Adrad Holdings Limited · ASX:AHL
Adrad — Investor Presentation (September 2022)
34 slides from Adrad's investor presentation, Sep 30, 2022
Slide 1: Investor Presentation September 2022
For personal use only INVESTOR PRESENTATION Visit SEPTEM B E Now R 2022 adradholdings.com.au
Slide 2: Disclaimer
Disclaimer 2 This document has been prepared as at 2 August 2022 and is based on information provided by Adrad Holdings Limited ACN 121 033 396 (Company) and Adrad in this document will under any circumstances create an implication that there has been no change in the affairs of the Company since th
Slide 3: Today's presenters
Today’s presenters 3 For personal use only Gary Don Jamie Washington Cormack Baensch Founder, Chief Executive General Manager – Executive Director Officer Air Radiators • Gary along with his wife Karen, founded • Don was appointed the CEO of Adrad in 2006 • Jamie is the General Manager of the Compan
Slide 4: Agenda
Agenda 4 For personal use only Section 1 Section 2 Section 3 Section 4 Section 5 Company Business Growth Financial Appendices Introduction Operations Opportunities Overview
Slide 5: Company Introduction
5 Section 1 Company For personal use only Introduction
Slide 6: Adrad's History
Adrad’s History 6 For personal use only 1974 1985 1990 2006 2012 2018 Now Air Radiators Adrad CBM Industrial Natra Group of Radiators Cummins Rail & Adrad poised founded Radiators Radiators (now Companies acquired by Australia (WA) Supacat for founded by Air Radiators Adrad including Natra / acquire
Slide 7: Introduction to Adrad
Introduction to Adrad 7 For personal use only $130.4m $16.4m $10.8m 30-40% 500 16 FY22 Revenue FY22 EBITDA FY22 NPAT Dividend payout ratio Employees Warehouses across Australia, NZ, Thailand Adrad is an Australian-based business specialising in the design and manufacture of innovative heat transfer
Slide 8: A strong track record in servicing the engine cooling market
A strong track record in servicing the engine cooling market 8 For personal use only Founded in 1985 and headquartered in Beverley, South Australia with approximately 500 employees across 8 main sites and 16 warehouse locations in FINANCIAL PROFILE1 Australia, New Zealand and Thailand 4.9% 15.1% 1
Slide 9: Key highlights
Key highlights 9 CONTINUING TO GROW BOTH OPERATING SEGMENTS BY FURTHER LEVERAGING OUR STRONG TRACK RECORD IN AUSTRALIA AND For personal use only NEW ZEALAND AND THE COMPETITIVE ADVANTAGES GAINED THROUGH OUR THAILAND FACILITIES Designer of heat Significant growth Design and High quality and diverse S
Slide 10: Well-positioned to capitalise on the electrification of motor vehicles
Well-positioned to capitalise on the electrification of motor vehicles 10 For personal use only While the electrification of motor vehicles is a growing trend, battery electric vehicles (BEVs) are not expected to comprise a significant proportion of the Australian registered vehicle population for m
Slide 11: Business Operations
11 Section 2 Business For personal use only Operations
Slide 12: Aftermarket
Aftermarket 12 AUSTRALIA’S LARGEST MANUFACTURER, IMPORTER AND DISTRIBUTOR OF RADIATORS AND OTHER HEAT For personal use only EXCHANGE PRODUCTS FOR THE AUSTRALIAN AUTOMOTIVE AND INDUSTRIAL AFTERMARKET Manufacturer, importer Extensive product range Stocks over 2,000 Broad customer base Significant grow
Slide 13: Aftermarket
Aftermarket 13 For personal use only $62.6m $4.7m 227 69:31 66:34 2,000+ FY22 Revenue FY22 EBITDA Employees Purchased : Automotive : Product Manufactured Industrial Catalogue SEGMENT REVENUE AND EBITDA (A$M)1 KEY 8.6% 14.2% 7.5% BRANDS Auto Air Products 80 8.3 10.0 60 8.0 Revenue (A$m) EBITDA (A$m)
Slide 14: Original Equipment (OE)
Original Equipment (OE) 14 For personal use only ADRAD OE IS A DESIGNER AND MANUFACTURER OF OEM INDUSTRIAL RADIATOR AND COOLING SYSTEMS ACROSS A BROAD RANGE OF MARKET SECTORS Designer and manufacturer of original equipment manufacturer (OEM) industrial radiator and cooling systems Low volume, high v
Slide 15: Original Equipment (OE)
Original Equipment (OE) 15 For personal use only OE PROJECT LIFECYCLE KEY BRANDS KEY CUSTOMERS KEY COMPETITORS Application Product Manufacturing Aftersales Engineering Development SEGMENT REVENUE AND EBITDA ($AM)1 R&D Service 3.5% 21.0% 18.2% Test & Validation Repair 80 12.3 14.0 11.3 12.0 Revenue (
Slide 16: Industrial end markets
Industrial end markets 16 MOBILE STATIONARY For personal use only ON HIGHWAY OFF HIGHWAY RAIL POWER & ENERGY GEN INDUSTRIAL Heat transfer systems Heat transfer systems for Custom designed heat transfer Heat transfer systems for Heat transfer systems RELEVANT MARKET for construction and rail transpor
Slide 17: Product Innovation Snapshot
Product Innovation Snapshot 17 For personal use only ULTRA FUSED ULTRA SEAL ALU FIN PIN FIN Stress free silicon grommet joining tube to header Ultra Fused Ultra Seal Conventional Brazed Charge Air Cooler Soft Soldered Grommeted Thick nose Extruded joints extruded tubes tanks Fusion welded joint wi
