RAC - numbers out - EBITDA improvement, deleveraging and better outlook

All,

RAC FY19 numbers exceed model: 

- Sales:  H2 £318m versus £307m

- Gross Profit: H2 £162m v £154m 

- EBITDA: H2 £120m v £109m

- Taxes were in line, with WC inflow in H2 following outflow in H1, we had outflow in H2.  

- FCF £124m versus £91m. 

CAPEX in line with guidance, no debt repayment during H2, but the Company paid a £54m dividend in H2, which is higher than expected.  Despite this, leverage ended year at 5.9x from 6.2x at H1 2019, and our expected 6.4x 

Outlook remains positive and only item to be aware of is the FCA market study into general insurance which is expected in Q1 2020.  RAC are confident they remain in compliance.  

Call is due 11th March, we remain positive.   

Call if any questions

Tomas