Investor Pack
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- INVESTOR PACK Interim Results for the 6 Months ending 30th June 2014 Main Contents Page 3 Safety Page 4 TClarke at a Glance Page 5 Group Highlights Page 6 Financial Highlights Page 7 Income Statement Page 8 Cash Flow Mark Lawrence Page 9 Balance Sheet Page 10 Operational Review Chief Executive Page 11 Forward Order Book Page 12 Strategy and new revenue streams Page 13 Transport Projects Page 14 Residential Page 15 Current Project Portfolio Page 17 Summary and outlook Appendices Page 20 Vision and Strategy Page 21 TClarke City Page 23 Plc Board Martin Walton Page 24 Opportunities for Growth Finance Director Page 25 TClarke Founded 1889 Presentation 2 Safety Everything starts with safety Safety is priority number one with TClarke. Our new ‘You See, You Say’ App offers an industry leading advance in proactive 3 at a glance Aberdeen Bristol We are a nationwide building services . Nationwide Coverage - 16 Local Cardiff group. We deliver high levels of value Locations Colchester to building projects, through the full lifecycle of design, installation, . Directly employed workforce circa Derby commissioning and maintenance. 1,200 Falkirk Harlow We are focused on retaining and . 9 focus business areas Huntingdon enhancing our traditional reputation for Leeds delivering good value, total M&E Residential & trustworthiness and excellent work FM London quality. Contracting Hotels Newcastle Intelligent Peterborough Transport Design & Build We aim to demonstrate value through Buildings Plymouth engineering excellence and innovation Mission Sittingbourne in every way. Manufacturing Green Critical St Austell Three Year financial highlights Revenue - £m Underlying Profit before tax - Earnings per share - Dividend per share - 140.0 operating profit - £m p p £m 120.0 1.0 1.40 2.50 2.5 1.20 100.0 0.8 2.00 1.00 80.0 2.0 0.6 0.80 1.50 60.0 1.5 0.4 0.60 1.00 1.0 40.0 0.40 0.2 0.50 20.0 0.5 0.20 - - - - - 12 12 13 13 14 12 12 13 13 14 12 12 13 13 14 12 12 13 13 14 12 12 13 13 14 H1 H2 H1 H2 H1 H1 H2 H1 H2 H1 H1 H2 H1 H2 H1 H1 H2 H1 H2 H1 H1 H2 H1 H2 H1 4 Group Highlights • Leading UK provider of complete range of building services • Strong reputation for quality with long standing client relationships • Highly experienced team with nationwide strength in depth • Market conditions remain tough in 2014, but improving • Revenue and profit down due to slow start on projects in the South • Problem issues, Insurance Claim / Contract settlement under discussion • Forward order book strengthened • Significant future opportunities • Expect to see continued growth next year • Cross sell strategies delivering new value particularly for London M&E 5 Financial Highlights 30th June 2014 Margin 30th June 2013 Margin £m % £m % Revenue 109.8 114.7 Underlying operating profit¹ 1.2 1.1% 1.2 1.0% Profit before tax 0.2 0.2% 0.8 0.7% Earnings per share – basic 0.32p 1.23p Earnings per share – underlying 1.58p 1.50p Dividend per share 0.50p 1.00p Order book 275.0 225.0 ¹ Before amortisation and non-recurring costs 6 Income Statement Segmental Analysis 30th June 2014 30th June 2013 £m £m Revenue Underlying Profit Margin Revenue Underlying Profit Margin South 79.8 (0.1) - 0.1% 91.3 - 0.0% North 20.5 0.9 4.4% 17.0 1.0 5.9% Scotland 9.6 0.2 2.1% 6.4 - 0.0% Other 0.2 0.2 Total revenue 109.7 114.7 Underlying operating profit 1.2 1.2 Net interest (0.3) (0.3) Underlying PBT 0.9 0.9 Exceptional claim settlement costs (0.6) - Amortisation (0.1) (0.1) Profit before tax 0.2 0.8 • Net interest includes £0.3m non-cash items (2013: £0.3m) 7 Cash Flow 30th June 2014 30th June 2013 £m £m Operating cash flow before working capital movements 0.6 1.2 Working capital movement (5.5) 2.9 Operating cash flow (4.9) 4.1 Corporation tax 0.3 (0.8) Fixed asset disposals net of additions 0.2 (0.3) Cash outflow before financing (4.4) 3.0 Dividends paid (0.9) (0.8) Borrowings 5.0 - Net cash inflow (0.3) 2.2 Opening cash 1.0 5.6 Closing cash 0.7 7.8 Unused Facilities 8.0 8.0 8 Balance Sheet Balance Sheet 30th June 2014 30th June 2013 £m £m Revenue Profit Revenue Profit Intangible assets 23.3 23.6 Property plant and equipment 5.3 5.8 Deferred tax 1.9 2.0 30.5 31.4 Inventories and construction contracts 25.0 18.6 Trade and other receivables 37.5 32.2 Trade and other payables (53.2) (54.7)) Current tax (0.5) 0.3 Working capital excluding cash and borrowings 8.8 (3.6) Cash 0.7 7.8 Borrowings (5.0) (0.1) Net current assets 4.5 4.1 Pension scheme (11.7) (11.1) Net assets 23.3 24.4 • £5m 3 year Revolving Credit Facility fully drawn • Pension deficit - cash contributions c £1.1m per annum 9 Bloomberg London Our site activities commenced July 2014 Operational Review M & E Contracting 10 Secured forward order book stretching from July 2014 through to 2021 2014 2015 