boyd group 2011 q4 presentation

8/2/2019 Boyd Group 2011 Q4 Presentation

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April 2012

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Forward-Lookin Statement

This presentat ion contains forward-looking st at ements, other t han hist orical fact s, which ref lect t he

view of the Fund's management with respect to future events. Such forward-looking statements

ref lect the cur rent views of the Fund's management and are made on the basis of informat ion

current ly available. Alt hough management believes t hat it s expectat ions are reasonable, it can give

no assurance that such expectat ions wi l l prove to be correct . The forward-lookin statement

cont ained herein are subject t o t hese fact ors and other risks, uncert ainties and assumpt ions relat ingto the operat ions, results of operat ions and f inancial posit ion of the Fund. For more informat ion

concerning forward-lookin statements and relat ed risk fact ors and uncert aint ies, please refer t o the

Boyd Groups interim and annual regulatory f il ings.

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Ca ital Market Prof ile

.

Units and Shares Outstanding: 12.9 mil l ionPrice (Apri l 2, 2012): $11.95

-

Market Capitalizat ion: $154.2 million

Annualized Dist r ibut ion (per unit ): $0.45

Current Yield: 3.8%

Payout Rat io (2011): 31.3%

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Com an Overview

Own and operate collision repair centres in the U.S. and Canada

Largest operator of collision repair shops in North America

-

Coll ision repair companies that derive a high percentage of their revenue from

insurance companies are the most insulated from the effects of the economy

of any segment of the auto aftermarket industry

Revenue Contribution:

By Country By Payor

< 10%Customer Pay

U.S.

Canada

> 90%Insurance

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North American Presence

Canada Manitoba 14

39 Alberta (12)

B.C. (11)

Saskatchewan (2)

U.S. Il l inois (36)

North Carolina (17)

140centers

Arizona (12) Georgia (12)

Washington (12)

o 9

Indiana (8)

Florida (9)

Colorado (6)

Pennsylvania (5)

Nevada 3

5

Oklahoma (3)

Kansas (1)

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. .

140 locat ions includin 8 from recent l

acquired Master Collision Repair, 37 from

True2Form, and 28 from Cars Collision

Operate full -service repair centres offering

collision repair, glass repair and

re lacement services

Strong relationships with insurance carriers

as a result of best -in-class performance

Advanced management system technology

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39 Company-owned/ operated centres;

8 franchise locat ions

Operate full -service repair centres offeringco s on repa r, g ass repa r an rep acemen

Customer focused:

Modern retail locations ISO 9002 certified

Standard operating procedures

MIS Systems

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Business Strategy

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Lar e Fra mented Market

industry is est imated to be approximately $30-40

billion annually

Car dealerships are now estimated to have

approximately 21%of the total market

Large Mult i-shop operators are estimated to haveapproximately 11%of the total market (including

car dealerships)

The remaining North American collision repair

industry is dominated by smaller independentam y-owne us nesses opera ng n oca mar e s

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Im ortance of Direct Re air Pro rams

Direct Repair Programs (DRPs) are established between insurance companies and

coll ision re air sho s to bet ter mana e auto re air claims and the level of customer

satisfaction

Auto insurers utilize DRPs for a growing percentage of collision repair claims volume

Growing preference among insurers for DRP arrangements with multi-location collision

repair operators

,

insurers and most regional insurers

Boyd has minimal exposure to one insurance customer

Top 5 largest customers cont ribute ~41%of revenue

Largest customer cont ributes 14%of revenue

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Business Strate

Same-store sales

Expensemanagement

growth and opt imizereturns from exist ing

operations

perat onaexcellenceNew locat ion and

acquisit ion growth

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- -

single-locat ion acquisit ions

Large, accretive acquisitions at

at t ract ive mult iples

Same-store sales growth

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New Start-U

Growth t hrough Greenfield & Brownfieldeve opmen o co s on ac es

Low-cost growth No dilution

yp ca ew ar - p un ng o e :

Funded By: Forgivable Funding* US$100,000

ap a eases ,

Seller Financing US$200,000

Total Capital Investment** US$500,000

13

* From Trading Part ners

** Cash/ operat ing l ine borr owings t o be used to off set any short fall in any funding source


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U.S. Colli sion Re air Market

Estimated market size in 2010 of 37,700 total collision repair locations

Long-Term Decline of Independent and Dealership Repair Facilities

Total number of collision repair locations has declined by 16%from 2006 to 2010, and

