Inchcape Plc · LSE:INCH
Inchcape — Investor Presentation (November 2020)
12 slides from Inchcape's investor presentation, November 2020
Slide 1: Investor presentation
Investor presentation November 2020
Slide 2: Inchcape: Group overview
Inchcape: Group overview Who we are 2019 financial highlights • Largest independent global automotive distributor and retailer £9.4bn £326m o Distribution accounts for >90% of Group profits Revenue PBT1 • Long-term relationships with strong OEM brands • Operating in 34 markets; focused on high-growt
Slide 3: Inchcape: key characteristics
Inchcape: key characteristics Global presence: 34 markets, with an EM focus Distribution driven business Key: Distribution Retail Sales and operating profit (2019) APAC UK & Europe OP Australia Belgium 7% Hong Kong Greece Singapore Romania, Bulgaria Distribution Sales Brunei, Guam, Saipan Baltics UK
Slide 4: Distribution business model
Distribution business model Higher gross Greater Significant High barriers Capital-light Attractive and operating flexibility of value-add to entry model cash returns margins overheads National Network 6 Aftersales and marketing management servicing 4 Brand 8 positioning 2 Parts distribution 5 7 1 3
Slide 5: Retail business model
Retail business model Higher gross Greater Significant High barriers Capital-light Attractive and operating flexibility of value-add to entry model cash returns margins overheads 6 Aftersales and servicing 8 7 New & Used vehicle sales 9 Finance & Insurance Investor presentation: November 2020 5
Slide 6: A highly cash-generative business
A highly cash-generative business Disciplined capital allocation Past five years: Strong cash- conversion • Dividends: £450m • Acquisitions: £600m • FCF = 60-70% of • Buybacks: £330m Overheads operating profit leverage • Capex <1% of sales • Streamlined regional M&A structure opportunities • 14 dist
Slide 7: Delivering a resilient through-cycle performance
Delivering a resilient through-cycle performance Revenue (£bn) Operating Profit (£m) % margin IFRS 16 10.0% 400 9.3 9.4 8.0% 9.0 300 7.8 4.4% 4.6% 4.5% 4.2% 4.3% 4.0% 6.0% 3.8% 3.8% 200 3.1% 6.3 4.0% 6.1 5.9 5.6 100 2.0% // 0 // 0.0% 07 08 09 10 16 17 18 19 07 08 09 10 16 17 18 18 19 • 4% revenue CA
Slide 8: Quarterly trend: encouraging bounce-back
Quarterly trend: encouraging bounce-back Organic revenue growth (yoy%) 1Q20 2Q20 3Q20 5% (6)% (5)% (21)% (10)% (6)% (48)% Group (54)% Distribution Retail (51)% • Apr (76)% • May (59)% • Jun (18)% Investor presentation: November 2020 8
Slide 9: 3Q20 performance highlights
3Q20 performance highlights Topline Gross Overheads Financial outperformance margin YoY restructure position continuing stable on-track strengthened Organic growth: (10)% Quarter-on-quarter improvement Targeting >£90m savings vs ’19 Working capital well-managed TIV1: (16)% Stable despite geo-mix hea
Slide 10: Prepared for the future
Prepared for the future Near-term Strategic focus • Improved performance in lockdowns • Further building our OEM relationships o Aftersales continuing o Online selling (click and collect) • Continuing to outperform market volumes • Continued strong financial position • Targeting M&A opportunities •
Slide 11: Capital allocation: maintaining our discipline
Capital allocation: maintaining our discipline 1 2 Invest in the business Dividends Capex for organic growth and To be resumed when appropriate technological investment Policy: 40% annual payout of basic EPS Retain focus on portfolio optimisation (pre exceptionals) Strong balance sheet 4 3 Net debt
Slide 12: Investment proposition: growth and cash returns
Investment proposition: growth and cash returns Distribution at our core: A highly cash generative and sustainable business model Strong and increasing weighting to higher growth markets supports our diversification Ignite strategy driving organic performance ahead of market growth Continued consoli