Avon Technologies Plc · LSE:AVON
Avon Technologies — Avon Rubber p.l.c. — FY2011 Earnings Presentation
28 slides from Avon Technologies's earnings presentation, 2011
Slide 1: Preliminary Results 2011
PRELIMINARY RESULTS 2011 FOCUSED ON OPPORTUNITIES
Slide 2: Peter Slabbert, Chief Executive
PRELIMINARY RESULTS 2011 PETER SLABBERT CHIEF EXECUTIVE
Slide 3: Highlights
HIGHLIGHTS Revenue £’m FINANCIAL HIGHLIGHTS Operating profit up 20% (23% at constant currency) Lower interest costs and effective tax rate Profit before taxation up 43% Earnings per share up 66% to 25.2p Resumption of interim dividend and 33% increase in final dividend to 2.0p Positive c
Slide 4: Globally Focused
GLOBALLY FOCUSED FOCUSED ON OPPORTUNITIES 4
Slide 5: Andrew Lewis, Group Finance Director
PRELIMINARY RESULTS 2011 ANDREW LEWIS GROUP FINANCE DIRECTOR
Slide 6: Group Income Statement
GROUP INCOME STATEMENT 2011 2010 £’m £’m Revenue 107.6 117.6 EBITDA 16% 15.7 13.6 Depreciation and amortisation (4.6) (4.3) Operating profit Body copy to go in here where it is required. Body copy to go in 20% 11.1 9.3 here where it is required. Interest expense Body copy to go in here where 51% (0.
Slide 7: Revenue & Profit Progression
REVENUE & PROFIT PROGRESSION REVENUE – GROUP 2010 v 2011 140 120 100 80 60 40 20 0 Body copy to go in here where it 2010 is required. Body copy to go in FX AEF / Other Fire UK MoD Dairy DoD NA / EMEA 2011 here where it is required. Body copy to go in here where OPERATING PROFIT – GROUP 2010 v 2011 i
Slide 8: Protection & Defence Financials
PROTECTION & DEFENCE FINANCIALS REVENUE 2011 2010 100 £’m £’m £m Revenue 77.4 90.2 50 H2 EBITDA 11.6 10.4 H1 Operating profit 7.5 6.5 0 2009 2010 2011 OPERATING PROFIT PERFORMANCE DRIVERS 8 DoD mask system volumes maintained and £m filter spares increased by 63% to c.1m pairs 6 Non DoD sales of
Slide 9: Protection & Defence Revenue
PROTECTION & DEFENCE REVENUE 2011 £77m 2010 £90m 4% DoD 8% 5% 8% NA DHS / EMEA 31% 41% Fire 56% 24% AEF & Other UK MoD 11% 12% • US DoD M50 masks and M61 filters still dominate Protection & Defence revenue • North American homeland security growing • EMEA success in Saudi Arabia, Kuwait and France •
Slide 10: Analysis of DoD Contract
ANALYSIS OF DoD CONTRACT Mask systems (thousands) 3,000 Sole Source Contract Vehicle 2,500 2,000 Total Service Requirement 1,500 1,000 500 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 10 FOCUSED ON OPPORTUNITIES
Slide 11: Dairy Financials
DAIRY FINANCIALS REVENUE 2011 2010 40 £’m £’m £m 30 H2 Revenue 30.2 27.4 20 EBITDA 5.9 5.0 H1 10 Operating profit 5.5 4.6 0 2009 2010 2011 OPERATING PROFIT PERFORMANCE DRIVERS PERFORMANCE OPERATIONAL 6 Input costs volatile and rising, passed on to £m customers, accounting for half of the rise in 4
Slide 12: US$ Translation Has Been a Marginal Headwind in 2011
US$ TRANSLATION HAS BEEN A MARGINAL HEADWIND IN 2011 GROUP PROTECTION & DEFENCE 2010 2010 restated at restated at 2011 2011 rates 2010 2011 2011 rates 2010 £’m £’m £’m £’m £’m £’m Revenue 107.6 114.3 117.6 Revenue 77.4 87.5 90.2 EBITDA 15.7 13.3 13.6 EBITDA 11.6 10.2 10.4 Operating Profit 11.1 9.0 9
Slide 13: Cashflow
CASHFLOW 2011 2010 £’m £’m Net cashflow from operations Continuing excluding exceptional items 12.0 13.6 Exceptional items ‐ (1.2) Continuing total 12.0 12.4 Discontinued (1.6) (2.0) Cash generated from operations 10.4 10.4 Tax Body copy to go in here where it (1.5) (1.8) is required. Body c
Slide 14: Increasing Investment to Underpin Growth
INCREASING INVESTMENT TO UNDERPIN GROWTH R&D cash £6.6m (2010: £2.3m) Customer funded Customer funded £1.7m 1.7m Avon funded £4.9m R&D capitalised £3.2m Body copy to go in here where it R&D expensed £1.7m is required. Body copy to go in here where it is required. Body copy to go in here where Balanc
