Ben Stocks - Chief Executive Chris Tyler - Finance Director Summary - - PowerPoint PPT Presentation
Ben Stocks - Chief Executive Chris Tyler - Finance Director Summary Consistent strategy Consistent strategy delivering results Niche positions New product development in growing, regulated markets and intellectual property 2013-2018 9%
Ben Stocks - Chief Executive Chris Tyler - Finance Director
Consistent strategy delivering results
Consistent strategy Niche positions
in growing, regulated markets
New product development
and intellectual property
2013-2018 Year ended 30 November 2018 9% CAGR
in revenue
£68m
cash from
£42m
invested
13% CAGR
in EPS
11%
revenue growth
11% EPS
growth to 22.9p
£13.5m
invested
43%
return on
employed
and environmental technology Specialist filters are used to protect costly
Attractive business characteristics
Niche positions:
Long life cycles Bespoke Consumable products
Robust demand drivers:
Secular trends Regulation/legislation Maintenance schedules
Barriers to entry:
Specialist design skills Engineering skills Patent protection Quality accreditation
and operational objectives Long-term growth from developing specialist filtration and environmental technology businesses both organically and by acquisition
Into 2019: capacity in place for further growth
A focus on regulated markets with long-term growth prospects Four key markets
1
Concerted new product development
2
Geographic expansion to support key markets
3
Generate cash to invest in: Organic growth Acquisitions Dividends
4
with long-term growth prospects Regulation Market growth Markets
FAA, CAA, EASA and other specific accreditations Growth in pax revenue miles 2018 - 2037
(Source: Boeing 2018)
4.7%
p.a. Aerospace
International nuclear standards: NQA1, ASME, etc Long term growth in nuclear power generation capacity
(Source: IAEA)
3-4%
p.a. Industrial
Approved methods: EPA, SEPA, EU water directives Growth in water analysis consumables
(Source: company estimate)
5-6%
p.a. Laboratory
ISO and customer accreditations; extensive qualification requirements Growth in primary aluminium usage to 2021 (Source: CRU 2018)
3.6%
p.a. Metal Melt Quality
1 2 3 4
1 2 3 4
and operating companies – new divisions Business division Principal markets Approximate share
Metal Melt Quality
30%
Global aluminium US foundry Super alloys
SELEE Corp
Laboratory
30%
Environmental Bioscience Chromatography
Seal Analytical (Rohasys) Porvair Sciences (JG Finneran)
Aerospace & Industrial
40%
Aerospace General industrial Energy
Porvair Filtration Group
Main operating companies
1 2 3 4
Niche positions
Fuel systems Coolant systems Hydraulics
Growth drivers
New build Maintenance New airframes and engines Retrofit programmes
Recent new products
Inerting, hydraulics, lube
Boeing 787-10 777 TX P8 Airbus NEO Rolls Royce Ultrafan
Competitive advantage
Installed base Design engineering Range of media Design protection
Aerospace
and new product development
1 2 3 4
Niche positions
Hot gas and gasification Pulse jet systems Nuclear remediation Polymer production Microelectronics
Growth drivers
Gasification build rates Maintenance schedules Nuclear clean-up Energy efficiency and security
Recent new products
Gasification spares 2nd generation Nuclear: Rolls Royce Rotary kiln filters
Competitive advantage
Installed base Range of media Design engineering Design protection
Industrial
and new product development
1 2 3 4
Niche positions
Analysis of inorganic chemicals in water Sample preparation Chromatography consumables
Growth drivers
Regulated water testing Analytical science:
Recent new products
Seal: AA500 Minilab sampler Sample prep ranges New Vyon
Competitive advantage
Installed base Instrument design protection Porous plastics IP and related patents
Laboratory
and new product development
1 2 3 4
Niche positions
Aluminium cast house filtration Gray and ductile iron filtration Super alloys
Growth drivers
Aluminium consumption US auto and light truck production Increased use of high grade and exotic alloys Expansion in China
Recent new products
