GYG plc (LON:GYG), the market leading superyacht painting, maintenance and supply company, has announced its Interim Results for the six months ended 30 June 2020.
Financial Highlights
· Group revenue decreased 12% to €29.1m (H119: €33.1m) due to COVID related impact
o Coatings (Refit and New Build) revenue decreased 10.2% to €24.5m (H119: €27.3m)
o Supply revenue decreased 19.3% to €4.6m (H119: €5.7m)
· Adjusted EBITDA1 increased 6.7% to €1.6m (H119: €1.5m)
· Adjusted EBITDA margin increased 21.4% to 5.6% (H119: 4.5%)
· Operating profit maintained at €0.1m (H119: €0.1m)
· Loss before tax of (€0.5m) (H119: profit before tax €0.1m)
· Net debt2 of €10.9m at 30 June 2020 (30 June 2019: €8.1m)
· Cash of €3.0m at 30 June 2020 (€5.5m at 30 June 2019)
· Bank facilities improved and balance sheet strengthened to provide resilience against COVID-19 uncertainties
Operational Highlights
· Record higher value new build pipeline generated with relationships now established with the majority of key European shipyards
· Started work on three of the six New Build contracts signed in 2019, with three to start in Q420
· Major contract signed for an 80+ metre New Build in a new shipyard, with work started in Q320
· Strong momentum in Refit during 2019 continued into H1 with several major Refit contracts signed for an immediate start
· Supply division’s new branding and renewed focus on direct yacht sales through Pinmar Yacht Supply delivering positive results
· Continued focus on driving operational efficiencies in H1, delivered further improvements in EBITDA margin
· Sprayable filler collaboration with AkzoNobel progressing well with early data showing step change in speed and efficiency of application process
Post period end
· Signed major Refit contracts for a 70+ metre yacht in Palma and 100+ metre yacht with MB92 Group; work on both of these projects has commenced
· Work underway on two MB92 Refit contracts in Barcelona, Spain and La Ciotat, France
· Signed Letter of Intent for a 100+ metre New Build in Europe, scheduled to start Q2 2021
· Exclusive distribution agreement with ALTRAD plettac assco GmbH to distribute its specialised scaffolding equipment in the USA representing significant opportunity to offer cutting-edge equipment and improved efficiencies in one of the world’s largest markets
Order Book
· Record Order Book at 22 September 2020 provides more forward visibility than ever before
· Total Order Book increased €11.1m, up 26% since 30 June 2020, with 24% increase in current year
| Order Book at: | Total Order Book | Current Year | Current Year +1 | ForwardOrder Book |
| 22 September 2018 | €32.3m | €10.6m | €15.7m | €6.0m |
| 22 September 2019 | €43.6m | €16.4m | €22.1m | €5.1m |
| 22 September 2020 | €53.8m | €20.4m | €27.8m | €5.6m |
Outlook
· Coatings division will be active on an unprecedented eight New Build projects in 2021, five of which are c.70 metre – 100 metre and three 100 metre+, driving increasing New Build revenue in H2 and into 2021
· Advanced negotiations underway for New Build contracts to commence in 2021 and 2022
· Focus on driving further margin improvements will continue through H2 and beyond
· We continue to assess further organic and inorganic growth opportunities
· Despite the significant disruptions in H1, the market remains strong as demonstrated by the record order book for 2021 and beyond
· The Board remains confident in meeting market expectations
| (1) (2) | Adjusted EBITDA is defined as operating profit before depreciation, amortisation, impairment, performance share plan costs and exceptional items. This is an alternative performance measure used by Directors to assess the operating performance of the GroupNet debt position is defined as the net cash and cash equivalent balances, less short and long-term borrowings and obligations under leases. This is an alternative performance measure used by investors, financial analysts, rating agencies, creditors and other parties to ascertain a company’s debt position |
| (3) | Order Book is defined as contracted but unrecognised revenue from New Build and Refit projects. It does not include revenue already recognised during the year and it does not include any future value for revenue in the Supply division |
Analyst Webcast
There will be a conference call/webcast for sell-side analysts at 9:30am BST this morning, 24 September 2020, the details of which can be obtained from FTI Consulting.
Remy Millott, Chief Executive of GYG plc, commented:
“I am pleased with the Group’s performance in H1 given the unprecedented circumstances that remain prevalent across the globe. Our teams have worked hard to ensure that we can continue to deliver projects on time and on budget, while working with the additional safety measures that we have put in place. I would like to take this opportunity to thank all of our employees for their continued efforts and resilience in the face of the pandemic.
“GYG’s Order Book is the strongest it has ever been and we continue to have positive discussions with both the New Build shipyards across Europe and also yacht owners, captains and management companies with regards to their Refit requirements. I am confident that this positive momentum will continue through H2 and into 2021 as the industry prepares and hopes for a more normalised cruising season in 2021.”
