2011 unaudited preliminary results presentation 7 March 2012 STADIUM GROUP PLC ELECTRONIC TECHNOLOGIES GROUP UK AND ASIA 1

Transcription

1 2011 unaudited preliminary results presentation 7 March 2012 STADIUM GROUP PLC ELECTRONIC TECHNOLOGIES GROUP UK AND ASIA 1

2 Stadium Board of Directors Nick Brayshaw OBE Stephen Phipson CBE Colin Wilson Chairman Chief Executive Finance Director Tony Inskip Group Commercial Director Charlie Peppiatt Group Operations Director 2 Chris Gill Snr Independent Director

3 Our business Stadium Group plc is a leading provider of electronic technologies including power supplies and electronic manufacturing services (EMS) from manufacturing sites in the UK and Asia, to the professional electronics market. c.900 employees UK manufacturing at Hartlepool, and Rugby Asia manufacturing in the Guangdong Province, China Commercial offices in Newbury (UK) and Hong Kong Listed on AIM, market cap c. 21million 100 years in business 3

4 2011 highlights Healthy trading performance in a period of change New Board appointments: Stephen Phipson, Chief Executive; Charlie Peppiatt, Operations Director Operational limprovement underway New business wins with strong pipeline pp into 2012 Pension scheme closed to future accrual 4

5 2011 financialhighlights Revenues 44.94m (2010: 44.81m) Profit before tax up to 3.96m (2010: 2.87m) 87m)* Net cash up to 2.65m (2010: 1.67m) Earnings per share 9.0p (2010: 6.8p) Dividend 2.8p (2010: 2.5p) * including a number of one off items Normalised profit before bf tax 2.64m 5

6 Operating expenseadjustments For the year ending 31 December S S Reported profit before tax 3,960 2,873 Adjustments to operating expenses: Gain from change from RPI to CPI for pension inflation (992) Settlement gains on defined benefit pension transfers (341) Profit on disposal of surplus property (458) Costs of changing Chief Executive 372 Severance costs Normalised profit before tax 2,637 2,907 6

7 Summarised cash flow For the year ending 31 December s s Operating profit continuing operations 4,201 3,343 Trading adjustments (817) (687) Trading cashflow 3,384 2,656 Pensions & tax (3,505) (2,341) Operating cashflow (121) 315 Fixed assets (332) (334) Proceeds from non core property sale/ business divestment 2,514 2,001 Interest/loans (808) (820) Equity share capital subscribed Dividends (761) (699) Increase in cash Closing cash 4,592 4,061 Net cash (against bank debt) 2,937 1,667 7

8 CEO Review Progress after first six months: Defined a clear strategy Strengthened the commercial team new customer projects won Operational Improvement Implemented a programme of functional globalisation Consolidated Group material purchasing Optimised EMS manufacturing capacity investment in manufacturing equipment underway 8

9 Our strategy Optimise existing EMS capacity (improve factory utilisation, reduce material cost) Leverage economies of scale in EMS through acquisitions in niche adjacent technologies with greater IP content Offer a cost effective and comprehensive complete design and build service Stadium will evolve into a comprehensive technology group with improved gross margin performance 9

10 Our strategy 10

11 Strengthening the commercial team sales progression 100m Jan 2011 June 2011 Jan

12 Strengthening the commercial team sales progression, continued

13 Operational improvement Data centric management of operations and commercial activities implemented PCB Category Spend & Supplier Review RUGBY 2012 Pricing Customer 2012 Total Pipeline Months 2011 Vendor Vendor Vendor Vendor Vendor Vendor On Hand On Order Total Supplier Inventory On Hand Price A B C D E F 2012 Price 2012 Spend 2012 Prices 2012 Savings After 2012 Spend Estimated Pipeline 2011 Prices FY Savings Consumption A TBC , , B , , ,176 1,482 C TBC , , ,048 8,895 D , , ,673 2,673 E , , ,215 1,259 F , , ,910 5,910 G , , ,620 3,844 H , , I , , J , , K TBC TBC , , L , , , M , , N TBC TBC , , O TBC TBC , , P , , ,571 1,569 Q , , R , , ,296 1,969 S TBC , , T TBC TBC , , Optimised i dems manufacturing footprint tand capacity upgrading of equipment UK management structure implemented Asia management structure under review 13

