Boparan Holdings Q1 Results for the 13 weeks ended 31 October 2015 - - PowerPoint PPT Presentation

BONDHOLDER UPDATE

Boparan Holdings

Q1 Results for the 13 weeks ended 31 October 2015

15 December 2015 Charles Allen, Chairman Ranjit Singh, CEO Steve Leadbeater, CFO

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Headlines

Q1 in line with previous guidance

Performance in Q1 in line with expectations Substantial and targeted investments to drive productivity and efficiency across all divisions now commenced Focus on building a better business Progress experienced in Q4 continues into Q1

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Better Before Bigger

Building a better, stronger business; focusing on profitable top line growth

• Major £150m investment programme in UK poultry business
• £55m investment in Meal Solutions including refurbishments is well under way
• Lease of new site and acquisition of assets of food business in Derbyshire

INVESTMENT

• Commitment to lead on innovation across all divisions
• Over 100 new product developments planned for FY16 in Chilled division
• Winner of a number of awards for our products and work in Protein, Chilled and Frozen

INNOVATION

• Streamlined production, logistics and supply chain for UK poultry
• Continued tight cost control

EFFICIENCY

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Industry leader

Investment and innovation in deeper, stronger customer relationships

CAMPYLOBACTER

• Leadership in UK poultry with award-winning £10m campylobacter reduction programme
• FSA and major customers approval
• Pioneering technologies

ANTIBIOTICS & ANIMAL WELFARE

• Leading the sector
• Won Agriculture Innovation Award for our work on responsible antibiotic use within the poultry

agriculture supply chain

PARTNERSHIPS

• Innovative production facilities for customers
• Continued investment in production facilities to improve quality and taste for customers

PRODUCT DEVELOPMENT

• Focus on better taste, better value, better quality and reduced waste
• New product development core to the growth strategy

Financial overview

Q1 results:

• LFL sales down 2.3% to £787.9m
• Performance in line with expectation
• Strong operational Cash flow in the quarter
• Net Debt ratio broadly in line with last quarter

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• 1. LFL CY Revenue & EBITDA adjusted for the impact of exchange translation.
• 2. LTM Adjusted EBITDA = LFL EBITDA before the impact of £17.4m of costs incurred in 14-15 relating to Avian influenza and IT system issues.

Q1 2016 Q1 2015 Y-o-Y Variance Revenue: Like-for-like (£m)1 787.9 806.7 (2.3)% Revenue (£m) 778.3 806.7 (3.5)% EBITDA: Like-for-like (£m)1 41.2 43.7 (5.7)% EBITDA margin: Like-for-like (%) 5.2% 5.4%

• 20bps

EBITDA (£m) 40.4 43.7 (7.6)% Cash flow from operations (£m) 28.8 12.3 16.5 Net Debt (£m) 726.3 681.2 45.1 LTM Adjusted EBITDA2 (£m) 161.5 174.4 (12.9) Net debt to Adj. EBITDA ratio2 4.5 x 3.9 x 0.6 x

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Revenue analysis

• Revenue down 3.5% (£28.4m)
• Currency impact £9.6m
• Deflation impact £8.1m
• Tesco share loss £6.3m
• Chilled contract withdrawals Q1 2014 £8.8m
• Underlying growth £4.4m

Q1 2016 Revenue analysis 806.7 (9.6) (8.1) (6.3) (8.8) 4.4 778.3 725 775 825

LY Exchange Deflation Tesco Share Loss Withdrawals Underlying growth CY

£m

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Cashflow

• Overall a net outflow of £8.5m
• Working capital increase of £4.9m
• Pension payments amounted to £5.1m
• Cash exceptionals relating to actions in PY

were £1.6m

• Interest £24.9m mainly half year bond interest

payment

• Capex of £13.5m

Q1 2016 Cashflow

Q1 2016 Q1 2015 Working capital as % of LTM revenue (4.5)% (4.5)% Capex as % of Q1 revenue 1.7% 3.4%

40.4 (4.9) (5.1) (1.6) (24.9) (13.5) 1.1 (8.5) (30) (20) (10) 10 20 30 40 50

EBITDA Q1 2015-16 Working capital movement Pensions Exceptionals Interest Capex (net) Finance leases (net inflow) Cash outflow Q1 2015-16

£m

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Protein performance

• LFL revenue down 2% in current quarter
• Deflation impact 1.8%
• Tesco impact 1.1%
• 0.2% growth compared with Q4
• LFL EBITDA down 26.1% compared to the

same period last year

• Year-on-year comparison impacted

by changes in group charges Protein – UK and European Poultry & Red Meat

¹ CY At constant currency

Year on year Q1 2016 Q1 2015 Y-o-Y Variance Revenue: Like-for-like (£m)1 538.6 549.7 (2.0)% Revenue (£m) 530.2 549.7 (3.5)% EBITDA: Like-for-like (£m)1 18.4 24.9 (26.1)% EBITDA margin: Like-for-like (%) 3.4% 4.5%

• 110bps

EBITDA (£m) 18.0 24.9 (27.7)%

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Chilled performance

• Quarter-on-quarter revenues up from £130.9m

to £148m; LFL sales v Q1 last year down 5.1%

• Turnaround strategy is on track and is starting

to deliver

• Focus on investing in quality and innovative

products to drive growth

• Over 100 new product launches planned in Q2
• £55m investment in Meals Solution Division

progressing well Chilled – Food To Go & Bakery; Meal Solutions

1 CY At constant currency

Year on year Q1 2016 Q1 2015 Y-o-Y Variance Revenue: Like-for-like (£m)1 148.0 155.9 (5.1)% Revenue (£m) 148.0 155.9 (5.1)% EBITDA: Like-for-like (£m)1 8.3 9.0 (7.8)% EBITDA margin: Like-for-like (%) 5.6% 5.8%

• 20bps

EBITDA (£m) 8.3 9.0 (7.8)%

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Branded performance

• Quarter-on-quarter revenues increase from

£88.3m to £100.1m

• LFL sales up 0.2% fuelled by strong growth

in Fox’s biscuits

• Continued growth in EBITDA in absolute and

% terms

• LFL EBITDA up 48.0%
• Positive response to launch of new products

and ranges Branded – Frozen & Biscuits

¹ CY At constant currency

Year on year Q1 2016 Q1 2015 Y-o-Y Variance Revenue: Like-for-like (£m)1 101.3 101.1 0.2% Revenue (£m) 100.1 101.1 (1.0)% EBITDA: Like-for-like (£m)1 14.5 9.8 48.0% EBITDA margin: Like-for-like (%) 14.3% 9.7% 460bps EBITDA (£m) 14.1 9.8 43.9%

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Summary

Better Before Bigger: Consistent and sustainable performance

Targeted investment programmes supporting future growth across our Protein, Chilled and Branded divisions Business transformation continues at pace with strategy delivering with progress experienced in Q4 continuing in Q1 Confident outlook despite continued tough industry environment