Pres Conf BNPP - Jan 2018 - VFinale - loxamgroup.com€¦ · Our key strengths Favorable long-term...

18 January 2018

InvestorPresentation

-BNP Paribas HY Conference

London – January 2018

2 BNP Paribas HY ConferenceThursday 18 January 2018

Disclaimer

This presentation does not constitute or form part of and should not be construed as an offer to sell or issue, or the solicitation of an offer to buy or acquire, securities of LOXAM (the “Issuer”), in any jurisdiction or an inducement to enter into investment activity. It is solely for use at an investor presentation for information only. It does not contain all of the information relating to the Issuer or its business that may be material to an investor. No part of this presentation, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever.

The information contained in this presentation has not been independently verified. No representation, warranty or undertaking, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or the opinions contained herein. None of the Issuer or any of its respective affiliates, advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection with the presentation.

This presentation includes "forward-looking statements". These statements contain the words "anticipate", "believe", "intend", "estimate", "expect" and words of similar meaning. All statements other than statements of historical facts included in this presentation, including, without limitation, those regarding the Issuer’s financial position, business strategy, plans and objectives of management for future operations (including development plans and objectives relating to the Issuer’s projects and services), are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of the Issuer to be materially different from results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the Issuer’s present and future business strategies and the environment in which the Issuer will operate in the future. These forward-looking statements speak only as at the date of this presentation. Each of the Issuer and its respective agents, employees and advisers, expressly disclaims any obligation or undertaking to update any forward-looking statements contained herein.

The information and opinions contained in this document are provided as at the date of this presentation and are subject to change without notice.


Presenting today

13 years with Loxam

Patrick Bourmaud

Chief Financial Officer

17 years with Loxam

Stéphane Hénon

Managing Director

11 years with Loxam

Maëg Videau

Finance Director

XX

BNP Paribas HY ConferenceThursday 18 January 2018

Introduction

Stéphane HENON


Loxam in a nutshell

Europe’s #1 equipment rental company, World’s #3 powere d access player

#1European equipment

rental player

#3largest powered

access fleetworldwide

€1.36bnLTM 30 Sep 2017 proforma revenue

22Presence in 22

countries

7 300Staff

725Branches

225 000+

Customers

250 000+

pieces of equipment

40 000powered access

units


Our key strengths

Favorable long-term market trends

Largest rental company in Europe

Highly diversified and fragmented client base with established loyalty from its customers

Ownership of one of the largest and most diversified fleet in Europe, renowned for its quality and

availability

Unrivalled density of network

Proven ability to manage business cycles : robust financial track record


Equipment

Rental Market

Maëg VIDEAU


End markets

Mostly construction, but not only

60%

40%

Non Construction

ConstructionBuilding construction / Civil engineering

Industrials

Services

Local authorities

Events & Media


Equipment rental vs. Construction correlation

Equipment rental evolves early in the construction cycle and amplifies trends

-15%

-10%

-5%

0%

5%

10%

15%

Construction Equipment rental


Construction forecasts

Favorable outlook

2017F 2018F 2019F

Source: Euroconstruct –December 2017

Denmark

2.0% 2.7% 2.8%

Spain4.1% 3.8% 3.7%

Netherlands5.4% 4.9% 3.8%UK2.7%

0.7%1.9%

Belgium

2.5%3.7%

2.3%

Germany2.6%

0.9%

-0.3%

Switzerland

1.6% 2.5% 1.9%

Ireland

14.6% 12.7% 7.9%

Norway6.8%

3.5%2.5%

France

3.6%2.3%

2.7%

Portugal6.0% 5.0% 5.0%

Italy

1.0%2.0% 1.8%


Rental market supported by strong drivers

Increasing equipment

rental penetration

Flexible charge vs. capex

No maintenance cost

No disposal risk

Cost of ownership

Health & safety norms imposing equipment

Trend to mechanise tasks

Favours powered access

Safety & working

conditions

Equipment

Sharing / usage

economy

Latest generation equipment

Specific machine for each job

Renting is sharing

Sustainable development


European competitive environment

Clear #1 for equipment rental

Clear #1 for powered access equipment rental

Leading positions(European players by 2016 revenue €m)

(2017, AWP fleet size)

(a)

(European players by 2016 revenue €m)

Source: International Rental News ranking (June 2017); Access International ranking (August 2017)(a) Proforma for Hune and Lavendon(b) In the powered access market

#1

#1(b)

#1

#2

#2

Benelux

1283

712 695 664532 485 431 426 400 385

40 432

20 66714 278 13 934 12 363 11 200 11 200 9 363 9 294 9 040


Business

Overview

Stéphane HENON


Generalist France

Closely knitted network & broad equipment offer

Key data

Revenue(a) € 605m

EBITDA margin(a) 35%

Nb of branches(b) 424

Headcount(b) 3 438

Share of 9M-2017 group revenue

(a) LTM to 30 Sep 2017; (b) as of 30 Sep 2017

45%

Historical business of Loxam

Local relationships critical

Broad equipment range

2 national players and multiple regional and local players


Specialist France

Business units addressing specific market segments

Key data

Revenue(a) € 211m



Headcount(b) 765


16%


Start in 2001

7 business units with dedicated networks and management teams

Deep equipment ranges

Technical expertise critical

Competition with specialist players: Aggreko, Algeco, Riwal


International

Presence mostly in Western Europe

Key data

Revenue(a) € 541m



Headcount(b) 3 085


40%


Entry into Switzerland in 1997

21 countries

Acceleration of development in the past 10 years

Generalist, Specialist or mixed business units (DK, NL, BEL, SP)

