Slide 1: A.P. Eagers Broker Presentation
For personal use only A.P. Eagers Broker Presentation Thursday 10 March 2011 © 2011 AP Eagers Limited. All Rights Reserved. Wednesday, 9 March 2011
Slide 2: A.P. Eagers / Adtrans Post Merger
A.P. Eagers / Adtrans Post Merger For personal use only • 98 year old automotive retail group founded in 1913 • 53 years as a listed public company – dividend paid every year • Post acquisition A.P. Eagers will own more than 70 acres of prime real estate with land and buildings of $321m • Represents
Slide 3: Represents 10 of the top 10 selling vehicle brands in Australia
A.P. Eagers / Adtrans Post Merger For personal use only Represents 10 of the top 10 selling vehicle brands in Australia © 2011 AP Eagers Limited. All Rights Reserved. Wednesday, 9 March 2011
Slide 4: Representing 31 vehicle brands in total
A.P. Eagers / Adtrans Post Merger For personal use only As well as 21 others, representing 31 vehicle brands in total © 2011 AP Eagers Limited. All Rights Reserved. Wednesday, 9 March 2011
Slide 5: Representing truck and bus brands
A.P. Eagers / Adtrans Post Merger For personal use only Representing 12 truck and bus brands © 2011 AP Eagers Limited. All Rights Reserved. Wednesday, 9 March 2011
Slide 6: Combined ADG and APE annual operating metrics
A.P. Eagers / Adtrans Post Merger For personal use only ADG APE Combined Annually: Annually: Annually: Total Cars Sold 16,000 49,000 65,000 New Cars Sold 6,500 32,000 38,500 Used Cars Sold 7,500 17,000 24,500 New / Used Trucks 2,200 0 2,200 Retail Finance Contracts $126m $300m $426m Vehicle Servicin
Slide 7: Operational Highlights for 2010
Operational Highlights for 2010 For personal use only Substantial earnings accretive growth utilising only limited new equity (6% of capital). • Caloundra City Auto – Qld April 2010 • Adtrans Group – SA (Cars), Vic & NSW (Trucks) October 2010 • Sydney Truck Centre NSW (Western Star/MAN) October 2010
Slide 8: AP Eagers / Adtrans Post Merger geographic split
AP Eagers / Adtrans Post Merger For personal use only AP Eagers $1.7 billion Adtrans $0.7 billion Eblens (SA) $0.05billion AP Eagers AP Eagers $0.15 BN (6%) Total $2.45 billion $1.10 BN (45%) $0.0 BN 1.0% 20.1% 11.3% Adtrans/Eblens $0.48 BN (19%) AP Eagers $0.45 BN 6.4% Adtrans $0.12 BN (24%) 30.6%
Slide 9: Profitability and New Vehicle Stock Availability
Profitability and New Vehicle Stock Availability For personal use only 2007 2008 2009 2010 2011 Jan – June (1st Half) V. Good & Stable Recovering Solid, still Stimulus Forecast, Industry Profitability Increasing driven Solid Jan – June (1st Half) Lots, but Lots and increasing, Decreasing fast, Corre
Slide 10: Retail Markets
Retail Markets For personal use only •New car market volume effects • Hail damage in Victoria and W.A – early 2010 • Increased vehicle inventory and over-supply in some areas. • Heavy trucks sector experienced only a very modest recovery. • Queensland economy lagging • Business confidence below othe
Slide 11: Financial Highlights (Full Year 2010 vs 2009)
Financial Highlights (Full Year 2010 vs 2009) For personal use only 1. Solid margins, in a more cautious retail market » NPBT/Sales 2.6% vs 3.0%. » EBITDA/Sales 4.0% vs 4.6%. but compare well with history and industry. 2. Substantial earnings accretive growth achieved with limited new equity issued
Slide 12: Group Financial Results
