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INVESTOR PRESENTATION – Intertek

Intertek · May 1, 2014 · 46 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. INVESTOR PRESENTATION – Intertek – slide 1
    Investor Presentation May 2014 For further information contact: Sarah.ogilvieintertek.com +44 (0)20 7396 3434 1 www.intertek.com
  2. INVESTOR PRESENTATION – Intertek – slide 2
    Investment Proposition Global leader in Quality Solutions Strong structural growth drivers High barriers to entry Low customer penetration, high market fragmentation Balanced portfolio (industries, geographies & customers) Emerging…
  3. INVESTOR PRESENTATION – Intertek – slide 3
    Our Network Over 36,000 people Working in more than 1,000 laboratories and offices In more than 100 countries 4 www.intertek.com
  4. INVESTOR PRESENTATION – Intertek – slide 4
    Balanced Industry Portfolio Consumer Goods Textiles Toys Commodities Oil and Petrochemicals Hardlines Government & Trade Services 17% Minerals 27% Commercial & Electrical Products Commodities Electrical since 1896 since 1885…
  5. INVESTOR PRESENTATION – Intertek – slide 5
    Global revenue EMEA 33% Asia Pacific Americas 32% 35% Emerging Markets 38% 6 www.intertek.com
  6. INVESTOR PRESENTATION – Intertek – slide 6
    Enduring Growth Drivers 1 Global Trade & Emerging Market Trade Growth 2 Outsourcing & Consulting Services 3 Network & Service Expansion 4 Industry Consolidation 5 Market Drivers in our Industries 7 www.intertek.com
  7. INVESTOR PRESENTATION – Intertek – slide 7
    Market Drivers in our Industries End-User Quality Expectations & Diversity Developed and emerging economies Supply Chain New Needs Technologies Shifting cycles, Innovation and Market sourcing and product variety Drivers…
  8. INVESTOR PRESENTATION – Intertek – slide 8
    Our Strategy Quality Advisory Assurance Testing Auditing Training Certification Outsourcing Inspection CSR Supply/Value Chain End user R&D Performance Certification -Compliance Production Distribution…
  9. INVESTOR PRESENTATION – Intertek – slide 9
    Five Year Performance 2009 to 2013 Revenue Adjusted Operating Profit(1) Adjusted Diluted EPS(1) 15% CAGR 13% CAGR Pence 14% CAGR m m 350 140 2,200 138.6 343 2,184 335 131.2 120 2,054 1,925 300 281…
  10. INVESTOR PRESENTATION – Intertek – slide 10
    Financial Highlights For the twelve months to 31 December 2013 Revenue 2,184m + 6.3% at actual + 4.3% at constant organic(2) Operating profit(1) 343m + 2.2% at actual - 1.2% at constant organic(2) Operating profit margin(1)…
  11. INVESTOR PRESENTATION – Intertek – slide 11
    Interim management statement: 16 May 2014 First four months 2014 revenue growth: 3.6% total at constant exchange rates 0.3% organic at constant exchange rates -4.9% total at actual January to April: Variable market conditions,…
  12. INVESTOR PRESENTATION – Intertek – slide 12
    Divisional Revenue Mix Total FY Organic FY Total m constant exchange rates Revenue Revenue FY Revenue Growth Growth Chemicals Industry & Assurance 709m 7% 4% & Pharma Commodities 587m 3% 2% Commercial Industry & &…
  13. INVESTOR PRESENTATION – Intertek – slide 13
    Divisional Performance Summary FY 2013 Revenue Margin m constant Organic Organic exchange rates FY 13 Change change FY 13 Change change Industry & Assurance 709.3 6.8% 4.2% 11.6% 0bps (20)bps Commodities 586.6 3.1% 2.1% 11.9%…
  14. INVESTOR PRESENTATION – Intertek – slide 14
    In-fill and Strategic Acquisition summary In-fill Acquisitions Add technical capabilities and IP in specific locations and industries Readily integrated:…
  15. INVESTOR PRESENTATION – Intertek – slide 15
    Spending Patterns of Markets International Tourism Domestic Tourism Services Insurance United States Ad Spending Luxury Cars UK Dishwashers Durables Cars Washing machines Copper Energy 2.5bn consumers…
  16. INVESTOR PRESENTATION – Intertek – slide 16
    Spending Patterns of Markets The Future International Tourism Domestic Tourism Services Insurance Ad Spending Luxury Cars Dishwashers Durables Cars Washing machines China 2030 Copper Energy 2.5bn consumers driving…
