Kingspan Group PLC · EURONEXT:KRX
Kingspan — H1 2015 Earnings Presentation
30 slides from Kingspan's earnings presentation, Aug 24, 2015
Slide 1: Kingspan Interim Results 24th August 2015
Kingspan Interim Results 24th August 2015
Slide 2: Disclaimer
Disclaimer Forward Looking Statements This presentation contains certain forward-looking statements including, without limitation, regarding the Group’s financial position, business strategy, plans and objectives of management for future operations. Such forward- looking information involves risks a
Slide 3: The Business
The Business A global leader in high performance insulation and building envelopes Market leading positions in UK, Mainland Europe, North America and Australasia Proprietary technology drives differentiation in product performance 61% INSULATED PANELS 26% INSULATION BOARDS 7% 6% ACCESS FLOORS
Slide 4: H1 2015 In a Nutshell
H1 2015 In a Nutshell 1,235 1,235 112 112 Billion Billion Million Million Above are based on internal estimates, and are directional rather than precise 4
Slide 5: Our Strategy
Our Strategy Lead the field in high performance insulation globally with proprietary and differentiating technologies Become the world’s leading provider of low energy building solutions – Insulate & Generate Achieve greater geographic balance, primarily focusing on The Americas, Western Europ
Slide 6: 5 Year Financial Performance
5 Year Financial Performance Revenue (€’m) (CAGR 13.9%) 2,599.0 1,776.8 1,891.2 1,546.9 1,628.7 2011 2012 2013 2014 2015* Trading Profit (€’m) (CAGR 23.2%) 220.5 148.5 122.8 107.7 95.7 2011 2012 2013 2014 2015* * Analyst consensus 6
Slide 7: H1 2015 In Summary
H1 2015 In Summary • Strong delivery overall with encouraging organic growth Revenue complemented by significant development activity. up 39% • Insulated Panel revenue growth of 43% to €753m, to €1.24bn reflecting solid organic growth in key markets, combined with the acquired sales of Joris Ide and
Slide 8: Financial Highlights
Financial Highlights H1 2015 H1 2014 Change cc* Revenue (€m) 1,235.3 889.3 +39% +29% Trading Profit (€m) 111.7 69.2 +61% +44% EBITDA (€m) 137.9 88.9 +55% +40% Earnings per share (cent) 46.5 €x 29.2 +59% Interim Dividend (cent) 8.0 6.25 +28% Free Cashflow (€m) 105.7 28.7 +268% Net Debt (€m) 449.3 113
Slide 9: Trading Profit & Margin Progression
Trading Profit & Margin Progression Trading Profit Margin % 125.0 100.0 H1 14 FY 14 H1 15 Insulated 8.3% 8.0% 9.3% Panels 75.0 Insulation 8.0% 8.4% 8.9% Boards €’m 111.7 Environmental 0.3% 0.8% 4.3% 50.0 Access Floors 10.8% 11.7% 11.4% 69.2 Group 7.8% 7.9% 9.0% 25.0 52.7 55.9 44.2 0.0 H1 11 H1 12 H1
Slide 10: Group Sales & Profit Bridge
Group Sales & Profit Bridge Sales 90.7 25.0 230.3 1,235.3 889.3 H1 14 Acquisitions FX Underlying H1 15 Trading Profit 9.1 11.9 21.5 111.7 69.2 H1 14 Acquisitions FX Underlying H1 15 10
Slide 11: Strong Free Cash Flow
Strong Free Cash Flow 180.0 160.0 WC/Sales 14.2% * 2.1 (7.7) 17.1 140.0 (9.5) 120.0 (34.2) 100.0 €’M 137.9 80.0 105.7 60.0 40.0 20.0 0.0 EBITDA Working Provisions, Interest Tax Net Capex Free cash flow Capital Pension, Non- Payable cash * Average working capital to sales % reduces to 11.5% when adju
Slide 12: Movement in Net Debt
Movement in Net Debt 500.0 (2.9) 450.0 17.6 400.0 350.0 300.0 449.3 €’M 250.0 414.8 200.0 150.0 100.0 125.5 (105.7) 50.0 0.0 Net Debt Dec 14 Free Cash Flow Acquisitions Dividend Shares issued/fx Net Debt Jun 15 etc. 12
Slide 13: Growing ROCE
Growing ROCE 16.0% 14.0% 14.4%* 13.4% 12.0% 12.3% 11.3% 10.0% 10.7% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 2011 2012 2013 2014 H1 2015 * Includes the full year profit of current period acquisitions 13
