Slide 1: Results for full year ended 31 March 2018
CARCLO PLC Results for full year ended 31 March 2018 Presentation to Analysts 5 June 2018
Slide 2: Carclo is a leading global manufacturer of fine tolerance parts
Carclo is a leading global manufacturer of fine tolerance parts for the Medical, Industrial, Aerospace and Luxury and Supercar Lighting markets Global contract manufacturer to medical market Leading designer and manufacturer of luxury and supercar LED Lighting Leading supplier of aviation control ca
Slide 3: FY2018 Highlights
FY2018 Highlights Group revenue increased by 5.7% to £146.2 million (2017 - £138.3 million), driven mainly by sales growth within Wipac Underlying* operating profit decreased by 13.5% to £10.8 million with underlying operating margin decreasing 160 bps to 7.4% Underlying* profit before tax dec
Slide 4: Strategic KPIs
Strategic KPIs Revenue growth 2018 £146.2m Year on year revenue growth is a strong indicator of 2017 £138.3m success in delivering the Group’s strategy – up 5.7% 2016 £119.0m on the prior year Underlying operating margin 2018 7.4% Margin weakened 160 bps to 7.4% in 2018 2017 9.0% 2016 8.4% 4
Slide 5: Strategic KPIs - Return on Capital Employed
Strategic KPIs 19.8% Return on Capital Employed 17.0% Our criteria for all major capital investment continues to require that investments enhance our ROCE performance in 14.2% the medium term The reduction in 2018 mainly reflects the weak operating performance during the year but also reflects t
Slide 6: CTP and LED divisions performance
CTP and LED divisions performance CTP & LED Revenue £m CTP & LED Underlying operating profit £m 140.2 H2 131.2 14.6 H2 H1 13.1 110.9 98.3 11.6 70.9 71.4 9.8 8.2 6.5 58.3 54.0 6.3 5.9 59.8 69.3 6.6 52.6 5.3 6.4 44.3 3.9 14/15 15/16 16/17 17/18 14/15 15/16 16/17 17/18 Technical Plastics revenue show
Slide 7: Financial Highlights
Financial Highlights Year ended Year ended 31 March 2018 31 March 2017 £000 £000 Revenue Technical Plastics 89,653 87,814 LED Technologies 50,589 43,419 Aerospace 5,972 7,049 CIT Technology Nil Nil Total 146,214 138,282 Underlying operating profit* 10,811 12,498 Exceptional items (904) (541) Operati
Slide 8: Technical Plastics
Technical Plastics 100 10 80 8 Revenue increase +2.1% 60 6 Revenue £m Profit* £m 40 4 Underlying operating profit decrease -23.4% 20 2 0 0 Sales Mar 15 Mar 16 Mar 17 Mar-18 Profit * Revenue growth continued, but just below expectation due to delays in new program placements Profit reduced agains
Slide 9: LED Technologies
LED Technologies 60 7 50 6 5 Revenue increase +16.5% 40 Revenue £m 30 4 Profit* £m 3 Underlying operating profit increase +9.1% 20 2 10 1 Sales 0 0 Mar 15 Mar 16 Mar 17 Mar-18 Profit * Strong growth in revenues and an increase in profit over prior year Delays in placement of new projects resulte
Slide 10: Aerospace
Aerospace 8 2.0 7 6 1.5 Revenue decrease -15.3% 5 Revenue £m4 1.0 Profit* £m 3 Underlying operating profit decrease -42.7% 2 0.5 1 Sales 0 0.0 Mar 15 Mar 16 Mar 17 Mar-18 Profit * Revenues reduced due to weaker demand for our product range and the completion of a multi year contract for the supply
Slide 11: Income Statement Comparative
Income Statement Comparative Revenue 31-Mar-18 146.2 31-Mar-17 138.3 Revenue increased by 5.7% to £146.2 million Operating profit Divisional underlying operating profit 13.8 15.9 Underlying divisional Central costs (3.0) (3.4) operating profit decreased Underlying operating profit 10.8 12.5 12.9
Slide 12: Financial Position – Cash Flow
Financial Position – Cash Flow £million £million Strong underlying cash generation from Net debt at start of period (26.0) operations of £15.2 million Underlying cash from operations 15.2 Working capital increase of £7.5 million Working capital (7.5) Interest and tax (2.6) due to increase in des
Slide 13: Financial Position – Debt & Facilities
Financial Position – Debt & Facilities Net Debt Net debt of £31.5m at 31 March 2018 (£26m at 31 March 2017) Reflected investment in Wipac design contracts and capital expenditure for new programs at CTP and Wipac Year end net debt to EBITDA ratio was 1.99x (2017 – 1.52x) Bank Facilities £30.
