Impro Precision Industries Limited · HKEX:1286
Impro Precision Industries — FY2023 Earnings Presentation
30 slides from Impro Precision Industries's earnings presentation, Mar 12, 2024
Slide 1: 2023 Annual Results Presentation
Stock Code: 1286 2023 ANNUAL RESULTS PRESENTATION March 12, 2024
Slide 2: Disclaimer
Disclaimer The information set forth in this presentation relates to the business of Impro Precision Industries Limited (the “Company”, together with its subsidiaries, the “Group”) for the year ended December 31, 2023. This presentation is intended to provide updated information on the Group for the
Slide 3: FY2023 Results Summary
FY2023 Results Summary Increase in Reported Profit; Resilient Revenue Growth Decrease in Adjusted Profit • 2023 Group revenue up 5.7% y-on-y to HK$4,604.4M • Reported profit att. to shareholders increased to HK$585.1M or up 0.5% y-on- • Aerospace, Energy & Medical end-markets revenue grew strongly,
Slide 4: Revenue by End Markets
Revenue by End Markets 2H/2022 2H/2023 FY2022 FY2023 2H/2022 2H/2023 Inc/(Dec) FY2022 FY2023 Inc/(Dec) By End Market HK$ mil HK$ mil HK$ mil Change HK$ mil HK$ mil HK$ mil Change Diversified Industrials 1,112.0 1,029.5 (82.5) -7.4% 2,183.8 2,213.6 29.8 1.4% Automotive 769.8 793.8 24.0 3.1% 1,699.5 1
Slide 5: Revenue by End Markets (detail)
Revenue by End Markets 2H/2022 2H/2023 Inc/(Dec) FY2022 FY2023 Inc/(Dec) By End Market HK$ mil HK$ mil HK$ mil Change HK$ mil HK$ mil HK$ mil Change Diversified Industrials 1,112.0 1,029.5 (82.5) -7.4% 2,183.8 2,213.6 29.8 1.4% - Construction Equipment 332.0 292.8 (39.2) -11.8% 646.9 695.0 48.1 7.4%
Slide 6: Revenue by Business
Revenue by Business 2H/2022 2H/2023 FY2022 FY2023 2H/2022 2H/2023 Inc/(Dec) FY2022 FY2023 Inc/(Dec) By Business HK$ mil HK$ mil HK$ mil Change HK$ mil HK$ mil HK$ mil Change Investment Casting 965.8 919.9 (45.9) -4.8% 1,899.6 1,914.8 15.2 0.8% Precision Machining & Others 731.2 859.6 128.4 17.6% 1,4
Slide 7: Revenue by Geographical
Revenue by Geographical 2H/2022 2H/2023 FY2022 FY2023 2H/2022 2H/2023 Inc/(Dec) FY2022 FY2023 Inc/(Dec) By Geographical HK$ mil HK$ mil HK$ mil Change HK$ mil HK$ mil HK$ mil Change Americas 1,076.6 1,092.8 16.2 1.5% 2,123.0 2,233.3 110.3 5.2% - United States 994.6 995.7 1.1 0.1% 1,957.7 2,019.0 61.
