Marshalls Plc · LSE:MSLH
Marshalls — FY2009 Earnings Presentation
25 slides from Marshalls's earnings presentation, 2010
Slide 1: Transforming Britain’s Landscapes
Transforming Britain’s Landscapes Transforming Britain’s Landscapes
Slide 2: Highlights
Highlights Transforming Britain’s Landscapes 2009 2008 Results before works closure costs, goodwill and intangible asset impairments and redemption of debenture: Revenue £311.7m £378.1m Operating profit £16.4m £30.6m Profit before tax £12.1m £22.5m Basic EPS * 5.38p 10.38p Dividends declared and pai
Slide 3: Revenue
Revenue Transforming Britain’s Landscapes £m 402.9 378.1 311.7 Revenue (17.6)% Revenue Movement 2007 2008 2009 Revenue £m 2008 378.1 Working days: 3 fewer in 2009 (4.7) 373.4 Merchant de-stocking (estimated) (2.4) Like for like (60.2) (16.1)% Acquisitions 0.9 2009 311.7 3
Slide 4: Revenue Analysis
Revenue Analysis Transforming Britain’s Landscapes Public Sector and Commercial Revenue z 58% of Group z Like for like revenue down 18% z Price and mix up 4%, volume down 22% Domestic Revenue z 42% of Group z Like for like revenue down 13% z Price and mix up 3%, volume down 16% Phasing z H1 volume d
Slide 5: Operating Profit
Operating Profit Transforming Britain’s Landscapes 2009 2008 £m £m EBITDA* 36.1 52.9 Depreciation / amortisation (19.7) (22.3) Operating profit* 16.4 30.6 Works closure costs (7.2) (17.7) Goodwill and intangible asset impairments - (9.3) Operating profit: reported 9.2 3.6 * before works closure cost
Slide 6: Closures
Closures Transforming Britain’s Landscapes 2009 2008 Total £m £m £m Non-cash items 2.8 6.8 9.6 Cash items 4.4 10.9 15.3 Income Statement charge 7.2 17.7 24.9 Cash outflows £m z 2008 actual 6.0 z 2009 actual 6.9 z 2010 onwards 2.4 15.3 Benefits z 2008:£1.5m reduction in costs; £6m cash released from
Slide 7: Underlying Margin Reconciliation
Underlying Margin Reconciliation Transforming Britain’s Landscapes Movement in Impact on Revenue Operating Margin Profit* £m £m % 2008 * 378.1 30.6 8.1 Workings days: 3 fewer in 2009 (4.7) (1.4) (0.3) 373.4 29.2 7.8 Sales volume (inc. merchant de-stocking) (73.9) (23.7) (6.0) Cost increases recovere
Slide 8: Additional Information and Ratios
Additional Information and Ratios Transforming Britain’s Landscapes 2009 2008 Financial expenses: Interest (£’m) (4.2) (8.2) Notional interest on pensions (£’m) (0.1) - Debenture redemption (£’m) (7.3) - Tax rate: 20.1% 27.8% EPS: Adjusted * 5.38p 10.38p Reported (0.42)p (3.98)p Weighted average num
Slide 9: Free Cash Flow
Free Cash Flow Transforming Britain’s Landscapes Cash inflow arising from: 2009 2008 £m £m Operating profit * 16.4 30.6 Depreciation and amortisation 19.7 22.3 EBITDA * 36.1 52.9 Net financial expenses paid (4.2) (7.8) Taxation 2.9 (4.7) Pensions (contributions paid / other items) (2.1) (6.6) Invent
Slide 10: Cash Flow
Cash Flow Transforming Britain’s Landscapes 2009 2008 £m £m Free cash flow 35.3 28.2 Investment: z Capital expenditure (9.2) (22.0) z Acquisitions (0.7) (6.1) z Sale proceeds 2.4 11.5 Works closure costs (6.9) (6.0) Payment to acquire own shares - (0.6) Dividends paid (5.5) (19.4) 15.4 (14.4) Rights
Slide 11: Significant Borrowing Facilities
Significant Borrowing Facilities Transforming Britain’s Landscapes £m 220 200 Expiry Date Facility Cumulative 180 Facility 160 £m £m 140 Committed facilities: 120 Q1 2013 50 50 100 Q4 2012 25 75 80 Q3 2011 48 123 60 Q4 2010 20 143 40 20 On demand facilities: 0 Available all year 25 168 2009 2010 * S
Slide 12: Financial Flexibility
Financial Flexibility Transforming Britain’s Landscapes 2009 Headroom Actual EBITA: Interest charge 4.1 times approx 50% Net Debt: EBITDA 2.0 times approx 50% z EBITA to interest charge must be greater than 2.5x z Net debt to EBITDA must be less than 3x z Net assets must be greater than £100 million