2016 - 2021 £97m £122m £56m £275m Additional projects where TClarke are currently under consideration Good visibility of projects that will fuel our wider recovery. Bond Street Station Principal Place Forward order book has been replenished and strengthened and stands at £275m up from £225m at this point last year. 90% of our targeted revenues for 2014 have been secured. Transport M&E Contracting We are at an advance stage of negotiation on a number Rathbone Square London Wall Place of high profile schemes particularly in our London Businesses that will be on site commencing 2015. Forward Order Book M&E Contracting M&E Contracting 11 Manufacturing Pre Fabricated Modules Project Nova, Victoria Our TClarke DGR workshop at Harlow BAE, Barrow-in-Furness Part of the Groups strategy was to widen the operational coverage and provide new revenue streams, some examples • The use of our prefabrication facility will be utilised for Land Securities, Project Nova at Victoria (above). FM / M&E Contracting • We work extensively at BAE in Warton and Samlesbury, this year we secured our first projects at Barrow-in-Furness (left). Crossrail Project C610 • Our push in to transport has secured several high profile projects, we have further opportunities such as Project C610, the services within the Crossrail tunnels (left). Strategy and new revenue streams Transport 12 Current Transport Current Transport Bid / Project Opportunity Transport Projects 1. Heathrow 2. Paddington 3. Bond Street 4. Victoria 5. Waterloo 6. Holborn 7. Camden Town 8. Kings Cross 9. Old Street 10. Bank 11. Shadwell 12. Devons Road 13. Poplar 14. East India 15. Emirates Royal Docks 16. Emirates Greenwich Peninsula 17. Beckton 18. Canary Wharf 19. Elephant & Castle 20. Silwood Sidings 13 Riverwalk House Number of Residential starts in Central London* 2013 2011 2012 4,900 6,800 13,500 97% Increase 2012-2013 * Source, Jones Lang Lasalle Current London schemes Current London opportunities Residential in London, 2014 now over Include; include; 20,000* units under construction, our focus will be on the main infrastructure elements • De Vere Gardens • Battersea and Intelligent Buildings • Fitzroy Place • Centre Point • Fulham Reach • One Nine Elms In Scotland we will complete 1,500 • Riverwalk House • Rathbone Square residential units this year and have secured • South Bank Tower • Royal Mint Gardens 900 for 2015. 14 Silwood Sidings 2 New Ludgate Transport Selfridges M&E Contracting BBC, White City Mission Critical BP Sunbury M&E Contracting Current Project Portfolio M&E Contracting 15 Romford Rail Operating Centre Aberystwyth University student accommodation Residential Transport Deutsche Bank, Birmingham ICT at Archerfield Links in Scotland Residential M&E Contracting Redcar Heart First Bus Depot Current Project Portfolio M&E Contracting Transport 16 Summary and outlook 2013 – 2014 challenging conditions During 2015 we expect to see the remain throughout UK construction improved market conditions across the sector country begin to benefit the Group • Market conditions still challenging • Our Forward order book across the in 2013 and for 2014. Group continues to strengthen. • Maintained discipline in bidding at • Encouragingly more new work being commercially viable rates despite secured that is not fixed price. continued pressure on margins • Improved contract conditions and • Maintained revenues. payment terms. • Cost base down. • Excellent opportunities in the London commercial sector and for transport • Operational improvements projects. including cost management. 17 Building Services Building Innovation Building Relationships www.tclarke.co.uk 18 Appendices Page 20 Vision and Strategy Page 21 TClarke City Page 23 Plc Board Page 24 Opportunities for Growth Page 25 TClarke Founded 1889 Apprentices & Training Because real jobs mean real motivation It requires a long term investment of time, money and resource, what we get in return is people who care about their work and have the skills and attitude you want on your job. Finalists for TClarke Apprentice of the Year (from left) Michael O’Donovan - TClarke Bristol, Jamie McDonald – TClarke East and the winner Andrew Stephenson – Veale-Nixon 19 Vision and Strategy Our Vision Examples of delivering our strategy TClarke aims to be a strong, successful and highly capable building services contractor, organised to create and take advantage of market opportunities for profitable growth across the construction industry; • Continued programme to centralise and retaining TClarke’s traditional focus on delivery of high quality work, by unify key systems and functioned highly-motivated and expert teams, sustaining long-term relationships and unlocking new streams of innovation to create value for all our shareholders • Integrated marketing delivers major projects