Investor Presentation May 6, 2019
FY19 Annual Results
This presentation and the accompanying slides (the This presentation contains certain forward looking “Presentation”), which have been prepared by Security and statements concerning the Company’s future Intelligence Services (India) Limited (the “Company”), have been business prospects and business profitability, prepared solely for information purposes and do not constitute which are subject to a number of risks and any offer, recommendation or invitation to purchase or uncertainties and the actual results could subscribe for any securities, and shall not form the basis or be materially differ from those in such forward relied on in connection with any contract or binding looking statements. The risks and uncertainties commitment whatsoever. No offering of securities of the relating to these statements include, but are not Company will be made except by means of a statutory offering limited to, risks and uncertainties regarding document containing detailed information about the Company. fluctuations in earnings, our ability to manage SAFE growth, competition (both domestic and international), economic growth in India and This Presentation has been prepared by the Company based on HARBOUR abroad, ability to attract and retain highly skilled information and data which the Company considers reliable, professionals, time and cost over runs on but the Company makes no representation or warranty, express contracts, our ability to manage our international or implied, whatsoever, and no reliance shall be placed on, the operations, government policies and actions truth, accuracy, completeness, fairness and reasonableness of regulations, interest and other fiscal costs the contents of this Presentation. This Presentation may not be generally prevailing in the economy. The Company all inclusive and may not contain all of the information that you does not undertake to make any announcement may consider material. Any liability in respect of the contents of, in case any of these forward looking statements or any omission from, this Presentation is expressly excluded. become materially incorrect in future or update any forward looking statements made from time to time by or on behalf of the Company.
RESULTS HIGHLIGHTS FY19 7093 Cr 215 Cr 21.6% 31.7% YoY YoY REVENUES PAT FY18 | 5833 Cr FY18 | 163 Cr Q4 FY19 EBITDA PAT margin increase ROCE at 18.6% and 115 Cr from 2.8% to 3% RONW at 18.8% 365 Cr Rs 29.5 16.9% 29.5% YoY YoY EBITDA EPS FY18 | 312 Cr FY18 | Rs 22.8
COMPOUNDING STORY PLAYING OUT WITH PREDICTABLE GROWTH Group Revenues ( Rs. In crs ) Group EBITDA ( Rs. In crs ) 1955 1837 115 1690 1611 1592 1538 98 1460 87 84 1243 78 74 74 67 Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Quarterly CAGR over last 8 quarters of 8% Quarterly CAGR over last 8 quarters of 6.7%
CUSP OF A TREMENDOUS OPPORTUNITY Across Security Services …and Cash Logistics …Facility Management 227 Bn 168 Bn 80 Bn 80 47 Education Heathcare Infra. B2G Retail 2013 2017 2025 95% of transactions in India are still in cash Indian Per Capita Industry expected 5X growth in Indian real estate market by spend $31 as to be 60% 2028 Cash in circulation/ GDP is at a 3 year high against Aus($85) & organised UK($150)
#1 #2 #2 Market Security Facility Cash India Management Logistics Position 14 % 4 % ~3 % But, Market Share
SECURITY INDIA - A LANDMARK YEAR, ENDING THE YEAR AT NO.1 Revenues EBITDA Ended the year at a monthly revenue run rate of INR 267 crores - 144,257 Rs. In Crs strong base for FY20 Trained security personnel Q4 run rate makes us the largest security company in India 2696 151.4 EBITDA flat on account of provisioning in Q1 and one off costs in Q2 170 – INR 12.7 Cr 2150 149 +26.2% +2% Branches Q4 EBITDA margin back to stable levels at 6.3% FY18 FY19 FY18 FY19 14,800 Sites DSO stable at 63 days
Trends in India Security Services Industry is around 65000 cr SIS, despite being the Increasing compliance Fragmented industry - Technology changes – Margin pressure continues in size – growing at 18-20% largest, less than 5% in enforcement and resultant consolidation expected nascent but certain p.a market share formalisation