Slide 8: 2023 Financial Review
impro 2023 Financial Review
Slide 9: FY2023 Financial Review
FY2023 Financial Review FY2022 FY2023 Financial Highlights HK$ mil HK$ mil Change Revenue 4,354.7 4,604.4 5.7% Gross profit 1,261.0 1,178.3 -6.6% Gross profit margin 29.0% 25.6% -3.4% Other revenue 23.9 30.2 26.4% Other net (loss)/income (24.6) 20.0 -181.3% Selling and distribution expenses (180.7)
Slide 10: Gross Profit
Gross Profit HK$'mil 29.0% 30.0% 1,700.0 25.6% 25.0% 1,400.0 1,261.0 40.0 26.1% 1,178.3 20.0% 1,100.0 222.2 27.2% 177.7 21.6% 15.0% 800.0 358.0 24.1% 375.8 20.8% 10.0% 500.0 640.8 33.7% 630.0 32.9% 200.0 (5.2) 5.0% -9.1% (100.0) FY2022 FY2023 0.0% Investment Casting Precision Machining and Others Sa
Slide 11: Cost of Sales Analysis
Cost of Sales Analysis HK$'mil 4,000.0 3,500.0 3,426.1 3,093.7 580.7 16.9% 3,000.0 541.9 17.5% 221.0 6.5% 2,500.0 7.5% 322.3 9.4% 232.3 249.5 8.1% 2,000.0 827.0 24.1% 790.0 25.5% 1,500.0 1,000.0 1,280.0 41.4% 1,475.1 43.1% 500.0 - FY2022 FY2023 Cost of materials (raw materials & Staff Costs Deprecia
Slide 12: Operating Expenses Analysis
Operating Expenses Analysis Selling and Distribution Expenses Administrative and Other Operating Expenses HK$ mil HK$ mil 300.0 500.0 9.0% 7.7% 8.0% 4.1% 7.4% 250.0 4.0% 400.0 7.0% 3.4% 341.7 334.7 200.0 6.0% 180.7 300.0 158.5 5.0% 150.0 4.0% 2.0% 200.0 100.0 3.0% 2.0% 100.0 50.0 1.0% - 0.0% - 0.0%
Slide 13: Key Working Capital Ratios
Key Working Capital Ratios Inventory Turnover Days (Average) Trade and Bills Receivable Turnover Days (Average) HK$ mil Days HK$ mil Days 1,500 135 150 1,600 105 121 123 84 88 88 1,400 90 1,200 1,152.1 120 1,200 1,091.2 1,081.4 75 974.6 961.2 1,000 972.2 900 90 60 800 600 60 45 600 400 30 300 30 200
Slide 14: Capital Expenditure
Capital Expenditure HK$ mil Actual and Forecast Capex in FY2021-FY2024 1,500.0 1500 12.3% 1,200.0 8.5% 1200 1,054.1 5.7% 900.0 900 590.1 713.0 599.7 600.0 553.3 600 319.9 353.1 257.9 300.0 300 464.0 393.1 246.6 295.4 0.0 0 FY2021 FY2022 FY2023 FY2024 Actual Capex Forecast Capex Capex (Excl. Mexico)
Slide 15: Dividends & Available Bank Facilities
Dividends & Available Bank Facilities Dividends HK$ mil Available Bank Facilities HK$ mil 400.0 2,100.0 57% 350.0 1,800.0 46% 45% 300.0 1,500.0 250.0 1,200.0 200.0 900.0 1,785.6 150.0 301.9 301.4 600.0 100.0 1,101.2 1,114.4 190.2 50.0 300.0 - - FY2021 FY2022 FY2023 FY2021 FY2022 FY2023 Dividends Div
Slide 16: Key Financial Ratios
Key Financial Ratios Adjusted Return on Shareholders' Equity Net Gearing Ratio 20.0% 50.0% 14.9% 39.2% 40.0% 15.0% 33.2% 11.5% 10.1% 30.0% 10.0% 22.1% 20.0% 5.0% 10.0% 0.0% 0.0% FY2021 FY2022 FY2023 FY2021 FY2022 FY2023 x Net Debt / Adj. EBITDA x Interest Coverage 1.5 1.4 25.0 1.3 20.0 18.5 1.0 1.0
Slide 17: Sustainability Highlights
Sustainability Highlights ⚫ Insist in low carbon emissions during manufacturing process, consistently reducing group’s carbon emissions and energy consumption density over the last 3 years Tonne of CO2/ Tonne of std. coal/ HK$ mil Revenue Greenhouse Gas Emission Density HK$ mil Revenue Energy Consum
Slide 18: Business Outlook
impro Business Outlook
Slide 19: Mexico SLP Campus Construction Update
