CLIPPER LOGISTICS PL

CLG
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Clipper Logistics : 2020 Full Year Results Presentation (PDF)

08/24/2020 | 02:13am

Full year results 2020

A winning formula for the fast-growinge-commerce zone

Steve Parkin: Executive Chairman & Founder

David Hodkin: Chief Financial Officer

Tony Mannix : Group Chief Executive Officer

Sebastien Desreumaux: Chief Executive Officer Europe/ Group M&A

Disclaimer

Disclaimer

This presentation includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believe", "estimates", "plans", "projects", "anticipates", "expects", "intends", "may", "will", or "should" or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include matters that are not historical facts and include statements regarding the Company's intentions, beliefs or current expectations.

Any forward-looking statements in this presentation reflect the Company's current expectations and projections about future events. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These risks, uncertainties and assumptions could adversely affect the outcome and financial effects of the plans and events described herein. Forward-looking statements contained in this presentation regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. You should not place undue reliance on forward-looking statements, which speak only as of the date of this presentation. No representations or warranties are made as to the accuracy of such statements, estimates or projections.

Please note that the Directors of the Company are, in making this presentation, not seeking to encourage shareholders to either buy or sell shares in the Company. Shareholders in any doubt about what action to take are recommended to seek financial advice from an independent financial advisor authorised by the Financial Services and Markets Act 2000.

Extensive operational capabilities

Global E-fulfilment shipping

2

Contents

Page:

Investor highlights

4

Clipper overview

7

The 'Clipper Way'

15

Environmental, social and governance

19

E-commerce mega trends and Post-COVID-19 acceleration

23

Business case: Superdry

28

Headline financials

30

Clipper's unique strategic position

36

Q&A

38

3

Investor highlights

Investor highlights

Clipper: a clear winner in the e-commerce zone

4

Investor highlights

Financial highlights: a clear winner in the e-commerce zone

  • Total revenue growth of 8.8% to £500.7m (2019: £460.2m), organic growth only - 16% CAGR since IPO in 2014.
  • E-commerce related revenue growth of 18.4% to £277m (2019: £234m).
  • Strong Group EBIT growth of 19.1 % (IAS 17 basis) to £24.1m (2019: £20.2m) - (EBITDA 17% CAGR since IPO in 2014).
  • High cash growth from operations of +12.7% to £31.9m (2019: £28.3m).
  • Net debt of £45.1 m including £34.9m on back to back contracts with clients - leverage ratio Net debt/EBITDA of 1.3x, falling further since year end.
  • Earnings per share growth of 17.4% to 15.5p (2019: £13.2m).
  • Strength of performance and cash generation leads the Board to recommend a final dividend of 6.2p.

Total dividend per share for the year of 9.7p (2019: 9.7p).

5

Investor highlights

A winning formula for the fast-growinge-commerce zone

Leading position in the full end to end e-commerce zone

Outperformed market in terms of growth and profit

Resilient & asset light Business Model

First class and long-term customer relationship

High level of cash conversion and ROCE

International, highly experienced entrepreneurial Executive team to accelerate growth & value creation

66% of Logistics revenue, +18.4% YoY

Revenue: £500.7m +8.8%

EBIT: £24.1m +19.1%

Open book: 70% of revenue

Maintenance CAPEX : 0.8%

Top 5: less than 15% EBITA

Typically contracted 3 to 10 years

Cash conversion: 108% (IAS 17)

ROCE: >30%

Aggregate +100 years experience UK, Mainland Europe and USA

6

Clipper overview

Clipper overview

Pan-European leader

7

Clipper overview

A pan-European leader in the e-commerce zone

50

SITES

THROUGHOUT

EUROPE

12million sq. ft. (1.5million sq. ft. in Europe)

+15.4% YoY increase

Extensive operational capabilities

Dedicated & shared use operations

Global e-fulfilment shipping

154m units pa. of

E-fulfilment

125m units pa. of

Returns

110m units pa. of

Pre-Retail

121m units pa. of

Retail Wholesale

GERMAN FACILITIES IN: BERLIN MUENCHBERG HOF NEUSS NETTETAL

POLISH FACILITIES IN:

POZNAN

Our Retail Solutions focus on: Taking cost, risk and complexity out of the supply chain

Note: 2019 data

8

Clipper overview

Segment and business activity details

E-fulfilment &

returns management

This business activity includes the receipt, warehousing, value-added processing, stock management, picking, packing and despatch of products on behalf of customers to support their online trading activities, as well as a range of ancillary support services, including the management of the returns process.