Slide 15: Summary Balance Sheet
SUMMARY BALANCE SHEET 2011 2010 £’m £’m Intangible assets 10.5 8.8 Property, plant and equipment 16.7 17.0 Current assets 29.1 26.2 Current liabilities Body copy to go in here where it (18.0) (18.2) is required. Body copy to go in here where it is required. Non‐current liabilities Body copy to go in
Slide 16: UK Retirement Benefit Scheme
UK RETIREMENT BENEFIT SCHEME IAS19 30 SEPTEMBER 2011 31 MARCH 2011 TRIENNIAL VALUATION Valuation brought forward by twelve months following Move from a £6.3m deficit to a £0.3m surplus agreement between Company and Trustee Scheme 98.4% funded Strong asset performance in the twelve months and
Slide 17: Peter Slabbert, Chief Executive
PRELIMINARY RESULTS 2011 PETER SLABBERT CHIEF EXECUTIVE
Slide 18: Protection & Defence Strategy
PROTECTION & DEFENCE STRATEGY “Customer driven World Leader of Advanced CBRN/Respiratory Protection Delivering Quality, Reliability, “Customer driven World Leader of Advanced Performance and Value” CBRN/Respiratory Protection Delivering Quality, Reliability, Performance and Value” Body copy to go in
Slide 19: Protection & Defence Product Strategy
PROTECTION & DEFENCE PRODUCT STRATEGY • Board approved program to enhance product range • Unique modular approach to respiratory protection • Multi‐community interaction through common Avon products • Total market coverage for all Fire, Military and First Responder community • Program delivers in 20
Slide 20: Dairy Strategy
DAIRY STRATEGY “Continued development of the brand to expand the current product range and markets to achieve long term growth, serviced by a globally competitive and sustainable cost base” Further development of the brand. Investment in Body copy to go in here where it product development is requir
Slide 21: Dairy Potential
DAIRY POTENTIAL GLOBAL COW POPULATION 150M FUTURE MARKETS (COWS MILLIONS) 19% 25% 56% MILKING EXPERTISE PRODUCTS PRODUCTS 22 FOCUSED ON OPPORTUNITIES
Slide 22: Opportunities and Outlook
PRELIMINARY RESULTS 2011 OPPORTUNITIES AND OUTLOOK
Slide 23: Protection & Defence Outlook
PROTECTION & DEFENCE OUTLOOK MARKET ENVIRONMENT GROWTH DRIVERSGROWTH DRIVERS US Budgets under pressure Personal protection a priority (but still growing!) Established success of sole source Extended Continuing Resolution possible JSGPM program for 2012 Superior technology platform 2013/1
Slide 24: Dairy Outlook
DAIRY OUTLOOK MARKET ENVIRONMENT GROWTH DRIVERS Milk price remains high IP‐MV Farm consolidations BRIC and Australasian markets Technology growth Milk price Material inputs stabilised Global dairy demand Population growth China direct distribution Expansion of emerging markets
Slide 25: Outlook Statement
OUTLOOK OUTLOOKSTATEMENT STATEMENT We expect to make further progress despite an uncertain outlook for global defence spending. In our Protection & Defence business, being the technology leader, operating in global markets, investing in people and products and having an appropriate cost base has all
Slide 26: Wrap Up
WRAP WRAPUP UP Strong 2011 performance Investment shifting from capacity to technology / products (Project Fusion) Protection & Defence well placed in uncertain environment Dairy robust Balance sheet in good shape Capacity for further investment or acquisitions Focused on opportunities
Slide 27: Questions?
PRELIMINARY RESULTS 2011 QUESTIONS?
Slide 28: Safe Harbour Statement
SAFE HARBOUR STATEMENT Avon Rubber p.l.c. (the ‘Group’) is providing the following cautionary statement. This document contains certain statements that are or may be forward‐looking with respect to the financial condition, results or operations and business of the Group. These statements are sometim