Mexico SLP Campus Construction Update SC-SM SC-SM SC Plant Aerospace & SC Plant Aerospace & ST Plant ST Plant PM Plant PM Plant IC Plant IC Plant (Photo taken on Mar 1, 2024) (Photo taken on Aug 2, 2023) ⚫ Mexico SLP Campus Precision Machining (PM), Sand Casting (SC) and Investment Casting (IC) plan
Slide 20: Business Outlook
Business Outlook ⚫ Global economy remains exposed to a number of uncertainties: high inflation, potential geopolitical conflicts and multilateral tensions that would dampen near term revenue growth rate ⚫ The Group’s “Global Footprint” and “Diversified End-markets” strategies will continue to divers
Slide 21: Q&A Session
Q&A Session
Slide 22: Appendices – Financials Summary
Appendices – Financials Summary
Slide 23: Reconciliation of Adjusted Profit Attributable to Shareholders and Adjusted EBITDA
Appendix 1 - Reconciliation of Adjusted Profit Attributable to Shareholders and Adjusted EBITDA FY2022 FY2023 HK$ mil HK$ mil Change Reconciliation to Adj. Profit Attr. to Shareholders Profit after tax 582.8 586.8 Adjustments (net of tax): - Recognition of deferred tax assets of a Turkish subsidiary
Slide 24: Consolidated Statement of Profit or Loss
Appendix 2 – Consolidated Statement of Profit or Loss FY2022 FY2023 HK$ mil HK$ mil Revenue 4,354.7 4,604.4 Cost of sales (3,093.7) (3,426.1) Gross Profit 1,261.0 1,178.3 Other revenue 23.9 30.2 Other net (loss)/income (24.6) 20.0 Selling and distribution expenses (180.7) (158.5) Administrative and
Slide 25: Consolidated Statement of Financial Position
Appendix 3 – Consolidated Statement of Financial Position 12/31/2022 12/31/2023 HK$ mil HK$ mil Non-current assets Property, plant and equipment 4,050.2 4,535.5 Prepayments for Property, plant and equipment 46.8 52.4 Intangible assets 248.4 214.8 Goodwill 230.8 227.5 Deferred expenses 163.2 161.1 Ot
Slide 26: Consolidated Statement of Financial Position
Appendix 3 – Consolidated Statement of Financial Position 12/31/2022 12/31/2023 HK$ mil HK$ mil Current liabilities Bank loans 942.4 1,028.6 Lease liabilities 14.4 7.7 Trade payables 457.8 519.5 Other payables and accruals 303.1 308.9 Taxation payable 94.5 59.6 1,812.2 1,924.3 Net current assets 1,1
Slide 27: Consolidated Statement of Financial Position
Appendix 3 – Consolidated Statement of Financial Position 12/31/2022 12/31/2023 HK$ mil HK$ mil Capital and reserves Share capital 188.5 188.7 Reserves 4,190.8 4,691.9 Total equity attributable to equity shareholders of the Company 4,379.3 4,880.6 Non-controlling interest 18.7 20.3 TOTAL EQUITY 4,39
Slide 28: Condensed Consolidated Cash Flow Statement
Appendix 4 – Condensed Consolidated Cash Flow Statement FY2022 FY2023 HK$ mil HK$ mil Operating activities Cash generated from operations 940.5 1,454.5 Tax paid (103.0) (173.1) Net cash generated from operating activities 837.5 1,281.4 Investing activities Payment of property, plant and equipment (6
Slide 29: Condensed Consolidated Cash Flow Statement
Appendix 4 – Condensed Consolidated Cash Flow Statement FY2022 FY2023 HK$ mil HK$ mil Financing activities Proceeds from bank loans 1,626.6 1,295.0 Repayment of bank loans (950.7) (1,228.3) Interest paid (59.6) (115.5) Lease rentals paid (9.4) (15.7) Proceeds from exercise of share options 3.0 6.5 D
Slide 30: Thank You
impro Reliable - Flexible + Global THANK YOU
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