14 Operational improvement Global group purchasing deployment showing early benefits Negotiations held with >50 suppliers Material demand centralised and rationalised Supply chain and inventory management optimisation Positive impact in H2 as we consume inventory 14

15 Outlook 2012 Stadium is changing we are becoming one business In the short term: Slower start to the year than anticipated ii dbut Power business continues strong growth trend New customer projects won and will gain momentum in H Operational a improvements poe e will positively impact H In the medium term: We have a strategy which is coherent, deliverable and will create value Operational and commercial ilteams driving dii performance Work underway on potential acquisitions 15

16 Appendix 16

17 HISTORY History Zirkon acquired Launch Pioneer in injection moulding EMS business China facility acquired Power expands Centenary Sold Stadium Plastics Final plastics business sold 17

18 Business overview power Power supply design and manufacture Manufacturing at Diss (UK) and China 30 people Established in house power supply engineering expertise Own brand IP including LED drivers and EN54 Franchised products with exclusive distribution agreements Opportunity for operational leverage Cross sell activity in EMS business Opportunity for growth in volume 2.62 revenue m UK Asia Sales up 14%

19 Business overview electronics (EMS) Electronic manufacturing services from design, engineering and new product introduction (NPI) to PCB assembly, final product build and logistics. Manufacturing at Hartlepool, Rugby (UK) and China Positioned in lower tier 2 of the European marketplace Opportunity for operational leverage Cross sell activity in power business Design, NPI and engineering activity is key Strong sales team UK and Asia revenue m UK Asia

20 Prioritygrowth markets MARKET GREENTECH DRIVER & OPPORTUNITY Smart metering rollout & Smart grid Wireless communications Renewable energy LED LIGHTING LED technology LED cost Government initiatives Transport infrastructure MEDICAL & HEALTHCARE Ageing population Focus on early diagnosis Home healthcare / telehealth Advancing technologies INDUSTRIAL CONTROL Increased automation Emerging technology in building automation systems and LED/LCD controls 20

21 Prioritygrowth markets MARKET FIRE & SECURITY DRIVER & OPPORTUNITY EN54 4 standard Wireless and remote technology and monitoring COMMUNICATIONS PMR Wireless technology CIVIL AEROSPACE Emerging economies dii driving growth Increasing passenger traffic Emerging low cost carriers (Asia) Fleet replacements 21

22 Fiveyear record Revenue ( s) 50,000 revenue 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 29,408 36,752 35,295 44,811 44,938 ( 000's) Operating profit ( operating profit

23 Segmental analysis 31 Dec s 31 Dec s Revenue 44,938 44,811 Electronics 40,013 40,474 Power 4,925 4,337 Security and lighting g 14% revenue by sector Communications Green energy 10% 14% Medical 17% Industrial 45% Operating profit 3,209 3,343 Electronics 1,948 2,525 revenue by customer location 2011 Power 1, Americas 23% Europe 7% Asia Pacific 11% UK 59% 23

24 Income statement appendix For the year ending 31 December S S Revenue 44,938 44,811 Cost of sales (36,360) (35,585) Gross profit 8,578 9,226 Operating expenses (4,377) (5,883) Operating profit 4,201 3,343 Finance costs (241) (470) Profit before tax 3,960 2,873 Taxation (1,338) (924) Profit from continuing operations 2,622 1,949 Profit fitfrom discontinued d operations 20 Profit attributable to equity holders of the parent 2,622 1,969 Continuing operations Basic earnings per share (p) Diluted earnings per share (p) Continuing and discontinued operations Basic earnings per share (p) Diluted earnings per share (p)

25 Summarised cash flow For the year ending 31 December 31 Dec s 31 Dec s Operating profit continuing operations 4,201 3,343 Operating profit discontinued operations 247 Depreciation continuing operations Depreciation discontinued operations 99 Working capital (1,395) (1,694) Trading cashflow 3,384 2,656 Pensions (3,472) (1,815) Tax (33) (526) Operating cashflow (121) 315 Fixed assets (332) (334) Proceeds from non core property p sale divestment 2,514 2,001 Interest/loans (808) (820) Equity share capital subscribed Dividends (761) (699) Increase in cash

