Norcros Plc · LSE:NXR
Norcros — Merger or Acquisition (May 2022)
17 slides from Norcros's merger presentation, May 2022
Slide 1: Acquisition of Grant Westfield
Acquisition of Grant Westfield(1) Analyst Presentation May 2022 (1) Granfit Holdings Limited and/or its subsidiary undertakings
Slide 2: Disclaimer
Disclaimer IMPORTANT NOTICE THIS PRESENTATION AND ITS CONTENTS ARE STRICTLY CONFIDENTIAL AND ARE NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES (INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES AND THE
Slide 3: Acquisition of Grant Westfield
Acquisition of Grant Westfield Market leading designer, manufacturer and supplier of waterproof bathroom wall panels in the UK Transaction overview • Enterprise Value of £80m • Implied acquisition multiple of 7.9x 2021A Adjusted EBITDA(1) • Earnout of up to an additional £12.0m subject to achieving
Slide 4: Overview of Grant Westfield
Overview of Grant Westfield Leading UK supplier of premium bathroom wall panels Business overview Grant Westfield’s channel profile(1) • A leading UK designer, manufacturer and supplier of waterproof bathroom Residential includes: wall panels, operating under the renowned Multipanel brand Chart Titl
Slide 5: Investment highlights
Investment highlights 1 Leading player in high growth bathroom wall panels subsegment 2 High quality product with a diversified selection of ranges 3 Strong product vitality and innovation track record 4 Opportunity to leverage Norcros’ existing relationships 5 Diversified blue chip customer base 6
Slide 6: Leading player in high growth bathroom wall panels subsegment
Leading player in high growth bathroom wall panels subsegment UK bathroom wall coverings market(1,2,3) Market growth drivers and trends Total Addressable Market (Norcros Est): c.£330m Wall coverings Chart Title Panel Segment (Norcros Est): c.£100m • Continued growth in domestic bathroom expenditure
Slide 7: Diversified blue chip customer base
Diversified blue chip customer base % FY21 Customer examples sales Blue chip customer base across National / Merchants 41% Regional Merchants, Specification and Online Independent 30% Top 20 customers account for 68%(1) of sales retail Major buying Grant Westfield has an 80%(2) Net Promoter 15% grou
Slide 8: High quality product with a diversified selection of ranges
High quality product with a diversified selection of ranges • A premium product with an improved aesthetic – a modern alternative to ceramic tiles • Cost effective option and easy to install relative to alternatives • ‘Tongue & Groove Hydrolock’ connection allows panels to be joined without a mid-jo
Slide 9: Strong product vitality and innovation track record
Strong product vitality and innovation track record Track record of continued product innovation • Exclusive designer range launched in 2018, curated by renowned designer Linda Barker Revenue from Linda Barker wall panel sales(1) Linda Barker £m revenue • Premium wall panel product with marble, gran
Slide 10: Opportunity to leverage existing relationships
Opportunity to leverage existing relationships Modular market case study Modular & Pod Manufacturers Norcros brands associated Modular building and bathroom pods • High growth sector driven by market tailwinds: • Focus on cost efficiency • Simplified procurement • Superior quality control • Waste re
Slide 11: Consistent organic growth and increasingly profitable
Consistent organic growth and increasingly profitable Financial overview • Strong track record of organic revenue and EBITDA growth • Demonstrated resilient performance through Covid period • Growing and sustainable EBITDA margin • Margin improvement driven by operational efficiency gains and contin
Slide 12: Significant financial benefits for Norcros shareholders
Significant financial benefits for Norcros shareholders Compelling financial case • Double-digit EPS accretion expected in the first full financial year of ownership(1) • Acquisition is enhancing to the Group’s EBITDA margin • Retains the Group’s high cash conversion due to low capital intensity(2)
Slide 13: Funding, post transaction balance sheet and integration
Funding, post transaction balance sheet and integration Financing • Enterprise Value of £80m, excluding an earnout of up to an additional £12m(1) • Transaction financed through a combination of an equity placing, existing cash and committed debt facilities • Equity placing raising gross proceeds of
Slide 14: Significant organic growth opportunities
Significant organic growth opportunities Grant Westfield offers strong organic growth prospects through: Ongoing market penetration – based on attraction of wall panels – through new product development Scope to increase exposure to UK new housing (private and social), modular and DIY channels Geogr
Slide 15: Acquisition of Grant Westfield
Acquisition of Grant Westfield Market leading designer, manufacturer and supplier of waterproof bathroom wall panels in the UK Compelling strategic rationale • Acquisition consistent with Norcros' strategy to expand its bathroom product offer • Market leading position and attractive returns from a h
Slide 16: Appendix
Appendix
Slide 17: Group strategy and successful M&A track record
Group strategy and successful M&A track record Clear and focused strategy “A leading supplier of bathroom and kitchen products in selected geographies, offering strong brands, contemporary designs, 2025 vision trusted quality, outstanding service, innovation and a wide product range.” Successful M&A