Trellidor Holdings Ltd. · JSE:TRL
Trellidor — H1 2021 Earnings Presentation
32 slides from Trellidor's earnings presentation, March 2021
Slide 1: Trellidor Holdings Limited Interim Results for the Period Ending 31 December 2020
TRELLIDOR HOLDINGS LIMITED INTERIM RESULTS FOR THE PERIOD ENDING 31 DECEMBER 2020
Slide 2: Strategic Objectives for 2021
STRATEGIC OBJECTIVES FOR 2021 The Group prioritised its key strategies for F21 as follows: Cash preservation and generation Focus on improving operational efficiencies and active cost management within the Group TERRY DENNISON GROUP CEO Enhancement of route to market in South Africa and abroad to fa
Slide 3: Strategic Objectives Update: Cash and Efficiencies
STRATEGIC OBJECTIVES UPDATE Cash preservation and generation: Cash generation has been excellent Cash from operation is up 50% to R48m from R32m in prior period TERRY DENNISON GROUP CEO Particularly pleasing is the 89.1% improvement in Taylor’s cash generation Focus on improving operational efficien
Slide 4: Strategic Objectives Update: Route to Market
STRATEGIC OBJECTIVES UPDATE Enhancement of route to market in South Africa and abroad to facilitate growth The Durban and Johannesburg West branches are now fully integrated, and the results have been excellent TERRY DENNISON GROUP CEO Comparative sales through the Trellidor branches have increased
Slide 5: Strategic Objectives Update: New Products and Buy-back
STRATEGIC OBJECTIVES UPDATE Introduction of new products both locally and abroad 4 new products and will be launched through H2 F21 to meet changing customer needs, and improve market penetration in certain sectors, primarily being gated estates TERRY DENNISON GROUP CEO Continue with the share-buy b
Slide 6: Prospects
PROSPECTS Sales in January and February are in line with prior year. Assuming the economy remains open and consumer confidence is sustained we anticipate sales to significantly exceed TERRY DENNISON prior year by year-end. GROUP CEO The Trellidor owned and managed branches in three of the major citi
Slide 7: Prospects
PROSPECTS H2 will benefit from a full 6 months of performance from the Trellidor UK business. The UK business has a strong brand and loyal customer base that has been developed over TERRY DENNISON more than 25 years. This branch is key to our growth strategy within the UK and over GROUP CEO time it
Slide 8: Prospects
PROSPECTS Sales into Africa are expected to improve through H2 F21 following the relaxation of border closures in response to the Covid-19 Pandemic TERRY DENNISON Dividend GROUP CEO An interim dividend of 10c per share has been declared, and we anticipate returning to our normal dividend policy for
Slide 9: Group Financial Overview
GROUP FINANCIAL OVERVIEW THE @iXSea xe) GROUP
Slide 10: Group Financial Performance
GROUP FINANCIAL PERFORMANCE HY 21 vs Group financial performance (R'm) FY 2018 HY 2019 FY 2019 HY 2020 FY 2020 HY 2021 HY 20 CAGR Revenue 539.0 286.2 514.9 274.8 421.5 281.6 2.5% -1.4% Gross profit 245.9 128.9 231.9 122.5 175.5 125.6 2.5% -2.2% DAMIAN JUDGE EBITDA 103.5 55.7 81.2 49.1 11.6 57.8 17.7
Slide 11: Group Financial Performance: Revenue
