Mears Group Plc · LSE:MER
Mears — FY2003 Earnings Presentation
25 slides from Mears's earnings presentation, 2004
Slide 1: Mears Group Plc Full Year Results
MEARS GROUP PLC Full Year Results 31 December 2003 Bob Holt Chairman David Robertson Finance Director
Slide 2: Contents
Contents • Highlights • Financial review • Order book and contract awards • Strategy • Summary • Appendix
Slide 3: Highlights of the year
Highlights of the year Strong performance with increased margin Increased visibility of earnings Record order book Record pipeline Acquisitions integrated
Slide 4: 5 year compound growth
5 year compound growth Profit pre goodwill 44% EPS 32% Dividend 28%
Slide 5: Financial highlights
Financial highlights Turnover £112.3m UP 42.4% Profit pre goodwill £5,238k UP 39.2% Earnings per share 6.47p UP 35.1% Dividend 1.35p UP 35.0% Order book £550m UP £250m
Slide 6: Segmental analysis
Segmental analysis £’000 Turnover EBITA 2003 2002 2003 2002 Maintenance 99,574 62,916 4,626 2,536 Vehicle collection 12,697 15,918 534 1,142 112,271 78,834 5,160 3,678 Public sector element 65% 49%
Slide 7: Turnover movement
Turnover movement £’000 Original business 103,177 up 30.9% Acquisitions Scion 7,687 Powersave 858 Painting Companies 549 Total 112,271 up 42.4%
Slide 8: Operating margin pre goodwill
Operating margin pre goodwill 2003 2002 Maintenance 5.00% 4.22% Scion 0.48% Vehicle collection 4.21% 6.41% Total 4.60% 4.67%
Slide 9: Profit and margin
Profit and margin 6000 5 5000 4.5 4000 4 % £’OOO 3000 3.5 2000 3 1000 0 2.5 1999 2000 2001 2002 2003 Profit pre goodwill % Operating margin
Slide 10: Profit pre goodwill UP 39%
Profit pre goodwill UP 39% 6000 5000 4000 £’OOO 3000 2000 1000 0 1999 2000 2001 2002 2003
Slide 11: EPS pre goodwill UP 35%
EPS pre goodwill UP 35% 7 6 5 Pence 4 3 2 1 0 1999 2000 2001 2002 2003
Slide 12: Dividend UP 35%
Dividend UP 35% 1.4 1.2 1.0 Pence 0.8 0.6 0.4 0.2 0.0 1999 2000 2001 2002 2003
Slide 13: Forward order book £550m
£mn Forward order book £550m £m 150 100 At June 2002 At June 2003 50 Currently 0 2004 2006 2008 2010 2012 2014 2016 2018
Slide 14: Recent contract awards/extensions
Recent contract awards/extensions New Islington & Hackney HA 5 years £7.5m p.a. Barnsley Council 2 years £7.5m p.a. LB Ealing 5 years £5.4m p.a. Leeds NE Homes 5 years £3m p.a. Crawley BC 5 years £2m p.a. Wigan & Leigh Housing 15 years £4.5m p.a. Total £172.0m
Slide 15: Bidding Pipeline £500 million
Bidding Pipeline £ 500 million Scotland £50m North £180m Midlands £126m South £144m
Slide 16: Strategy
Strategy Consolidate our leadership position in Social Housing Expand range of services offered Continue to build management team
Slide 17: 2003 summary
2003 summary • Record profits ,EPS and margin • £550 million order book • Pipeline of £500 million
Slide 18: Appendix
LEADERS IN SOCIAL HOUSING MEARS) hei Stik UL Appendix
Slide 19: Balance Sheet
Balance Sheet 2003 2002 Fixed assets: intangible 12,273 5,433 tangible 3,093 1,641 investments 107 99 15,473 7,173 Stocks 2,487 1,266 Debtors 24,875 15,920 Cash 3,408 5,566 Current liabilities (28,600) (18,129) Working capital 2,170 4,623 Long term provisions (5,351) (2,260) Net Assets 12,292 9,536
Slide 20: Balance Sheet key movements
Balance Sheet key movements £m Acquisitions-goodwill 7.3 tangible assets 1.3 working capital (3.1) deferred considerations (3.5) 2.0 Impact of 30.9% organic growth 4.0 Debtor ,creditor efficiency gains (3.8) Other 0.6 Increase in net assets 2.8
Slide 21: Operating Cash Flow
Operating Cash Flow 2003 2002 Operating profit 4,727 3,512 Depreciation & amortisation 1,159 616 Stocks / WIP (1,069) (29) Debtors (3,461) 575 Creditors 3,335 69 Operating cash flow 4,691 4,743 80% of EBITDA converted into operating cash flow 99% of operating profit converted into cash
Slide 22: Cash flow
Cash flow 2003 2002 Opening funds 5,566 2,613 Operating cash flow 4,691 4,743 Interest 81 83 Tax (1,543) (538) Capital expenditure (826) (750) Acquisitions (5,388) (358) Dividends (623) (479) Financing (57) 252 Net movement (3,665) 2,953 Closing Funds 1,901 5,566
Slide 23: Profit pre goodwill - half year split
Profit pre goodwill - half year split 3000 2500 2000 £'000 1500 1000 500 2001 H1 2001 H2 2002 H1 2002 H2 2003 H1 2003 H2
Slide 24: EPS pre goodwill - half year split
Pence EPS pre goodwill - half year split 4.00 3.50 3.00 2.50 2.00 1.50 1.00 0.50 0.00 2001 H1 2001 H2 2002 H1 2002 H2 2003 H1 2003 H2
Slide 25: Shareholders
Shareholders • Board and employees 20.0% • Unicorn 12.5% • Newton 7.2% • Fidelity 4.3% • Close 4.1% • Rathbone 4.1% • Gartmore 4.1% • Standard Life 3.6% • Glasgow Inv.Mgrs 3.2%