SECURITY INTERNATIONAL - EXPANDING HORIZONS Continued Strong growth (Organic Growth = 13.6%) Revenues EBITDA Continued dominance in Australia Rs. In Crs 10,000+ Acquired Henderson & P4G – Added Revenue of 70 Mn AUD Trained Security (Annualized) 3458 152.1 Personnel Focus on integration in FY20 33 +14.6% +19.8% 3019 129.6 Branches Margins stable despite steep federal wage hike FY18 FY19 FY18 FY19 9,600 DSO - higher by 4 days over FY19 Mobile Patrol Sites Australia generated Free Cash Flow of AUD 27.3 mn
Industry Trends Market consolidation means Market share in all Upward pressure on Top 6 players in Australia are business units quite labour and related now Internationally owned steady on-costs Tenders continue to Australia market growth~ 5%. MSS/SXP remain #1 be procurement led, We continue to outpace putting pressure on market growth margins
FACILITY MANAGEMENT – INCHING CLOSER TO NO. 1 Rs 235 Cr organic increase in revenues – 35% Revenues EBITDA 55,441 Trained staff Ended at the year at No.2 in FM in India Rs. In Crs New growth drivers - TFM, Railways, One SIS 948 64 73 EBITDA Margin increased from 4.9% (FY18) to 6.7% (FY19) Branches +40.8% +92.5% 674 33.2 Operating leverage seen across both SMC and DTSS FY18 FY19 FY18 FY19 3,400 Rare consolidated from Nov. 2018 Customer Sites Terminix close to Breakeven
TRENDS IN FACILITY MANAGEMENT Verticalization/ Market growth Stringent Larger contract Integrated Services / Specialisation at 18-20% compliance/ audit sizes “Smarter Combination”
CASH LOGISTICS- ECOSYSTEM TURNING POSITIVE Revenues EBITDA RBI Regulations Rs. In Crs Revenue decline due to termination of unprofitable Minimum networth of Rs. 100 cr routes & contracts Minimum 300 cash vans fleet (Owned) Changed the business mix - from 47% non-ATM 312 4.5 Full migration to cassettes over 3 years business in April '17 to 65% currently 287 1.7 -6.2% (ATM’s) -62.8% Early signs of tariff upsides - working with industry partners Increased circulation of Rs. 200 notes FY18 FY19 FY18 FY19 Investment in near term to meet new RBI & MMA Increased security equipment in Vaults regulations & Cash Vans
FY19 Financial Information
QUARTER 4 SUMMARY Rs in Cr Security Security +38.5% +7.3% +31.7% +30.5% International India 49. 779 902 4 572 37.4 46.5 38.4 841 Q4FY18 Q4FY19 Q4FY18 Q4FY19 Q4FY18 Q4FY19 Q4FY18 Q4FY19 Revenues Revenues EBITDA EBITDA Facility Cash +51.9% -1% +87.4% +338% Management Logistics 277 9.4 77.8 19.3 182 77 10.3 2.2 Q4FY18 Q4FY19 Q4FY18 Q4FY19 Q4FY18 Q4FY19 Q4FY18 Q4FY19
FINANCIAL SUMMARY INCOME STATEMENT Financial Statements (INR Crores) Q4 FY19 Q4 FY18 Y-o-Y FY19 FY18 Y-o-Y 21.6% Revenue from operations 1,954.8 1,592.2 22.8% 7,093.3 5,833.4 EBITDA 16.9% 114.8 85.2 34.8% 365.2 312.4 Finance costs higher on account of EBITDA % 5.9% 5.3% 5.1% 5.4% acquisition borrowings & utilization of Share of net profit /(loss) of Associates 14.9% (0.7) (4.3) -84.8% (13.5) (11.8) existing working capital line for operations Other Income -37.4% 9.0 2.9 212.0% 21.9 35.0 Effect of entries resulting from biz combination acc 125.4% (31.2) 0.7 -4689.3% (50.6) (22.4) Finance costs -18.0% 14.5 27.7 -47.7% 61.5 75.0 Depreciation and amortisation expense 5.0% 15.2 18.3 -16.9% 51.9 49.4 Others - 0 - (1.3) Profit before Tax 62.2 39.0 209.6 187.4 11.8% 59.5% Profit before Tax % 3.2% 2.5% 3.0% 3.2% Continue Getting DTA Benefit Tax expense -121.1% (10.1) 3.0 -439.6% (5.2) 24.4 Profit after taxes 72.4 36.1 214.7 163.0 31.7% 100.6% Profit after tax % 3.7% 2.3% 3.0% 2.8% EPS 29.5% 10.0 4.7 115.2% 29.5 22.8 Diluted EPS 29.7% 9.9 4.6 116.0% 29.0 22.4
FINANCIAL SUMMARY BALANCE SHEET 31 March Net debt: EBIDTA @ 1.11 Particulars (INR Cr) 31 March 2018 Particulars (INR Cr) 31 March 2019 31 March 2018 2019 Working Capital increased Non-Current Assets 2,110.6 1,099.8 Equity 1,250.2 1,029.7 due to acquisitions Non-Current Liabilities 1,544.6 759.8 Current Assets 2,113.7 1,694.3 Non-Current liabilities up due to accounting for present value of estimated Current Liabilties 1,429.4 1,004.6 Total Assets 4,224.3 2,794.1 future payouts Total Liabilities 4,224.3 2,794.1 Non current assets up due to acquired goodwill & intangibles Rs. In Crs
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