Slide 1: FY23 Investor Presentation
ASX Announcement 23 August 2023 FY23 Investor Presentation Attached for release is Reece Limited’s investor presentation for the 12 month period ended 30 June 2023. For further information contact: Siobhan Weaver Investor Relations E: siobhan.weaver@reece.com.au T: 0477 480 813 This announcement has
Slide 2: Full Year Results 2023
Full Year Results 2023 12 months ended 30 June 2023 1. FY23 Result
Slide 3: Disclaimer
Disclaimer The material in this presentation has been prepared by Reece Limited (ABN 49 004 313 133) (“Reece") (ASX:REH) and is general background information about Reece's activities current as at the date of this presentation. The information is given in summary form and does not purport to be com
Slide 4: Presenters
Presenters Peter Wilson Andrew Cowlishaw Group CEO and Group CFO Deputy Chair 3. FY23 Result
Slide 5: What we’ll share today
What we’ll share today 01 02 03 FY23 overview Strategy recap Operational review 04 05 06 Financial review Outlook Summary 4. FY23 Result
Slide 6: FY23 Overview
01 FY23 Overview 5. FY23 Result
Slide 7: Financial overview
Reece Group – Half Year Results 2023 Financial overview Strong year in softening macro environment Sales Normalised Adjusted Adjusted Adjusted Revenue EBITDA1 EBIT NPAT EPS up 16% up 16% up 19% up 11% up 11% to $8.8b to $975m to $668m to $405m to 63 cents ANZ US* Net leverage ratio2 FY23 total divid
Slide 8: Strategy Recap
02 Strategy Recap 7. FY23 Result
Slide 9: Our Blueprint
Our Blueprint Inspired Live the Embrace Execute Deliver by our Reece our 2030 Strategic Customer Purpose Way Vision Priorities Promise Our purpose and We will be our Operational Customised To improve the lives service of our customers values guide our trade’s most Excellence and our people by decisi
Slide 10: Strategy positions Reece for long term success
Strategy positions Reece for long term success Diversified business A trusted brand Clear track record 1 with a differentiated customer proposition 2 Long term experience managing the cycle 3 by geography, segment, customer; focused on resilient R+R Large markets Long term focus Well capitalised 4 w
Slide 11: Building a sustainable business
Building a sustainable business Announced emissions reduction Sustainability Strategy targets October 2022: 1. Sustainable 2. Empowered 3. Resilient Business Trade Communities 35% Reduction from FY21 baseline by FY30 Good early progress executing strategy in FY23 Net zero • • Began executing roadmap
Slide 12: Operational Review
03 Operational Review 11. FY23 Result
Slide 13: Strong operational execution across Group in FY23
Strong operational execution across Group in FY23 Operational Accelerating Investing for Excellence Innovation Profitable Growth • Ongoing focus on being brilliant at the • Progressing innovation initiatives; focus on • US store rollout and Reece rebrand 2030 fundamentals, continuous trade of the fu
Slide 14: ANZ network of scale
ANZ network 11 of scale 655 Branches 123 51 185 45 186 Market leader, leveraging 39 network density to deliver 15 customer promise 13. FY23 Result
Slide 15: Building scale in the US
Building scale in the US 231 Branches Network +27 branches 15 organic roll-out Network upgrade and Reece rebrand progressing at pace 14. FY23 Result
Slide 16: Five years in the US
Five years in the US 80% ~30% USD sales revenue growth* team growth 3.1x 5 2030 EBIT growth** bolt-on acquisitions Our Trade’s ~35% most valuable branch network growth commenced brand roll-out partner ~125% senior branch team growth launched *Revenue growth calculated from FY19 (first year post-acqu