Slide 14: Financing and Interest
Financing and Interest Interest Payable 2015 2014 €’m €’m Bank and Loan Notes 7.1 6.9 Non Cash Derivatives 0.4 - Non Cash Pension 0.1 0.1 7.6 7.0 Significant Headroom €’m Revolving Credit Facility (undrawn) 190 Bi-Laterals (undrawn) 40 Cash 170 400 14
Slide 15: Efficient Debt Management
Efficient Debt Management 2015 interest is forecast to be in line with 2014 16.0 14.0 2.0 (3.8) 0.8 12.0 1.8 10.0 14.8 €’M 8.0 14.0 6.0 4.0 2.0 0.0 2014 Maturing Notes Bank Debt FX New Notes 2015 Forecast 15
Slide 16: Sales by Geography
Sales by Geography H1 2014 H1 2015 10% 4% 9% 3% 13% 18% 33% 38% 35% 37% Republic of Ireland Britain & Northern Ireland Mainland Europe Americas €’m H1 15 H1 14 Constant Currency YoY % Rest of World Change Change Britain & Northern Ireland 399.7 335.3 +7% +19% Mainland Europe 459.0 314.2 +46% +46% Am
Slide 17: Insulated Panels
Insulated Panels Strong start to 2015 reflecting solid organic growth combined with acquired sales of Joris Ide H1 15 H1 14 and Vicwest Inc. Sales (€m) 752.9 526.1 Robust UK performance overall, % of Group Sales 61% 59% positive project pipeline Benelux sales continue to Analysis of YoY % Chan
Slide 18: Insulated Panels (Cont.)
Insulated Panels (Cont.) Australasia more challenging, prioritising margin over revenue Strong performance in North America, with a double digit increase in sales Strong orderbook in North America points towards positive H2 Kingspan Energy continuing to gain traction, now with presence in No
Slide 19: Insulation Boards
Insulation Boards UK sales grew strongly in H1 owing to increase in Kooltherm® penetration and general H1 15 H1 14 construction recovery Sales (€m) 319.2 221.1 Kooltherm® sales robust, % of Group Sales 26% 25% benefitting margins Improvement in Continental Analysis of YoY % Change Europe, part
Slide 20: Access Floors
Access Floors Overall sales increased by 22% with contrasting performances H1 15 H1 14 across the territories Sales (€m) 85.7 70.5 US grew significantly driven by % of Group Sales 7% 8% data centre product sales Analysis of YoY % Change Traditional office floor market Currency Volume Price & M
Slide 21: Environmental
Environmental Positive sales performance H1 15 H1 14 overall demonstrating tangible recovery Sales (€m) 77.5 71.6 % of Group Sales 6% 8% Fuel storage solutions significant driver of growth Analysis of YoY % Change Lower hot water product sales Currency Volume, Price & Mix Total due to competit
Slide 22: Outlook
Outlook Improved momentum in UK and US anticipated to continue for time being, despite easing of UK activity in recent months Gradual and sustained market recovery expected in European markets Input environment at a cyclical low, likely to harden over time Good H2 expected overall Skifield,
Slide 23: Additional Information
ADDITIONAL INFORMATION University of Arizona, USA 23 Dri-Design
Slide 24: 2015 Snapshot
2015 Snapshot * *Analyst Consensus 24
Slide 25: Our Evolution - Financial
Our Evolution - Financial CAGR = 17.4% 25
Slide 26: Kingspan Insulates Better
Kingspan Insulates Better 26
Slide 27: Kingspan v Construction Macro
Kingspan v Construction Macro 27
Slide 28: Driving Penetration Growth
Driving Penetration Growth Aim to change Building Practices / Material Choices 28
Slide 29: Our Net Zero Energy Path
Our Net Zero Energy Path Kingspan. Total Energy Use Total Renewable Energy NZE Year GWh GWh % 2012A 317 27 9 2013A 327 60 18 2014A 312 88 28 2015P 334 143 43 2016P 337 181 54 2017P 342 193 56 A=Actual; P=Plan 29
Slide 30: Dublin Road, Kingscourt, Co. Cavan, Ireland
Dublin Road, Kingscourt, Co. Cavan, Ireland Telephone: +353 42 969 8000 Fax: +353 42 966 7501 Email: admin@kingspan. com www. Kingspan. com Kingspan