Slide 1: Robust Performance in 2022
ROBUST PERFORMANCE IN 2022 2022 FULL YEAR RESULTS PRESENTATION 28 February 2023
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This presentation contains certain forward-looking statements with respect to the financial condition, results, operations and business of Intertek Group plc. These statements and forecasts involve risk and uncertainty because they relate to
Slide 3: FY22 Key Takeaways
FY22 KEY TAKEAWAYS Double Higher ATIC Robust Strong Progress on Digit EPS demand Margin Cash Flow ROIC Growth Note: EPS at actual rates 3
Slide 4: Performance Highlights 2022 Financial Results
01 02 03 04 05 Performance 2022 Financial Business Lines Growth 2023 Highlights Results Review Opportunities Outlook
Slide 5: Robust Performance in 2022
ROBUST PERFORMANCE IN 2022 YoY YoY 2022 2021 (Actual rates) (Constant rates) Revenue £3,192.9m £2,786.3m 14.6% 8.2% Like-for-like revenue £3,067.4m £2,761.0m 11.1% 4.9% Operating Profit1 £520.1m £473.9m 9.7% 3.8% Operating Margin1 16.3% 17.0% (70bps) (70bps) EPS¹ 211.1p 190.8p 10.6% 4.6% ROIC 18.0%
Slide 6: LFL Revenue Acceleration in Trade & Resources
LFL REVENUE ACCELERATION IN TRADE & RESOURCES Group LfL YoY Growth Products LfL YoY Growth 7.6% 5.6% 4.9% 5.3% 5.8% 3.5% 3.9% 2.5% 2019 2020 2021 2022 21-22 2019 2020 2021 2022 21-22 Avg Avg (6.8%) (5.9%) Trade LfL YoY Growth Resources LfL YoY Growth 7.9% 4.2% 5.6% 4.3% 6.0% 3.0% 4.8% 1.7% 2019 2020
Slide 7: Nov/Dec LFL Performance Impacted by Covid in China
NOV/DEC LFL PERFORMANCE IMPACTED BY COVID IN CHINA Group LfL YoY Growth Products LfL YoY Growth 6.4% 6.4% 5.6% 4.9% 4.4% 4.3% 4.0% 3.5% 3.8% 2.6% H1 Jul-Oct Nov-Dec Nov-Dec Nov-Dec H1 Jul-Oct Nov-Dec Nov-Dec Nov-Dec 22 22 22 22 Adj* 21 22 22 22 22 Adj* 21 Trade LfL YoY Growth Resources LfL YoY Growt
Slide 8: Robust Margin with Progress in Trade & Resources
ROBUST MARGIN WITH PROGRESS IN TRADE & RESOURCES FY Margin 17.5% 17.2% 16.9% 17.0% 16.3% 15.9% 16.0% 15.5% 15.6% 2014 2015 2016 2017 2018 2019 2020 2021 2022 2022 Margin Performance Group Products Trade Resources 22.7% 17.8% 10.5% 16.3% 8.2% 14.6% 9.1% 21.1% 6.6% 7.6% 4.7% 19.3% H1 H2 FY H1 H2 FY H1
Slide 9: Continuing Discipline on Margin Accretive Revenue Growth
CONTINUING DISCIPLINE ON MARGIN ACCRETIVE REVENUE GROWTH Performance Portfolio Cost Reduction Plan Management • Pricing power and disciplined • 5x5 metrics discipline in all mix management operating units Restructurings (SDI) £27.4m • Double-digit LFL revenue • Benchmarking of Business Annual growth
Slide 10: Continuing Progress on Cash Management
CONTINUING PROGRESS ON CASH MANAGEMENT Adjusted EBITDA Working Capital as % of Revenue AdjustedAdjusted Cash Generated Cash Generated from 1 from Operations Operations1 £696m £701m 7.1% £643m £731m £705m £696m £722m £602m £563m £571m £499m 5.0% £565m £596m £603m 3.9% 3.4% (1.6%) (1.5%) (0.1%) FY 16
Slide 11: Disciplined Investments in Growth
DISCIPLINED INVESTMENTS IN GROWTH M&A INNOVATIONS CONNECTED WORLD GEOGRAPHIC EXPANSION SUSTAINABILITY WORLD OF ENERGY SAAS PLATFORMS FOOD & HOSPITALITY Insert Footer Here 11 1 0
Slide 12: Progress on Sustainability Excellence
PROGRESS ON SUSTAINABILITY EXCELLENCE End-to-end systemic sustainability approach People & Culture Customers Environment Communities Fully engaged employees Ensure our customers can Decarbonise Create positive impacts in in safe working operate safely and by 2050 the communities where environments s
Slide 13: Performance Highlights 2022 Financial Results
01 02 03 04 05 Performance 2022 Financial Business Lines Growth 2023 Highlights Results Review Opportunities Outlook
Slide 14: Key P&L Financials
