Ig Design Group Plc · LSE:IGR
Ig Design — H1 FY2024 Earnings Presentation
19 slides from Ig Design's earnings presentation, Nov 28, 2023
Slide 1: Half Year 2024 Results
Half Year 2024 Results Presented by IG DESIGN GROUP Paul Bal PLC 2021 & Rohan FULL YEAR Cummings 1 RESULTS PRESENTATION 28 November 2023
Slide 2: HY2024 Highlights
HY2024 HIGHLIGHTS HY2024 Results Strategy FY2024 Outlook • Adjusted operating profit • Margin recovery FY2025 • Bank facilities to June up 26% to $38.2 million aspiration (4.5%+) on- 2026 track • Margin up 270 bps to • Continued uncertainty 8.6% • New growth-focused over consumer demand strategy und
Slide 3: HY2024 Financial Summary
HY2024 FINANCIAL SUMMARY Revenue ($m) Adjusted Operating Profit ($m) Adjusted EBITDA ($m) 53.3 8.7% 38.2 47.2 46.8 40.2 30.0 30.5 8.6% 35.3 26.8 521.2 22.6 11.4% 483.9 6.9% 12.0% 434.6 444.1 5.9% 10.9% 309.2 4.7% 9.0% 8.3% HY2020 HY2021 HY2022 HY2023 HY2024 HY2020 HY2021 HY2022 HY2023 HY2024 HY2020
Slide 4: Category Performance
CATEGORY PERFORMANCE Revenue by product category HY2024 HY2023 Revenue by season HY2024 HY2023 Celebrations 63% $278.5m 64% $333.4m Christmas 50% $223.3m 50% $258.8m Craft & creative play 15% $67.9m 15% $80.0m Minor seasons 4% $19.2m 5% $26.6m Stationery 4% $18.2m 6% $28.9m Gifting 11% $49.2m 9% $45
Slide 5: DG Americas Update
DG AMERICAS UPDATE Commercial • 24% revenue decline: • Smaller orders reflect lower consumer demand, in Everyday and now Seasonal • Some phasing shift to H2 and more traditional seasonality • All categories impacted, especially: Giftwrap, Décor, Cards, Creative Play, Stationery • More focus on profi
Slide 6: DG International Update
DG INTERNATIONAL UPDATE Commercial • 8% revenue increase: • Resilience in continental European markets • Weakness in the UK and Australia • Volume driven, as no pricing opportunity • Favourable FX TM • Very strong interest in Europe for Smartwrap TM • Eco Nature gaining distribution in the UK, good
Slide 7: Group Revenue
Revenue HY2024 HY2023 Growth GROUP REVENUE DG Americas DG International $m 282.4 161.7 $m 373.4 149.4 % (24%) 8% Elims / Central costs - (1.6) - Total 444.1 521.2 (15%) DG Americas 64% DG International 36% % of Group Revenue % of Group Revenue Reported revenue was down 15% driven by DG Americas offs
Slide 8: Adjusted Operating Profit
Adjusted operating HY2024 HY2023 Growth ADJUSTED OPERATING PROFIT profit DG Americas $m 16.6 $m 15.2 % 9% DG International 25.3 18.4 38% Elims / Central costs (3.7) (3.1) - Total 38.2 30.5 26% 5.9% Adjusted Operating Margin 8.6% • Group Adjusted Operating Profit was up $7.7m (26%) with an increase i
Slide 9: Profit & Loss
PROFIT & LOSS Adjusted Reported HY2024 HY2023 Change HY2024 HY2023 $m $m $m $m Revenue HY2024 HY2023 Growth Revenue 444.1 521.2 (15%) 444.1 521.2 $m $m % Gross profit 93.4 86.6 8% 93.0 86.6 DG Americas 282.4 373.4 (24%) DG International 161.7 149.4 8% Gross margin 21.0% 16.6% 440bps 20.9% 16.6% Elim
Slide 10: Cash Flow
CASH FLOW HY2024 HY2023 Working capital analysis $m $m HY2024 HY2023 Adjusted EBITDA 53.3 46.8 $m $m Add back for share based payment charge 0.6 0.3 Receivables (163.3) (146.8) Inventory (14.6) (48.1) Movements in working capital (99.5) (136.3) Creditors 78.4 58.6 Adjusted cash used by operations (4
Slide 11: The New Strategy
THE NEW STRATEGY 11. 11 IG DESIGN GROUP PLC 202448 HALF YEAR RESULTS PRESENTATION
Slide 12: Our Strategic Priorities
OUR STRATEGIC PRIORITIES Strategic Adaptive Dependable Strong Collaborative Informed • Adopt clearer category • Continue investing in • Embarking on further • Strengthening our • Digitise and • Consolidating our architecture and product design and development near-shoring sales and account standardi
Slide 13: Our Strategic Aspirations
OUR STRATEGIC ASPIRATIONS • Good progress on the first stage: returning to proforma pre-Covid-19 adjusted operating profit margins of at least 4.5% in FY2025 • Proforma reflects the full-year contribution from CSS Industries (acquired in March 2020) for FY2020 • Second stage aspiration of FY2027 del
Slide 14: Summary and Outlook
SUMMARY AND OUTLOOK Summary • Strong start to FY2024 with adjusted operating profit up due to re-built margins • Cash generation significantly above expectations • Revenue down mainly due to lower demand and phasing • Despite the challenging conditions at retail, our customer relationships hold • DG
Slide 15: Appendix
APPENDIX 15. IG DESIGN GROUP PLC 2024 HALF YEAR RESULTS PRESENTATION
Slide 16: A vibrant display from our Paperchase collaboration with Tesco in the UK
A vibrant display from our Paperchase collaboration with Tesco in the UK TM Our innovative Smartwrap Free-standing display shrink-free wrap solution has units are building Eco been well received in TM Nature distribution Continental Europe and sales in the UK We are expanding into the Décor category
Slide 17: Largest Shareholders
LARGEST SHAREHOLDERS* Hedlund Family Canaccord WM Octopus Fidelity 23.32% 14.83% 11.05% 9.85% Hauck & Rowan Dartington Close Brothers Schroder IM Aufhaeuser Bank 4.31% 2.30% 2.11% 2.54% *Information taken from Equiniti Share Register Analysis 31 October 2023 17. IG DESIGN GROUP PLC 2024 HALF YEAR RE
Slide 18: Our Strengths
OUR STRENGTHS Relationships - with the biggest global retailers • Consistently serving household names through recent global challenges, and now the “cost of living crisis” • Continued demand for our products • Top 20 customers: 67% of revenues, at $296m • Walmart ‘Giga-Guru’ status for carbon reduc
Slide 19: Financing
FINANCING Facilities: Facility size ABL: Up to $125m depending on US receivables availability UK Overdraft: £8.5m (c. $10.4m) Tenure: June 2026 Accordion $50m available Pricing: SOFR plus bank margin ranging from 1.85% to 2.35% (including credit spread adjustment), depending on excess liquidity Open