Bright Horizons Delivering on the Plan FY17: Interim Results - PowerPoint PPT Presentation

Bright Horizons Delivering on the Plan FY17: Interim Results Presentation 21 February 2017

DISCLAIMER The information in this presentation dated 21 February 2017 may contain forward-looking statements and projections. These reflect thl’ s current expectations, based on what it thinks are reasonable assumptions. However, for any number of reasons the future could be different and the assumptions on which the forward-looking statements and projections are based could be wrong. thl gives no warranty or representation as to its future financial performance or any future matter. Except as required by law or NZX listing rules, thl is not obliged to update this presentation after its release, even if things change materially. This presentation may contain a number of non-GAAP financial measures. Because they are not defined by GAAP or IFRS, thl ’s calculation of these measures may differ from similarly titled measures presented by other companies and they should not be considered in isolation from, or construed as an alternative to, other financial measures determined in accordance with GAAP. This presentation does not take into account any specific investors objectives, and does not constitute financial or investment advice. Investors are encouraged to make an independent assessment of thl . The information contained in this presentation should be read in conjunction with thl ’s latest financial statements, which are available at: www.thlonline.com 2

H1 FY17 FINANCIAL HIGHLIGHTS REVENUE EARNINGS BEFORE H1 REVENUE INTEREST AND TAX +9% +20% $18.7M +1% $146M 146 134 111 110 UP UP 25% 9% FY14 FY15 FY16 FY17 NET PROFIT H1 NPAT INTERIM DIVIDEND +38% AFTER TAX 10cps (50% imputed) $11.3M +45% 11.3 +129% 8.2 UP FROM UP 5.6 9cps (50% imputed) 38% 2.5 FY14 FY15 FY16 FY17 All financials in NZ Dollars unless stated otherwise (throughout presentation) All comparisons are against prior corresponding period 3

FINANCIAL HIGHLIGHTS • NPAT growth of 38%. NZD $M H1 FY17 H1 FY16 VAR VAR % • Rentals NZ achieved $3.7M EBIT, an Operating revenue 146.0 133.7 12.3 9% increase of $3.7M on the pcp. Earnings before 18.7 15.0 3.7 25% interest and tax* • Tourism EBIT growth of $1.0M or 30% on the pcp. Operating profit 17.7 13.7 4.0 29% before tax • Rentals Australia 5% rental income growth, 28% EBIT growth on a constant Profit after tax 11.3 8.2 3.1 38% currency basis. • Growth in the underlying US Rentals EBIT of 7%. In NZD terms EBIT is down 2% due to the stronger exchange rate. • Group and Other costs were up $1.3M, due to the ongoing investment in the Mighway and GeoZone new initiatives. * EBIT excludes joint venture and associates earnings 4

H1 FY17 GROWTH INITIATIVE HIGHLIGHTS El Monte Roadtrippers Mighway Purchase of the second Purchased 22.5% of Operating successfully largest RV rental business Roadtrippers USA, the across NZ summer peak. in the USA completed on 6 leading US road trip travel Commitment to launch in January. app provider. North America, with West Synergies in fleet and GeoZone sold into Coast USA focus from Q1 operations to be realised Roadtrippers Australasian 2017 calendar year. over next three years. JV. 5

BALANCE SHEET • Net debt at 31 December 2016 was NET DEBT DEC 2016 DEBT:EBITDA $103M, up $13M on 31 December 2015. 1.4 X $103M • Increase in debt on prior year is due LAST YEAR to the lift in flex fleet, to be turned LAST YEAR over in less than 18 months. As at 31 $90M 1.3 X Dec, Net Book Value of flex fleet in NZ and Australia to be sold within six months is ~$26M, up $16M on FY16. JUNE 2017 FORECAST JUNE 2017 FORECAST $185M 2.0 X • The purchase of El Monte lifts forecast debt levels to ~$200M. • Debt:EBITDA forecast at 2.0x remains below market comparators and within our target Moody’s Baa guidelines. 6

DIVIDEND • Interim dividend of 10 cents per share imputed to 50%. INTERIM DIVIDEND INTERIM DIVIDEND PER SHARE* • Sustaining dividends over the longer +11% 10 cents +29% term remains a key focus for the business. +40% • Key dates: Per Share – 50% Imputed • Ex-date 31 March 2017 UP • Record date 3 April 2017 11% • Payment date 13 April 2017 • A Dividend Reinvestment Plan, to provide a cost effective means for shareholders to reinvest dividends, will be introduced for the interim dividend payment. • The issue price will be based on the 5 day volume weighted share price following the record date, less a 2% discount. • Details of the plan will be sent to eligible shareholders in early March. *Dividends imputed to 50% from FY14 Final Dividend 7

