XP Power — Solid H123, outlook for FY23 maintained

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XP Power

Solid H123, outlook for FY23 maintained

H123 results

Electronic and electrical equipment

1 August 2023

Price	2,040p
Market cap	£401m
$1.29/£
Net debt (£m) at end H123		148.4

Shares in issue	19.6m
Free float	93.7%
Code	XPP

Primary exchange	LSE
Secondary exchange	N/A

Share price performance

%	1m	3m	12m
Abs	3.7	(7.9)	(32.9)
Rel (local)	1.2	(6.0)	(34.4)

52-week high/low

2,680p

1,464p

Business description

XP Power is a developer and designer of power control solutions, with production facilities in China, Vietnam, Germany and the United States, and design, service and sales teams across Europe, the United States and Asia.

Next events

Q323 trading update

10 October 2023

Analyst

Katherine Thompson

+44 (0)20 3077 5700

tech@edisongroup.com

Edison profile page

XP Power is a research client of Edison Investment Research Limited

XP Power reported year-on-year revenue growth of 30% in H123 as it made good progress shipping from its elevated backlog. As expected, orders declined year-on-year, but the c £250m backlog still provides at least nine months’ revenue visibility. The company continues to invest for the longer term in Malaysia (manufacturing) and the United States (R&D). With no change to management’s full year expectations, we maintain our normalised operating profit forecasts for FY23 and FY24 and nudge up our interest cost forecast for FY23.

Year end	Revenue (£m)	PBT* (£m)	EPS* (p)	DPS (p)	P/E (x)	Yield (%)
12/21	240.3	43.8	176.3	94	11.6	4.6
12/22	290.4	38.0	160.1	94	12.7	4.6
12/23e	320.1	36.8	150.2	94	13.6	4.6
12/24e	326.6	43.3	174.7	97	11.7	4.8

Note: *PBT and EPS (diluted) are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments.

H123 helped by receding supply chain issues

XP Power reported H123 year-on-year revenue growth of 30% (24% constant currency (cc)), adjusted operating profit growth of 45% (36% cc) and normalised diluted EPS growth of 13%. Better factory utilisation and the effect of prior year price increases largely offsetting cost inflation resulted in gross margin expansion of 160bp y-o-y to 41.8%. Net debt at the end of H123 was £148.4m, marginally down from the end of FY22, with net debt/EBITDA of 2.3x from 2.7x at the end of FY22.

Backlog normalising; possible trough in orders

Order intake declined 40% y-o-y and the backlog reduced by c £58m over H123 to c £250m. As supply chain issues have reduced, customers have less need to place orders further in advance; at the same time, some customers are destocking and seeing weaker demand from certain end customers. The company believes that orders from the semiconductor sector have troughed and expects group order intake to improve towards the end of FY23 and into FY24. We maintain our normalised operating profit forecasts for both years and slightly increase net finance costs in FY23; we also introduce FY25 forecasts showing modest growth in revenue and margins. We expect gearing to reduce to 1.7x by the end of FY25.

Valuation: Reduced gearing to improve rating

The share price is essentially flat year-to-date, in line with the UK All Share Index. On a P/E basis averaging FY23 and FY24, XP is trading at a 45% discount to global power solution companies and a 26% discount to UK electronics companies, with a dividend yield at the top end of the range. The company generates EBITDA and EBIT margins at the upper end of both peer groups and has a strong order book. In our view, a return to growth in order intake, further improvements in the supply chain and resolution of the Comet litigation will be key drivers of the share price.