RoW: 7% of consolidated revenue


A comprehensive equipment fleet

Maintained to the highest standards

Main equipment categories

Modulars • Modular spaces• Containers

Building & Others

• Concrete processing• Scaffolding, trucks• Powertools

Energy • Compressors• Generators, coolers

Handling • Forklift and telehandlers

Compaction • Compactors• Rammers, rollers

Earth moving • Excavators• Loaders, dumpers

Aerial work platforms

• Booms, scissors• Van mount, truck mount Procurement

MaintenanceRepairControl

Disposal

- Recognized international brands- Loxam specifications- Corporate colors- No volume commitments

- Stringent internal procedures- Client safety first- Regulatory safety checks outsourced- Ensure fleet availability

- Technical decision at end of life- Auctionneers- Machines fully depreciated- Stable second-hand prices


Operational management

Focused on profit-centres

Branch focusProfit centres with allocated ressourcesFleet "owned" by branchesAll KPIs monitored at branch levelBranches operating like their local competitors

Support by central functions

General Management

General Management

OperationalManagementOperational

ManagementCentral

FunctionsCentral

Functions


A look back at our 50th anniversary year

Selected 2017 business and financial highlights

Transformational and bolt-on acquisitions

€1bn revenue bar crossed organically

Customer focus: digitalization initiatives & Award for best customer service

Progressive integration of newly acquired perimeters

Equipment RentalDenmark


Financial

Performance

Patrick BOURMAUD


Consistent revenue growth

International revenue multiplied by 5x

Favorable long term growth pattern

Acceleration of growth at Specialist France and International divisions

Revenue (€m)

* LTM revenue as of 30/09, proforma for the acquisition of Hune, Lavendon and Cramo Denmark branches, and the disposal of Lavendon Germany

*

480 556 571 547 511 515 573 605

117128 138 138 143 141

164 211106

122 119 120 158 182190

541

702807 828 805 812 838

927

1358

2010 2011 2012 2013 2014 2015 2016 09/2017 LTM PF

Generalist France Specialist France International


Resilient and first class EBITDA margin

EBITDA margin consistently above 30% through the cycle

Among the highest margins in Europe

EBITDA (€m) & EBITDA margin

* LTM revenue as of 30/09, proforma for the acquisition of Hune, Lavendon and Cramo Denmark branches, and the disposal of Lavendon Germany

234275 274

245 256277

305

462

33% 34% 33%30% 32%

33% 33% 34%

2010 2011 2012 2013 2014 2015 2016 09/2017 LTM PF


Capex driven by market prospects

50 60

127

210

90 85 97 98

184 173 171201

116

228194

28

96

165

127

190

234

124

198

371

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 LTM - Sep2017

Gross book value of disposed equipment fleet Fleet Capex

Gross Fleet Capex and Disposals (€m)


Free cash flow counter-cyclicality

*Free cash flow before acquisitions, dividends and high yield refinancing costs

16%

9%

13%

3%

-18%

0%

10%

-2% -3% -3%0%

5%7%

-140

-100

-60

-20

20

60

100

140

180

220

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 LTM30/09/17

YoY Sales growth (like-for like) FCF (€m - RHS)

Annual revenue growth and FCF evolution since 2005


Debt leverage

4.5x post acquisitions

End of year Net Debt (€m) & ND/LTM proforma EBITDA r atio

811 857 778 833952 1 025

1 141

2 1033.5x

3.1x2.8x

3.4x3.7x 3.5x

3.7x

4.55x

2010 2011 2012 2013 2014 2015 2016 30 Sep 2017


Debt maturity profile as of 30/9/2017

33 161 138 117 69 18 4

250300250250

300

299

2017 2018 2019 2020 2021 2022 2023 2024 2025

299 €m Senior Secured Notes


250 €m Senior Subordinated Notes



250 €m Senior Subordinated Notes

542 €m Bilaterals and financial leases

Debt maturity profile (in €m)

93 €m Cash and Cash Equivalents

75 €m RCF (undrawn)


9M-2017 Financial highlights

Acceleration of organic growth

€1000m revenue, growing by 46% (+8% like-for-like and at constant FX)

Increased EBITDA margin at 33%

Breakeven Q3 cash flow before M&A

Net debt to EBITDA as of 30/9: 4.55x


Strategy &

Roadmap

Stéphane HENON


Roadmap 2018

Continuation of favorable market environment

Capex spend to secure market share

Operational integrations in the UK, Spain and France

Focus on deleveraging


Proven strategy

Loxam’s philosophy is to pursue the conduct of its s uccessful business model

Cycle management Adapt resources in order to benefit from market tail-winds over the next few years

Europe Keep consolidating our position in Western Europe through external growth

Non Europe Consolidate and reinforce our existing countries

Profitabilty Maintain strict financial policy

Debt leverage Close monitoring of debt leverage

Innovation Equipment innovation, roll-out of new store concepts , digitalization

Pres Conf BNPP - Jan 2018 - VFinale - loxamgroup.com€¦ · Our key strengths Favorable long-term...

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