the equipment rental specialist presentation to carillion...
TRANSCRIPT
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The Equipment Rental Specialist
The Equipment Rental Specialist
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Presentationto Carillion
The Equipment Rental Specialists
9th June 2010
The Equipment Rental Specialists
DRAFT #3 (24 Nov)
The Equipment Rental Specialist
Results for the
year ended
31 March 2018
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The Equipment Rental Specialist
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AGENDA1. Strategic Aim and Highlights
2. Market and Trading Review
3. Financial Review
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The Equipment Rental Specialist
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Strategic
Aim
and
Highlights
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Resilient
and
proven model
First class
asset
management
Enhancing
our
offer
Building on
core
attributes
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o ●Excellent profit growth +16%
o ●Revenue growth +22%
o ●Rental fleet investment +13% to £64.9m
o ●Four acquisitions including Brandon Hire
o ●Return on capital 14.8% (16% excluding Brandon)
o UK division delivering strong results
o ●Focus on specialist rental markets continues to
pay off
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183.1
205.6 208.7
248.7
303.6
0
50
100
150
200
250
300
350
2014 2015 2016 2017 2018
Profit before
tax,
amortisation
and
exceptional
items
20.1
26.829.8
34.9
40.6
0
5
10
15
20
25
30
35
40
45
50
2014 2015 2016 2017 2018
(£m)
(£m)
Revenue
13% compound growth over 5 years
19% compound growth over 5 years
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Market
and
Trading
Review
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Infrastructure
Housebuilding Oil & Gas
Construction
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Market segment
Revenue Growth
on
prior year2018
£m
2017
£m
Infrastructure* 113.6 105.0 +8%
Construction 100.4 66.2 ** +52%
Housebuilding 34.5 31.5 +9%
Oil & Gas 24.9 21.5 +16%
Other 30.2 24.5 +23%
Total 303.6 248.7 +22%
* Utilities, Rail, Transmission and Facilities Management
** 14% growth excluding Brandon acquisition
o Infrastructure growth – water / transmission
o Construction growth – repair & maintenance / fit out
o Housebuild – stable demand
o Offshore Oil & Gas – delayed recovery
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2018
£m
2017
£m
Revenue 303.6 248.7 +22%
PBITA 44.0 37.8 +17%
Operating margin 14.5% 15.2%
o Excellent UK performance
o Strong profit growth
o Core markets supportive
o Organic growth and acquisitions
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2018
£m
2017
£m
Revenue 272.0 220.0 +24%
PBITA 43.0 35.9 +20%
Operating margin 15.8% 16.3%
o AMP 6 activity – Groundforce
o Construction opportunity – buoyant trading in Hire Station
o Supportive housebuilding – UK Forks
o Rail, off peak but good performance – Torrent Trackside
o Brandon Hire acquisition – November 2017
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2018
£m
2017
£m
Revenue 31.6 28.7 +10%
PBITA 1.0 1.9 -46%
Operating margin 3.1% 6.6%
o Australia and New Zealand markets supportive in year of
good progress for TR Group
o Global offshore oil & gas slower than expected for Airpac
Bukom
TR Group
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2018
£m
2017
£m
UK 59.8 53.9
International 5.1 3.7
Total fleet investment 64.9 57.6
Disposal proceeds (18.5) (16.7)
Net expenditure on fleet 46.4 40.9
o Strong UK regional fleet capex supporting demand
o Investment for growth into Hire Station/Groundforce/Torrent
o International fleet capex – mostly TR Group
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April 2017 – JMS M&E
○ UK mechanical and electrical specialist tool hire - Hire Station
○ consideration £3.6m
April 2017 – Zenith Survey Equipment
○ UK survey and safety equipment rental and sales - Hire Station
○ consideration £3.7m plus £2.3m debt
November 2017 – Brandon Hire Group
○ UK tool hire specialist with 143 branches - Hire Station
○ consideration £41.7m plus £27.5m debt
November 2017 – First National
○ regional UK telehandler business - UK Forks
○ consideration £0.9m
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o ●New financial year has started well
o UK division
- UK infrastructure, housebuild and construction
provide solid foundation
- Focus on successful integration of Brandon Hire into
the Vp group
- European activities gaining traction
o ●International division
- Australia and Malaysia positive outlook.
