Slide 1: Strong performance, on target for full year outlook
Strong performance On target for full year outlook Stelrad Group plc Results for the six months ended 30 June 2024
Slide 2: Agenda
RESULTS FOR THE PERIOD Agenda • Overview • Financial review • Business review • Summary and outlook • Q&A Trevor Harvey Leigh Wilcox Chief Executive Officer Interim Chief Financial Officer Stelrad Group plc 2
Slide 3: Overview
Overview Trevor Harvey Chief Executive Officer
Slide 4: Strong performance and clear strategic progress despite challenging environment
2024 INTERIM RESULTS SUMMARY Strong performance and clear strategic progress despite challenging environment • 8.9% revenue decline, as anticipated, due to challenging macroeconomic conditions • Adjusted operating profit up 12.8% to £15.7 million • 16% rise in contribution per radiator to over £20 •
Slide 5: Financial review
Financial review Leigh Wilcox Interim Chief Financial Officer
Slide 6: H1 financial performance snapshot
FINANCIAL REVIEW HIGHLIGHTS H1 financial performance snapshot Adjusted Adjusted Operating ROCE % Dividend Leverage Revenue operating operating cash (before lease (LTM) profit profit % conversion liabilities) £143.1m £15.7m 11.0% 26.4% 2.98p 57.7% 1.49 x (H1 23: £157.0m) (H1 23: £14.0m) (H1 23: 8.9%)
Slide 7: Strong performance underpinned by operational discipline
FINANCIAL REVIEW HIGHLIGHTS Strong performance underpinned by operational discipline Revenue Adjusted operating profit Adjusted EPS £143.1m £15.7m 6.34p 143.1 H1 24 15.7 H1 24 6.34 H1 24 H1 23 157.0 H1 23 14.0 H1 23 6.36 H1 22 150.1 H1 22 19.0 H1 22 10.95 H1 21 127.9 HY21 16.8 H1 21 6.34 H1 20 83.0
Slide 8: Continuing improvement in per unit contributions
FINANCIAL REVIEW HIGHLIGHTS Continuing improvement in per unit contributions Radiator volumes sold Premium panel radiator Contribution per radiator volumes sold 2,412k units 139k units £20.48 H1 24 2,412 H1 24 139 H1 24 20.48 H1 23 2,622 H1 23 154 H1 23 17.66 H1 22 2,710 H1 22 155 H1 22 16.06 H1 21
Slide 9: Resilient performance in UK & Ireland and selected European countries
REVENUE Resilient performance in UK & Ireland and selected European countries H1 2024 H1 2024 H1 2023 Movement Movement Revenue by geographical market £m % of total £m £m % UK & Ireland 69.1 48.2 70.1 (1.0) (1.5) Europe 66.8 46.7 76.5 (9.7) (12.6) Turkey & International 7.2 5.1 10.4 (3.2) (30.6) Tot
Slide 10: Adjusted operating profit up 12.8% to £15.7m
ADJUSTED OPERATING PROFIT Adjusted operating profit up 12.8% to £15.7m £15.7m £0.2m £14.0m £1.5m £1.5m £3.7m £2.6m H1 23 Volume Mix Price Cost initiatives Dep’tion H1 24 • Decrease in sales volumes of 210k units • Mix improvement driven by UK & Ireland • Benefits of Q4 2023 restructuring Stelrad Gro
Slide 11: Proactive margin management actions driving adjusted operating profit growth
ADJUSTED OPERATING PROFIT Proactive margin management actions driving adjusted operating profit growth H1 2024 H1 2023 Movement Movement Adjusted operating profit by geographical market £m £m £m % UK & Ireland 15.1 11.5 3.6 31.5 Europe 3.7 4.9 (1.2) (23.5) Turkey & International 0.9 0.7 0.2 35.0 Cen
Slide 12: Investment in working capital, leverage reduced
CASH FLOW AND NET DEBT Investment in working capital, leverage reduced H1 2024 H1 2023 Movement £m £m £m EBITDA 21.7 19.7 2.0 Exceptional items - (0.1) 0.1 Gain on disposal of property, plant and equipment (0.1) - (0.1) Share-based payments 0.3 0.3 - Working capital movements (9.8) (4.9) (4.9) Net c
Slide 13: Taxation, Dividends, Return on capital employed
BALANCE SHEET, TAXATION, DIVIDENDS AND ROCE Taxation Dividends • Effective tax rate 31.5% (H1 23: 22.2%) • Interim dividend of 2.98 pence, 2.0% • Impact of withholding tax on dividends from increase on 2023 Turkey • Confidence in future prospects and cash • Tax charge increased year on year due to g
Slide 14: Technical guidance
TECHNICAL GUIDANCE Technical guidance • Year on year volume reduction expected to moderate in H2 • Key input prices, including steel, are expected to remain stable for the balance of the year • Capital expenditure (excluding lease liabilities) expected to be c. £6.0 million • Investment in working c
Slide 15: Business review
Business review Trevor Harvey Chief Executive Officer
Slide 16: Stelrad is the #1 player in hydronic heat emitters, with an effective multibrand strategy
STRONG MARKET POSITION, CLEAR STRATEGIC PROGRESS Stelrad is the #1 player in hydronic heat emitters, with an effective multibrand strategy Stelrad operates in ten core steel panel radiator markets: • UK #1 53% share • France #1 35% share • Belgium #1 34% share • Netherlands #1 48% share • Ireland #1
Slide 17: Stelrad operates across three global territories