GROUP FINANCIAL PERFORMANCE Top line has been resilient following the National Lockdown R'm Revenue 600.0 539.0 514.9 500.0 421.8 DAMIAN JUDGE As a result, the Group revenue is up 400.0 GROUP CFO 241.1 282.1 2.5% year-on-year 300.0 228.7 147.0 - 200.0 100.0 A 27.5% increase year-on-year in the - 297
Slide 12: Group Financial Performance: EBITDA
GROUP FINANCIAL PERFORMANCE EBITDA increased and is up on F20 and EBITDA R'm Total F19 due to: 120.0 103.5 Total 100.0 Improved volumes in tough economic 81.2 Total 80.0 conditions 38.5 25.7 Total 57.8 - DAMIAN JUDGE 60.0 11.6 GROUP CFO Production overheads and expenses being 40.0 well managed 20.0
Slide 13: Group Balance Sheet
GROUP BALANCE SHEET Debt/Equity ratio of 47% (F20: 42%) – Invested capital and interest cover change driven by a 12% decrease in 350.0 35.0x 300.0 30.0x equity as a result of the prior year loss 250.0 25.0x DAMIAN JUDGE and share buy-backs Interest cover 20.0x 200.0 GROUP CFO R'm 15.0x 150.0 Interes
Slide 14: Group Net Working Capital
GROUP NET WORKING CAPITAL Reduction in inventory is in line with a 200.0 Net working capital strategic objective to reduce stock 150.0 holding in Taylor in particular 110.6 107.1 93.1 93.1 89.7 100.0 DAMIAN JUDGE Increase in Receivables in line with 50.0 GROUP CFO increased trading through Q2 F21 64
Slide 15: Group Summarised Cash Flow
GROUP SUMMARISED CASH FLOW Cash conversion (R'm) 50.0 47.6 47.4 DAMIAN JUDGE 45.0 GROUP CFO 39.1 40.0 37.4 35.0 32.6 31.8 31.8 31.2 30.0 26.8 24.2 24.3 25.0 25.0 23.3 20.5 20.0 17.5 15.0 10.0 5.0 - HY 2017 HY 2018 HY 2019 HY 2020 HY 2021 Profit after tax Cash from operating activities Free cash flow
Slide 16: Capital Allocation
CAPITAL ALLOCATION Return to shareholders FY20 Postponed Interim dividend of R8m (2019: R17m) was paid R3.5m spent on the buy-back of 2 188 160 shares at an average price of R1.73 per share DAMIAN JUDGE Debt Servicing GROUP CFO Paydown interest bearing liabilities of R8.9m Net interest R3.5m CAPEX R
Slide 17: Capital Allocation
CAPITAL ALLOCATION UK Franchise Acquisition 100% of the shares in UK Franchise was acquired for R33.0m The purchase price net of cash is R17.5m R6.9m was deployed from SA cash reserves to part fund the first purchase price instalment DAMIAN JUDGE GROUP CFO H2 F21 Capital Allocation F21 interim divid
Slide 18: Segments
SEGMENTS
Slide 19: Trellidor – Sales Analysis
TRELLIDOR – SALES ANALYSIS Overall revenue has increased by 3.5% across the Trellidor markets Geographical presence 2% 17% DAMIAN JUDGE Main centres' contribution to up 2% to 38% 38% GROUP CFO driven mainly by the 27% growth in the Trellidor branches 43% Overall, the Outlying regions continue to mak
Slide 20: Trellidor – Sales Analysis
TRELLIDOR – SALES ANALYSIS Diversified product range spans income Product type groups which mitigates weak middle and upper middle-class economy 13% 2% DAMIAN JUDGE 6% GROUP CFO The decline in sales into Africa has impacted the sale mix as this is 15% 65% predominately a Traditional Trellidor market
Slide 21: Trellidor – Trading Margin
