Renishaw Plc · LSE:RSW
Renishaw — FY2012 Earnings Presentation
33 slides from Renishaw's earnings presentation, June 2012
Slide 1: 2012 results
RENISHAW.& apply innovation™
Slide 2: Highlights
Highlights • Record results • Revenue £331.9m +15% Revenue (£m) Adjusted PBT (£m) 400 331.9 100 80.4 86.0 288.7 80 • Profit before tax £86.0m +7% 300 201.2 171.2 181.6 60 41.7 200 28.7 40 100 20 8.8 • EPS 95.6p +8% 0 2008 2009 2010 2011 2012 0 2008 2009 2010 2011 2012 Year Year • Dividend per share
Slide 3: PBT changes from 2011
120 100 0 20 40 80 60 £m Slide 3 2011 PBT 80.4 Revenue increase less 29.9 cost of sales other finance 1.7 income PBT changes from 2011 margin erosion (5.4) additional engineering (7.9) costs additional distribution (10.1) costs additional admin costs (2.6) 2012 PBT 86.0
Slide 4: Income statement
Income statement 2012 2011 change £m % £m % % Cost of sales Sales 331.9 100 288.7 100 +15% £m Cost of sales (110.0) (33) (91.3) (31) +20% 120 110.0 80 Engineering (incl R&D) (45.0) (14) (37.1) (13) +21% 100 91.3 70 74.2 60 80 67.4 65.3 50 Gross profit 176.9 53 160.3 56 +10% 60 40 40 30 Distribution
Slide 5: Income statement – Engineering costs
Income statement – Engineering costs • Engineering costs (including R&D, current £m % of sales engineering and manufacturing processes): Engineering costs 47.9 2012 2011 50 40.0 50 35.4 40 35.9 40 • Total spend £47.9m £40.0m 30.9 30 30 • Less capitalised (net) £2.9m £2.9m 20 20 • Remaining in P&L £4
Slide 6: Income statement – Distribution costs
Income statement – Distribution costs £m Distribution costs % of sales • Distribution costs up 19%: 70 62.2 40 •Expansion of UK & overseas sales and marketing 60 52.1 30 facilities to support growing revenue 50 41.5 39.7 40 35.7 20 30 •New subsidiary in Mexico 20 10 10 0 0 •Expanded offices in USA,
Slide 7: Income statement – Administrative expenses & headcount
Income statement – Administrative expenses & headcount • Administrative expenses increased by 9% £m % of sales Administrative expenses •Mainly inflationary, effect of acquisitions and growth in 40 40 infrastructure 31.5 28.9 30 30 •Represents 9% of group revenue (2011 10%) 21.4 22.6 19.9 20 20 • Gro
Slide 8: Income statement – Profitability
Income statement – Profitability £m % of sales •Profit before tax by quarter: 40 Quarterly profit before tax 80 33.5 2012 2011 change 35 70 30 60 £m £m % 25.3 25 21.4 50 20.1 19.9 20 17.5 40 Quarter 1 13.6 15.1 -10% 15.1 13.6 15 30 Quarter 2 17.5 20.1 -13% 10 20 Quarter 3 21.4 25.3 -15% 5 10 Quarter
Slide 9: Group revenue analysis
Group revenue analysis Highlights: Revenue £m • Revenue up 15% at £331.9m, from £288.7m 400 • Good progress in all geographic areas 288.7 331.9 300 • Record final quarter with £103m revenues 201.2 181.6 • Strong final quarter in Far East due to China - driven by 200 171.2 strong demand for consumer
Slide 10: Group revenue analysis
Group revenue analysis Revenue by segment 7.9% 7.5% 2011 2012 92.1% 92.5% Metrology Healthcare • Segmental analysis 2012 2011 change £m £m % • Metrology 305.8 267.0 +15% • Healthcare 26.1 21.7 +20% Slide 10
Slide 11: Group revenue analysis
Group revenue analysis • Changes in geographic areas: 2012 2011 increase Revenue by region £m £m % • Far East 130.2 114.5 +14% 2012 2011 2012 2011 3% 2% • Europe 95.7 85.7 +12% 6% 5% UK Other • Americas 76.8 65.1 +18% • UK & Ireland 18.9 14.8 +28% 2012 2011 2012 2011 • Other regions 10.3 8.6 +20% 23
Slide 12: Group revenue - Metrology
Group revenue - Metrology • Global investment in production systems for automotive, civil aviation, agriculture and energy are strong drivers • All product lines grew apart from encoder products Revenue by region • Machine tool and calibration product lines performed particularly well 2012 2011 2012
Slide 13: New product releases - Metrology
New product releases - Metrology REVO® SFP1 surface finish probe UCC T3 - a 3 axis touch trigger CMM controller / amplifier designed specifically for entry level 3 axis DCC touch trigger machines UCC motion control software for CMMs: new releases for improved throughput and efficiency PHC10-3, repla
Slide 14: New product releases - Metrology
New product releases - Metrology MCU-W - a bluetooth operated CMM hand controller for use New MODUS metrology on very large machines software for aero engine blade inspection and analysis XR20-W rotary calibrator UCC2-2 replacement for UCC2 machine controller: new processor, new branding. PI 7-3 and
Slide 15: New product releases - Metrology
New product releases - Metrology 64-bit support and improved model annotation tools for Renishaw OMV on- machine verification software 64-bit support and a wider range of multi-axis CNC machine support for our Productivity+™ process control software LinACE heavy-duty absolute New Resolute™ products:
Slide 16: New investments - Metrology
New investments - Metrology • Investment – R&R Sales LLC • £2.6m investment in cash in April 2012 for 100% shareholding in R&R with further payments based on performance • US-based supplier of fixtures for the global measurement and inspection market • R&R to utilise Renishaw’s worldwide distributio