Business activity revenue

£277m

% of Logistics revenue

66% (2019: £234m)

+18.4%

Non

e-fulfilment

This business activity includes receipt, warehousing, value-added processing, stock management, picking, packing and distribution of products on behalf of customers.

Business activity revenue

£144m

% of Logistics revenue

34% (2019: £145m) -1.1%

Commercial

vehicles

The commercial vehicles business, Northern Commercials, operates Iveco and Fiat commercial vehicle dealerships from five locations, together with three sub-dealerships. It sells new and used vehicles, provides servicing and repair facilities, and sells parts.

Segment revenue

£83m

% of Group revenue

16% (2019: £83m)

0.0%

Note: The amounts and percentages shown indicate the contribution to Group revenue by each business area disregarding inter-segment sales.

9

Clipper overview

Ambition: accelerated global growth in the e-commerce zone

VISION

TO BECOME THE

GLOBAL LEADING

BRAND IN INTEGRATED

FULL END-TO-END

E-COMMERCE

LOGISTICS

MISSION

  1. Out-performthe market in growth & profitability
  2. Innovative and collaborative
  3. Deployment of the brand and expertise across new territories through strategic acquisitions
  4. Operate at the forefront of technology

10

Clipper overview

Ambition: accelerated global growth in the e-commerce zone

Build on market-

Develop new,

Continue

Explore

leading customer

complementary

European

acquisition

proposition to

products and

expansion

opportunities

expand the

services

customer base

11

Clipper overview

Clipper at the forefront of e-commerce

Service Portfolio:

E-FULFILMENT

CLICK & COLLECT

RETURNS

REPAIR & REMEDIAL

DISPOSITION

MANAGEMENT

12

Clipper overview

High quality customers: Top 5 account for less than 15% EBITA

E-FULFILMENT & RETURNS MANAGEMENT

SOLUTIONS

DEDICATED RETURNS SOLUTIONS

MULTI-CHANNEL SOLUTIONS

RETAIL LOGISTICS

INBOUND & PRE-RETAIL OPERATIONS

HIGH VALUE/SECURITY OPERATIONS

RETAIL/STORE TRANSPORT SOLUTIONS

SUPPLIER COLLECTIONS

RELIEF OPERATIONS

13

Clipper overview

Trusted partners: size, scale & long-term relationships

Morrisons

John Lewis

Liberty

Asda

(Walmart)

New Look

Harvey

Nichols

24 Years

22 Years

21 years

19 years

16 years

16 years

Clipper Account Portfolio by Turnover

14

The 'Clipper Way'

The 'Clipper Way'

E-commercelong-term enabler

15

The 'Clipper Way'

AGILE

COLLABORATIVE

ENABLER OF

A SCALABLE AND

AND ABLE

AND SOLUTION

CUSTOMERS'

RESILIENT BUSINESS

DRIVEN

GROWTH AND

MODEL

PROFITABILITY

AN EXPERIENCED

LONG-TERM CLIENT

EXCELLENCE IN EXECUTION

OPEN BOOK

ENTREPRENEURIAL &

PARTNERSHIPS

AND SHARED

INTERNATIONAL TEAM

USER MODEL

16

The 'Clipper Way'

Clipper delivers a broad range of value-added logistics services tailored to the emerging and future needs of our customers.

Key inputs

How we create value

Thought leadership and innovation

Clipper has a strong brand, long- standing customer relationships and an experienced team, which combine to deliver thought leadership and innovation in the logistics sector.

Technologically advanced

We work in trusted partnership with our customers to develop and rapidly deploy solutions to the challenges they face. Our team is focused on addressing tomorrow's challenges today and embraces new technology.