53%over the past 30 years

arge u t p e- ocat on o s on epa r perator ar et are ppor tun ty

Large MLOs represented 2.9%of total locations in 2010 and 10.8%of revenue (up

from 9.1% in 2006)

56 MLOs had $20-million or greater revenues in 2010 (Boyd acquired two in the lasttwo years)

MLOs benefit from standardized processes, integration of technology platforms, andexpense reduction through large-scale supply chain management

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Source: The Romans Group LLC, A Profile of the Evolving Collision Repair Marketplace


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True2Form Acquisition

ugust 1Strategic Benefi t s

Added 37 locations in four new eastern U.S. states

Complements existing Boyd U.S. footprint

Strong management, operational expertise

Boyd became the largest operator in North America, with 136 locat ions af ter

acquisition

Financial Benefit s

Immediately accret ive to EBITDA, Dist ributable Cash, and Value to Unitholders

US$16.8-mm transaction (net purchase price excluding costs) with no dilution tocurrent n t o ers; un e w t 9-mm new ong-term e t , 1.8-mm cas ,

and US$6-mm forgivable supplier funding

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Cars Collision Acquisition

une 11Strategic Benefi t s

Added 28 locations for a total of 164 locations post-

acquisition

ncrease oca ons o rom n e

Chicagoland market (IL and northern IN)

New Colorado market with 6 locations

Similar business model and long-term vision asBoyd Group

Financial Benefits

Immediately accret ive to EBITDA, Dist ributable Cash, and Value to Unit holders

US$20.5-mm transact ion, with no dilut ion to Unit holders; funded wit h US$9.7-

mm new long-term debt, US$5.0-mm cash, and US$5.8-mm forgivable supplier

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Master Collision Acquisition

anuary 1Strategic Benefi ts

First entry into the Florida market with the addition

of 8 new locations

omp emen ary us ness mo e prov ng a

similar fully-integrated service offering

Financial Benefit s

Immediately accret ive to EBITDA, Dist ributable Cash, and Value to Unitholders

. -

current Unitholders; funded with US$3.1-mm cash, and US$2-mm forgivable supplier

funding, and $7-mm new long term debt

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Review

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Revenue Growth

(C$ mi llions)

$357.0

$350.0

$400.0

$224.9

$256.8

$250.0

$300.0

$183.6

$197.6.

$150.0

$200.0

$100.0

$

.

2006 2007 2008 2009 2010 2011

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O timizin Returns f rom Exist in O s

Same-st ore sales increases in 21 of 28 most recent quart ers

ow

th12.0%

14.0%

eSalesGr

6.0%

8.0%

.

ame-Stor

0.0%

2.0%

4.0%

4.0%

2.0%

05

05

05

05

06

06

06

06

07

07

07

07

08

08

08

08

09

09

09

09

10

10

10

10

11

11

11

11

8.0%

.

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* Total Company, excluding FX. Adjust ing for t he posit ive impact of hail in Q4-10,Q4-11 SSSG was 4.7%.

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Ex ense Mana ement

Well-managed operating expenses as a percentage of sales

40.5%

40.5%

41.0%

nsesas%

s

39.5%39.5%

40.0%

atingEx

p

ofSale 39.1%

38.4%38.5%

39.0%

Oper

37.9%37.8%

38.0% 38.0%

37.5%

38.0%

37.0%

2004 2005 2006 2007 2008 2009 2010 2011

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New Location Results

New Locat ions LTM Sales (C$)* LTMEBITDA (C$)* EBITDA Margin (% )2006Tacoma, WA Renton, WA

$10,058,000 $1,422,000 14.1%co s a e,

2007Glenview, IL Tempe, AZ

$8,883,000 $1,533,000 17.3%

2008acey, a gary,

Las Vegas, NV

, , , .

2009Scurf ield, MB Anthem, AZMesa, AZ Rome, GA

$13,398,000 $757,000 5.7%

Glendale, AZ Tucson, AZ (4 locations)

2010***Cartersvil le, GA Tulsa, OKLas Vegas, NV Evanston, ILRoswell, GA Buckhead, GA

$11,142,000 $439,000 3.9%

Bellingham, WA Yuma, AZ

2011 1st Half ***Savannah, GA** McDonough, GA**

$4,785,000 $175,000 3.7%

2011 2nd Half

Richmond, BC** Seat t le, WA**

Edmonton N, AB ** Everet t , WA**

Grove City, OH** Winnipeg, MB****

Kent , WA****

$6,865,00 $(435,000) (6.3)%

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Combined $63,154,000 $4,677,000 7.4%

