Transcript Employee Opinion Survey 2006

INTERIM REPORT 2006/07
4th December 2006
Presentation to Analysts and Investors
Overview
Group sales up 38% to £67.8m (2005: £49.1m)
Adjusted profit* before tax up 64% to £7.4m (2005: £4.5m)
Reported profit before tax £5.1m (2005: £3.7m)
Basic earnings per share 4.60p (2005: 3.55p)
Interim dividend up 10% at 2.2p (2005: 2.0p)
Major acquisition completed in 1st half
Order book of £141m, of which £49m is related to the acquisition
*Profit before amortisation of acquired intangibles, voluntary severance payments, share based payment charges, integration costs and non-recurring
costs associated with the acquisition.
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Overview (Cont’d)
Sensors and Semiconductors
• Organic sales growth of 5% to £24m (2005: £22m)
• Acquisition provided additional sales of £13m (2 months contribution)
Electronic Tubes
• Strong sales growth of 15% to £31m (2005: £27m)
• Driven by radiotherapy and defence applications
Other Matters
• SAP roll out continuing to production planning phase
• Anticipate formally launching Lincoln site marketing in 2nd half
• Planning approved to redevelop Chelmsford ‘front of house’
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Grenoble Overview
New divisional Director in place and relocated
Management and workforce stabilised – leadership conference well received
Sales post acquisition up 10.5% compared with last year
Half year sales growth of 12%
So far, so good - no surprises !
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Business Overview
Medical and Science
Aerospace and Defence
Commercial and Industrial
Sensors and
semiconductors
£36.8m
(+38%)
£11.9m (+43%)
£14.7m (+208%)
£10.2m (+50%)
£7.6m (+21%)
£12m (+1%)
Electronic
tubes
£31.0m
(+15%)
£11.4m (+31%)
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Sales by Product Group and Market Sector
First half sales £’000
70,000
Medical &
Science
Aerospace &
Defence
(2005 : £17.0m)
(2005 : £13.4m)
60,000
50,000
£23.3m
£22.3m
40,000
30,000
£22.2m
20,000
10,000
0
04/05
05/06
Sensors and Semiconductors
06/07
Tubes
Total
Commercial &
Industrial
(2005 : 18.7m)
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Business Overview Sensors and Semiconductors
Medical & Science (Sales at £11.9m - 2005: £8.3m)
• Strong performance in life science – 22% year on year growth
• Continued strong demand overall for dental sensors, though OEM performance is variable
• £3.4m of sales from Grenoble
Aerospace & Defence (Sales at £14.7m - 2005: £7.1m)
• Recovery of solid state microwave sales – 37% year on year growth
• Strong sales in space imaging as anticipated – 47% year on year growth
• Supplemented by £4.9m of sales in high reliability microprocessors and broadband data convertors
from Grenoble
Commercial & Industrial (Sales at £10.2m - 2005: £6.8m)
• Organic sales declined by 20% year on year in fire and automotive sectors
• Augmented by £4.8m of sales from Grenoble, primarily ASICs and industrial cameras
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Business Overview – Electronic Tubes
Medical & Science (Sales at £11.4m - 2005: £8.7m)
• 31% year on year growth
• Driven by radiotherapy products
Aerospace & Defence (Sales at £7.6m - 2005: £6.3m)
• 21% year on year growth
• Specific programme for modulators
• Strong performance from RF subsystems to the UK and other national defence agencies
Commercial & Industrial (Sales at £12.0m - 2005: £11.9m)
• Marine radar continues to grow
• UHF TV and others generally flat
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Geographic Sales Split – First Half
Europe £38.2m + 42%
(Grenoble £8.3m)
Asia Pac £6.0m + 38%
(Grenoble £1.2m)
Americas £22.5m + 27%
(Grenoble £3.2m)
M. East + Africa £1.1m
(Grenoble £0.4m)
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Financial Summary
6 months ended
30 September 2006
£m
Sales
6 months ended
30 September 2005
£m
Year ended
31 March 2006
£m
67.8
49.1
112.3
Adjusted Profit* before tax and net finance costs
7.4
4.5
15.4
Profit before tax and net finance costs
5.1
3.7
13.8
Cash generated by operations
3.3
9.6
26.5
Capital Expenditure
4.5
4.0
7.8
US $
1.84
1.81
1.78
€
1.46
1.47
1.46
Average exchange rates
* Adjusted profit is before tax and net finance costs, amortisation, voluntary severance payments, share based payment charges and
non-recurring acquisition expenses.