Review of H123 results

Exhibit 1: H123 results highlights

£m	H123	H122	y-o-y
Revenues	160.2	123.6	29.6%
Gross profit	67.0	49.7	34.8%
Gross margin	41.8%	40.2%	1.6%
EBITDA	29.4	20.6	42.7%
EBITDA margin	18.4%	16.7%	1.7%
Normalised operating profit	21.8	15.0	45.3%
Normalised operating margin	13.6%	12.1%	1.5%
Reported operating profit	17.3	(45.2)	-138.3%
Reported operating margin	10.8%	-36.6%	47.4%
Normalised PBT	15.8	13.8	14.5%
Normalised net income, after minority interest	11.6	10.3	12.6%
Reported net income, after minority interest	7.6	(35.6)	-121.3%
Normalised diluted EPS (p)	59.1	52.2	13.2%
Reported basic EPS (p)	38.9	(181.4)	-121.4%
Net debt	148.4	102.0	45.5%
Orders	115.6	193.1	-40.1%

Source: XP Power. Note: Edison normalised measures are equivalent to the company’s adjusted profit measures.

H123 order intake was down 40% y-o-y or 44% cc; Q223 orders were £54.4m, down 40% y-o-y and down 11% q-o-q. Book-to-bill for H123 was 0.72x. Customers moderated their orders as supply chain pressures eased and end demand started to soften in the semiconductor manufacturing equipment and industrial technology sectors. The backlog at the end of H123 was c £250m, down from c £308m at the end of FY22. This currently provides nine to 10 months’ forward visibility, well ahead of the historical four- to five-month range.

H123 revenue increased 30% y-o-y or 24% cc, with Q223 revenue of £82.3m up 33% y-o-y and 6% q-o-q. As supply chain pressures eased, the company was able to ship more of the order backlog, but revenue was also boosted by price increases enacted in 2022, which were applied to orders that have now been shipped.

Gross margin increased 160bp y-o-y to 41.8% (down from 42.5% in H222). The company expects margins to improve in H223.

Operating costs (excluding specific items) increased 30% y-o-y to £45.1m, resulting in adjusted operating profit of £21.8m. The adjusted operating margin increased 150bp y-o-y to 13.6% and declined 310bp h-o-h.

XP reported specific items totalling £4.5m to arrive at reported operating profit of £17.3m. These comprised legal costs for the Comet case (£1.4m), restructuring costs (£1.5m), acquired intangible amortisation (£1.6m), enterprise resource planning (ERP) software implementation costs (£0.2m) and a gain on derivative financial instruments (£0.2m).

Net finance costs increased to £6.0m in H123 (H122: £1.2m) on higher gross debt and higher interest rates. A £0.6m gain on the modification of the revolving credit facility and £1m in lease interest on a US facility were treated as specific items and excluded from adjusted PBT. The effective tax rate on adjusted PBT was 25.3% due to the geographic mix of profits. The company expects the full year rate to be in the range 18–20%.

XP closed H123 with net debt of £148.4m, down from £151.0m at the end of FY22. The company noted that it had started to work down its safety inventory (although some components still have extended lead times) and that there should be further working capital benefit from this in H2 and FY24. Net debt/EBITDA was 2.3x at the end of H123, down from 2.7x at the end of FY22 and well within its banking covenants.

The company announced a Q223 dividend of 19p, in line with last year and our forecast.

Divisional performance

Exhibit 2 summarises revenue by division and geography.

Exhibit 2: Half-yearly performance by division

£m	H123	H122	y-o-y		H123	H122	y-o-y
Europe				Asia
Semi manufacturing	2.5	1.4	79%	Semi manufacturing	8.2	6.9	19%
Industrial technology	35.4	28.2	26%	Industrial technology	7.8	5.7	37%
Healthcare	14.3	9.3	54%	Healthcare	3.2	2.6	23%
Total	52.2	38.9	34%	Total	19.2	15.2	26%
North America				Group
Semi manufacturing	43.7	40.0	9%	Semi manufacturing	54.4	48.3	13%
Industrial technology	25.5	19.0	34%	Industrial technology	68.7	52.9	30%
Healthcare	19.6	10.5	87%	Healthcare	37.1	22.4	66%
Total	88.8	69.5	28%	Total	160.2	123.6	30%

Source: XP Power

■

Semiconductor manufacturing equipment: revenue was 13% higher year-on-year as orders were shipped from the backlog. Orders declined 67% to £28.1m resulting in a book-to-bill of 0.52x. The company believes that orders troughed in Q223 and should start to gradually improve through H223 and into FY24. SEMI, the semiconductor equipment manufacturing industry organisation, forecasts a decline in front-end equipment sales of 19% in FY23 before a rebound of 15% in FY24, which would imply that the industry is likely to start increasing orders imminently.