STELRAD AT A GLANCE Stelrad operates across three global territories £69.1m £66.8m £7.2m (2023: £70.1m) (2023: £76.5m) (2023: £10.4m) UK & Ireland Europe Turkey & International 48.2% 46.7% 5.1% of Group revenue of Group revenue of Group revenue % Volumes by product % Volumes by product % Volumes by
Slide 18: Four key strategic objectives continue to drive Stelrad's progress
STRATEGIC OBJECTIVES Four key strategic objectives continue to drive Stelrad’s progress Growing 1 Improving 2 Optimising 3 Positioning 4 market share product mix routes effectively to market for decarbonisation • Strive for cost leadership • Accelerate upselling to • Adapt quickly to channel • Maxim
Slide 19: In 2023, significant share growth extended our leadership position
GROWING MARKET SHARE 1 In 2023, significant share growth extended our leadership position in steel panel radiators • Between 2022 and 2023, Stelrad share increased by 1.6 ppts, from 19.2% to 20.8%*, outperforming all other key players • In the UK, Stelrad benefitted from its #1 position, with market
Slide 20: Stelrad continues to gain share in key European markets
GROWING MARKET SHARE 1 OPTIMISING ROUTES TO MARKET 3 Stelrad continues to gain share in key European markets • #3 in Germany in 2023 • 15.8% share, leveraging full year benefits of Radiators SpA acquisition: +6.7 ppts vs #3 2022, +9.8 ppts vs 2021 • #1 consolidated in France #1 • 34.6% share: +4.0 p
Slide 21: UK market share growing in tandem with product mix improvement
IMPROVING PRODUCT MIX 2 POSITIONING EFFECTIVELY FOR DECARBONISATION 4 UK market share growing in tandem with product mix improvement • H1 2024, premium steel panel share of steel panel volume increased by 10% relative to H1 2022 and 2023 • Average radiator heat output increased by 7%, reflecting spe
Slide 22: Stelrad.com is growing quickly as the Group adapts to evolving channel trends
GROWING MARKET SHARE 1 IMPROVING PRODUCT MIX 2 OPTIMISING ROUTES TO MARKET 3 Stelrad.com is growing quickly as the Group adapts effectively to evolving channel trends • Accelerating trend towards digital transformation in both B2B and B2C markets is driving continued investment in digital capability
Slide 23: Selective investments position Stelrad for market recovery
GROWING MARKET SHARE 1 OPTIMISING ROUTES TO MARKET 3 Selective investments position Stelrad for market recovery • 2023 management actions have driven cost savings whilst enabling greater operational flexibility • Stelrad is positioned to respond effectively as market volume recovers • Product availa
Slide 24: Summary and outlook
Summary and outlook Trevor Harvey Chief Executive Officer
Slide 25: Positive H1 2024 with early signs of market improvement
SUMMARY AND OUTLOOK Positive H1 2024 with early signs of market improvement Summary • Overall revenue decreased by 8.9% due to lower volumes • Contribution per radiator up 16%, driving increased operating profit • Effective cost reduction and margin management actions contributed to operating profit
Slide 26: Questions
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Slide 27: Appendices
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Slide 28: ESG is central to our core purpose
SUSTAINABILITY ESG is central to our core purpose H1 2024: • Further metrics and targets have been developed • Focus on areas of material sustainability: – Health and safety – Packaging – Development of products for decarbonised systems • Stelrad successfully launched the Green Series range of low-c
Slide 29: Consolidated income statement summary
CONSOLIDATED INCOME STATEMENT SUMMARY H1 2024 H1 2023 Movement Movement £m £m £m % Revenue 143.1 157.0 (13.9) (8.9) EBITDA (1) 21.7 19.7 2.0 9.9 Adjusted operating profit (1) 15.7 14.0 1.7 12.8 Exceptional items - (0.1) 0.1 100.0 Amortisation of customer relationships (0.1) (0.1) - 2.8 Operating pro
Slide 30: Consolidated balance sheet summary
CONSOLIDATED BALANCE SHEET SUMMARY 30 June 31 December 30 June 31 December 2024 2023 2024 2023 £m £m £m £m Non-current assets Non-current liabilities Property, plant and equipment 82.1 87.2 Interest-bearing loans and borrowings 89.6 88.2 Intangible assets 5.0 5.3 Deferred tax liabilities 0.2 0.2 Tra
Slide 31: Consolidated statement of cash flow summary
CONSOLIDATED STATEMENT OF CASH FLOW SUMMARY H1 2024 H1 2023 Movement £m £m £m EBITDA (1) 21.7 19.7 2.0 Exceptional items - (0.1) 0.1 Gain on disposal of property, plant and equipment (0.1) - (0.1) Share-based payment charge 0.3 0.3 - Working capital (adjusted for foreign exchange 2022) (9.8) (4.9) (
Slide 32: Disclaimer
DISCLAIMER This presentation is not intended to, and does not constitute or form part of, any offer, invitation or the solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of, any securities in Stelrad Group plc or any other invitation or inducement to en