26 Statementof financialposition For the year ending 31 December S S Tangible assets 3,904 3,987 Intangible assets 2,799 2,707 Other receivables 441 6,703 7,135 Inventory 5,615 6,176 Receivables 10,422 8,369 Payables (10,380) (9,936) Working capital 5,657 4,609 Non current assets hldf held for sale 2,041 Bank cash 4,592 4,061 Bank loans (1,655) (2,394) 2,937 1,667 Net pension liability (4,831) (5,641) Other (219) (30) Net assets 10,247 9,781 Gearing Nil Nil 26

27 Management team biography Stephen Phipson CBE Chief Executive Stephen Phipson CBE was the President of Smiths Detection from 1 August 2004 to August He joined Smiths Group plc in 1997 and was previously Managing Director ofsmiths Interconnect as well as previous several senior roles in the global electronics and defence industries. Stephen has an MSc in Operations Management, is Chairman of the UKTI Security Sector Advisory Group, former Vice President Security, at ADS, a trustee and council member ofthe Royal United Services Institute (RUSI) and a Fellow of the Institute of Directors (IOD). He is the founding Chair of the UK Security and Resilience Industry Suppliers Community (RISC). Stephen was awarded the CBE for services to the security and defence industry in

28 Management team biography Nick Brayshaw OBE Chairman Nick, aged 56, was appointed as a non executive Director in April 2005 and Chairman in April He began his career with Rio Tinto plc and Caradon plc, before being appointed Group Chief Executive of Wagon plc until March He was an independent member of the Business and Innovation Group Board of the Department of Trade and Industry from 2000 to 2006, and Chairman of the CBI Manufacturing Council from 2003 to Nick is also Chairman of 3 private equity backed companies, Worldmark International Limited, Kee Safety Group Limited, and Sentinel Performance Solutions Group Limited 28

29 Management team biography Colin Wilson Finance Director and Company Secretary Colin Wilson, aged 44 and a Chartered Accountant, joined Stadium in April 2006 as Finance Manager. He was appointed as Company Secretary in December 2006 and Finance Director in February Colin trained with Coopers & Lybrand prior to moving into industry, where he joined ICI s Uniqema business, spending over 10 years in diverse roles covering production accounting, systems implementations, planning and performance management and business analysis. 29

30 Management team biography Charlie Peppiatt Group Operations Director Charlie Peppiatt, aged 41, joined Stadium as Group Operations Director in October 2011 from Laird Plc a FTSE 250 global electronics company. Charlie was formerly Vice President of Global Operations for Laird Technologies with operational responsibility for a division with turnover of USD$400m and 6,000 staff covering eleven sites. During eighteen years with Laird, Charlie held other senior roles in USA, Europe and Asia as VP of Operations (Mobile Antenna Systems), General Manager Laird Technologies Beijing and Shenzhen, Operations Director LSSD and Managing Director Intron Ltd. His leadership for significant business turnaround and dramatic performance improvement has received plaudits for the achievement in winning China s National Great Wall award in 2010 for lean manufacturing and operational excellence at Laird s Beijing facility. 30

31 Management team biography Tony Inskip Group Commercial Director Tony, aged 49, was appointed Group Commercial Director in Tony initially joined Stadium as Sales Director for the Rugby EMS operation (formerly Zirkon Limited) when the site was acquired in November He was appointed to the role of Group Commercial Director in November Former roles include Product Group Manager and later General Manager at Econocruise, Commercial Manager at Leyland DAF and sales and marketing roles at blue chip companies Furon, Clayton Dewandre (Wabco) and Automotive Products. 31

32 Management team biography Chris Gill ACA Senior Independent Director (Audit, Remuneration and Nomination Committees) Chris, aged 49, is a Chartered Accountant and was appointed as a non executive Director in April He is Chairman of the Audit Committee at Stadium Group. Chris is currently CFO at SMD Limited; previous roles include Finance Director of Wellstream Holdings plc, Finance Director at Domnick Hunter Group plc and a number of senior international finance roles at Black and Decker.' 32