Techtronic Indus Ltd Adr

I'm so glad. Full cinema. Morning, ladies and gentlemen. Thank you for coming. Thank you, our board of directors here and most of our senior management from the U.S. and Europe and overseas. Thank you. It gives me a great pleasure to welcome all of you to TTI's Group 2024 First Half Results Announcement. I would like to start by introducing Steve Richman and his present and recent promotion to TTI's group CEO. Steven, welcome aboard. Thank you very much. We had an outstanding first half with sales outperforming the market on delivering double-digit profit and growth. Our group vice chairman, Mr. Stephan Puth, will continue with our opening remark, but let me tell you one thing. We don't care what's out there. We only care about our shareholder, our investor, to deliver best results, and we don't care what happens, competition up or down, which has not happened in this case, the hour down, but our first and focal point are our investors. Thank you very much. Stefan, I hand you over.

Thank you, Chairman, and I'd like to thank all of you for attending today and for your continued support. With EBIT up 11.8%, net profit up over 15%, record first-half free cash flow of over $500 million, we're off to a great start to the year. Now we delivered exceptional revenue growth and we continued with very strong market share gains. But at the foundation of our success is great people. And we have spent years assembling what we believe is the greatest team of people in the industry. And it is this team what sets TTI apart from the competition. So with us today, We have, as our chairman commented, Stephen Richmond, our new CEO. We also have Shane Maul with us, who is our president of Milwaukee. He was here at the most recent results presentation. But we also have Alex Duarte, who is our senior group president of EMEA, which is our European business and the region. So the team has done an exceptional job, and I'm so excited to have them here today. And I'm going to pass the floor over to Stephen and then Frank as well, who's going to give you some highlight on the financials. And I hope you enjoy the presentation.

Thank you, Mr. Chairman and Seven. As Chairman and Seven mentioned, we've delivered strong first-half results. We have ourselves increased it by 6.3% to US$7.3 billion as compared to last year. Our Milwaukee business continues to extend our leadership position as the global number one professional tools brand and delivered an 11.2% sales growth in local currencies. Ryobi also outperformed the market and delivered mid-single-digit sales growth led by outdoor divisions' strong performance. Gross profit increased by 219 million to 2.92 billion US dollars, with margin increased by 67 business points to 39.9%. The improvements were from favorable sales mix of margin of creative Milwaukee business, aftermarket battery sales, introduction of innovative products, category expansion, and our focus in improving productivity and efficiencies at all manufacturing locations and stringent cost controls. As cross-margin increased it by 67 basis points and SG&A increased it by only 24 basis points, our EBIT increased by 11.8% to $626 million, with EBIT margin improved by 42 basis points to 8.6%. With the increase in EBIT and the reduction of net finance costs, while our effective tax rate has been comparable to that of last year, net profit increased by 15.7% to $515 million, with margins improved by 60 basis points to 7.5%. Earnings per share increased by 15.8% to 30.12 US cents per share. The Board declared an interim dividend of 108 Hong Kong cents per share, an increase of 13.7% over last year, representing a payout ratio of 46.3%, comparable to the payout ratio of the full year 2023. With We've continued our strategic investments in new product developments, technology, commercialization, and geographic expansion. SG&A, as a percentage to sales, increased it by 24 basis points to 31.5% as compared to same period last year, mainly due to the 54 basis points increase in R&D spent from 3.5% of sales to 4.1%. We have, however, been able to leverage down our selling expenses from 17.3% of sales to 17%. an improvement of 24 basis points. Administrative expenses also 6 basis points lower than that of last year as we rigorously controlled our spend. Our focus over the past 12 months was to reduce our net finance costs and we've been able to deliver this target. Net finance costs reduced it by 34% to $32 million. We project that we will be able to further improve this cost for the full year by paying down high-cost debt from the free cash flow generated from operations and utilization of our current facilities in the most cost-effective manner. Effective tax rates was at 7.3% as compared to 6.9% reported last year. We have a very strong tax team and been very proactive mitigating all the challenges in this ever-changing global tax environment. We believe the current level of effective tax rates is very sustainable mid-term. Our balance sheet continues to be very healthy and strong. Shared equity was at $6.25 billion, an increase of $559 million, or 9.8%, as compared to first half last year. Our current assets was lower as a result of our strategy to reduce inventory over the past 12 months. Our current liabilities, however, also reduced it by $755 million during the period. Net current assets as a result increased by 253 million or 10% versus first half 2023. To improve working capital efficiencies has always been our primary focus. Working capital as a percentage to sales improved by 409 basis points to 18.7% as compared to 22.7% reported last year. Total inventory reduced by $554 million, and improvements of 24 days to 104 days. Finished goods was 20 days lower at 81 days, and raw materials three days lower at 19 days. Trade receivables was at 60 days, six days higher than same period last year, while payables was at 96 days. The days mainly reflected the timing of sales and procurements. We do not anticipate any collection issues and will continue to leverage our volume and financial strength for the best trade terms with our suppliers. As our infrastructure and capacity expansion projects to support our future growth be mostly completed, CapEx for the period was at $100 million, 52.3% less than the $210 million last year. Our key target this first half was to continue to deliver positive free cash flows after we generated close to $1.3 billion in 2023. With very disciplined working capital management, higher EBIT and lower CapEx, we delivered record first half free cash flows of $508 million, an increase of $207 million when compared to first half 2023. We are well positioned to continue to deliver strong free cash flows in the coming years. Gearing, as a result, improved it to 9.2% as compared to 25.7% first half last year, or 17.1% end 2023. We expect gearing can be further improved by end of the year. We have continued to manage the cost efficiencies of our ball rings and been paying down high-cost stats over the past 12 months. When compared to first half 2023, our total gross stats reduced it by 1.15 billion, or 39%. and our total net debts reduced it by $889 million, a decrease of approximately 61%. After paying down the debts, high-cost short-term floating rate borrowings now account for 52% of our total debts, a reduction of $884 million, or 48.7%. We will continue to effectively manage our portfolio to deliver most efficient structure to support our growth and to further reduce our net finance costs to improve our product. And now I would like to pass the floor to our CEO, Mr. Steve Richman.