Videndum Plc · LSE:VID
Videndum — FY2022 Earnings Presentation
41 slides from Videndum's earnings presentation, Feb 28, 2023
Slide 1: Full Year Results 2022
Enabling the capture and sharing of exceptional content. Full Year Results 2022 28 February 2023 Capture. Share.
Slide 2: Agenda
Agenda 1. Full Year 2022 Summary ▪ Stephen Bird, Group Chief Executive 2. Market and Strategy Update ▪ Stephen Bird, Group Chief Executive 3. Financial Review ▪ Andrea Rigamonti, Group Chief Financial Officer 4. Summary ▪ Stephen Bird, Group Chief Executive 5. Q&A 2 | Videndum plc
Slide 3: Summary
Summary 2022 financial highlights ▪ Record revenue (+14%) and adjusted PBT* (+27%) ▪ Organic, constant currency revenue slightly ahead, despite softness in consumer segment and some retail destocking ▪ Executing on our M&A strategy with acquisitions integrated well ▪ Adjusted operating margin* progr
Slide 4: Market & strategy update
Market & strategy update 4 | Videndum plc
Slide 5: Group strategic priorities
Group strategic priorities 1 2 3 Organic growth Margin improvement Growth through M&A Well positioned to deliver growth and value for shareholders 5 | Videndum plc
Slide 6: 1. Organic growth
1. Organic growth ▪ Organic growth driven by advances in technology plus four strong structural market growth drivers experiencing double-digit growth: 1. The internet/e-commerce 2. Subscription TV/original content creation 3. TikTok/YouTube 4. Live streaming Attractive structural market growth driv
Slide 7: Technology innovation to improve productivity and drive shorter product replacement cycles
Technology innovation to improve productivity and drive shorter product replacement cycles ▪ Improving productivity is increasingly important to our customers ▪ Our products are part of the solution and we continue to develop innovative new technology to reduce set up time, lower operating costs and
Slide 8: 2. Continued margin improvement: executing self-help
2. Continued margin improvement: executing self-help 1. Continuous improvement culture ▪ Well managed, agile business ▪ 3% YoY productivity gains with lean manufacturing and continuous improvement ▪ Reorganisation in Creative Solutions ▪ Delivering synergies from acquisitions 2. Additional opportuni
Slide 9: Media Solutions
Media Solutions ▪ Market: TAM grown to c.£1.5bn (2022-25 CAGR c.4%), driven by acquisitions and market growth from an increase in vlogging, retail e-commerce and audio capture; short-term impact of macroeconomic environment affecting business confidence ▪ Strategy: focused on innovation to improve o
Slide 10: Audio capture represents a significant growth opportunity
Audio capture represents a significant growth opportunity Video from Marco Pezzana, Group Chief Operating Officer and Divisional CEO, Media Solutions 10 | Videndum plc
Slide 11: Production Solutions
Production Solutions ▪ Market: TAM c.£0.4bn (2022-25 CAGR c.3%), driven by demand for original content, automated production and on-location news ▪ Strategy: focused on growth in core professional equipment for original content in cine/scripted TV, and products for on-location news and sporting even
Slide 12: Creative Solutions
Creative Solutions ▪ Market: TAM >£1bn (2022-25 CAGR c.10-15%), driven by streaming and demand for original content ▪ Strategy: focused on continuing to deliver 4K/HDR replacement cycle, as well as new technology to improve our customers’ productivity in the growing areas of remote monitoring/collab
Slide 13: Financial review
Financial review 13 | Videndum plc
Slide 14: Full year 2022 results
Full year 2022 results FY 22 FY 21 % change £m £m ▪ Revenue 8% ahead of 2021 on a constant Revenue 451.2 394.3 +14% currency basis Gross profit* 198.1 173.2 +14% ▪ Gross margin* maintained with pricing Gross margin %* 43.9% 43.9% - more than offsetting inflation Operating expenses* (138.1) (127.0) +
Slide 15: Divisional performance
Divisional performance Revenue Operating margin* FY 22 FY 21 % change FY 22 FY 21 Change £m £m (const. FX) £m £m (bps) Media Solutions 217.8 194.7 +8% 15.2% 13.7% +150 Production Solutions 137.8 121.8 +6% 22.8% 23.0% -20 Creative Solutions 95.6 77.8 +10% 13.1% 10.7% +240 Group 451.2 394.3 +8% 13.3%