Slide 17: Group revenue - Healthcare
Group revenue - Healthcare Revenue by region • Record Spectroscopy sales – driven by increasing applications in nanotechnology, advanced materials & life sciences 2012 2011 •Growth in dental and neuro 2012 2011 8% 5% 7% 9% • Further sales of the neuromate surgical robot for UK Other neurosurgical pr
Slide 18: Healthcare developments
Healthcare developments • During the year, the Board refocused part of the healthcare activities to a smaller number of projects, particularly in our neurological products line and withdrew from the supply of radio frequency coils for use in MRI scanning research which was no longer considered core
Slide 19: New product releases - Healthcare
New product releases - Healthcare RA800-series of OEM benchtop instrument solutions can be configured to provide tailored chemical analysis solutions across a range of application areas. The image shows a RA800-series instrument in use at Renishaw Diagnostics Ltd Integrated Raman AFM system 3D imagi
Slide 20: New product releases - Healthcare
New product releases - Healthcare In our neurological business, the next generation of neuroinspire™ surgical planning software was CE marked in January 2012 Full contour zirconia is one solid piece of material that has a shade applied then some stain and glaze to finish LaserAbutment is a one piece
Slide 21: Awards
Awards • Renishaw’s 15th Queen’s Award. Awarded for the SP80 ultra-high accuracy analogue scanning probe • The co-founders of Renishaw plc, Sir David McMurtry and John Deer, have been honoured with the prestigious Swan Medal of the Institute of Physics, for their role in founding Renishaw plc and le
Slide 22: Awards
Awards • Equator™ was also honoured with another top international award, winning the Gold Award at Holland’s Techni-Show Innovation Awards 2012 • At the UK's National Business Awards Renishaw was awarded the Grant Thornton Mid-Cap Business of the Year award for FTSE listed businesses and mutuals wi
Slide 23: Cash flow
£m 100 140 120 20 40 60 80 0 b/fwd Slide 23 23.7 Cash flow PBT depreciation 86.0 and 20.2 amortisation R&D capitalisation (9.7) capital (30.3) working (23.1) capital dividends (25.4) tax (14.1) intangibles & (3.7) investments pension fund (2.1) other (0.4) c/fwd 21.1
Slide 24: Balance sheet
Balance sheet June June 2012 2011 change Working capital (excluding cash) £m £m % £m Property, plant & equipment 101.0 82.3 +23% 100 97.6 Intangible assets & investments 61.2 54.5 +12% 75.7 80 Deferred tax assets 17.8 23.8 -25% 54.6 60 52.5 Derivatives 3.5 0.7 +400% 37.7 40 Total non-current assets
Slide 25: Capital expenditure – Tangible fixed assets
Capital expenditure – Tangible fixed assets • Total Tangible fixed asset spend £30.3m (2011 £16.5m), of which £13.6m was on property, £16.7m on plant and equipment Capital expenditure • Property additions £m • Miskin refurbishment 40 30.3 • New property for MDL in construction 30 16.5 • Canada 20 11
Slide 26: Capital expenditure – UK property
Capital expenditure – UK property Miskin, near Cardiff, South Wales Before refurbishment After refurbishment Slide 26
Slide 27: Capital expenditure – UK property
Capital expenditure – UK property Additive Manufacturing Products Division, Stone, Staffordshire Progress on new MDL building, York Slide 27
Slide 28: UK property expansion plans
UK property expansion plans Approved application: New Mills, Wotton-under-Edge (230,000 sq.ft phased development) Approved application: Charfield, near Wotton-under-Edge (50,000 sq.ft extension)
Slide 29: Capital expenditure – overseas property
Capital expenditure – overseas property Renishaw Canada, Mississauga Renishaw Iberica, Barcelona, Spain Renishaw S.p.A., Turin, Italy Associate company RLS, Slovenia
Slide 30: Outlook
Outlook • Final quarter saw increases in revenue growth • Our markets exhibit attractive, long-term structural drivers with continuing global investment in production systems and processes • Continued investment in R&D, manufacturing, marketing and distribution capability • World economic outlook un
Slide 31: Chairman’s statement
Chairman’s statement I am pleased to announce a record set of Group results in terms of both revenue and profit for the year ended 30th June 2012; a year of further progress and growth. Total Group revenue for the year was £331.9m, 15% ahead of the £288.7m for last year. All geographic areas saw goo
Slide 32: Chairman’s statement (continued)
Chairman’s statement (continued) During the year, the Board refocused part of the healthcare activities to a smaller number of projects, particularly in our neurological products line, and withdrew from the supply of radio frequency coils for use in MRI scanning research which was no longer consider
Slide 33: Chairman’s statement (continued)
Chairman’s statement (continued) Balance sheet and working capital Net cash balances at 30th June 2012 were £21.1m, compared with £23.7m in 2011. In addition, there is an escrow account amounting to £11.5m (30th June 2011 £10.8m) relating to the provision of security to the Company’s defined benefit