High level of contractual certainty

Clipper provides customers with services. We operate open book or minimum volume guarantee contract terms for 94% of our UK Logistics customers, giving us a high level of contractual certainty.

Mutually beneficial long-term relationships

Innovative solutions

Clipper has developed specialist services (e.g. pre-retailing services and reprocessing of garments) to support our customers in their ever-complex supply chains and to ensure that product is ready for sale in the most efficient and cost-effective manner.

As the retail landscape changes to become more omni-channel focused, developing innovative solutions such as Clicklink and Boomerang to support our

Fleet procurement benefits

Whilst Northern Commercials is not heavily dependent on the logistics division of the Group, it provides Clipper with flexibility over fleet procurement, and margins on servicing activity are retained within the Group.

Commercial vehicle dealerships

Enduring relationships

Clipper's focus on the provision of

Effective financial management

We seek to efficiently use funds

We also operate closed book contracts for customers, many of whom we have worked with for several years.

customers has led to Clipper retaining customers on a long-term basis as well as winning new business every year.

In addition, our commercial vehicles division is profitable and cash generative - its profitability driven by higher margin aftersales

value-added services to retailers at a competitive cost has resulted in a number of long-standing contractual arrangements with major retailers such as Asda, ASOS, John Lewis, Morrisons and Superdry.

obtained through financing or generated from operations or investments. A high degree of contractual certainty underpins financial predictability and stability.

Talent and expertise

In order to ensure long-term customer relationships, we continually draw on our team's expertise to drive innovation in our operations. This enables us to retain our market-leading cost competitive position and continue to strengthen our brand.

activity, which is underpinned by legal requirements governing the inspection of commercial vehicles.

17

The 'Clipper Way'

Clipper delivers a broad range of value-added logistics services tailored to the emerging and future needs of our customers.

How the value is shared

Shareholders

High growth market sectors, an attractive business model and a clear growth strategy combine to give operating profit growth and good cash conversion, resulting in dividend distributions of circa 61% in 2020.

Customers

Blue-chip customers in logistics and commercial vehicles can rely on Clipper's established reputation and high levels of service, particularly when they need it most through peak trading periods.

Communities

Clipper's Corporate Social Responsibility agenda benefits local communities by providing employment opportunities, reinvesting in the local communities through sponsorship and developing green initiatives.

Employees

Over 8,000 employees have access to attractive career progression in a market-leading logistics business. The Sharesave Plan enables employees to share in the financial success of the business.

Suppliers

Clipper benefits from its relationships, built over many years, with large and small trusted partners and suppliers. Clipper's diverse supply base de-risks Clipper and its customers from fluctuations in market conditions.

18

Environmental, social and governance

Environmental, social and governance

19

Environmental, social and governance

Ethical governance

Everyone who works for and with Clipper Logistics plc has the right to work in an environment that is free from harm and to do so freely for their own purpose.

Clipper has partnered with Intertek plc to create an Ethical Trading audit that is based on the SMETA audit standards as well as being benchmarked against the Ethical Trading Initiative (ETI) standards.

Sites' contingent labour providers and onsite support functions (e.g. security, cleaning and catering companies) are audited yearly with stringent follow-up actions.

This provides significant confidence to senior management and the

Board on compliance with our strict ethical policies, including Modern

Slavery.

20

Environmental, social and governance

Fresh Start

PURPOSE

  • Create new ways of working to counteract the potential impact of Brexit.
  • Improve channels of available resource- through innovation and new ways of working.
  • Market-leadingexample of diversity and inclusion - changing stereotypes of logistics.
  • Recognise and adapt to how to attract young talent: 80% of Millennials look at Diversity & Inclusion policy of employers.