- Offshore oil & gas showing tentative improvement
o We are excited about delivering on a wide range of
initiatives in the new financial year
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Financial
Review
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2018
£m
2017
£m
Revenue 303.6 248.7 +22%
EBITDA 84.3 71.2 +18%
Depreciation (40.3) (33.4) +21%
EBITA 44.0 37.8 +17%
Interest (3.4) (2.9)
PBTA (and exceptionals) 40.6 34.9 +16%
Net margin 13.4% 14.0%
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2018 2017
Basic EPS (pre amortisation) 81.8p 69.5p +18%
Profit before tax / amortisation £40.6m £34.9m +16%
Weighted ave. no. of shares 39.5m 39.2m
Effective tax rate 20.9% 22.0%
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Dividend per share (pence)
14.0
16.5
18.9
22.0
26.0
6
11
16
21
26
2014 2015 2016 2017 2018
2018 2017
Dividend per share 26.0p 22.0p +18%
Dividend cover 3.2x 3.2x -
EPS adjusted* 81.8p 69.5p +18%
* Pre amortisation and exceptionals
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0
2
4
6
8
10
12
14
16
18
20
2014 2015 2016 2017 2018
13.5%
16.2% 16.3% 16.0%
14.8%*
* 16% excluding Brandon
WACC
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2018
£m
2017
£m
Property, plant and equipment 241.9 195.6
Intangible assets/goodwill 91.5 47.5
Net working capital 7.3 (1.9)
Other (7.1) (5.0)
Net debt (179.2) (98.9)
Net assets 154.4 137.3
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2018
£m
2017
£m
EBITDA 84.3 71.2 +18%
Cash from operations 73.6 69.9
Net capital expenditure (53.1) (48.0)
Interest and tax (10.4) (7.4)
Acquisitions (49.7) (10.0)
Dividends (9.0) (7.6)
Other (1.2) (5.8)
Debt acquired (30.5) (3.9)
Change in net debt (80.3) (12.8)
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Facilities
2018
£m
Facilities
2017
£m
RCF ends May 2020 65.0 65.0
RCF ends December 2021 135.0 55.0
Total RCF 200.0 120.0
Overdraft 7.5 5.0
Actual borrowing net debt 179.2 98.9
Headroom 28.3 26.1
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14.2015.24
13.00
11.35
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
FY 15 FY 16 FY 17 FY 18
1.241.45 1.39
1.89
0.0
0.5
1.0
1.5
2.0
2.5
3.0
FY 15 FY 16 FY 17 FY 18
EBITA
Interest
Cover
> 3 times
Net Debt /
EBITDA
< 2.5 times
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Supplementary
Schedules
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2018
%
2017
%
Standard rate 19.0 20.0
Impact of tax rate change (2.7) -
Permanent disallowables 0.9 0.6
Chattels (1.2) (1.4)
Prior year adjustments 0.6 0.5
Non qualifying depreciation 0.7 0.7
Overseas tax rate 0.5 0.1
Impairment of intangibles 3.1 1.6
Other - (0.1)
Effective rate 20.9 22.0
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Revenue:1970:
£2m
1980:
£14m
1990:
£70m
2000:
£55m
2010:
£129m
2014:
£183m
2015:
£206m
2016:
£209m
2017:
£249m
2018:
£304m
Group history – 1954 to date
1954
1973
19801990
2018
1954Vibratory Roller & Plant Hire(Northern) Limited founded
1973Floated on main market
Vibroplant plc
1975First move into specialist plant
Airpac
1980Shoringdivision
established
1982US powered
access
business established
1990Groundforceacquired from
SGB
1996Cannon Tool Hire
acquired
Exit from USA
1997Rail:
Torrent
Trackside acquired
2000UK
Forks
divisioncreated
2001Hire Station formed through merger
of 5 regional tool businesses
2001renamed Vp
plc
2005TPA and ESS
acquired
2006Acquisition of
Bukom
Oilfield Services(Airpac Bukom
formed)2010
Geographical expansion:Global (Airpac Bukom)
Eire (Groundforce)Germany (TPA)
2015Acquisition of
Test &
Measurement
2016Acquisition of Higher Access
and TR Pty (Australia)
2017Acquisition of
JMS M&E
Zenith Survey
Equipment
2014Vp
celebrates
60 years
2017
Acquisition of
Brandon Hire
2017
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Rough terrain material handling equipment and
tracked access platforms
Excavation support systems and specialist products
Portable roadway and temporary access solutions
Tool hire, safety equipment, press fitting and low level
access
Tool and equipment hire to the building and
construction industry
Infrastructure equipment and services to the railway
renewals and maintenance sector
International
division
UK
division
Equipment and service providers to the international
oil and gas exploration and development markets
Test & measurement, communications and audio
visual rental in Australia, New Zealand and Malaysia.TR Group