Michelmersh Brick Holdings PLC · LSE:MBH
Michelmersh Brick — FY2021 Earnings Presentation
33 slides from Michelmersh Brick's earnings presentation, October 2022
Slide 1: 2021 Full Year Results
Q@ MIiCHELMERSH Britain's Brick Specialists
Slide 2: Disclaimer
Michelmersh Full Year Results 2021 1 Disclaimer ▪ The information contained in this presentation document (the “presentation”, which term includes any information provided verbally in connection with this presentation document) does not constitute an offer or solicitation to hold, sell or invest in
Slide 3: Presentation Team
Michelmersh Full Year Results 2021 2 Presentation Team Frank Hanna Britain’s Brick Specialist Joint Chief Executive Officer Ryan Mahoney Michelmersh strives to be a well-invested, long term, Chief Financial Officer sustainable and environmentally responsible business dedicated to delivering quality
Slide 4: Michelmersh Brick Holdings plc
3 Michelmersh Full Year Results 2021 Michelmersh Brick Holdings plc 125m+ Strong core market Manufacturer of diverse RMI, Housing,Commercial, premium brick products UrbanRegeneration, Specification 2 3 lifetime Robust distribution revenue sources policy 1 3 • Bricks Pioneering Select • Landfill Orde
Slide 5: Highlights – At a glance
Michelmersh Full Year Results 2021 4 Highlights – At a glance Strong adjusted performance surpassing both 2020 and 2019 record year ▪ Revenue and Gross Profit of £59.5m and £24.2m, ahead of 2019 with growth of 11.2% and 10.5% (2019: £53.5m and £21.9m) ▪ Adjusted* EBITDA of £14.7m supports an EBITDA
Slide 6: 2021 Financial Highlights
Michelmersh Full Year Results 2021 5 2021 Financial Highlights 2020 Comparative Turnover Gross Margin Adjusted EBIT £59.5m 40.7% £11.1m £52.0m 41.3% £8.8m Adjusted Cashflow from EBITDA Profit Before Tax operations £14.7m £9.7m £15.8m £12.3m £6.9m £12.9m Basic EPS Adjusted EPS NAV per share 6.50p 9.3
Slide 7: 2021 Operational Highlights
Michelmersh Full Year Results 2021 66 2021 Operational Highlights ▪ Excellent performance in 2021, with results for the year ahead of record 2019 pre-Covid-19 comparison across all key adjusted financial metrics ▪ Focused management of production efficiency and cost base supported profit growth ahea
Slide 8: Financial Review
Michelmersh Full Year Results 2021 7 Financial Review V&A Museum, London (2021 Renovation with Royal Albert Hall)
Slide 9: Income statement
Michelmersh Full Year Results 2021 8 Income statement Compared to pre-Covid-19 2019, which was a record year for the business ADJUSTED ADJUSTED ADJUSTED 2021/2019 2021 2020 2019 £M £M £M Revenue 59.5 52.0 53.5 11.2% Gross profit 24.2 21.5 21.9 10.5% Gross margin 40.7% 41.3% 40.9% (0.2%) Central cost
Slide 10: Balance Sheet
Michelmersh Full Year Results 2021 9 Balance Sheet Strong balance sheet position provides flexibility to pursue strategic initiatives and acquisition opportunities 2021 2020 31 Dec £M 31 Dec £M Intangible fixed assets 20.2 21.4 Tangible fixed assets 63.2 60.9 Net working capital 9.1 9.1 Net cash/(de
Slide 11: Cash Flow
Michelmersh Full Year Results 2021 10 Cash Flow Consistent quality of the fundamental cash generating ability of the business with adjusted EBITDA cash conversion of 107.5% 2021 2020 £M £M Net cash generated by operations 15.8 12.9 Tax paid (2.3) (2.5) Interest paid (0.2) (0.7) Purchase of property,
Slide 12: Net Cash/Debt Profile 2013 - 2021
Michelmersh Full Year Results 2021 11 Net Cash/Debt Profile 2013 - 2021 Strong net cash position of £7.7m and new RCF of £20m provides headroom and flexibility for the medium term 2017 Carlton 2019 Floren Acquisition Acquisition 10 2.0 5 - 1.0 EBITDA Multiple 2013 2014 2015 2016 2017 2018 2019 2020
Slide 13: Sector Review
Michelmersh Full Year Results 2021 12 Sector Review Hampshire Homes Funtley Road
Slide 14: Market Fundamentals
Michelmersh Full Year Results 2021 13 Market Fundamentals UK Housing Dynamics Strong demand for new housing • Continued Government and opposition parties committed to construction as a key foundation of the economy • Post COVID-19 housing demand with the ongoing “chase for space” and focus on the im
Slide 15: UK Brick Manufacturing – Current Trends
