Belysse Group Nv · EURONEXT:BELYS
Belysse Group Nv — Balta Group — Q3 2017 Earnings Presentation
18 slides from Belysse Group Nv's earnings presentation, Nov 7, 2017
Slide 1: Q3 2017 Financial Results
Yabalta Q3 2017 Financial Results
Slide 2: Disclaimer
Disclaimer Certain details included in this presentation are subject to updating, revision, further verification and amendment. Balta Group NV (the "Company") is not under any obligation to update or keep current the information contained in this presentation. In considering any performance informat
Slide 3: Despite the Challenges in Q3 we have Made Good Progress Executing our Strategy
Despite the Challenges in Q3 we have Made Good Progress Executing our Strategy • Continued investment in the attractive growth areas of Rugs and Commercial – We now have a fully automated production process for tile carpets – We have received our first specified orders for Modulyss tiles in Bentley
Slide 4: Q3 YTD Financial Summary
Q3 YTD Financial Summary +5.3% organic • Organic performance driven by growth of Rugs +11.6% and +17.6% Commercial +5.6% (1.2%) FX impact yoy sales growth (consolidated) • Acquisition of Bentley +13.5% +13.5% M&A(1) 0.0% organic +6.8% • Material impact to earnings from FX -7.4% (7.4%) FX impact Adj.
Slide 5: Q3 Financial Summary
Q3 Financial Summary +3.5% organic • Performance underpinned by a strong organic performance in +23.2% Rugs +8.7% and acquisition of Bentley +21.3% (1.6%) FX impact yoy sales growth (consolidated) • Organic growth impacted by start up issues in Belgium commercial tile plant +21.3% M&A(1) (20.9)% org
Slide 6: Group Q3 Revenue Performance
Group Q3 Revenue Performance 27,3 158,0 4,2 (0.0 ) 0,2 0,1 132,8 (2.1 ) 128,3 +8.7% (1.6%) +21.3% Revenue Rugs Residential Commericial Non-Woven LfL Revenue FX Impact M&A Reported Q3 2016 Q3 2017 Revenue Q3 2017 Start up issues in Belgium tile factory held back Strong organic performance in Rugs +8.
Slide 7: Group Q3 EBITDA and Margins
Group Q3 EBITDA and Margins Adj. EBITDA margin (%) 15.1% 11.6% 12.0% 19,4 (1.7 ) 4,6 18.9 (1.7 ) (0.5 ) (0.3 ) 15.3 (1.0 ) (5.2%) +23.8% EBITDA Rugs Residential Commericial Non-Woven LfL FX Impact M&A Reported Q3 2016 EBITDA EBITDA Q3 2017 Q3 2017 Raw materials and FX have Start up issues in Belgium
Slide 8: Rugs Business Continues to Grow Strongly
Rugs Business Continues to Grow Strongly Revenue Evolution (€m) • Strong execution in Rugs leading to +8.7% 4.2 (1.4) 51.2 organic revenue growth 48.4 (2.9%) +8.7% • Margins impacted by: – Timing of Raw material and price increase – one off costs associated to the reorganisation Q3/16 Organic growth
Slide 9: Commercial Business Temporarily Impacted by Supply Interruption
Commercial Business Temporarily Impacted by Supply Interruption Revenue Evolution (€m) • Q3 Revenue and EBITDA impacted by start up 27.3 46.5 issues in Belgium tile factory, now addressed • First specified orders received for Modulyss 19.1 0.2 (0.1) tiles by Bentley customers +1.2% (0.7%) +142.9% Q3
Slide 10: Residential More Challenging Market than Expected
Residential More Challenging Market than Expected Revenue Evolution (€m) • Continued challenging market in continental 54.8 (0.0) (0.6) 54.2 Europe and a stable volume market in the UK (0.1)% (1.0%) • Margins impacted by: – Timing of Raw material and price increase – Negative mix in the core volume
Slide 11: Plan to Restore Residential Margins by Optimising Operational Footprint
Plan to Restore Residential Margins by Optimising Operational Footprint Enabling Greater Focus on Strategy of Growing Higher Margin Products • Intention to absorb Residential production from Oudenaarde factory into the two other Residential factories in Belgium • Intention to close rented warehouse
Slide 12: The Movement of Leverage and Net Debt from Q2 and Q3 is Consistent Year on Year
The Movement of Leverage and Net Debt from Q2 and Q3 is Consistent Year on Year Reflecting the Working Capital Peak Post Acquisition 385 deleveraging of Bentley using primary IPO net proceeds 292 280 269 268 257 3,9x 3,5x 3,6x 3,3x 2,9x 2,6x Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Net Debt (€m) Leverage
Slide 13: 2017 Outlook
2017 Outlook • Continued growth in Rugs • Re-acceleration of growth in Commercial • Partially offset by impact from raw materials price inflation and FX • Full year earnings at the lower end of our guidance range • Medium term guidance unchanged – Mid-single digit top line growth – EBITDA margin of
Slide 14: Our Disciplined Approach to Capital Allocation
Our Disciplined Approach to Capital Allocation Profitable Growth: • Mid-single digit top line growth & margin expansion Strong underlying FCF conversion: • Active working capital management 1 2 3 Disciplined and efficient Allow us to prioritise value Whilst maintain a balance sheet: accretive acquis
Slide 15: Despite the Challenges in Q3 we have Made Good Progress Executing our Strategy
Despite the Challenges in Q3 we have Made Good Progress Executing our Strategy • Continued investment in the attractive growth areas of Rugs and Commercial – We now have a fully automated production process for tile carpets – We have received our first specified orders for Modulyss tiles in Bentley
Slide 16: Q&A Session
Q&A Session 15
Slide 17: Appendices
Appendices 16
Slide 18: Refinancing opportunity has the potential to materially lower net financing cost from Sept 2018
Refinancing opportunity has the potential to materially lower net financing cost from Sept 2018 Potential Redemption Opportunity One-off prepayment €0.6m €1.0m €8.9m penalty SSN 34,2 3,1 2,0 0,4 2,4 Bentley debt 25,4 Assumes refinancing of 3,8 €75m 2,2 Term loan 23,0 €234.9m SSN including pre- 2,0 1