PARTNERS

AWARDS

FRESH STARTERS PROFILE

Disability: physical, learning or mental health Ex-Offenders

Ex-MilitaryFull-time parents

Retirees

Ex-Homeless

Long-term Unemployed

2

2nd Birthday May 2020

1,050

Fresh Starters across the group

92%

Retention rate

21

Environmental, social and governance

Sustainability

Clipper recognises that every organisation has a responsibility to the environment and is committed to establishing environmental management as a corporate priority. Example programmes of work include:

  • Clipper are UK franchise partner for Give Back Box
  • Objective to reduce clothing that goes to landfill - c. 400m tonnes every year in UK
  • Outbound packaging is reused and filled with unwanted clothing and sent to Clipper for processing
  • Clipper then re-distributes to 3 nominated UK charities
  • Clipper is working with a growing number of UK retailers to grow the initiative

GREEN FLEET

  • Clipper are committed to moving away from diesel powered vehicles
  • Investment to date:
    • LNG Gas x 11 vehicles
    • CNG Gas x 25 vehicles
    • Electric x 4 vehicles
    • 16 Double Deck Trailers - trunk reduction by 30%
  • Radial deliveries - reduce C02 by 750 tonnes
  • Inner City Deliveries (electric) reduce C02 by 100 tonnes per vehicle
  • Regent Street Consolidation Centre - operates electric vehicles and consolidated deliveries to reduce vehicle trips by over 80%

SUSTAINABILITY INITIATIVES

  • Think Green site led initiatives
    • "Drive cultural change to reduce emissions, recycle more and save energy for the good of the planet"
    • Focus on:
      • Colleague engagement
      • Energy reduction
      • Zero landfill
      • Carbon neutrality
  • Sustainability Forums
    • Launched 2019
    • Clipper / Customer Forums
    • Objective to reduce environmental impact of supply chain operations
    • Forum topics:
      • Closed loop packaging
      • Materials reuse & recycling
      • Waste to energy
      • End of life stock routes

22

E-commerce mega trends and post-COVID-19 acceleration

E-commerce

Mega trends and post-COVID-19 acceleration

23

E-commerce mega trends and post-COVID-19 acceleration

Navigating through COVID-19

PEOPLE

The safety and wellbeing of our colleagues has been and continues to be our overriding priority

STRATEGY

LIQUIDITY

PROCESS

The Board is

The availability of

The Clipper team

monitoring events

cash resources and

has demonstrated

closely with regular

committed facilities,

its ability to support

Board oversight

together with strong

supply-chain

evaluating the

cash flow, support

continuity for

impacts and

the Group's liquidity

existing and new

designing

and viability through

customers thanks to

appropriate

the pandemic

its very agile and

response strategies

resilient processes

24

E-commerce mega trends and post-COVID-19 acceleration

NHS PPE & other solutions: agility matched by ability

2 NEW SITES,

NEW SITE

DISTRIBUTION

DC/DISTRIBUTION

SUBSTANTIAL

E-COMMERCE &

SUPPORT

GROWTH

DISTRIBUTION

SOLUTIONS

MULTIPLE ADDITIONAL OPPORTUNITIES SEIZED AS RETAILERS RESHAPE THEIR BUSINESS MODELS INCLUDING OUTSOURCING, E.G. JOULES

25

E-commerce mega trends and post-COVID-19 acceleration

Supporting the supply chain, delivering for customers

4 DAYS

Responding to a request from Government, mobilisation of the solution took 4 days

200,000 SQ. FT.

including setting up a full warehouse management system for an initial 200,000 sq. ft. of warehousing space

7 DAYS

We additionally created an online solution, working with eBay to support aspects of the primary care network and we had that operation up and running in 7 days

Supporting

the NHS

In the 'Clipper Way', demonstrating our agility, Clipper was able to mobilise an initial 200,000 sq. ft. solution within 4 days. We are currently utilising our logistics capabilities at several locations, thereby easing the pressure on the NHS Supply Chain network.

The aim was to work with our NHS partner and establish a new supply chain for NHS Personal Protective Equipment (PPE) products.

We are not only delivering to NHS Hospital Trusts, we have also developed an online eBay solution to support healthcare providers, GP surgeries, care homes and others in the primary care network across the country.

26

E-commerce mega trends and post-COVID-19 acceleration

COVID-19: accelerated e-commerce growth

Online orders increased significantly from March 2020 onwards

21% year-on-year increase in e-commerce sales in fashion, apparel and accessories globally. Bricks-and-mortarsaw online orders increase from 52% to 76% compared with the same period last year (The Future of Ecommerce, April 2020).