Selee CSX™ / CSW™ Selee IC™ Selee SA™ Range extensions
Competitive advantage
Patent protection Metallurgical expertise US / China manufacturing
Metal Melt Quality
and new product development
1 2 3 4 £42 million invested in the last five years
Americas 7 sites
2018 update:
Keystone Filter acquired J G Finneran plant expansion Microelectronics plant upgrade Improvements to ceramic 3D capability
Revenue
52% 13%
UK
15%
Europe
UK and Europe 5 sites
2018 update:
Rohasys acquired Bioscience media expansion
Revenue
19%
2018 update:
Further investment in Xiaogan
Asia 2 sites
Revenue
for the year ended 30 November 2018
to £128.8m Revenue
Laboratory Revenue
Metal Melt Quality Revenue
to £13.5m Adjusted PBT
to 22.1p Basic EPS
1 2 3 4
Aerospace & Industrial Revenue
to 22.9p Adjusted basic EPS
for the year ended 30 November 2018
2017
£000
2018
£000
Revenue 128,823 116,423 Operating profit 14,343 13,021 Interest (830) (657) Profit before tax 13,513 12,364 Tax (3,113) (3,011) Profit for the year 10,400 9,353 Adjusted EPS (basic) 22.9p 20.7p
1 2 3 4
for the year ended 30 November 2018
1 2 3 4
2017
£000
2018
£000
2017
£000
2018
£000
Adjusted profit for the year 10,400 9,353 Equalisation of GMP (773)
(564) (244) Other acquisition related expenses (138) (438) Adjustments to profit before tax (1,475) (682) Tax effect of pre-tax adjustments 325 171 Tax exceptional item 778
1,103 171 Profit for the year 10,028 8,842
for the year ended 30 November 2018
2017
£000
2018
£000
Operating cash flow before working capital movements 16,989 13,651 Working capital movement (1,654) (1,394) Interest (339) (216) Tax (2,419) (2,741) Capital expenditure (net of disposals) (4,452) (5,425) Net cash from operations 8,125 3,875 Acquisitions (9,007) (5,932) Proceeds from issue of shares 131 364 Purchase of Employee Benefit Trust shares (416) (475) Dividends paid (1,957) (1,769) Exchange movements (37) 90 Net cash at 1 December 9,786 13,633 Net cash at 30 November 6,625 9,786
1 2 3 4
Results and progress – year ended 30 November 2018
US nuclear and industrial orders Keystone filter acquired and integrated Second half aerospace strength Gasification servicing and spares
17% revenue growth 2018
£000
2017
£000
Revenue 50.5 43.2 Operating profit 8.0 6.8
Outlook
Microelectronics plant upgrade Stronger aerospace order book Large projects commissioning
1 2 3 4
Results and progress – year ended 30 November 2018
Seal Analytical strong in US, offsetting China falls Strong performance from JG Finneran Rohasys acquired and trading in line with targets
9% revenue growth 2018
£000
2017
£000
Revenue 38.7 35.3 Operating profit 6.5 6.3
Outlook
Seal instrument upgrades Bioscience capacity and capability increased JG Finneran plant expansion Finneran and Rohasys synergies
1 2 3 4
Growth from cast shop and super alloys Improved plant efficiencies Record US margins China revenue up over 30%
Constant currency revenue up 9% 2018
£000
2017
£000
Revenue 39.6 37.8 Operating profit 2.4 1.7
Outlook
China losses diminish as volumes/margins increase Range and volume growth in ceramic 3D printing
1 2 3 4
Results and progress – year ended 30 November 2018
£42m invested in capex and acquisitions over five years; £13.5m in the year
Aerospace
Boeing 737 Auto Pilot Boeing 737 Max Rolls Royce BR715 Comac C919 Inerting: 3rd Generation
Industrial
Nuclear: HEPA Gasification spares and service USA: 20% CAGR (2013-18) GasPro microelectronics Keystone Filter integration
Laboratory
AA500 New Vyon Molecular coatings JGF plant expansion: clean manufacture Rohasys: NPD process
Metal Melt Quality
Growth in China based on value selling China input cost reduction Ceramic 3D manufacture – aerospace and IGT
Organic growth Acquired growth
and outlook Results
Revenue growth
11%
PBT growth to £13.5m
9%
EPS growth to 22.9p
11% Investment
Invested in the period
£13.5m
Rohasys Keystone Filter ACQUIRED JG Finneran Microelectronics Bioscience CAPACITY EXPANSION
Outlook
Order books for 2019 HEALTHY Balance sheet STRONG Clear organic growth targets ORGANIC Outlook POSITIVE
Ben Stocks - Chief Executive Chris Tyler - Finance Director