Slide 17: Financial Review
04 Financial Review 16. FY23 Result
Slide 18: Group performance
Group performance Group Adjusted EBIT & Sales Group ROCE 700 5,000 16.0% 9,000 600 4,500 14.0% 8,000 4,000 7,000 12.0% Sales revenue ($m) 500 Shareholders equity 3,500 Adjusted EBIT ($m) plus net debt ($m) 6,000 10.0% ROCE (%) 400 3,000 5,000 2,500 8.0% 300 4,000 2,000 6.0% 3,000 1,500 200 4.0% 2,00
Slide 19: Financial highlights
Financial highlights Sales Normalised Adjusted Adjusted Adjusted Revenue* EBITDA1 EBIT NPAT EPS up 16% up 16% up 19% up 11% up 11% to $8.8b to $975m to $668m to $405m to 63 cents From $7.7b From $838m From $562m From $363m Final dividend Total dividend Normalised Net leverage ratio2 EBITDA1 margin 1
Slide 20: ANZ performance
ANZ performance • Sales up 10% FY23 • FY23 estimated average product 30 June 2023 1HY 2HY FY23 FY22 Var. % inflation 9%, moderating progressively (AU$m) (H2: 7%) • H2 volumes up 1% on pcp Sales revenue 1,928 1,925 3,853 3,518 10% • Normalised EBITDA1 margin compressed Normalised EBITDA1 293 280 57
Slide 21: US performance
US USD performance FY23 30 June 2023 (US$m) 1HY 2HY FY23 FY22 Var. % • Sales up 12% on USD basis Sales revenue 1,678 1,664 3,342 2,986 12% • FY23 estimated average product Normalised EBITDA1 136 133 269 226 19% inflation 14%, moderating progressively (H2: 6.6%) Normalised EBITDA1 margin 8.1% 8.0% 8.
Slide 22: Cashflow
Cashflow FY23 - 30 June 2023 (A$m) Normalised EBITDA1 FY23 975 FY22 838 Net movements in working capital (incl. FX) 70 (412) • Improved operating cash flows Non-cash items in normalised EBITDA1 8 4 • Net working capital Income tax paid (200) (144) • Normalised inventory levels while maintaining Net
Slide 23: Disciplined approach to capital management
Disciplined approach FY23 30 June 2023 (A$m) FY23 FY22 to capital management Cash 373 220 Trade and other receivables 1,338 1,368 Inventories 1,505 1,528 • Investment in organic growth Other current assets 3 7 • Bolt-on M&A Total current assets 3,219 3,123 PPE and leases 1,586 1,493 • Balance sheet
Slide 24: Outlook
05 Outlook 23. FY23 Result
Slide 25: Environment to continue softening in FY24
Environment to continue softening in FY24 Opportunity to re-focus after extraordinary 3-year period of growth • Expect inflation to continue to moderate • Uncertain demand environment; our assumption is volumes will continue to decline • Demand trend across customer base not yet clear • Long term fu
Slide 26: Summary
06 Summary 25. FY23 Result
Slide 27: Summary
Summary Strong Long-term Investing for Softening Result Focus the Future environment 26. FY23 Result
Slide 28: Reece Group
reece group"
Slide 29: Appendix & supplementary information
Appendix & supplementary information 28. FY23 Result
Slide 30: Key metrics
Key metrics Reconciliation from Statutory EBIT to Adjusted EBIT Reconciliation from Statutory NPAT to Adjusted NPAT FY23 - 30 June 2023 (A$m) FY23 FY22 Var. % FY23 - 30 June 2023 (A$m) FY23 FY22 Var. % NPAT (statutory) 388 392 (1%) EBIT (statutory) 654 578 13% Add back (tax effected): Add back: US i
Slide 31: Group definitions
Group definitions EBITDA adjusted to exclude impairment, business acquisition costs and finance costs 1 Normalised EBITDA (as reported in note 2.1 of the Annual Report) 2 Net leverage ratio Net borrowings over 12-month rolling EBITDA, calculated on a pre-AASB16 Leases basis 3 BAC income Income from
Slide 32: FX impact on sales
FX impact on sales 31. FY23 Result