Group Financial Results Underlying Trading Performance For personal use only Margins reduced from record Underlying Trading Performance levels due to a return to a FY 2010 Change more normal level of vehicle $m inventory, a generally more Revenue 1,811 +9% cautious retail customer EBITDA 74.5 -2% en
Slide 13: Ongoing margin improvement trend
Ongoing margin improvement trend - albeit below record 2009 levels. For personal use only © 2011 AP Eagers Limited. All Rights Reserved. Wednesday, 9 March 2011
Slide 14: Financial Trends
Financial Trends For personal use only © 2011 AP Eagers Limited. All Rights Reserved. Wednesday, 9 March 2011
Slide 15: Financial Trends
Financial Trends For personal use only © 2011 AP Eagers Limited. All Rights Reserved. Wednesday, 9 March 2011
Slide 16: Group Balance Sheet - Summary
Group Balance Sheet - Summary For personal use only • Acquisitions of Caloundra FY10 Change Change $m ($m) City Auto, Adtrans and Sydney Truck Centre. CA-CL (excl. held 71.9 18.9 +37% • Takeover of Adtrans for sale) eliminated the previous Investments 2.7 (24.2) -90% equity accounted PP&E (incl. hel
Slide 17: Borrowings
Borrowings For personal use only • Cash and debt used Dec 10 Dec 09 for earning accretive $m $m acquisitions. Cash 0.2 18.9 • Inventories have Current - Bailment & O’draft 243.6 170.9 adjusted to more normal levels. N/Current (Bank Debt) 166.3 115.2 Total Borrowing 409.9 286.1 • Adtrans $74.5m of ca
Slide 18: Group Cash Flow - Summary
Group Cash Flow - Summary For personal use only FY2010 FY2009 • Higher tax payments $m $m ($13.5m) due to 2009 Cash from operations 31.1 65.2 profitability. PP&E Acq./Disp (1.3) 11.8 • Growth investments of Business Acq./Disp. (43.6) (0.2) $43.6 m. Net proceeds from 25.0 (40.6) borrowings Repayment
Slide 19: Franchise Automotive Retail Segment
Franchise Automotive Retail Segment For personal use only FY2010 FY2009 • Whole of Adtrans included in $m $m Franchise Auto segment. Revenue 1761.5 1,606.6 • Margin/Return lower due to more cautious trading Profit before tax 40.7 48.4 environment and higher interest costs. Total Assets 596.3 404.2 •
Slide 20: Property Segment
Property Segment For personal use only FY2010 FY2009 • Lower property related debt and $m $m interest costs. Rental Income 28.2 29.4 • Adtrans property assets included in Auto Franchise segment in Profit before tax 10.5 9.8 2010. Revaluation (6.1) (8.5) • Property valuation problematic surplus/(defi
Slide 21: Adtrans
Adtrans For personal use only • Heavy duty truck industry remains subdued. • Acquired Western Star, Man, Foton and Dennis Eagle (Nov 2010) • Other truck opportunities pending • Eblens added to Adtrans SA car division (March 2011) • Integration benefits to flow through during 2011 and 2012. © 2011 AP
Slide 22: National Heavy Commercial Sales 2002 to 2010
National Heavy Commercial Sales ‐ 2002 to 2010 (15,001 kgs GVM and over) For personal use only © 2011 AP Eagers Limited. All Rights Reserved. Wednesday, 9 March 2011
Slide 23: Adtrans 2011 EPS
Adtrans 2011 EPS For personal use only • 27% of ADG’s PAT results were already in APE results due to equity accounting • 73% of ADG is therefore additional earnings • Acquisition funding via approximately $50m (cash and debt) and $22m in AP Eagers shares (equity) • Forecast EPS accretion of 8 cents
Slide 24: AP Eagers in 2011 and Beyond
AP Eagers in 2011 and Beyond For personal use only IH 2011 •Priority, secure value from 2010 acquisitions •Maintain and improve core dealership results 2H 2011 and Beyond •No shortage of growth opportunities •Evaluation and decisions critical to maximise EPS © 2011 AP Eagers Limited. All Rights Rese