Slide 14: Financial Position – Pensions
Financial Position – Pensions Scheme assets have decreased by £6.9 million and scheme liabilities have decreased by £9.6 million IAS19 financing expense of £0.8 million and scheme administration costs of £0.7 million reflected in the income statement 2018 2017 Defined benefit obligation at the e
Slide 15: Financial Position – Pensions (cash)
Financial Position – Pensions (cash) £1.9 million cash cost of the Pension Scheme includes Scheme administration costs of £0.7 million and a £1.2 million annual recovery plan payment Recovery plan provides that the Group will aim to eliminate the funding deficit over a period of 14 years and 8 m
Slide 16: Financial Position – Dividends
Financial Position – Dividends The board is not recommending the payment of a dividend The Board recognises the need to reward shareholders and for them to participate in the growing profitability of the business. Accordingly it intends to recommence dividend payments when it becomes confident t
Slide 17: Markets & Strategy Actions
Technical Plastics LED Technologies Aerospace Markets & Strategy Actions 17
Slide 18: COMP Action Plan
COMP Action Plan COMP – “Cash Initiative”, “Operational Excellence”, “Management” & “Pricing” Began from investigation into CTP Czech performance issues from September 2017 and implemented across the rest of the CTP Division from January 2018 (with certain elements across the Group). COMP focussed
Slide 19: Technical Plastics
Technical Plastics Mar-18 Mar-17 £m £m Revenue 89.7 87.8 Profit* 6.7 8.7 Margin 7.4% 9.9% Revenue grew by 2.1% despite delays in the placement of new tooling and validation programs Compound annual growth in revenues over last five years of 11.5% has put strain on several of the operations Ope
Slide 20: LED
LED Mar-18 Mar-17 £m £m Revenue 50.6 43.4 Profit* 6.4 5.9 Margin 12.7% 13.6% Revenue growth reflected a combination of new design, development and tooling wins secured during the financial year and prior years. Further design wins were delayed which contributed to revenue and profit being lower th
Slide 21: Aerospace
Aerospace Mar-18 Mar-17 £m £m Revenue 6.0 7.0 Profit* 0.7 1.3 Margin 12.5% 18.5% Revenue and profit declined following the completion of a multi-year large project during the prior year and slower demand for the traditional control cable products Product diversification from control cables into
Slide 22: Group Strategy
Group Strategy Creation of sustainable growth in revenues and operating profits through the development of innovative and highly efficient solutions for existing and new customers to ensure that they see real benefits accruing from working in partnership with us Improve operating margin through
Slide 23: Outlook
Outlook We expect the actions that we have taken through our COMP initiative to positively impact the current year and subsequent years The remodelling of the CTP footprint is now largely complete and this will allow the Division to focus on high quality business development and operational impr
Slide 24: Appendix 1 - Tax
Appendix 1 - Tax One-off effect of introduction of lower tax rates in the US lead to a £2 million reduction in the value of deferred tax liabilities Effective tax charge higher than current UK corporation tax rate because a large proportion of the Group’s profits are generated in countries where
Slide 25: Appendix 2 – Exceptional
Appendix 2 – Exceptional Rationalisation costs in the year related to redundancies (mainly in the US), costs incurred at the remaining CTP property at Harthill and group reorganization costs Compensation for loss of office relates to Robert Brooksbank 2018 2017 Rationalisation costs £556k £233k
Slide 26: End
Forward looking statements - Certain statements made in this presentation are forward looking statements. Such statements are based on current expectations and are subject to a number of risks and uncertainties that could cause actual events to differ materially from any expected future events or re