KEY P&L FINANCIALS YoY YoY 2022 (Actual rates) (Constant rates) Revenue £3,192.9m 14.6% 8.2% Like-for-like revenue £3,067.4m 11.1% 4.9% Operating Profit1 £520.1m 9.7% 3.8% Operating Margin1 16.3% (70bps) (70bps) EPS¹ 211.1p 10.6% 4.6% Note: (1) Before separately disclosed items 14
Slide 15: Cash Flow & Net Debt
CASH FLOW & NET DEBT £m @ actual exchange rates 2022 2021 Adjusted operating profit1 520.1 473.9 Depreciation/amortisation 180.5 169.3 Change in working capital 6.3 35.9 Other2 15.1 16.7 Adjusted cash flow from operations 722.0 695.8 Capex (116.5) (97.1) Interest paid/received (35.3) (25.5) Other3 (
Slide 16: Financial Guidance
FINANCIAL GUIDANCE FY 2023 Guidance Net finance cost (pre-fx) £40-45m Effective tax rate 26.5-27.5% Minority interest £21.5-22.5m Diluted shares (as at 31 December 2022) £161.9p Capex £115-125m Financial Net Debt¹ £630-680m Note: (1) Net debt guidance before any material change in FX rates and any M
Slide 17: Business Lines Review
01 02 03 04 05 Performance 2022 Financial Business Lines Growth 2023 Highlights Results Review Opportunities Outlook
Slide 18: Good Performance in Products
GOOD PERFORMANCE IN PRODUCTS Revenue (£m) Like-for-like Revenue (£m) Operating Profit1 (£m) Operating Margin1 (%) 2,024 22.8% 21.1% 1,911 427 1,755 1,730 400 2021 2022 2021 2022 2021 2022 2021 2022 8.5% CCR 3.9% CCR Stable at CCR (180bps) CCR 15.3% 10.4% 6.8% (170bps) H1 22 Actual LFL H2 22 Actual L
Slide 19: Double Digit Profit Growth in Trade
DOUBLE DIGIT PROFIT GROWTH IN TRADE Revenue (£m) Like-for-like Revenue (£m) Operating Profit1 (£m) Operating Margin1 (%) 636 635 58 575 575 52 9.0% 9.1% 2021 2022 2021 2022 2021 2022 2021 2022 5.6% CCR 14.0% CCR 70bps CCR 5.6% CCR 10.4% 12.2% 10bps 10.5% H1 22 Actual LFL H2 22 Actual LFL FY 22 Actua
Slide 20: Growth Acceleration in Resources
GROWTH ACCELERATION IN RESOURCES Revenue (£m) Like-for-like Revenue (£m) Operating Profit1 (£m) Operating Margin1 (%) 533 522 35 23 5.0% 6.6% 456 456 2021 2022 2021 2022 2021 2022 2021 2022 7.9% CCR 50.9% CCR 180bps CCR 10.3% CCR 14.5% 56.2% 160bps 17.0% H1 22 Actual LFL H2 22 Actual LFL FY 22 Actua
Slide 21: Growth Opportunities
01 02 03 04 05 Performance 2022 Financial Business Lines Growth 2023 Highlights Results Review Opportunities Outlook
Slide 22: Our Portfolio Is Well Positioned for Growth
OUR PORTFOLIO IS WELL POSITIONED FOR GROWTH Divisional Revenue Split (£m) ATIC Revenue Split (£m) £3,193m £3,193m 9% 17% 25% £2,166m 20% £2,166m 8% 24% 30% 25% 46% 63% 52% 51% 20% 10% FY 15 FY 22 FY 15 FY 22 Assurance Testing Products Trade Resources Inspection Certification Revenue (£m) 2015 2022 C
Slide 23: ATIC Demand Will Grow Faster Post Covid
ATIC DEMAND WILL GROW FASTER POST COVID 19 GLOBAL ATIC MARKET GROWTH OPPORTUNITY 01 CUSTOMER $50BN RETENTION Currently 02 outsourced CUSTOMER PENETRATION 03 $200bn ATIC CROSS- SELLING Currently in-house 04 NEW CUSTOMER WINS Untapped 05 potential CUSTOMER OUTSOURCING 23
Slide 24: Attractive ATIC Structural Growth Drivers
ATTRACTIVE ATIC STRUCTURAL GROWTH DRIVERS PRODUCTS ATIC TRADE ATIC RESOURCES ATIC 63% OFREVENUE¹ 20% OFREVENUE¹ 17% OFREVENUE¹ 82% OFPROFIT¹ 11% OFPROFIT¹ 7% OFPROFIT¹ GDP+ GDP GROWTH LONG-TERM GROWTH Growth in Brands, Faster Population Growth Population Growth Investment in E&P, GDP growth SKUs & e
Slide 25: ATIC Growth Accelerators
ATIC GROWTH ACCELERATORS ATTRACTIVE ATIC STRUCTURAL GROWTH DRIVERS INCREASE IN NEW CLIENTS HIGHER INVESTMENTS IN SAFER SUPPLY HIGHER INVESTMENTS IN INNOVATION STEP CHANGE IN SUSTAINABILITY HIGHER GROWTH IN THE WORLD OF ENERGY 25
Slide 26: Significant Growth in the Number of Companies Globally