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Consolidated Income Statement
6 months ended
30 September 2006
£m
6 months ended
30 September 2005
£m
Year ended
31 March 2006
£m
67.8
49.1
112.3
Cost of Sales
(46.4)
(33.6)
(74.5)
Gross profit
21.4
15.5
37.8
Gross margin
31.6%
31.6%
33.6%
Net operating expenses
(14.0)
(11.0)
(22.4)
7.4
4.5
15.4
Revenue
Adjusted profit before tax and net finance costs
(0.4)
Costs associated with acquisition
-
-
(0.5)
(0.8)
Amortisation of intangible assets arising on acquisitions
(1.6)
(0.1)
(0.4)
Share based payment charges
(0.3)
(0.2)
(0.4)
5.1
3.7
13.8
(1.5)
(0.9)
1.9
3.7
2.8
11.9
(1.1)
(0.8)
3.8
2.6
2.0
8.1
Voluntary severance payments
Profit before tax and net finance costs
Net finance charges
Profit/(loss) before taxation
Tax on profit/(loss) on ordinary activities
Profit/(loss) for the period/year attributable to shareholders
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Results by Activity
6 months ended
30 September 2006
%
£m
6 months ended
30 September 2005
%
£m
Year ended
31 March 2006
%
£m
Sensors and semiconductors
36.8
22.2
50.2
Electronic tubes
31.0
26.9
62.1
Turnover
Profit before central overheads
Sensors and semiconductors
4.0
10.8%
2.3
10.5%
10.0
20.0%
Electronic tubes
3.3
10.8%
2.8
10.5%
7.3
11.8%
Central Overheads
Difference on exchange
Administrative expenses
Adjusted profit
Exceptional items
Profit before tax and net finance costs
0.8
(0.1)
(0.6)
(0.7)
(0.5)
(1.3)
7.4
4.5
15.4
(2.3)
(0.8)
(1.6)
3.7
13.8
5.1
© e2v technologies plc
Summarised Balance Sheet
30 September 2006
£m
30 September 2005
£m
31 March 2006
£m
Intangible assets
88.2
21.1
22.4
Property, plant and equipment
33.3
20.8
21.3
3.3
0.6
2.0
Inventories
38.6
22.2
20.8
Trade and other receivables
33.0
24.2
25.6
Cash
12.5
5.5
8.1
Total Assets
208.9
95.4
100.2
Current liabilities
(46.6)
(27.9)
(33.0)
(105.2)
(29.6)
(23.5)
57.1
37.9
43.7
Deferred tax assets
Non-current liabilities
Net Assets
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Cash Flow
6 months ended
30 September 2006
£m
6 months ended
30 September 2005
£m
Profit before tax and net finance costs
5.1
3.7
13.8
Depreciation, amortisation and other non cash items
7.3
3.6
7.7
(9.1)
2.3
5.0
3.3
9.6
26.5
(2.9)
(2.1)
(3.3)
0.4
7.5
23.2
Net interest payable
(1.1)
(0.9)
(1.7)
Capex
(4.5)
(4.0)
(7.8)
(64.6)
(5.0)
(5.0)
Other Investing activities
(1.0)
(0.4)
(1.3)
Dividends paid
(2.3)
(2.1)
(3.2)
Bank loans and other financing activities
77.6
6.3
(0.2)
4.5
1.4
4.0
Working capital
Cash generated by operations
Taxation
Net Cash from operating activities
Acquisitions
Net increase/(decrease) in cash
© e2v technologies plc
Year ended
31 March 2006
£m
Summary and Outlook
Good performance in first half
Strong order book of £141m (2005: £79m) underpins second half
Integration of Grenoble based activity proceeding to plan
Active cost reduction programme neutralising inflationary pressures
Organic development on track and we continue to assess potential acquisitions
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