendix 1 – Key Risks 26 Appendix 2 – Foreign Selling Restrictions 28 RPM AUTOMOTIVE GROUP LTD (ASX: RPM) 3
Slide 4: Executive Summary
EXECUTIVE SUMMARY 4 RPM AUTOMOTIVE GROUP LTD (ASX: RPM) 4
Slide 5: Executive Summary
EXECUTIVE SUMMARY STRATEGIC • RPM Automotive Group Limited (“RPM” or the “Company”) has entered into a binding agreement to acquire the inventory and assets of Metro Tyre Services (“Metro”) for total consideration of $4.5m, (the “Acquisition”). The Acquisition is subject to normal working capital ad
Slide 6: Overview of Acquisition
OVERVIEW OF ACQUISITION 6 RPM AUTOMOTIVE GROUP LTD (ASX: RPM) 6
Slide 7: Strategic Rationale
STRATEGIC RATIONALE • Significantly expands geographic footprint and provides further scale in existing markets EXPAND NATIONAL ‐ Increases RPM’s national footprint from 38 points of presence in FY22 to 40 post acquisitions FOOTPRINT • The Acquisition extends RPM’s presence into metro Sydney and Gre
Slide 8: Metro Tyre Services
METRO TYRE SERVICES Metro Key Financials $10m $1.1m • Metro is a full-service tyre dealer, providing 24/7 onsite mobile tyre fitting repairs and servicing, specialising in earthmoving, FY22 Revenue FY22 EBITDA forklift and commercial tyre sales, fitting, service and repairs • Based in Penrith, NSW K
Slide 9: Expanded National Footprint
EXPANDED NATIONAL FOOTPRINT 27 Retail points of presence (PoPs) 9 Wholesale distribution PoPs EXPAND to service the retail footprint RETAIL IN NSW 4 Manufacturing PoPs RETAIL WHOLESALE Total PoPs: FY20 (20), FY22 (38), FY26F (50+) MANUFACTURING NEW ACQUISITION RPM AUTOMOTIVE GROUP LTD (ASX: RPM) 9
Slide 10: Vertical Integration for Margin Expansion
VERTICAL INTEGRATION FOR MARGIN EXPANSION Wholesale Distributes wholesale Provides insight Increased retail volumes of RPM Increasing blend into consumer footprint creates products and of own, private demand (eg high economies of global brands to label products margin 4WD and scale further commercia
Slide 11: Equity Raising Overview
EQUITY RAISING OVERVIEW 11 RPM AUTOMOTIVE GROUP LTD (ASX: RPM) 11
Slide 12: Equity Raising Overview
EQUITY RAISING OVERVIEW • $3.0m equity raising comprising: ‐ Placement to raise $2.0m; and ‐ Underwritten $1.0m SPP. The SPP is fully underwritten by Collins St Value Fund. OFFER SIZE & (together, the Placement and SPP are the “Offer”) STRUCTURE • Approximately 18.2 million new fully paid ordinary s
Slide 13: Sources & Uses and Indicative Timetable
SOURCES & USES AND INDICATIVE TIMETABLE Sources & Uses Indicative Timetable Sources A$m Event Date Institutional Placement $2.0m Trading Halt Friday, 2 December 2022 Underwritten Share Purchase Plan $1.0m Total Sources $3.0m 7:00pm (AEDT) Friday, 2 Record date for SPP December 2022 Announcement of c
Slide 14: Financial Overview
FINANCIAL OVERVIEW 14 RPM AUTOMOTIVE GROUP LTD (ASX: RPM) 14
Slide 15: Refinance & Restructure of Bank Facility
REFINANCE & RESTRUCTURE OF BANK FACILITY Key Covenants • The new $26m bank facility with CBA (replacing existing NAB facility) includes commercial loans, asset finance and trade finance. Net Leverage Ratio <2.75x • The commercial loan will cover the existing deferred acquisition payments to be made
Slide 16: FY23 Outlook
FY23 OUTLOOK • FY23 expected revenue range of $125m - $130m and FY23 EBITDA range between $12m - $13m, on a consolidated basis • 2H FY23 revenue and EBITDA expected to be stronger than 1H FY23, with seasonally higher revenue in Q2 and Q3 • Focus on inventory management with inventory turns forecast
Slide 17: Track Record of Revenue and Earnings Growth
TRACK RECORD OF REVENUE AND EARNINGS GROWTH Sales Revenue ($m) Underlying EBITDA ($m) • FY22 organic growth of 18% 140 14 Guidance Range: $125m-$130m Guidance Range: • Q1 FY23 revenue of $12m-$13m 120 12 $28.4m, up 7% q-on-q and up 89% y-on-y 100 10 • Q1 FY23 EBITDA of $2.6m, 80 8 up 17% q-on-q and