Michelmersh Full Year Results 2021 14 UK Brick Manufacturing – Current Trends COVID-19 Impact on output and deliveries in 2020 with 2021 showing strong even recovery 2021 & 2020 Cumulative output and excess over output • Current UK brick industry stocks remain at an all time low of (Source;BIS) belo
Slide 16: UK Residential Market Update
Michelmersh Full Year Results 2021 15 UK Residential Market Update Stable projections for housing starts and completions, with positive RM&I output expected over the medium term Actual 2019 to Forecast 2023 Housing Starts and Completions Actual 2019 to Forecast 2023 RM&I Output (Source;MHCLG, ONS, C
Slide 17: Market Structure
Michelmersh Full Year Results 2021 16 16 Market Structure UK brick manufacturers Market Share OTHERS 3% UK brick manufacturing highly concentrated MICHELMERSH 5% FORTERRA 28% WIENERBERGER 21% Current UK capacity c. 1.9 billion Source: Published statistics and IBSTOCK 43% management estimates UK Bric
Slide 18: Clay Brick Industry
Michelmersh Full Year Results 2021 17 Clay Brick Industry Market presence and influence • 84% (over 205,000) of new homes in the UK were built using clay brick in 2021. • c.1.9 Billion clay bricks were manufactured in the UK in 2021. • 150-200 years minimum life expectancy for clay bricks. • 12,000
Slide 19: Why Brick?
Michelmersh Full Year Results 2021 18 Why Brick? Why brick is the UK’s external façade material of choice:
Slide 20: Why Brick?
Michelmersh Full Year Results 2021 19 19 Why Brick? Why brick is the UK’s external facade material of choice: The Cost of Comparative Cladding Materials’ by the RICS Building Cost Information Service (BCIS) Material cost comparison: The Group has invested over £7.7m since 2016 on efficiency and sust
Slide 21: Outlook
Michelmersh Full Year Results 2021 20 Outlook Industry • Continued UK housing dynamics of short supply to meet strong demand • Brick continues to be the façade material of choice • Continued demand for residential development and RMI market • Capital intensive and complex barriers to entry Michelmer
Slide 22: Appendices
Michelmersh Full Year Results 2021 21 Appendices Winchester University BREEAM Excellent Rating
Slide 23: Good corporate citizen Michelmersh Core Values - IRIS
Michelmersh Full Year Results 2021 22 Good corporate citizen Michelmersh Core Values - IRIS Using modernised production methods that emphasise sustainable building solutions and adhere to the most stringent production requirements, Michelmersh guarantees high quality product standards with a low eco
Slide 24: Sustainability Report 2021
Michelmersh Full Year Results 2021 23 Sustainability Report 2021 Shaping Genuine Sustainability United Nations’ Sustainability Development Goals (UNSDG’s) A detailed account of the Group’s sustainable The 17 Sustainable Development Goals are the blueprint to practices, plans and KPI targets for achi
Slide 25: Achieving Net Zero by 2050
Michelmersh Full Year Results 2021 24 Achieving Net Zero by 2050 Potential project reduction timeline -18.7% Group reduction in CO2 per tonne of production from 2016 baseline.
Slide 26: Think Longer
Michelmersh Full Year Results 2021 25 Think Longer Design for 200 years, not 20 Durable products with extensive longevity such as clay brick, will prolong the expected life of a building resulting in a lower carbon footprint for every year of use.
Slide 27: Education Sector
Michelmersh Full Year Results 2021 26 Education Sector AUB Student Accommodation & Headington School, Oxford
Slide 28: Luxury Homes
Michelmersh Full Year Results 2021 27 Luxury Homes Applegate Homes
Slide 29: Commercial
Michelmersh Full Year Results 2021 28 Commercial Bellefields Road, London
Slide 30: Affordable Housing
Michelmersh Full Year Results 2021 29 Affordable Housing Agar Place & Brentford Lock, London
Slide 31: Urban Regeneration
Michelmersh Full Year Results 2021 30 Urban Regeneration Hale Wharf, London
Slide 32: Pre-fabricated panel systems
Michelmersh Full Year Results 2021 31 Pre-fabricated panel systems London Fruit & Wool Exchange
Slide 33: Full Year Results 2021
Michelmersh 32 Full Year Results 2021 2021 RIBA Stirling Prize Winner Freshfield Lane Danehill Kingston University London Haywards Heath Sussex RH17 7HH Tel: 0844 931 0022 www.mbhplc.co.uk
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