Exova Results Year End 2012

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Year End 2012 Results for Exova Group Limited

 

Exova Group 2012 Results


Financial summary - 12 months to 31 December 2012


Revenue up 4.8% from £241.9m to £253.6m

  • Excluding the Exova Metlab business disposed of in 2011, constant currency revenue grew by 7.0%

Increase in Adjusted EBITDA

  • Adjusted EBITDA (before restructuring costs, loss on disposal of subsidiary and management fee to private equity investor) increased by 15% from £46.6m to £53.6m.

Resilient profitability and cash flow generation

  • Highly diversified across business sectors, geographies and customers providing resilience against regional and business specific downturns and currency fluctuations.
  • Strong operational cash flows support capital expenditure growth opportunities.

Solid financial position

  • £30.5m of cash and cash equivalents and £35.0m of committed but undrawn facilities at the end of 2012.
  • No repayments scheduled on the senior bank facilities until 2016 and beyond with the senior loan notes repayable in 2018.

Strategy and business development

  • We continued our focus on Health and Safety we have taken steps to improve further our ‘near miss’ reporting, the results of which allow us to develop continually improving Health and Safety Policies, and have implemented a Group-wide visitor safety policy which ensures all visitor receive safety information relevant to the facility they are visiting. 
  • The first phase of Exova Hub, our new Customer Relationship Management system was implemented across most of our Europe businesses.  In 2013 we will complete the rollout to all appropriate locations worldwide giving our teams an invaluable tool to improve our responsiveness to our customers.
  • We launched our Technical Career Development Programme which aims to strengthen our technical teams via a structured approach to helping colleagues develop new skills and further their careers with the Group.  In 2012 around 300 colleagues were involved in this programme.

Investment for long term growth

  • Significant new capital expenditure was announced in the year including an upgrade to our fire testing facility in Warrington (UK), a new fire testing furnace in Australia and the relocation of our global corrosion testing facility to new premises in Dudley (UK).  Overall, we increased capital expenditure on new equipment, systems and facilities by 47% in 2012, ensuring we have the tools required to meet our customers’ needs.
  • We continued to invest in our sales teams adding a number of new colleagues in all regions.  In parallel, we revised our sales incentives and forecasting tools all of which are key to driving organic revenue growth.
  • We continued to expand our business footprint through the acquisition of related businesses and completed three small asset acquisitions in our Metech business.  We have also developed a ‘pipeline’ of potential future acquisitions which we will evaluate further in 2013.
  • We expanded our sales representation through the appointment of a new country manager for India.  We are also continuing to evaluate a small number of other countries where we may ultimately expand our laboratory and/or sales network.

Outlook

  • We continue to see some positive fundamental indicators in a number of our key sectors.
  • We are seeing encouraging market trends in high growth, high investment sectors including oil & gas and aerospace.
  • The business is well positioned for growth, both organically and through bolt-on acquisitions.
  • We will continue to develop our people, processes and expertise and further invest in innovative new testing methods to support our clients’ ambitions in 2013.

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