  17. INVESTOR PRESENTATION – Intertek – slide 17
    Major Emerging Countries China India Population 1.3bn Population 1.2bn GDP per capita 6,200 GDP per capita 1,500 9,000 employees 1,800 employees Local managers Local managers Intertek 120 labs and offices 38 labs and offices…
  18. INVESTOR PRESENTATION – Intertek – slide 18
    Appendix Additional Slides from 2013 Full Year Results Presentation 19 www.intertek.com
  19. INVESTOR PRESENTATION – Intertek – slide 19
    Revenue Growth + 6.3% m actual rates m 2,200 32 10 2,200 14 20 88 38 2,184 2,184 44 14 2,100 2,100 2,054 + 4.3% 2,054 2,000 Constant 2,000 rates 1,900 1,900 1,800 1,800 1,700 1,700 1,600 1,600 1,500 1,500…
  20. INVESTOR PRESENTATION – Intertek – slide 20
    Cash Flow, Financing and Investment Adjusted Cash flow from Operations m 400 +14% Adjusted cash flow from operations up 14% to 394m 300 +10% Organic capex 145m; 6.6% of 200 revenue 100 2011 2012 2013 7 acquisitions for 122m…
  21. INVESTOR PRESENTATION – Intertek – slide 21
    Currency Analysis - Revenue Local currency to GBP 2013 2012 25% USD 2% 1.56 1.59 CNY 3% 9.68 10.01 55% EUR 4% 1.18 1.23 20% HKD 2% 12.12 12.31 AUD 6% 1.62 1.53 USD, CNY & HKD GBP & EUR Other 22 www.intertek.com
  22. INVESTOR PRESENTATION – Intertek – slide 22
    Operating Margin (60)bps % 16.5 (30)bps 16.3% (30)bps 16.0 (30)bps +10bps +20bps 15.7% 15.5 15.6 15.7% 15.0 14.5 14.0 2012 Minerals Europe Investment Acquisitions Other 2013 including & FX Tradegood 23…
  23. INVESTOR PRESENTATION – Intertek – slide 23
    Industry & Assurance 33% of Group Revenue 24% of Group Operating Profit Oil, gas, petrochemical, power, renewable energy, civil infrastructure Industrial and technical inspection, supplier evaluation, asset integrity management,…
  24. INVESTOR PRESENTATION – Intertek – slide 24
    Industry & Assurance FY 13 Performance Outlook m constant Organic BA further growth opportunities in exchange rates FY 13 Change change major emerging countries Revenue 709.3 6.8% 4.2% Operating profit 82.2 6.9% 2.9% Food expansion to…
  25. INVESTOR PRESENTATION – Intertek – slide 25
    Industry & Assurance Revenue Split Business Food & Agri Assurance 13% 10% C&T Legacy low margin contracts 4% E&P, AIM 15% Technical C&T Consulting & Training Inspection 58% AIM Asset Integrity Management E&P…
  26. INVESTOR PRESENTATION – Intertek – slide 26
    Capex in Energy Sector Intertek Revenue Split Oil majors 30% Upstream National Oil Companies Pipelines and distribution networks Ongoing investment into the energy sector 40% Midstream 30% Downstream 27…
  27. INVESTOR PRESENTATION – Intertek – slide 27
    Commodities 27% of Group Revenue 19% of Group Operating Profit Cargo inspection, analytical assessment, calibration and related technical services to the worlds energy, petroleum and chemical industries Mine site sample…
  28. INVESTOR PRESENTATION – Intertek – slide 28
    Commodities FY 13 Performance Outlook m constant Organic Shale growth extraction and rail exchange rates FY 13 Change change car transportation Revenue 586.6 3.1% 2.1% Asia continued strong growth Operating profit 70.0 (9.0)% (11.4)%…
  29. INVESTOR PRESENTATION – Intertek – slide 29
    Consumer Goods 17% of Group Revenue 37% of Group Operating Profit Textiles, toys, footwear, hardlines (eg furniture, sports equipment, bicycles, candles), cosmetics and retail Shorter time to market, brand value support to…
  30. INVESTOR PRESENTATION – Intertek – slide 30
    Consumer Goods FY 13 Performance Outlook m constant Organic Continued expansion of laboratory exchange rates FY 13 Change change network into new countries Revenue 381.3 8.9% 8.5% Cross-selling of services amongst Operating profit…
  31. INVESTOR PRESENTATION – Intertek – slide 31
    Commercial & Electrical 16% of Group Revenue 16% of Group Operating Profit Home appliances and electronics, lighting, medical, building, industrial, heating, ventilation and air conditioning (HVAC), IT, renewable energy,…
  32. INVESTOR PRESENTATION – Intertek – slide 32
