Tricorn Group Plc
Interim Results Presentation
2 December 2014
Introduction
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Bespoke tubular solutions to major global blue chip OEMs
Operating in niche markets with low batch sizes and high variety
High proportion of recurring revenue
Focus on creating value
Transportation
Energy
Key markets: On and off
highway, including construction,
trucks and agriculture
Key markets: Power generation,
marine, oil & gas, mining
2
Meeting our customers’ needs wherever
they operate
MTC, UK
JV Minguang-Tricorn Tubular
Products, Nanjing, China
Maxpower, UK
Maxpower
Wuxi, China
FTP Franklin, USA
Highlights-Interim Results
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Uniquely positioned with global manufacturing platform
Revenue up 7.9% on six months ended 31 March 2014
Further growth in China
Disposal of aerospace business for £1.064m in cash enabling
Group to focus on its core markets
Net debt reduced by 12.5% from year end position
Cash and cash equivalents at £1.028m
After period end, appointment of Non-Exec Chairman with over 30
years experience in international engineering groups
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Financial review
H1 2015
£’000
Restated
H1 2014
£’000
H1 2015
v H1
2014
Restated
H2 2014
£’000
H1 2015
v H1
2014
10,630
11,366
(736)
9,856
774
11
367
(356)
(426)
437
(70)
335
(405)
(528)
(458)
(0.21)p
0.61p
(0.82)p
(1.36)p
1.15p
Capex/Dep’n ratio
0.42
1.31
n/a
0.54
n/a
Cash and equiv
1,028
862
166
1,284
(256)
(2,963)
(3,641)
678
(3,386)
423
Revenue
Operating profit/(loss)
(Loss)/Profit before
tax
Adjusted (LPS)/EPSbasic
Net (debt)
All references to operating loss/profit, operating margin, loss/profit before tax and EPS are before
China start up costs, restructuring costs, intangible asset amortisation, share based payment
charges and foreign exchange derivative valuation.
Comparative results for continuing operations have been restated to exclude the RMDG
Aerospace and the Redman Fittings businesses as these were discontinued during the periods
ended 30 September 2014 and 30 September 2013 respectively.
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Financial review-change in net funds
£000’s
March
2014 Net
Debt
Operating
profit (Excl
JV)
Dep’n
Sale of
business
Finance
charges
China
investment
Capital
expenditure
Working
Capital
(90)
Sept
2014
Net Debt
(2,963)
(230)
(3,386)
934
(127)
(405)
304
Gearing
45.4%
37
Gearing
49.5%
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Financial review-net debt
• Group net debt is £2.963m down from £3.641m at 30
September 2013 and £3.386m at 31 March 2014
• Resultant gearing is at 45.4% (H1 2014: 48.3%, FY 2014:
49.5%)
• Following the final injection of registered capital into China
in September 2014, Group investments in existing
businesses in H1 are significantly lower than in previous
years
• The Group continues to use short term borrowing facilities
and lease finance arrangements for its cashflow needs
• The Group does not have any long term debt in place
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Business Performance-Energy
£’000
•
•
•
•
•
Benefitting from
Revenue
restructuring
implemented last year PBT
Delivering an improved
operational performance
Responding well to
increases in demand
Revenue up 11.2% on
previous period
Significant improvement
in segmental profit
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H1
2014/15
H2
2013/14
H1
2013/14
3,730
3,355
3,578
281
(221)
194
Business Performance-Transportation
UK
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Business
benefitting from
improved demand
through the period
£’000
H1
2014/15
H2
H1
2013/14 2013/14
Sales
6,900
6,501
7,788
PBT
(310)
(178)
199
China
USA
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• Revenues broadly flat on
previous period
• Operational performance fell
short of expected levels
• New management team has
made an encouraging start
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WOFE continues to see
revenue grow
Busy with managing in load
of new work
Joint venture integrating
well into the Group
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Outlook
• Strategic investments in the USA and China position the
Group uniquely in its target sectors
• Provides the platform for accelerated growth
– New business with existing customers
– As market conditions improve
• Business in China continues to expand
• The new management team in the USA has made an
encouraging start in creating a solid platform from which the
business can develop
• Market conditions expected to remain challenging for the
balance of the current year
• Revenue expected to be slightly lower in H2 compared to
H1
• Adjusted LBT in H2 is expected to be slightly higher than the
first half
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Appendix
Tricorn shareholders
Major shareholders:%
R Allsop
33.5%
Hargreave Hale
18.4%
W B Nominees
4.1%
Rock Nominees
4.1%
Quilter Nominees
3.1%
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Shareholder Analysis
35%
23%
42%
Institutions
Private shareholders
Directors
Board of Directors
Andrew Moss
Non-Executive Chairman
Appointed as Non-Executive Director in November 2014 and Non-Executive Chairman from December 2014. Member of the Audit,
Remuneration and Nomination Committee.
He has over 30 years' experience in international engineering Groups specialising in aviation, automotive and power electronics products,
and advanced composite materials. He spent 13 years with Umeco Plc, five years of which was spent as a main board Director, resulting in
his appointment as Chief Executive in 2011. Prior to this he was with BTR/Invensys Plc managing a number of international manufacturing
businesses.
Mike Welburn - Chief Executive
Joined Tricorn in April 2003,appointed to the Board in March 2004 and as Chief Executive in November 2007.
He had previously been with IMI plc for 18 years where he had held a number of senior roles within the Fluid Power Division. This included
responsibility for European Operations and Global OEM Strategy.
Phil Lee - Group Finance Director
Joined Tricorn in January 2009 and appointed to the Board in February 2009.
He had previously been at Rolls-Royce for 9 years working in a number of roles including Finance Director of Distributed Generation
Systems (part of the Rolls-Royce Energy Business). Prior to Rolls-Royce he had been with National Grid Plc.
David Leakey - Group Sales Director
Joined Tricorn and appointed to the Board in June 2011. He had previously spent 27 years working at Norgren Ltd, the Motion and Fluid
Controls division of IMI Plc. He has most recently held the role of Global Sales Director in the Energy Sector, with responsibility for the global
business development of the company’s products into the oil and gas markets. David has also held the position of Sales Director in
Norgren’s Life Sciences and Automotive Sectors.
Roger Allsop - Non Executive Director
Purchased MTC in 1984 and Chief Executive of Tricorn up to 2002 after which he became a non-executive Director. Chairman of the Audit
and Remuneration Committees and a member of the Nomination Committee.
He was previously managing Director of Westwood Dawes plc and non-executive Director of Netcall plc.
Nick Paul CBE - Non Executive Director
Appointed to the Board as non-executive Chairman in October 2001 and has held that position until the end of November 2014 following his
decision to step down as Chairman. He has announced his intention to retire from the Board at the end of March 2015. Member of the
Remuneration and Audit Committees, and Chairman of the Nomination Committee.
He is currently Chairman of Severn Valley Railway (Holdings) plc.
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