600 Group PLC Annual General Meeting 14 September 2011.
-
Upload
bartholomew-boyd -
Category
Documents
-
view
217 -
download
3
Transcript of 600 Group PLC Annual General Meeting 14 September 2011.
600 Group PLC
Annual General Meeting
14 September 2011
Highlights• Revenue up by 11% to £50.6M
• Underlying operating profit £1.2M (£1.1M)
• Net operating expenses reduced by £7.3M
• Net pension credit of £2.6M with the change to CPI
• Good order book and lower breakeven point
• Acquisition in Poland for production of the Group’s machine tools
• Successful share placement to finance Poland
• Change of bank in the UK to Santander
• Move to AIM completed
Operating Profit Trend
-3
-2
-1
0
1
2
3
2008/9 2009/10 2010/11
Un
der
lyin
g P
rofi
t /
Lo
ss (
£m)
39% of Sales 20% of Sales 14% of Sales 27% of Sales
Structure of the Group
Machine Tools (39% sales)
• Metal turning machines– Conventional (non CNC)
– Workshop CNC
– Production CNC
• Brands: Colchester and Clausing• Oxford Economics positive market
forecast– Double digit growth next 3 years
– Pre recession levels by 2012
• Increasing vertical integration following acquisition in Poland
Machine Tools New Business Model
Poland Production
UK Components
UK Machines
Sales Organisation
EMEALeeds
North AmericaMichigan
AustraliaSydney/Brisbane
South AfricaJohannesburg
Manufacturing Footprint
• EMEA sales organisation relocated• Shorter lead times• Increased margins and earnings• Higher quality• Better market rating as a bona fide engineering operation
Poland Benefits
• Lower material costs
• Skilled workers capable of being trained on CNC machines
• Vertically integrated production with low cost foundries in close proximity
• Good transport links to main markets plus new highway
• Low level of corruption
• Access to other CEE markets
• Poland latest GDP 4.4%
Precision Engineered Components (20% sales)
• Spares for installed base of machines• Bearings and tool holding equipment• High precision tolerances up to 0.5
micron • Poland machining capability• Good recovery for bearings
Laser Marking (14% sales)
• Alternative to inkjet marking• Global trend towards traceability• Proprietary software & laser
technology• Diverse customer base
– Automotive– Aerospace– IT– Solar– Pharmaceutical
• Pipeline of development projects
Mechanical & Waste Handling (27% sales)
• Sub Saharan Africa• Main drivers:
– Infrastructure– Electrification– Mineral extraction
• Positive GDP growth forecasts• Contract with Eskom completed in
2011
Major Issues and Response 2009/11
Outlook
• More flexibility with the move to AIM
• Poland is a medium term solution to the Group’s long term strategic issue on machine tools– Volume of transferred machines is increasing– Integration costs will reduce towards the end of the year– Margin benefits will be visible towards the end of the year– Upside potential over the next two years
• The shift from distribution to manufacturing should be well received by the market
• Good organic prospects offset by the uncertain macroeconomic environment
• Board changes