Slide 16: Cash generation
Cash generation FY 22 FY 21 Variance £m £m ▪ Strong operating profit growth Operating profit* 60.0 46.2 13.8 ▪ £19.4m increase in working capital* Depreciation 22.6 18.7 3.9 (Inc)/dec in working capital* (19.4) 1.1 (20.5) ▪ £10.2m increase in inventory (Dec) in provisions* (0.8) (0.8) - ▪ £3.7m decr
Slide 17: Net debt
Net debt Dec 22 FX Net debt Acquisition ▪ “Other items” incudes £8.6m of IFRS 16 lease additions, mainly for Audix Dec 21 Other Net debt items and Savage Dividends ▪ Acquisition of Audix Free cash ▪ FX impact due to stronger US Dollar flow ▪ Significant liquidity of c.£100m £(145.2)m £28.5m £(18.0)m
Slide 18: Historic operating cash flow performance
Historic operating cash flow* performance 100 150% Rolling 3 year cash conversion ▪ Focus on driving profit into cash 90 108% 105% 110% 108% 80 104% 100% 70 ▪ Control of working capital 90% 87% 60 83% ▪ Balance of capital investment to drive 50 50% long-term growth with short-term cash 40 generation
Slide 19: Recap on restructuring and efficiencies
Recap on restructuring and efficiencies ▪ Successfully implemented restructures in the past US Israel Japan to drive higher revenue growth and/or improved China margins: Costa Rica ▪ 2019/2020: transition of VMS to take advantage of Singapore higher margin e-commerce channel ▪ 2022/2023: reorganisat
Slide 20: Progress against mid-term financial goals
Progress against mid-term financial goals Revenue Pricing power Operating Operating High single digit More than leverage profit margin* organic growth offsetting inflation 16-18% in 2025 30%+ 2022: +1% (HY +11%) 2022: price > inflation 2022: 40% (at CC) 2022: +160bps to 13.3% Cash ROCE* Dividends Ne
Slide 21: Selected FY 2023 Guidance
Selected FY 2023 Guidance Profit Cash and Net Debt ▪ Higher than usual H2 weighting due to ▪ Gross R&D: 6-7% of revenue, c.45% capitalised current macro environment ▪ Cash tax: c.£15m ▪ D&A c.£4m higher; primarily amortisation ▪ Lease additions: c.£7m (incl Cassola renewal in H1) ▪ Restructuring 202
Slide 22: Summary
re oe | Videndum Summary
Slide 23: Summary
Summary ▪ Record 2022 revenue and adjusted profit ▪ Executing well on strategy: organic growth, margin improvement and M&A ▪ Uniquely positioned at the heart of the content creation market ▪ Attractive market growth drivers and leading, premium brands ▪ Technology innovation improves customers’ prod
Slide 24: Q&A
Q&A Dialling in from the UK: 0800 640 6441 Dialling in from all other locations: +44 203 936 2999 Access code: 593861 Press *1 to ask a question Press *2 to withdraw your question Press *0 for operator assistance 24 | Videndum plc
Slide 25: Appendices
25 =| Videndum pic | oe | Videndum
Slide 26: Responsibility framework
Responsibility framework Key focus areas Throughout 2022, Videndum further developed its Group-wide ESG programme, increasingly focusing on the end-to-end supply chain as well as direct operations, and addressing and reporting on material issues affecting our operations and stakeholders. By implemen
Slide 27: Videndum's transition plan – a roadmap to net zero (1)
Videndum’s transition plan – a roadmap to net zero (1) Scope Area Short term (to 2025) Medium term (2025-2035) Long term (2035- 2050) 2022 2023 2024 2025 2027 2030 2035 2045 Near-term Ensure that 100% of Group operations capture and report on 25% reduction. Carbon neutral. 35% reduction. 50% reducti
Slide 28: Videndum's transition plan – a roadmap to net zero (2)
Videndum’s transition plan – a roadmap to net zero (2) Scope Area Short term (to 2025) Medium term (2025-2035) Long term (2035- 2050) 2022 2023 2024 2025 2027 2030 2035 2045 Near-term Ensure that 100% of Group operations capture and report on 50% reduction in - - - - target CO2 emissions. business a
Slide 29: FX sensitivities
FX sensitivities Currency Current spot FY 22 FY 21 rates average average (24 Feb 23) rates rates USD 1.19 1.24 1.38 EUR 1.13 1.17 1.16 YEN 163 161 151 > The expected year-on-year impact on 2023 PBT* at current spot rates would be a tailwind of c.£2m > The expected further impact from Currency Moveme
