Transcript Interim

Tricorn Preliminary Results
For Year Ended 31 March 2009
Nick Paul, Chairman
Mike Welburn, Chief Executive
Phil Lee, Finance Director
Agenda
•
•
•
•
•
•
Background
Results Summary
Financial Review
Business Performance
Focus for 2009
Summary
Background-Senior Management
•
•
•
Nick Paul CBE
– Chairman
– Appointed 2001
– Previously Deputy Chief Executive of IMI
– Also Chairman of Advantage West Midlands
Mike Welburn
– Chief Executive
– Joined Tricorn April 2003
– Appointed Chief Executive November 2007
– Previously Director of Global OEM Strategy for IMI’s Fluid Power
Division
Phil Lee
– Group Finance Director
– Joined Tricorn January 2009
– Previously Finance Director of Distributed Generator Systems (RollsRoyce Energy Business)
Background-Customer Base
• Blue chip Original Equipment manufacturers
– Caterpillar
– Rolls-Royce
– Cummins
– JCB
– Shorts Bombardier
– Land Rover
– GPS
– Bearward
– Uponor
– Eaton Aerospace
Business Backgroundtructure
.
Results Summary
• Results significantly impacted by market down
turn in second half.
• The Group has acted decisively to reduce
operating costs.
• Improved cash flow from operations.
• Cash and equivalents increased 80% to £713k.
• Gearing and net debt reduced to 16% and
£2,064k respectively.
Results Summary
£’000
2009
2008
Change
Sales
22,245
20,829
6.8%
Adjusted Operating
profit*
1,430
1,661
(13.9)%
Adjusted earnings
per share*
3.16p
3.55p
(11.0)%
* Before restructuring costs, amortisation, share based charges and fair value adjustments.
Results Summary
£’000
2009
2008
Change
Cash flow from operating
activities
1,155
999
15.6%
Net debt
(2,064)
(2,870)
28.1%
Gearing*
16.0%
26.6%
39.8%
9.2x
8.1x
13.5%
EBITDA/interest
* Long term debt to equity
Financial Review
Financial Review-Sales
£’000
2009
2008
Change
Sales*
15,600
15,418
1.2%
Acquisition
adjustment
6,645
5,411
As Reported
22,245
20,829
* excludes any sales from acquisitions not included in prior year
6.8%
Financial Review-Profit
£’000
2009
2008
Change
Operating Profit*
1,430
1,661
(13.9)%
Interest*
(216)
(257)
15.9%
20
10
100.0%
1,234
1,414
(12.7)%
Finance income
Profit before tax*
* Before restructuring costs, amortisation, share based charges and fair value adjustments.
Financial Review - Profit
£’000
2009
2008
Change
EBITDA*
1,809
2,005
(9.8)%
Depreciation
(379)
(344)
Interest charge*
(196)
(247)
Profit before tax*
1,234
1,414
Intangible amortisation
(118)
(94)
-
(335)
Swap FV Adj
(100)
(12)
Restructuring costs
(239)
-
777
973
(192)
(174)
585
799
Share based charge
Profit before tax
Taxation
Profit after tax
(12.7)%
(20.1)%
(26.8)%
* Before restructuring costs, amortisation, share based charges and fair value adjustments.
Financial Review - Balance Sheet
£’000
2009
2008
Goodwill & Intangibles
1,502
1,620
Tangible Fixed Assets
1,382
1,414
Total Fixed Assets
2,884
3,034
Inventory
3,817
3,547
Trade & other receivables
3,661
5,728
(2,897)
4,697
Net working capital
4,581
4,578
Corporation tax
(292)
(273)
Deferred tax
(319)
(364)
Financial liabilities at fair value
(112)
(12)
(2,064)
(2,870)
28.1%
4,678
4,093
14.2%
Trade & other payables
Net Debt
Net Assets
Change
(7.6)%
0.0%
Financial Review - Cash flow
£’000
2009
2008
EBITDA
1,809
2,005
Restructuring
(239)
0
19
(541)
Operating cash flow
1,589
1,464
Interest
(196)
(257)
Tax
(218)
(208)
Capital expenditure
(263)
(148)
Investing & financing
activities
(106)
(1,888)
806
(1,037)
Opening net debt
(2,870)
(1,833)
Closing net debt
(2,064)
(2,870)
Working Capital
Net cash flow
Financial Review - Facilities
£’000
2009
2008
Cash & cash equivalents
713
397
(1,620)
(1,760)
Renewal in
November 2009
Term Loan
(969)
(1,263)
To be repaid in 2012
Finance leases
(188)
(244)
(2,064)
(2,870)
Interest cover
(EBITA/Interest)
7.3 times
6.7 times
Hurdle 2.5 times
Cashflow cover
1.8 times
2.2 times
Hurdle 1.1 times
Invoice discounting
Closing net debt
Banking covenants
Business Review
Malvern Tubular Components
• Gains in market
share
• Significant
softening in
demand over final
quarter
• Productivity being
maintained
£’000
2009
2008
Change
Sales
8,428
7,016
20.1%
EBITDA
965
804
20.0%
EBITDA %
11.5
11.4
Redman Fittings
• Relationships with
existing blue chip
customers remain
strong
• New accounts and
projects secured
• Low overhead base
• Some signs of
increasing demand
£’000
2009
2008
Change
Sales
1,176
2,665
(55.8)%
EBITDA
292
718
(59.3)%
EBITDA %
24.8
26.9
Maxpower Automotive
• Good progress
– low cost country
sourcing
– Lean manufacture
– ERP
implementation
• Increasing
customer
penetration
• Market demand
stabilising
£’000
2009
2008
Change
Sales
6,646
5,411
22.8%
EBITDA*
469
313
49.8%
