Judges Scientific plc AIM:JDG UHV Design 2011 Quorum 2014 Scientifica 2014 GDS 2011 Scientifica 2012 25 September 2015
Disclaimer The document attached hereto and the presentation of which it forms part (together the “Materials”) have been prepared by Judges Scientific plc (“Judges” or the “Company”) and are confidential and personal to you and the Materials are furnished to you as background information to provide a basis for potential investors to consider whether to pursue an acquisition of shares in the Company and do not constitute an offer or invitation for the sale or purchase of any securities, nor do they, nor do they purport to, set out or refer to all or any of the information an investor might require or expect in making a decision as to whether or not to deal in shares in the Company. 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Presentation team David Cicurel, Chief Executive : Founded Judges in 2002 having spent much of his career as a turnaround specialist and, subsequently, as an active private investor operating with own funds. Responsible for several corporate recovery exercises including two UK public companies: International Media Communications plc (later known as Continental Foods) and International Communication and Data plc. Brad Ormsby, Finance Director : A Chartered Accountant with significant senior management experience acquired during nine years at PwC followed by six years at Eurovestech plc and associated companies. Prior to joining Judges, Brad was CFO at Kalibrate Technologies plc, where he was actively involved in their successful IPO. 2
Overview • Focus on the scientific Share performance LSE: JDG FTSE: ASX instrument sector 2500 2000 • Eleven acquisitions since 1500 May 2005 pence 1000 • Continued opportunities for 500 consolidation 0 • Profitable and cash 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 generative • Interim dividend of 8.1p; an 5 Queen’s Awards for design increase of 11% excellence and export 3
Highlights – HY 2015 • Record revenues of £24.9m (H1 2014: £21.9m) but 9.6% organic contraction • Organic order intake up 9.5% compared with H1 2014 • Adjusted pre-tax profit: £3.3m (H1 2014: £4.1m); 18.5% down • Adjusted basic EPS: 41.1p (H1 2014: 50.3p), down 18.3% • Interim dividend up 11% to 8.1p (H1 2014: 7.3p) • £9.6m acquisition of Armfield Limited in January; business model intact • Adj. net debt* £7.5m at 30 June 2015 (June 2014: £3.3m; Dec 2014: £1.3m) • Cash generated from operations of £2.3m (H1 2014: £3.3m) * excluding minority quasi-equity 4
Order book impact on Earnings H1 2015 H1 2014 weeks weeks Opening order book 9.9 10.9 Closing order book 11.7 7.8 Growth/(depletion) 1.8 (3.1) pence pence Impact on EPS @ 6.5p per week (11.7) 20.2 • 2015 H1 order book growth providing store for higher H2 performance • H1 2014 brought forward earnings from H2 2014 by reducing the order book 5
10½ Year Financial History b c d e f g h i j k l m n o p q r s t u v w b c d e f g h i j k l m n o p q r s t u v Earnings and Dividends Revenues and Profits 120.0 25.0 45.0 9.0 40.0 8.0 100.0 20.0 35.0 7.0 80.0 30.0 6.0 15.0 Dividends (p) 25.0 5.0 Adj. EPS (p) Revenues £m 60.0 Profits £m 20.0 4.0 10.0 40.0 15.0 3.0 10.0 2.0 5.0 20.0 5.0 1.0 - - - - Revenue £m - half year Revenue £m Adj. eps - half year Adj. eps Dividend Dividend - half year Adjusted operating profit Adjusted operating profit - half year 5.0 Annual debt repaid + dividends paid from cashflow 4.0 3.0 £'m 2.0 1.0 - Dividends Repayment of borrowings 6
Return On Total Invested Capital Scientifica ROTIC (Trailing 12 months) June 2013 GDS acquisition March 2012 FTT acquisition 50.0% 45.0% Armfield 40.0% January 2015 35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% 7
UK Instrumentation Industry Background • The UK is a global centre of excellence for precision & scientific instrument manufacture • Fragmented industry with 2,000 companies in the sector (170 with turnover > £5m) • A resilient sector through past economic downturns • 78% of revenues exported* * Source: UK Office of National Statistics UK Trade in Goods Analysed in Terms of Industries Report - Q2 2009: §D, pp 5-13. 8
Our Business Model • Targets must be strong in their world niche markets • Companies must generate sustainable profits and cash • Pay 3 to 6 times EBIT according to size • Borrow up to 2.5 times EBITDA @ 2 to 4% • Create environment where businesses can thrive • Implement robust financial controls • Repay debt and reinvest in further acquisitions 9
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