TRELLIDOR – TRADING MARGIN Overall improvement in the % of costs to Cost of sales as a % of net sales net sales 60.0% 53.2% 52.2% 52.1% 53.8% 51.5% 50.0% 9.2% 9.4% 9.9% 10.0% 9.7% DAMIAN JUDGE Wages have been well-managed and 40.0% 10.5% 10.6% GROUP CFO include the once-off costs of a 30.0% 11.1% 15
Slide 22: Trellidor – EBITDA
TRELLIDOR – EBITDA EBITDA increased and is up on F20 due to: R'm EBITDA Total 80.0 Improved volumes in tough economic 70.2 Total 70.0 63.1 conditions DAMIAN JUDGE 60.0 GROUP CFO Production overheads and expenses being 50.0 Total 42.1 Total well managed 40.0 30.7 24.7 7.1 36.0 Includes the additional
Slide 23: Segments
SEGMENTS : =o SEs PAVESR cs. . | es =< | f= | | SS seine = 2 oe iid TRELLID@R Way
Slide 24: Taylor – Sales Analysis
TAYLOR – SALES ANALYSIS An increase of 1.4% from FY20 driven by Geographical Presence improved performance in Gauteng 3% 6% DAMIAN JUDGE It is pleasing to note that sales through the GROUP CFO Trellidor network continues to grow with a 29% increase year-on-year in HY1 91% The Western Cape continues
Slide 25: Taylor – Sales Analysis
TAYLOR – SALES ANALYSIS Turnover well spread across product types Product Type Aluminum Shutters has increased its 15% contribution during H1. DAMIAN JUDGE GROUP CFO 46% It is pleasing to note the contribution of NMC 30% sales has been maintained through H1. 9% Aluminium shutters PVC Shutters Blinds
Slide 26: Taylor – Trading Margin
TAYLOR – TRADING MARGIN Group buying strategies have been Cost of sales as a % of net sales implemented and savings were expected 70.0% 59.2% 59.6% 60.0% 63.6% through the course of H1 F21 61.1% 60.0% 6.8% 6.8% 6.3% 5.7% 6.3% 6.4% 5.9% However, the supply of raw materials from the 50.0% 5.2% 5.7% 5.
Slide 27: Taylor – EBITDA
TAYLOR – EBITDA EBITDA increased and is up on F20 and F19 due to a reduction in costs R'm Total EBITDA 40.0 33.3 following the prior year restructuring 30.0 7.9 Total Total Total 21.5 18.1 (26.4) DAMIAN JUDGE program 20.0 1.0 GROUP CFO 10.0 25.4 17.1 16.0 21.5 - -10.0 FY 2018 FY 2019 FY 2020 HY 2021
Slide 28: Additional Information
ADDITIONAL INFORMATION
Slide 29: Group Summarised Cash Flow
GROUP SUMMARISED CASH FLOW Group summarised cash flow (R'm) FY 2018 HY 2019 FY 2019 HY 2020 FY 2020 HY 2021 EBITDA 103.5 55.7 81.2 49.1 11.6 57.8 Movement in non cash items (incl provisions) 3.4 1.1 3.1 (1.9) 45.4 (1.4) Net working capital movement 0.1 (16.0) (13.6) (0.6) (2.0) 7.5 Inventory (12.3)
Slide 30: Group Summarised Balance Sheet
GROUP SUMMARISED BALANCE SHEET Summarised balance sheet (R'm) FY 2018 HY 2019 FY 2019 HY 2020 FY2020 HY2021 Non current assets Property, plant and equipment 61.2 66.1 64.9 57.2 56.8 58.2 RoU Assets - - - 21.0 19.6 20.0 Goodwill and other intangibles 116.8 116.4 113.5 111.7 82.7 89.6 Deferred Tax 3.4
Slide 31: Group Financial Performance: Earnings per Share
GROUP FINANCIAL PERFORMANCE EARNINGS PER SHARE (R'm) FY 2018 HY 2019 FY 2019 HY 2020 FY 2020 HY 2021 HY 21 vs HY 20 Profit attributable to ordinary shareholders 58.8 32.1 42.9 26.3 -21.3 30.4 16% Adjusted for: Profit on disposal of property, plant and equipment (0.1) - 0.2 0.5 (0.1) (0.0) DAMIAN JUD
Slide 32: Thank You
TERRY DENNISON DAMIAN JUDGE GROUP CEO GROUP CFO THANK YOU