    Commercial & Electrical FY 13 Performance Outlook m constant Organic Synergies from ATI acquisition exchange rates FY 13 Change change Revenue 338.4 4.8% 4.8% Good growth expected in Asia Operating profit 49.3 (4.6)% (4.6)% New…
  33. INVESTOR PRESENTATION – Intertek – slide 33
    Chemicals & Pharma 7% of Group Revenue 4% of Group Operating Profit Laboratory and consultancy services to chemical, pharmaceutical, oil and gas and producers of advanced materials eg; automotive and aerospace Health and safety…
  34. INVESTOR PRESENTATION – Intertek – slide 34
    Chemicals & Pharma FY 13 Performance Outlook m constant Organic Expect continued good growth in exchange rates FY 13 Change change Fuel and Lubricants Revenue 168.8 6.9% 2.0% Business will be more focused and Operating profit 16.6…
  35. INVESTOR PRESENTATION – Intertek – slide 35
    Separately Disclosed Items m actual exchange rates 2013 2012 Adjusted operating profit (1) 342.6 335.1 +2.2% Separately disclosed items: Amortisation of acquisition intangibles (22.5) (29.3) Acquisition and integration costs (1.5)…
  36. INVESTOR PRESENTATION – Intertek – slide 36
    Adjusted EPS m actual exchange rates 2013 2012 Adjusted operating profit 342.6 335.1 +2% Net interest expense (27.7) (26.7) Profit before tax 314.9 308.4 Tax 23.0% (26.0%) (72.4) (80.3) Profit after tax 242.5 228.1…
  37. INVESTOR PRESENTATION – Intertek – slide 37
    Taxation m actual exchange rates 2013 2012 Reported profit before tax 281.8 256.6 Reported tax (64.8) (68.4) Reported profit after tax 217.0 188.2 Reported tax rate 23.0% 26.7% Effective tax rate 23.0% 26.0% on adjusted…
  38. INVESTOR PRESENTATION – Intertek – slide 38
    Tax Adjusted Group Effective Tax Rate % 2013 rate of 23% 30 28.2% 2013 rate includes 1.7% 27 deferred tax benefit 26.0% 24 Emerging market growth 23.0% 21 providing mix benefit 18 15 2011 2012 2013 39 www.intertek.com
  39. INVESTOR PRESENTATION – Intertek – slide 39
    Operating Cash Flow m actual exchange rates 2013 2012 Operating Profit before changes in working 414.9 389.9 capital and provisions Changes in working capital (36.3) (57.3) Cash generated from operations 378.6 332.6 Separately…
  40. INVESTOR PRESENTATION – Intertek – slide 40
    Free Cash Flow m actual exchange rates 2013 2012 Adjusted cash generated from operations 394.1 345.4 +14% Net interest (26.9) (24.2) Taxation (80.9) (72.6) Net capital expenditure (140.2) (113.3) Adjusted Free Cash Flow 146.1…
  41. INVESTOR PRESENTATION – Intertek – slide 41
    Net Debt m actual exchange rates 2013 2012 Borrowings 734.6 717.2 Cash (116.4) (166.5) Net debt 618.2 550.7 Pro forma net debt to EBITDA 1.4x 1.3x 42 www.intertek.com
  42. INVESTOR PRESENTATION – Intertek – slide 42
    Liquidity Position m actual exchange rates 2013 2012 Debt facilities 909.6 881.4 Borrowings (734.6) (717.2) Undrawn committed borrowing facilities 175.0 164.2 Cash 116.4 166.5 Liquid funds 291.4 330.7 Average debt facility…
  43. INVESTOR PRESENTATION – Intertek – slide 43
    Divisional Performance Summary FY 2013 Organic Revenue Growth m constant exchange rates H1 H2 FY Industry & Assurance 8.5% 0.2% 4.2% Commodities 3.8% 0.5% 2.1% Consumer Goods 8.6% 8.3% 8.5% Commercial & Electrical 3.9% 5.7% 4.8%…
  44. INVESTOR PRESENTATION – Intertek – slide 44
    Connecting Responsible Buyers with Trusted Suppliers Investing in information based value added services Positive reception; slower ramp up 100,000 live customer profiles Investment to reduce; break even in 2015 45…
  45. INVESTOR PRESENTATION – Intertek – slide 45
    Dividend Increased by 12% Full Year Dividend Per Share Pence 16% CAGR Full year dividend 46.0p, up 12.2% 50 45 2013 full year pay-out of 74m 46.0 40 41.0 35 Reflects confidence in strong long 33.7 30 term structural…
  46. INVESTOR PRESENTATION – Intertek – slide 46
    What we do for our Customers Support Speed to Protect Their products and Market Reduce financial, processes in their Cut lead times operational, global trade in all and costs without reputational and quality related…

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