Slide 18: Thailand Facilities
Thailand Facilities 18 TWO MANUFACTURING FACILITIES LOCATED IN AMATA CITY RAYONG, INDUSTRIAL ESTATE ON THE EASTERN SEABOARD OF THAILAND For personal use only Manufacture of copper/brass and aluminium cores, complete radiators FACILITY and charge air coolers, metal fabrication and assembly for Cate
Slide 19: Financial Overview
19 Section 4 Financial For personal use only Overview
Slide 20: Financial Overview
Financial Overview 20 For personal use only PRO FORMA FINANCIAL PERFORMANCE 4 COMMENTARY A$m FY20A FY21A FY22F FY22A • Revenue expanded at a CAGR2 of 19.3% from FY20 to $130.4m in FY22 driven by strong revenue growth across Revenue 91.6 112.4 134.5 130.4 both Aftermarket and OE segments despite chal
Slide 21: Growth Opportunities & Outlook
21 Section 3 Growth For personal use only Opportunities & Outlook
Slide 22: Aftermarket Segment
Aftermarket Segment 22 For personal use only COMPETITIVE ADVANTAGES GROWTH OPPORTUNITIES Supplier of heat exchangers to the Australian and NZ aftermarkets Expand channels Increase customer base in direct-to-mechanics channel Brand and to market to the utilising Adrad’s online sales platform repu
Slide 23: OE Segment
OE Segment 23 For personal use only COMPETITIVE ADVANTAGES GROWTH OPPORTUNITIES Well established with long-term customer relationships Further develop Thailand capability to support the power Longstanding generation sector with local manufacturing relationships with Reputation for engineering
Slide 24: Investment Roadmap
Investment Roadmap 24 COMMENCING IN FY22, ADRAD HAS A DEFINED INVESTMENT STRATEGY TO DELIVER GROWTH THROUGH FY25 For personal use only FY22 FY23 FY24 FY25 Aftermarket New customer acquisition Expand range of aftermarket products Extend distribution footprint Develop Natrad Trade Online conce
Slide 25: Outlook Commentary
Outlook Commentary 25 For personal use only Following on from the positive end to FY22, the initial start to FY23 has been inline with management expectations Aftermarket segment is performing positively against the same period in FY22 with continued increase in volumes Build rates in OEM segm
Slide 26: Summary
Summary 26 Target dividend payout ratio of 30% to 40% of NPAT with pro forma FY22 NPAT of $10.8m For personal use only Extensive track record with Design and manufacturing capabilities over 100 years of experience and a trusted across an extensive product range supported brand with quality, reliabil
Slide 27: Appendices
27 Section 5 Appendices For personal use only
Slide 28: Offer Summary
Offer Summary 28 THE OFFER For personal use only Offer Price per Share $1.50 • The Company is seeking to raise $22.0 Total proceeds from the Offer, comprising: $22.0 million million by inviting investors to subscribe for up to 14.7 million shares at an Offer Price of Total proceeds from the issue of
Slide 29: Use of Funds and Capital Structure
Use of Funds and Capital Structure 29 For personal use only USE OF FUNDS1 SHAREHOLDER STRUCTURE2,3 Pre-Offer Post-Offer Purchase of additional manufacturing plant and million % Total % Total3 Shares Shares equipment to support the growth and expansion plans $5.3 million for the Thailand and Australi
Slide 30: Risks
Risks 30 This section describes some of the potential risks associated with the Company’s business and the industries in which switch to different distributors thereby providing them with bargaining power. An increase in bargaining power from the Company operates, and the risks associated with an in
Slide 31: Risks
Risks 31 Relationships with landlords may deteriorate Litigation risk For personal use only As of June 2022, Adrad has 25 property leases covering its manufacturing, warehousing, distribution and workshop Legal proceedings may arise from time to time in the ordinary course of business. Litigation ri
Slide 32: Risks
Risks 32 Execution of growth strategies General risks For personal use only Adrad’s current growth strategies include growing market share in its existing markets and expanding its technology Price of Shares into adjacent markets and products. There is a risk that these strategies are ineffective or
Slide 33: Risks
Risks 33 General economic conditions Unforeseen risk Factors such as inflation, currency fluctuations, interest rates, legislative changes, political decisions and industrial There may be other risks of which the Directors are unaware as at the date of this presentation which may impact on For perso
Slide 34: Contact Us
For personal use only CONTACT US Investor Relations Melanie Singh +61 439 748 819 [email protected] This presentation has been approved for release by the Board of Adrad Holdings Limited.
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