Slide 30: Net Debt:EBITDA
Net Debt:EBITDA £m Actuals Reported Net Debt 193.5 Adjust for upfront loan fee accounting 1.7 Covenant Net Debt 195.2 Reported 12-month EBITDA^ 82.6 Add back share-based payments^ 6.9 Less interest not in relation to gross borrowings 1.8 Add pro forma acquisition amounts - Covenant EBITDA 91.3 Repor
Slide 31: Five-year summary
Five-year summary 70 15% FY18 FY19 FY20 FY21 FY22 60 Revenue (£m) 385.4 376.1 290.5 394.3 451.2 50 10% Operating profit* (£m) 53.5 52.4 9.9 46.2 60.0 40 Operating margin* 13.9% 13.9% 3.4% 11.7% 13.3% 30 Operating cash flow* (£m) 44.7 44.5 25.4 49.7 49.8 5% 20 10 0% FY18 FY19 FY20 FY21 FY22 (10) (20)
Slide 32: Where we operate
Where we operate ▪ Sites in 11 countries; sell into 100+ countries ▪ Sales: UK accounts for only 9% of revenue ▪ Well capitalised, world-class manufacturing facilities in US Italy, Costa Rica, UK & US Israel Japan ▪ R&D centres in Italy, UK, US, Israel, New Zealand China ▪ Far East Procurement Centr
Slide 33: Who we are and what we do
Who we are and what we do Leading positions in defensible market niches Manual cine/broadcast Supports On Set Wireless Prompters Protective Solutions 6x 13x 4x 5x 55% 37% 27% 85% Photographic Tripods Batteries LED Lights Key 5x 1.4x 4.4x Videndum market share 36% Competition market share 21% 9% 33 |
Slide 34: Four key structural market growth drivers
Four key structural market growth drivers c.75% of Videndum’s business is being driven by double digit growth in content creation* The internet TikTok, YouTube Subscription TV Live streaming Retail e-commerce drives demand Growth in vloggers and influencers Spend on original content creation, Live s
Slide 35: Our structure
Our structure Videndum plc is organised in three Divisions: ▪ Media Solutions ▪ Production Solutions ▪ Creative Solutions 2022 Financial highlights Headquarters in the UK Revenue Number of employees £451.2m 1,900 (2021: £394.3m) Group 2022 revenue split 21% Adjusted operating profit* Number of count
Slide 36: Media Solutions Products for Professional Photography/Videography, Influencer/Vlogger and Cine/Scripted TV
Media Solutions Products* for Professional Photography/Videography, Influencer/Vlogger and Cine/Scripted TV Photo & video Lighting Smartphonography Audio capture Motion control & Carrying solutions supports & vlogging stabilisers Manfrotto Manfrotto JOBY Rycote Manfrotto Lowepro Fast Twin Carbon Tri
Slide 37: Production Solutions Products for Broadcast and Cine/Scripted TV
Production Solutions Products* for Broadcast and Cine/Scripted TV Studio pedestals On-location supports Prompters Mobile power Vinten Sachtler OConnor Sachtler/Vinten Autoscript Autocue Anton/Bauer Osprey pedestal Range Vario Ped Ultimate 1040 flowtech system flowtech with Sachtler aktiv10 EPIC-IP19
Slide 38: Creative Solutions Products for Cine/Scripted TV and Live Streaming Enterprises
Creative Solutions Products* for Cine/Scripted TV and Live Streaming Enterprises Cine Medical Live Streaming SmallHD Monitors Teradek Wireless Wooden Camera In-light camera Wireless Live streaming Live streaming Broadcast IP Video Cine 13, OLED 22, Cine 7 + RX Module, RT CTRL.3 Controller, Bolt 6 Ac
Slide 39: Product portfolio
Product portfolio Audio capture IP Video Monitors Robotic camera systems Audix Teradek SmallHD Camera Corps JOBY Vinten Rycote Lens control systems Prompters Teradek Autocue Smartphonography Backgrounds Autoscript JOBY Colorama Lighting & lighting controls Savage JOBY Carrying solutions Supports & S
Slide 40: Important notice
Important notice Forward-looking statements This presentation contains forward-looking statements with respect to the financial condition, performance, position, strategy, results and plans of Videndum plc (the “Group”, “Videndum”, or the “Company”) based on Management’s current expectations or beli
Slide 41: Thank you
Thank you Videndum plc Bridge House, Heron Square, Richmond, TW9 1EN United Kingdom T +44 (0)20 8332 4600 [email protected] videndum.com Capture. Share.