Slide 13: Pensions
Pensions Transforming Britain’s Landscapes Risk Management YE 20 2008 2000 closed to new members 2006 closed to future service accrual 10 2007 investment strategy 0 Investment Strategy -10 Moved from equities to LDIs H1 2008 Closer matching to liability profile of -20 YE pension scheme 2007 -30 H1 B
Slide 14: Actions Taken: Financial Position
Actions Taken Transforming Britain’s Landscapes Financial Position z £34.0 million of equity raised z Debenture redeemed reducing interest by £1.7m per annum z Net cash of £15.4 million generated z Net debt reduced to £69.2 million (2008: £111.3 million) z Facilities £168.4 million at year end 14
Slide 15: Actions Taken: Operations
Actions Taken Transforming Britain’s Landscapes Operations z Annual operating cost reduction of £11.4 million z Retained medium term manufacturing and logistics capability and built in flexibility z Full geographic coverage z Now focussed on optimisation of “lowest cost to market” model 15
Slide 16: Marshalls Defining Strengths
Marshalls Defining Strengths Transforming Britain’s Landscapes Market leaders - strong positions in core markets Well known brand National manufacturing and distribution network Efficient, well invested, latest technology Industry leading customer service and “lowest cost to market” Continuing innov
Slide 17: Public Sector and Commercial
Public Sector and Commercial Transforming Britain’s Landscapes z 58% of Group revenue (2008: 59%) z Public: education, health and public realm positive z Industrial and commercial: weaker z CPA forecast: -3.0% in 2010 z Olympics gathering momentum z Experienced sales and marketing teams focussed on
Slide 18: ABI Lead Indicator
ABI Lead Indicator Transforming Britain’s Landscapes January 2010 330 275 220 £millions 165 110 55 0 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 18
Slide 19: Domestic
Domestic Transforming Britain’s Landscapes z 42% of Group revenue (2008: 41%) z Consumer confidence improving from low base z Target customer group: 8.9 million existing homes “Don’t move, improve”. Generally older, equity in property and savings z CPA forecasts: 2% reduction in Private Housing Repa
Slide 20: Macroeconomic Outlook
Macroeconomic Outlook Transforming Britain’s Landscapes Quarterly GDP and Construction Output 1975 - 2009 400,000 40,000 Construction output : £million 350,000 35,000 GDP : £million 300,000 30,000 250,000 25,000 200,000 20,000 150,000 15,000 100,000 10,000 50,000 5,000 0 0 1975 1977 1979 1981 1983 1
Slide 21: Legislative and Lifestyle Developments
Legislative and Lifestyle Transforming Britain’s Landscapes Developments z Carbon reduction z Water run off and flooding z Machine lay z Ethical sourcing z Ageing population & outdoor living 21
Slide 22: Historical Perspective
Historical Perspective Transforming Britain’s Landscapes Operating Capital Revenue Profit Margin Expenditure £000 £000 % £000 1990 181,447 28,630 15.8 36,143 1991 184,370 18,697 10.1 11,959 1992 174,355 17,317 9.9 3,786 1993 169,492 12,437 7.3 5,712 1994 191,495 21,683 11.3 20,384 1995 229,496 31,19
Slide 23: Summary
Summary Transforming Britain’s Landscapes Financial flexibility - balance sheet robust and borrowings reducing Decisive action taken to reduce cost and conserve cash, operating flexibility established Public Sector and Commercial end market – challenging but comparatives easing Domestic end market s
Slide 24: Disclaimer
Disclaimer Transforming Britain’s Landscapes • This presentation, which is personal to the recipient and has been issued by Marshalls plc (“Marshalls”), comprises slides for a presentation in relation to Marshalls preliminary results, and is solely for use at such presentation. • This presentation a
Slide 25: Transforming Britain’s Landscapes
Transforming Britain’s Landscapes