Dramatic change in online shopping habits over the COVID-19 lockdown period Number of consumers who say they've increased their online shopping rising to 36% (Mintel research conducted 16-23April).

Catalyst for a new, more omni-channel focused future

42% of respondents to a survey conducted by Retail SaaS provider Qudini are more likely to use click and collect services.

Retailers without online presence threatened

42.6% of UK shoppers are spending more than usual online at the moment and 61% of those plan to keep doing so after the pandemic (Global Data's survey May 2020).

27

Business case

Business case

28

Business case

Superdry

99%

of returns available for resale within 24 hours

Putaway rates increased

Pick rates increased

by

by

900%

104%

32,000

locations served by robots.

Use of robots has increased putaway and pick rates, which in turn has increased productivity.

Use of automation to speed up processing

We partnered with Superdry to develop automation solutions to speed up the processing of e-commerce returns, making them available for sale again quickly. We looked at the flexibility robots could offer us in an automated goods-to-person system. The pilot project for handling e-commerce returns was conducted in 2018. After the success of that project, we moved on with planning expansion.

Over 80,000 sq. ft. of warehouse space at our Burton facility is being set out with 1,000 transportable pick-wall modules and 12 pick-to-light stations to facilitate the adoption of the robots. The site is also being prepared for the robot fleet by positioning QR codes on the floor for the robots to follow.

The solution will not only be able to process all existing e-commerce returns but will now also be able to process returns from store. Once live, this will cater for around 50% of the site's outbound activity. The expansion will take us from six robots and 92 modules to 46 robots and 1,000 modules.

This will allow over 32,000 locations to be serviced by robots.

Our plan is then to further expand the solution to include menswear next year. This will involve additional automation projects, redesign of the mezzanine floors as forward reserve storage to enable fast replenishment and reduced handling of goods to the High Productivity Racking area.

29

Headline financials

Headline financials

Outperforming the market

30

Headline financials

Historic performance

£'m

Clipper's track record demonstrates capability to seize opportunities:

1992: Clipper founded by Steve Parkin

2014-2020: post IPO CAGR: Revenue 16%; EBITDA 17%

2014: successful IPO

Group Revenue and EBITDA 2013-2020

600

500.7

500

460.2

400

400.1

340.1

300

290.3

201.2

234.8

200

160.7

100

12.9

IPO

15.7

19.8

23.1

25.9

30.3

34.6

13.5

0

2013A

2014A

2015A

2016A

2017A

2018A

2019A

2020A

Financial Year

Revenue

EBITDA

31

Headline financials

Operating and financial review

Group revenue

Including

£m

non-underlying factors

Underlying

2020

2019

Change %

2020

2019

Change %

E-fulfilment & returns management services

277.0

233.9

+18.4%

277.0

233.9

+18.4%

Non e-fulfilment logistics

143.8

145.3

-1.0%

143.8

142.2

+1.1%

Total value-added logistics services

420.8

379.2

+11.0%

420.8

376.1

+11.9%

Commercial vehicles

82.5

82.6

-0.1%

82.5

82.6

-0.1%

Inter-segment sales

(2.6)

(1.6)

(2.6)

(1.6)

Group Revenue

500.7

460.2

+8.8%

500.7

457.1

+9.5%

Group EBIT

Including

£m

Non-underlying factors

Underlying

2020

2019

Change %

2020

2019

Change %

E-fulfilment & returns management services

17.6

13.6

+29.4%

15.8

13.6

+16.2%

Non e-fulfilment logistics

14.2

13.0

+9.2%

12.4

9.9

+25.3%

Central logistics overheads

(6.9)

(5.5)

+25.5%

(6.7)

(5.9)

+13.6%

Total value-added logistics services

24.9

21.1

+18.0%

21.5

17.6

+22.2%

Commercial vehicles

2.0

1.1

+81.8%

2.0

1.1

+81.8%

Head office costs

(2.8)

(2.0)