Slide 18: About RPM
ABOUT RPM 18 RPM AUTOMOTIVE GROUP LTD (ASX: RPM) 18
Slide 19: Establishing a National Footprint in the Automotive Aftermarket
ESTABLISHING A NATIONAL FOOTPRINT IN THE AUTOMOTIVE AFTERMARKET RPM business units offer wheels, tyres, accessories and apparel across wholesale and retail Underlying demand (over 70%) comes from commercial & industrial driven by transport fleets, the mining and agricultural sectors RPM has grown or
Slide 20: 4 Complementary Business Units
4 COMPLEMENTARY BUSINESS UNITS REPAIRS PERFORMANCE WHEELS & ROADSIDE MOTORSPORT & ACCESSORIES & TYRES Commercial & industrial Certified race safety wear, Bolt on vehicle parts and Distribution of wheels and tyre and auto suits and helmets accessories tyres service centres Retail Retail Retail & Whol
Slide 21: Key Brands
KEY BRANDS REPAIRS PERFORMANCE WHEELS & ROADSIDE MOTORSPORT & ACCESSORIES & TYRES Primary retail brand Primary retail brand offers Primary wholesale brand Primary wholesale brand supported by acquired RPM and leading brand supported by acquired supported by acquired retail business products wholesal
Slide 22: Investments in Growth – Organic & Acquisition
INVESTMENTS IN GROWTH – ORGANIC & ACQUISITION VicWide Tyre Services Safety Dave ACT Total Tyres Metro Tyre Services AFT Automotive Jan-22 Feb-22 Apr-22 May-22 Jun-22 Jul-22 Nov-22 Revolution RPM Revolution Tyres Autoparts Tyres Woodville Prestons Prestons RPM AUTOMOTIVE GROUP LTD (ASX: RPM) 22
Slide 23: Revenue Growth Analysis
REVENUE GROWTH ANALYSIS Components of Revenue Growth ($m) FY20 FY21 FY22 Total Revenue1 35.5 48.8 82.0 Acquisition Growth 2.8% 34.8% 49.9% Organic Growth 9.4% 3.0% 18.1% Total Revenue Growth 12.2% 37.7% 68.0% Organic Growth by Division ($m) FY20 FY21 FY22 Repairs & Roadside (Retail) -4.1% 3.7% 28.9%
Slide 24: Experienced Board of Directors
EXPERIENCED BOARD OF DIRECTORS GRANT CARMAN CLIVE FINKELSTEIN LAWRENCE JAFFE GUY NICHOLLS ALEX GOODMAN NON-EXECUTIVE CHAIRMAN CEO/MANAGING DIRECTOR EXECUTIVE DIRECTOR NON-EXECUTIVE DIRECTOR NON-EXECUTIVE DIRECTOR Chartered accountant with over Co-founder of RPM Co-founder of RPM Over 30 years’ exper
Slide 25: RPM's 3-Year Vision
RPM’S 3-YEAR VISION In the next three years, RPM is working towards: • Expansion of wholesale: Warehouses and distribution facilities in each of the major centres • Expansion of retail: A well-built out retail network servicing the transport industry in major transportation hubs, focused on commerci
Slide 26: Appendix 1 - Key Risks
APPENDIX 1 - KEY RISKS 26 RPM AUTOMOTIVE GROUP LTD (ASX: RPM) 26
Slide 27: Key Risks
KEY RISKS Key risks Competition risk The Australian automotive parts and service industry is mature and highly competitive. The industry comprises many large and well-resourced companies as well as a large number of small businesses against whom the Company must compete for business. Barriers to ent
Slide 28: Appendix 2 - Foreign Selling Restrictions
APPENDIX 2 - FOREIGN SELLING RESTRICTIONS 28 RPM AUTOMOTIVE GROUP LTD (ASX: RPM) 28
Slide 29: Foreign Selling Restrictions
FOREIGN SELLING RESTRICTIONS WARNING: This document has not been, and will not be, registered as a prospectus under the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32) of Hong Kong, nor has it been authorised by the Securities and Futures Commission in Hong Kong pursuant to t
Slide 30: Media & Investors
MEDIA & INVESTORS KATIE MACKENZIE T: +61 455 502 197 E: INVESTORS@RPMGROUP.NET.AU RPM AUTOMOTIVE GROUP LTD (ASX: RPM) www.rpmgroup.net.au RPM AUTOMOTIVE GROUP LTD (ASX: RPM) 30
Rpm Automotive Group — Merger or Acquisition (December 2022) on 6ix