DIVISIONAL REVIEW 8

DIVISIONAL EBIT 6 Months to December ; $M DEC 16 DEC 15 VAR VAR % thl Rentals New Zealand 3.7 0.0 3.7 N/a Australia 5.6 4.7 0.9 19% USA 9.6 9.8 (0.2) (2%) Total Rentals 18.9 14.5 4.4 30% Tourism Group 4.3 3.3 1.0 30% Total operating divisions 23.2 17.8 5.4 30% Group Support Services & Other (4.1) (2.8) (1.3) (46%) EBIT before non-recurring Items 19.1 15.0 4.1 27% Non-recurring Items Profit on Geozone Sale 1.3 1.3 Transaction Costs - El Monte Acquisition (1.6) (1.6) EBIT 18.7 15.0 3.7 25% Split Australia 5.6 4.7 0.9 19% USA 9.6 9.8 (0.2) (2%) NZ 3.5 0.5 3.0 600% Total EBIT 18.7 15.0 3.7 25% 9

RENTALS NZ Strong H1 Performance • Half Year Rentals NZ has achieved a strong result, achieving a $3.7M profit, in NZD $M H1 FY17 H1 FY16 VAR % what has historically been a loss- Rental income 30.8 26.5 4.3 16% making half. • Sale of goods 18.6 16.3 2.3 14% Rental income growth of 16% was achieved through increased flex fleet, Costs (45.7) (42.8) (2.9) (7%) improved utilisation and yield growth. EBIT 3.7 0.0 3.7 n/a • Costs well controlled, resulting in improved EBIT margin. Vehicle Fleet Units: H1 FY17 H1 FY16 VAR % • The RV Super Centres (retail and service) in Auckland and Christchurch Opening Fleet July 1,740 1,787 (47) have continued to grow the Fleet Sales (206) (219) 13 (6%) contribution from non-fleet sales and service. The growth in contribution Fleet Purchases 640 470 170 36% (revenue less cost of sales) was 78%. Closing Fleet Dec 2,174 2,038 136 7% • Demand for motorhome sales remains strong. The lower fleet sales compared with last year reflects the lower volume of ex-fleet vehicles available for sale. • Flex fleet for summer has lifted peak fleet by approximately 7% over last year. 10

RENTALS AU Continued Progress Half Year • The Rentals Australia business has NZD $M H1 FY17 H1 FY16 VAR % made further progress in H1, growing EBIT by 28% in AUD terms. Rental income 30.3 30.3 0.0 0% • The 4WD buy-back arrangement Sale of goods 5.9 5.9 0.0 0% worked well, lifting returns on the pcp. Costs (30.6) (31.5) 0.9 3% • Rental income growth of 5% in AUD EBIT 5.6 4.7 0.9 19% arose from some fleet growth and yield growth. Half Year • Vehicle sales have met volume AUD $M H1 FY17 H1 FY16 VAR % expectations, with improved average margin. The volume of Rental income 29.6 28.1 1.5 5% retail fleet sales through the Sale of goods 5.7 5.5 0.2 4% Melbourne RV Sales Centre (launched FY16) is growing. Costs (29.8) (29.3) (0.5) (2%) • Telematics units have contributed to EBIT 5.5 4.3 1.2 28% good cost control. • The increase in fleet purchases Vehicle Fleet Units : H1 FY17 H1 FY16 VAR % reflects summer flex fleet, which Opening Fleet July 1,323 1,297 26 2% have lifted peak summer fleet by 8%. Core fleet purchases were flat Fleet Sales -External (150) (159) 9 6% on the prior year. Fleet Sales -Buybacks (105) (105) Fleet Purchases 348 172 176 102% Closing Fleet Dec 1,416 1,310 106 8% 11

RENTALS USA – ROAD BEAR Continued Growth & Strong ROFE • EBIT growth of 7% has been achieved Half Year in USD terms. A stronger NZD:USD NZD $M H1 FY17 H1 FY16 VAR % exchange rate (0.74 FY17 vs 0.67 Rental income 17.8 16.9 0.9 5% FY16) has resulted in a lower NZD EBIT result. Sale of goods 24.7 22.7 2.0 9% • As expected, EBIT margin is down due Costs (32.9) (29.8) (3.1) (10%) to investment in head office resource and infrastructure to facilitate growth. EBIT 9.6 9.8 (0.2) (2%) • Summer 2016 saw good growth in rental income. To date, summer 2017 Half Year bookings support a positive rental USD $M H1 FY17 H1 FY16 VAR % outlook. Rental income 13.1 11.3 1.8 16% • Vehicle sales demand remains strong. US RV industry motorhome shipments Sale of goods 18.2 15.3 2.9 19% were up 16% for the year to November Costs (24.2) (20.0) (4.2) (21%) 2016. EBIT 7.1 6.6 0.5 7% • Road Bear sold 52 additional units (+16%) in H1 compared with last year. • Lower fleet purchases in H1 is a timing Vehicle Fleet Units: H1 FY17 H1 FY16 VAR % difference, with later delivery of new Opening Fleet July 698 613 85 14% season fleet in FY17 than the prior year. Fleet Sales (373) (321) (52) 16% Fleet Purchases 10 155 (145) (94%) Closing Fleet Dec 335 447 (112) (25%) 12