Trifast plc (TRI) Earnings Call Transcript & Summary

Good afternoon, everyone, and welcome to the 2026 Annual General Meeting for Trifast plc. My name is Christopher Morgan, and I am the Company Secretary. Before we start the formal business of the meeting, just a couple of housekeeping points for everyone. There is no planned fire drill during the course of this meeting and not even today. So should the alarm -- fire alarm sound, you can you make your way through the doors, steps -- back up the stairs and exit on the side door, which is straight in front of you as you go up the stairs, and follow the lit up exit signs on the way. The team here from OSiT, the company that run this building will ensure that we exit the building safely, and there's a congregation point outside. So thank you. If I could now please introduce you to the company's Chair, Serena Lang.

Thank you very much, Christopher. And good afternoon to you all, and a warm welcome from me as well for those both here in the room and for everyone online. So the last 12 months has been another step in the rebuild process, and we've continued with the company's transformation, establishing a more resilient and sustainable business. And I spent the last 12 months going around the business, visiting our people and seeing our operations, and I continue to be extremely impressed by all the good work that our people are doing. And, of course, now we're working in this environment where there's always something else that we have to contemplate or another bit of tariff or something that we're looking at. And yet despite that, our teams continue to push ahead and focus on those core structures that we've put in place. So let me take the opportunity to introduce the Board to you, first of all. On my right-hand side here, our CEO, Iain Percival; and next to Iain is Nicholas Mills, our Non-Executive Director. Next to Nick is Kate Ferguson, our CFO. Clive Thomas (sic) [ Watson ], our Senior Director; Laura Whyte, who is our Chair of Remuneration; and Louis Eperjesi, who is our Non-Executive Director. So I just -- really, I think we are continuing to be a really strong business. We're continuing to ensure that as we rebuild the business, we're building from a place of strength, and I think that shows through in the numbers that we've got. But I don't want to take the thunder away from Iain, and Iain is going to do a presentation to you on where he is and what the team have been doing. So with that, Iain, I'll hand over to you.

Thanks very much, Serena. And let me add my welcome and thanks to all of our shareholders, both here in the room and those of you that are joining online. We're very grateful for your continued support into Trifast as a company. So before I get stuck into the presentation update -- business update, I wanted to share with you a short video, a new video that hopefully some of you will have seen online, and it's really focusing on how we are driving forward into our supply chain solutions value proposition. But let's play the video. [Presentation]

Great stuff. I think you'll agree, and just a quick snapshot of who Trifast are, who we are as we meet today. We are 1,100 employees all working each and every day to deliver and execute on our strategy of great quality, great service to our customers wherever they happen to be, delivering on that value proposition of engineering excellence, manufacturing capability as -- highlighted in the video, supply chain simplification and solutions. We're present in 18 countries around the world, and we supply and support more than 6,000 customers. As Serena mentioned, we've been executing the strategy that we laid out to shareholders and investors back in 2024, successfully delivering the first phase of that strategy, the recover phase at the end of our FY '25 financial period. And it was really great for Kate and myself to be able to present our full year results just a couple of months ago in July for our FY '26, the first full year of our rebuild phase of this strategy, where we were able to demonstrate further progression in margin enhancement, profit improvement, cash generation with a maintained focus on capital discipline, keeping low leverage. And how have we been executing the strategy? Well, really, I think there are 3 key messages for shareholders in the room. It's about strategically repositioning the business into relationships with customers where the value we deliver for them, whether that's in our engineering expertise, which is a highly differentiated value that we bring to our customers, or whether it's through supply chain solutions, like you saw in the video. It's really encouraging to see that since we started out on this strategy, we now have more than 60% of our customer revenue defined by one or both of those core differentiated value propositions. It's about positioning the business into growth sectors and growth markets. I'll talk later about smart infrastructure in particular. But we're also investing into the business for growth in those end markets, whether that's in engineering capability, in sales capability or indeed in physical assets and infrastructure. And it's been about improving the commercial execution and processes and disciplined rigor using data that we now have available at our fingertips as a result of the investments that we're making into modern AI-supported D365 ERP platforms. So very focused activity to drive and execute this strategy in the business. And look, there's lots more about the great work that our 1,100 employees do each and every day and some fab examples of this strategy in action that you can read online that it covers all 4 of our key strategic initiatives. So please take the time to read the material and celebrate with us the work that our teams have been doing during the last year. Our journey is very clear. It's about repositioning and getting our business back to double-digit EBIT margins. And you can see from this chart on the left, how each year we have successfully through that focused execution, been delivering on that journey of enhancing the EBIT margin. And again, doing that through strategic repositioning of where we play with which customers in which markets and making sure that we use the process, the data, the capabilities, the team that we have available and that we've invested in to drive that execution. Now often, I get asked about fasteners, well, why are fasteners so critical? Well, each one of the products we supply, whether it's a male-threaded fastener like a screw or a bolt, or whether it's a clip or an injection molded component that we buy in and we support our customers with. Each one of those products is critical to our customers' success. Without them, they cannot assemble the products that they manufacture, they supply and they assemble. And importantly, Trifast or TR as a partner globally is supporting our customers right across the value journey, whether that's helping them design and engineer the product right the way through to helping them with manufacturing solutions, of course, delivering on the supply chain simplification, removing the complexity out of their business and making sure that we deliver that great quality, great service that is reliable and allows customers to focus on the higher parts -- higher value-added parts of their bill of material. I think this is a nice graphic because it illustrates very clearly what the key message was in the video about the removing complexity and helping customers with the total cost of ownership. Fasteners and C-Class components typically only account for a few percent of our customers' product. But if they have to manage 200, 300, 400 components one by one, it takes a huge amount of their team, their resource, their working capital and their effort. So actually, what we are doing for our customers is helping remove that complexity from their supply chain. And that's a significant differentiated value that we bring. And I mentioned we've been investing in the business. And I want to share with you a few examples of how we're investing for growth in this business. You saw in the video that supply chain simplification, providing that solution to customers is so critical and differentiated. We've been investing in our technology opportunity that we can offer to customers that make that relationship of product line side on assembly lines at customers even more efficient, even more simple, even more seamless. And there's a great example online on YouTube, which we shared with one of our customers in Ireland called Grant Engineering. And again, I would really direct you to go and have a look at that excellent example of how we collaborate with a customer on bringing this supply chain simplification to life. Second example of investing for growth is how we've been positioning the business into smart infrastructure. We all read each and every day in the news about how AI is generating an unquenchable demand for data center investment. The amount of investment projects are enormous. And what we see from our customers who might be providing power transformation or water solutions or they might be providing HVAC is that their order books and their demand is significantly out into the future. And so what they are telling us is we really want you as Trifast to help us with the engineering, with the supply chain simplification because we need to be focused on how we're going to support our customers in delivering these data centers. And the third example is a growth market, India. India, as we all know, the fastest-growing industrial market globally. We've had a presence in India for a number of years, but we're really doubling down on the investment we're making. We've significantly enhanced the team and the team's capabilities in engineering, in supply chain, in commercial, in operations and finance. And we're doing that deliberately because we want to drive also growth in the Indian market, bringing to our existing customers who are there and also domestic Indian MNCs who are there, the capabilities that we deliver globally to our customers. And it's great to see that in the first quarter, we've seen a payback on that investment with significant double-digit growth, which is continuing as we go through the remainder of this first half. And our projection is we expect that to continue for the full year and beyond to the extent that we are about to move into a new larger purpose-built distribution center in Chennai to support that expansion and growth with our customers. So some great growth stories in this business that illustrate how we're repositioning. So to summarize, we're repositioning as we execute the strategy into growth market sectors like smart infrastructure, like medical equipment that you saw in the video. We're investing into the growth in markets as well. India, a good example. And we're being disciplined in managing the commercial execution using the quality of data that we have around us now by the investment in the technology platforms that we have to drive standardized commercial execution focus. I want to leave you with three key messages. First of all, we're driving our strategy. We're repositioning our business into those higher growth markets for the future; secondly, we're on track to deliver further progress in FY '27 with -- in line with market expectations; and thirdly, as a Board and as a management team, we're confident in the medium-term delivery of the targets that we set out, double-digit margin and profitable growth. With that, let me hand you back to Serena.

