Lords Group Trading Plc · LSE:LORD
Lords Group Trading — FY2022 Earnings Presentation
21 slides from Lords Group Trading's earnings presentation, May 3, 2023
Slide 1: FY22 Results
FY22 Results 3 May 2023 LORDS GROUP TRADING
Slide 2: Agenda
Agenda Overview Shanker Patel, CEO Financial review Chris Day, CFO & COO Strategy update & ESG Shanker Patel / Chris Day Summary & outlook Shanker Patel Q&A Lords Group Trading PLC 2
Slide 3: Overview
Overview Dave, Yard Foreman, AW Lumb, Tamworth
Slide 4: FY22 Highlights
FY22 Highlights Another year of positive strategic progress underpinned by strong financial performance. • Outstanding performance from every one of our 902 colleagues • Record performance with results ahead of expectations • Merchanting division market share growth strongly evidenced by FY22 revenu
Slide 5: The Lords Investment Case
The Lords Investment Case A leading, high growth distributor of building materials in the UK Unique Customer First Proposition Successful Value-Creative M&A History • Customer service excellence is the central pillar of our strategy • Independent merchants (£2-100m turnover) hold 40% of market and a
Slide 6: Financial Review
Financial Review Adam, Internal Sales Assistant, Hevey Building Supplies, Kettering
Slide 7: FY22 Financial Highlights
FY22 Financial Highlights FY22 FY21 Change • Significant 23.9% revenue (Restated)1 growth delivered through Revenue £450.0m £363.3m +£86.7m / +23.9% organic and acquisitive channels Adjusted EBITDA £30.0m £22.3m +£7.7m / +34.4% Adjusted EBITDA Margin 6.7% 6.1% +0.6% • EBITDA margin enhanced to 6.7%,
Slide 8: FY22 Financial Highlights - Merchanting
FY22 Financial Highlights - Merchanting Merchanting performance materially above FY21, demonstrating execution of our strategic growth levers. 12 months ended 31 Dec (£m) FY22 FY21 Change Total revenue £220.8m £130.5m +£90.3m / +69.2% LFL Growth vs FY21 +17.4% Adjusted EBITDA £16.1m £12.0m +£4.1m /
Slide 9: FY22 Financial Highlights – Plumbing & Heating
FY22 Financial Highlights – Plumbing & Heating Strong performance in P&H, growing EBITDA margin via range extension and pricing decisions. 12 months ended 31 Dec (£m) FY22 FY21 Change Total revenue £229.3m £232.8m -£3.5m / -1.5% LFL Growth vs FY21 -9.1% Adjusted EBITDA £13.8m £10.3m +£3.5m / 34.5% M
Slide 10: Robust balance sheet enables growth
Robust balance sheet enables growth • Debt structure refinanced on 5 April 2023, moving to a syndicate structure with HSBC, Natwest and BNP Paribas • New facilities reflect lender confidence and endorsement of Lords resilience and growth potential • RCF facility increased from £50m to £70m, attracti
Slide 11: FY22 Financial highlights – Free cash flow
FY22 Financial highlights – Free cash flow £m FY22 FY21 (Restated) Free cash flow (from IFRS EBITDA) of £19.1m, EBITDA (IFRS) 28.6 19.7 65.9%1 Exceptional Items and share based payments 1.3 2.6 Working capital continues to be tightly controlled Adjusted EBITDA 30.0 22.3 with management controls offs
Slide 12: Strategic Update
Strategic Update Dave, Sales Administrator; Kyle, Sales Administrator, AW Lumb, Tamworth
Slide 13: Renewables range: growing in a key product category
Renewables range: growing in a key product category • Demand for energy efficient technology being driven by increasing energy prices and government 'green initiatives’ • Lords is uniquely positioned to supply – distribution, merchanting and consumer channels • Suppliers recognise Lords track record
Slide 14: George Lines: capturing the organic growth opportunity
George Lines: capturing the organic growth opportunity • George Lines is a strong regional brand with national expansion plans • Specialist civils merchant selling aggregates, concrete, drainage and ducting, acquired in 2016 as a single site with £13m revenue • In FY22, George Lines operates from 3
Slide 15: Advance Roofing: strengthening our customer offer
Advance Roofing: strengthening our customer offer • Two site roofing merchant acquired in January 2022 on a 4.6x EBITDA multiple – immediately earnings accretive • Excellent example of how regional bolt on acquisitions can enhance our overall customer proposition • Customer proposition aligned with
Slide 16: Acquisitions: Track record of delivering superior returns
Acquisitions: Track record of delivering superior returns • EBITDA1 growth of 53% on average across all entities acquired since 2016 • Returns achieved by acquiring at the right price, seamless integration and achieving revenue growth synergies by investing in our 3P’s model • Healthy pipeline of co
Slide 17: ESG: Developing our strategy
ESG: Developing our strategy • Strategy developed in FY22, providing an effective framework to drive our ESG performance • Output includes materiality assessment, medium term initiatives, governance structure, and KPI’s to measure success • Scope 1 & 2 emissions initiatives continued to be implement
Slide 18: Medium Term Targets
Medium Term Targets Revenue growth target: £500m by 2024 Medium term EBITDA margin of 7.5% £500m £450m £363m £288m Operational leverage 2020 2021 2022 2024 Illustrative and not to scale Revenue growth driven by: Our targets: • Organic – product range extension, new geographies 1. Grow revenues to £5
Slide 19: Outlook
Outlook
Slide 20: Outlook
Outlook Whilst mindful of the macro-economic environment and its impact on the sector in the short term, the Group continues to trade in line with market expectations. The fundamentals of the Lords investment proposition remain: • Customer demand remains robust in our well positioned geographic and
Slide 21: Disclaimer
Disclaimer This presentation may contain forward-looking statements with respect to the financial condition, performance and position, strategy, results of operations and businesses of Lords Group Trading plc (the “Company”). Such statements and forecasts involve risk and uncertainty because they ar