EBITDA %*
7.1
5.8
* Excludes revaluation reducing stock by £98k in 2009
RMDG Aerospace
• Market remains
firm
• Progress has been
slower than
targeted
• Business refocused
and restructured to
improve margins
• Significant
improvements in
2009/2010
£’000
2009
2008
Change
Sales
5,995
5,737
4.5%
EBITDA
181
170
6.5%
EBITDA %
3.0
2.9
Focus for 2009/10
• Capacity Alignment
• Cost Reduction
• Balance Sheet focus
Focus for 2009/10 - Capacity
Alignment
•
•
•
•
Headcount reduced
Short time working-managed weekly
Extended shut downs
Productivity stabilised and will further
improve
• Skills being retained
• Able to respond quickly to upturn
Focus for 2009/10 - Cost
Reduction
•
•
•
•
•
Reduced overheads
Back office integration
Shared services
Reduction in pay
Suspension of
bonus/merit and pay
awards
• Spend controls
• Run rate at start of year
– Indirect headcount -23%
– Overheads -28%
Focus for 2009/10 - Balance Sheet
• CAPEX <50% of
depreciation
• Working capital
reduction
programmes at all
sites
• Operating cash
flow for 3 months
to the end of April
2009 £240k
Summary
•
•
•
•
Markets remain difficult
Decisive management action
Balance sheet will further improve
Well positioned to take advantage of
upturn
Disclaimer
The information contained in this presentation, and upon which this presentation is based, has been produced by Tricorn Group plc (“the Company”). This
presentation is confidential and is solely for the use of the directors of the Company in connection with the Company’s preliminary results for the year ended 31
March 2009. Neither the whole nor any part of the information in this presentation may be disclosed to, or used or relied upon by, any other person or used for
any other purpose and, in particular, should not be distributed outside the United Kingdom, without the prior written consent of the Company. The material
contained herein may include unpublished price sensitive information, the misuse of which may result in criminal and/or civil proceedings against you.
None of the information on which this presentation is based has been independently verified. Accordingly, neither the Company nor any of its connected persons
accepts any liability or responsibility for the accuracy or completeness of, nor makes any representation or warranty, express or implied, with respect to, the
information on which this presentation is based or that this information remains unchanged after the issue of this presentation.
No duty of care or otherwise is owed by the Company or any of its connected persons to any other person in relation to this presentation.
This presentation is not intended to provide the basis of any investment decision and should not be considered as a recommendation by the Company or any of
its connected persons to any recipient of the presentation in relation to the Company’s preliminary results for the year ended 31 March 2009. No person has been
authorised to give any information not contained in this presentation.
Nothing in this presentation is, or should be relied on as, a promise or representation as to the future. Any projection, estimate or statement as to future
performance contained in this Presentation contains significant assumptions and subjective judgements by such persons concerning anticipated results and may
or may not prove to be correct and there can be no assurance that any predicted results are attainable or will be realised.
This Presentation has not been approved by an authorised person for the purposes of the Financial Services and Markets Act 2000 or any other regulatory
authority.
This presentation may only be communicated in the United Kingdom to:
investment professionals, such persons having professional experience in matters relating to investments of this kind and who fall within Article 19 of the
Financial Services and Markets Act 2000 (Financial Promotions) Order 2005 (the “FPO”);
high net worth companies or high net worth unincorporated associations falling within Article 49 of the FPO;
persons who are already shareholders of the Company within article 43 of the FPO; and
any other person to whom this promotion may lawfully be directed.
This document will only be available to the categories of persons in the United Kingdom described above and any other person should seek their own
independent legal, investment and tax advice as they see fit.
In this notice, “connected persons” means, the holding company of the Company, the shareholders, subsidiaries and subsidiary undertakings of that holding
company and their respective directors, officers, employees, advisers and agents of each of them.