SIGNIFICANT GROWTH IN THE NUMBER OF COMPANIES GLOBALLY UK 2022 NORTH AMERICA New Company Incorporations CHINA 2022 U.S. +17% vs. 2018/19 8.5m New Private Enterprises New Business Applications +45% vs. 2018/19 FRANCE established in 2021, +12% YoY 1.1m Business Creations in 2022 +33% vs. 2018/19 INDIA
Slide 27: Increased Corporate Investment in Safer Supply Chains
INCREASED CORPORATE INVESTMENT IN SAFER SUPPLY CHAINS COVID 19 HAS MADE THE CASE FOR RISK BASED QUALITY ASSURANCE STRONGER LACK OF DATA, PROCESSES & SEVERE SUPPLY CHAIN DISRUPTIONS UNIDENTIFIED INTRINSIC RISKS INDEPENDENT ASSURANCE INVESTMENT IN SUPPLY CHAIN REAL-TIME DECISION MAKING EXPECTED TO INC
Slide 28: Innovation Acceleration in Products, Services & Technologies
INNOVATION ACCELERATION IN PRODUCTS, SERVICES & TECHNOLOGIES GLOBAL INNOVATION IS ACCELERATING The significant advancements in technology of the past 20 years and the generational shift in Energy & Sustainability is creating a historic inflection point for Innovation and Capital Spending The world w
Slide 29: Positive Regulatory Momentum for Sustainability
POSITIVE REGULATORY MOMENTUM FOR SUSTAINABILITY NORTH AMERICA EUROPE & UK GREATER CHINA Existing/Coming into Force Regulations: Existing/Coming into Force Regulations: Existing/Coming into Force Regulations: • Nasdaq board diversity listing rules • EU Non-Financial Reporting Directive • Measures for
Slide 30: World of Energy Growth Opportunities
WORLD OF ENERGY GROWTH OPPORTUNITIES Growth in O&G Under investment in O&G Technology and long-term Increase in global energy downstream trade flows Pathway to Net Zero Exploration & Production investments required to demand (GDP & and infrastructure requires significant and lack of build scale rene
Slide 31: High Performance Earnings and Cash Compounder Model
HIGH PERFORMANCE EARNINGS AND CASH COMPOUNDER MODEL SCIENCE-BASED CUSTOMER EXCELLENCE IN QUALITY, SAFETY & SUSTAINABILITY USP Our Assurance Testing Inspection Certification Services Our Sectors Our Outlook Growth GDP+ GDP Growth Long-Term Growth GDP+ Organic Revenue Growth in Real Terms Value Creati
Slide 32: Our Good to Great Journey Continues
OUR GOOD TO GREAT JOURNEY CONTINUES Intertek 2014-22 Track Record Intertek’s Competitive Advantage Metric1 2014 2022 Change External Revenue £2,093m £3,193m 53% What are we EBITDA £400.9m £700.6m 75% passionate about? OP £324.6m £520.1m 60% OP Margin 15.5% 16.3% 80bps Our Science-based EPS 132.1p 21
Slide 33: Our Science-Based Customer Excellence TQA Advantage
OUR SCIENCE-BASED CUSTOMER EXCELLENCE TQA ADVANTAGE supporting advances using our scientific in artificial fuelling expertise sight innovation to protect biodiversity in aviation Helping people to see again Development of synthetic fuels Protecting biodiversity in Peru’s coastal waters progressing a
Slide 34: 2023 Outlook
01 02 03 04 05 Performance 2022 Financial Business Lines Growth 2023 Highlights Results Review Opportunities Outlook
Slide 35: Group Outlook 2023
GROUP OUTLOOK 2023 • Mid-single digit LFL Revenue growth at CCY • Products: Good • Trade: Good • Resources: Robust • Margin progression year-on-year • Strong free cash flow • Capex: £115- 125m • FX impact: Neutral • Financial net debt: £630 -680m1 Note (1): Before any material change in FX and any M
Slide 36: A High Quality Growth Business Creating Sustainable Value for All
A HIGH QUALITY GROWTH BUSINESS CREATING SUSTAINABLE VALUE FOR ALL A CLEAR PURPOSE ACCELERATING MARKET • Bringing Quality, Safety and Sustainability GROWTH to life • New TQA clients • Leading ATIC solutions critical to society • Investments in safer supply • Sustainability Excellence. Committed to •
Slide 37: Intertek Total Quality. Assured.
ntertek Total Quality. Assured.