+40.0%

(2.6)

(2.8)

-7.1%

IFRS 16 impact (1)

8.4

-

Group EBIT

32.5

20.2

+60.9%

20.9

15.9

+31.4%

Note: All numbers are presented on an IAS 17 basis to aid comparability, with IFRS 16 impact shown as a single adjustment (1)

  • Group revenue growth of £40.5 million was largely attributable to growth in the e-fulfilment & returns management business activity, which grew by 18.4%.
  • This revenue growth is due to a combination of:
    • the full year impact of new contracts won in the prior year (Mountain Warehouse, Brissi, Tech Data, Neon Sheep, Levi Strauss, Sports Direct, Vestel and Ginger Ray);
    • new contracts won in the year ended 30 April 2020 (Hope & Ivy, Simba Sleep, Amara, Shop Direct, Loyalti, N Brown, SLG, the NHS, Joules and New Girl Order); and
    • growth in existing contracts and in continental Europe.
  • Underlying Group EBIT grew by 31.4%, on underlying Group revenue growth of 9.5%. Underlying EBIT from e-fulfilment& returns management services grew by 16.2% on revenue growth of 18.4%.
  • Commercial vehicles returned to normalised levels of profitability in FY20.

32

Headline financials

Operating and financial review

Group Income Statement

For the year ended 30 April

£m

2020

2019

Change %

Revenue

500.7

460.2

+8.8%

Strong revenue growth in the year driven by e-fulfilment & returns

Cost of sales

(358.7)

(331.9)

Gross profit

142.0

128.3

+11.6%

management services.

Other net gains

4.1

(0.3)

Key EBIT metric saw continuing growth of 60.9% including the impact of

Admin expenses

(114.7)

(108.4)

Operating profit before share of equity-accounted investees, net of tax

31.4

19.5

+61.0%

IFRS 16 and non-underlying factors.

Share of equity-accounted investees, net of tax

(0.2)

(0.4)

Operating profit

31.2

19.1

+63.4%

Excluding negative goodwill, property-related advisory fees and share

EBIT (excluding non-underlying factors)

20.9

15.9

+31.4%

based payments, underlying EBIT is up year on year by 31.4%.

IFRS 16 impact

8.4

Non-underlying factors

3.2

4.3

Finance costs up £9.0m, of which £8.3m is as a result of IFRS 16.

EBIT

32.5

20.2

+60.9%

Less: amortisation of other intangible assets

(1.2)

(1.2)

Profit before tax and amortisation up 17.7% to £21.3m.

Share of tax and finance costs of equity-accounted investees

(0.1)

0.1

Operating profit

31.2

19.1

Profit before tax increased by 18.9% to £20.1m.

Net finance costs

(11.1)

(2.1)

Profit before income tax

20.1

16.9

+18.9%

EPS growth of 20.5% to 15.9p.

Income tax

(3.9)

(3.5)

Profit for the financial period

16.2

13.4

+20.8%

Basic earnings per share (p)