Thank you, Iain. And as you can see, we continue to invest in our leadership capability and combining that with our strong and stable Board really gives us what we need to drive forward. And I should mention, we have had the pleasure this year of having a Board apprenticeship, Pooja Bagga, who's with us for the last year. And our Board meeting this morning was her very last Board meeting, and she's added huge value to us in terms of just sort of asking us questions that we might not ask, but also sharing insights from her perspective as well. And we thank her very much for being part of our Board and wish her all the best with her onward journey. So I'd like to remind you all that there will be an opportunity for questions at the end of the formal proceedings of the AGM. And for those of you online, please do use the question facility to ask your questions. And with that, I will now formally welcome everybody to this year's Annual General Meeting. I have the pleasure in declaring the meeting open. And unless anybody objects, I propose that the notice dated 8th of July 2026, convening this AGM meeting be taken as read. Thank you. Now on to that formal business, looking at the resolutions. So unless anyone has any specific questions about the resolutions, we will take the questions at the end. So resolution 1. Anything in terms of resolution 2? Also approved as was resolution 1. Resolution 3. Approved. So moving on to the next slide. So over the coming 4 resolutions are around electing the directors. Anything on the reelection of the Directors, resolution 4 through to resolution 8? I'm going to let Clive just check on.

Yes. So Serena's covering resolution 4 to 10, but except resolution 6. And resolution 6 is to re-elect Serena Lang as a Director.

Thank you. Moving on to resolution 11 to reappoint the auditors. No objections. Approved. Thank you. Resolution 12. Thank you. Resolution 13. No objections. Also approved. And then on to the special resolutions. So resolution 14. Thank you. Approved. Resolution 15. Resolution 16. Thank you. And finally, resolution 17. Super. Well, thank you all for those. And the final results of the meeting will be available on our website later today and reported to the market in the usual way. So that now concludes our formal business of our 2026 Annual General Meeting, and thank you very much. And with that...

We will now move on to questions and answers for any of the directors. And I'll open it up to the floor if there are any questions from anyone joining us physically in the room today. Yes, Mr. [ Castle ].

So you've mentioned about AI, the increasing use of AI, which will no doubt be very beneficial for the company. But AI is also one of the three main principal risks that have increased this year. And it's mentioned in the section on cybersecurity how with some of the risks of cybersecurity, you employ external specialists. And I wondered how you manage the increased risk of AI, whether this is through getting external specialists in, whether it's training the staff to be on the lookout, how you manage that?