Average per store $1,974,000 $146,000 7.4%

* Based on last twelve months (LTM ) resul ts *** Excludes resul ts for True2Form and Cars as these were strategic acquisi t ions outside the scope of t his growth plan

** Annuali zed based on actual r esult s excludi ng the start up period ****Excludes the result s of t hese locat ions as t hey were added at t he end of t he report ing period


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Financial Summar

(in C$ millions, except per unit and%amount s )

Three-months ended Twelve-months endedDec. 31, Dec. 31, Dec. 31, Dec. 30,

Sales $100.5 $80.8 $357.0 $257.0

Gross Margin $45.1 $36.4 $160.1 $116.4

Adjusted EBITDA* $7.6 $7.0 $24.4 $18.8

Adjusted EBITDA Margin* 7.6% 8.7% 6.8% 7.3%

Fair Value Adjustments (1.5) (1.8) (2.8) (2.5)

Income Tax Expense $0.7 ($6.7) $2.5 ($6.6)

Net Earnings ($2.1) $7.9 $2.9 $13.5

Net Earnings Per Unit (di luted) ($0.188) $0.800 $0.262 $1.249

Adj usted Net Earnings* $4.5 $4.9 $14.2 $11.9Distributable Cash $4.7 $4.1 $16.0 $15.1

Distributable Cash Per Unit (diluted)

& Class A Common Share$0.363 $0.343 $1.368 $1.275

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Payout Ratio 29.6% 24.5% 31.3% 24.7%

*Adj usted EBITDA and Adjust ed Net Earnings are not calculat ions defined under IFRS. See the Companys Q4 2011 MD&A for more informat ion


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Balance Sheet

(in C$ millions) Dec 31, 2011 Dec 31, 2010

Cash $18.4 $9.6

Long-Term Debt $28.9 $20.8

Obligations Under Finance Leases $6.4 $4.6

Operating Line $nil $0.2

(total debt, including current port ion and bankindebt edness, net of cash)

$16.9 $16.0

. .

Net Debt / Adj usted EBITDA (t tm) 0.69x 0.85x

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Net Debt / Adj usted EBITDA

(pro forma for Cars acquisition)0.65x N/A


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Dist r ibut ion Increases

Annuali zed dist r ibut ions have increased b 150 since December 2007

Annualized Dist r ibut ion per Unit (C$)

0.330 $0.345$0.360

$0.420

$0.450

$0.40

$0.45

$0.50

$0.180 $0.195$0.210 $0.225

$0.240 $0.255 $0.270$0.285 $0.300

.

$0.20

$0.25$0.30

.

$0.00

$0.05

$0.10

$0.15

Dec07

Mar08

Apr08

May08

Jun08

Aug08

Sept08

Nov08

Dec08

Mar09

Apr09

May09

Jun09

Aug09

Sept09

Nov09

Dec09

Mar10

Apr10

May10

Jun10

Aug10

Sept10

Nov10

Dec10 Jan11

Oct11

Nov11

Present

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Tax Eff icient Trust St ructure

Boyd Group Income FundBoyd Group Income Fund

The Bo d GrouThe Bo d Grou

Canada

Inc.Inc.

Canadian OperationsCanadian Operations

U.S. to fund distributions

& Operating Entities& Operating Entities

. .

(U.S.) Inc.(U.S.) Inc.

U.S. O erationsU.S. O erations

& Operating Entities& Operating Entities

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6-10%growth in new collision repair locations per year

Increase Nort h American presence through:

Targeted start -ups and/ or acquisit ions in exist ing and adjacent

markets

Drive same-store sales growth through enhanced capacity

ut ilizat ion develo ment of DRP arran ements and levera in exist in

maj or and regional insurance relat ionships

Continue to look for accelerated growth opportunities through the

acquisit ion of mult i-locat ion collision repair businesses

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Experienced & Commit tedanagemen eam

Brock Bulbuck President & Chief Execut ive Of f icer

Dan Dott Chief Financial Officer

Tim O DaPresident & Chief Operat ing Of f icer

. . perat ons

,

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Summar

Strengthening balance sheet

Stability Insurer preference for professional,mult i-unit operators

+

Increasin cash dist ribut ionsas s r u ons

Low payout ratio

Growth

$40-billion fragmented industry

Hi h ROI rowth st rate

= A Strong Foundation for Future Growth

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boyd group 2011 q4 presentation

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