15.9

13.2

+20.5%

33

Headline financials

Operating and financial review

Group Statement of Financial Position

At 30 April

£m

2020

2019

Intangible assets

37.9

37.3

Property, plant & equipment

29.0

61.5

Interest in equity-accounted investees

0.6

0.9

Right-of-use assets

186.2

-

Deferred tax

1.2

-

Non-current financial assets

1.9

1.9

Non-current assets

256.8

101.6

Inventories

27.9

24.0

Trade & other receivables

102.7

96.4

Cash & cash equivalents

2.7

3.5

Current assets

133.3

123.9

Trade & other payables

130.8

126.0

Borrowings

19.3

12.3

Lease liabilities

38.4

-

Short term provisions

0.1

0.2

Current tax liabilities

1.8

0.8

Current liabilities

190.4

139.3

Borrowings

0.1

39.1

Lease liabilities

163.9

-

Long term provisions

6.5

1.6

Deferred tax liabilities

-

2.3

Non-current liabilities

170.5

43.0

Net assets

29.2

43.2

  • IFRS16 saw the recognition of right-of-use assets ("ROU") of £175.0 million and lease liabilities of £190.2 million on transition in FY20.
  • There were £11.0 million of additions in property, plant and equipment and £39.7 million were reclassified to ROU assets.
  • Inventories higher in Commercial Vehicles subsidiary, funded by increased drawings on stocking credit line.
  • Trade & other receivables reflects: higher accrued income as the business continues to grow, with unbilled reconciliation income on open books; and certain short-term overdue debtors.
  • Trade & other payables also higher as a function of business growth.
  • Borrowings were £19.4 million in FY20 reduced from £51.4 million in the previous year, as obligations previously classified within this caption are now included within lease liabilities.
  • Net debt excluding the impact of IFRS 16 was £45.1 million. £35.4m is capex that is directly recoverable from customers through the open book charging mechanism.

Note: 2020 presented on an IFRS 16 basis; 2019 under IAS 17.

34

Headline financials

Operating and financial review

Group Statement of Cash Flows

For the year ended 30 April

£m

2020

2019

EBIT

24.1

20.2

Depreciation & Amortisation

5.3

8.2

Other non-cash items

1.2

(0.7)

IFRS 16 Impact

34.9

-

Change in working capital

1.3

0.6

Cash generated from operations

66.8

28.3

Net interest paid

(2.9)

(1.9)

Tax paid

(3.5)

(4.3)

Net cash flows from operating activities

60.4

22.1

Net capital expenditure

(11.7)

(25.9)

Acquisition of subsidiaries

(2.9)

(0.5)

Net cash flows from investing activities

(14.6)

(26.4)

Net drawdown of bank loans

1.2

7.2

Finance lease drawdowns

5.7

18.7

Repayment of capital on finance leases

(8.4)

(10.4)

IFRS 16 Impact

(34.9)

-

Shares issued

0.1

0.3

Dividends paid

(10.2)

(8.9)

Net cash flows from financing activities

(46.5)

6.9

Net increase / (decrease) in cash & cash equivalents

(0.7)

2.6

  • Cash generated from operations increased by £38.5 million. IFRS 16 resulted in an improvement of £34.9 million - excluding this there was a £3.6 million improvement YoY.
  • Net interest paid increased by £1.0 million largely as a result of increased interest costs on hire purchase and finance lease agreements following significant capital expenditure in the year ended 30 April 2019, and to a lesser extent increased interest costs on the commercial vehicles stocking lines.
  • Corporation tax of £3.5 million was paid in the year ended 30 April 2020 (2019: £4.3 million).
  • Included within investing activities is £2.9 million of cash outflow relating to the business combination.
  • 2020 saw overall lower levels of capex and therefore less asset funding was required; £5.7 million in 2020 down from £18.7 million in the prior year.
  • Net cashflows from financing activities were £46.5 million which included £34.9 million impact as a result of IFRS 16.

Note: 2020 presented on an IFRS 16 basis; 2019 under IAS 17.

35

Clipper's unique strategic position

Clipper's unique strategic position

36

Clipper's unique strategic position

A clear winner, uniquely placed to accelerate growth and create value

A leading e-commerce logistics company with nearly 30 years' experience in a fast-growing, rapidly changing retail marketplace.

Uniquely placed in the full end-to-ende-commerce zone including e-fulfilment, click & collect, returns management, repair & disposal.

Strong track record based on the combination of operational excellence, innovation and technology-driven solutions.

Out-performed market both in terms of growth and profitability: CAGR revenue 16%, EBITDA 17% since IPO.

An experienced team led by Clipper's founder, Steve Parkin, with an effective, efficient and entrepreneurial approach.

Strong trading picture in 2020 with more growth ahead in online shopping post COVID-19.

Substantial organic growth opportunities in the UK and mainland Europe where Clipper grew respectively 43% in FY19 and 34% in FY20.

M&A opportunities in the UK, mainland Europe and North America to deploy Clipper's expertise across new geographies and enhance value to customers and shareholders.

37

Q & A

Q & A

38

Thank you

39

Disclaimer

Clipper Logistics plc published this content on 24 August 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 August 2020 06:13:16 UTC

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