■

Industrial technology: this division saw some normalisation of order intake as well as some destocking by direct and indirect customers. Orders of £51.2m were 38% lower year-on-year. Revenue was 30% higher year-on-year resulting in a book-to-bill of 0.75x. XP expects good revenue performance and improving order intake in H223. The company is bringing on a new design-in distributor in Europe to target new areas.

■

Healthcare: revenue was 66% higher year-on-year and orders of £36.3m were 38% higher year-on-year. The company expects to make further progress in H223.

Update on Comet litigation

XP filed an appeal to the damages award in April and incurred an additional £1.4m in legal fees in H123. The appeal is expected to be heard in the next 12–18 months. The company is awaiting the outcome of a March 2023 hearing related to the award of legal fees in the damages case.

New CFO appointed

The company has appointed a new CFO, Matt Webb, with effect from 4 September (the previous CFO, Oskar Zahn, left on 31 March, with David Stibbs currently acting as interim CFO). Matt Webb was CFO at Luceco Group from February 2018 to May 2023. Prior to that he held various finance roles at Ferguson between 2006 and 2018.

Net zero transition plan published

Today the company published its net zero transition plan. It had previously disclosed its target to reach net zero by 2040 and the plan details how it expects to achieve this, covering R&D, operations and waste management. The cost of hitting this target is already factored into XP’s medium-term financial strategy.

Outlook and changes to estimates

Management’s full year expectations are unchanged, with a slight weighting to the second half. The company noted that while supply chain disruption had eased, there are still some residual issues. The company continues to expect order intake to improve in the latter part of FY23 and through FY24 as the semiconductor market recovers. As profitability improves and excess inventory is worked down further, XP expects leverage to reduce towards 2x by the end of FY23.

When we wrote on FY22 results, we highlighted the company’s medium-term financial targets (see Exhibit 3). Management has confirmed that it still expects to be able to achieve operating margins in the region of 20% in the medium term. Although it has been below this over the last 12 months, it has achieved this level for short periods in more recent months giving confidence that margins could expand towards this level.

Exhibit 3: Medium-term financial targets

	Target
Organic revenue growth	10% through the cycle
Gross margin	>45%
Operating margin	c 20%
Return on capital employed	>20%
Operating cash conversion	>90%
Net debt/EBTDA	1–2x

Organic revenue growth

Gross margin

Operating margin

Return on capital employed

Operating cash conversion

Net debt/EBTDA

Target

10% through the cycle

>45%

c 20%

>20%

>90%

1–2x

Source: XP Power

We have revised our forecasts to reflect higher revenue in FY23 and FY24, based on the higher run rate in Q223. We forecast marginally higher gross profit but, on higher revenue, this results in lower gross margins than previously forecast. For H223, this implies a gross margin of 43.1% on flat revenue half-on-half compared to 41.8% in H123. Our normalised operating profit forecasts for both years are unchanged. We have marginally increased our net interest cost estimate for FY23 reflecting higher H223 net debt. Our FY23 normalised diluted EPS forecast reduces by 1.3% and for FY24 is unchanged. We have also introduced FY25 forecasts, which reflect modest revenue growth and margin expansion.

We have factored in one-off costs of £5.5m for FY23 (restructuring and legal costs) and slightly reduced our forecast for amortisation of acquired intangibles (from £4.1m to £3.5m for FY23 and FY24) resulting in a reduction in reported operating profit and EPS in both years. Our net debt forecasts increase at the end of FY23 and FY24 as we have factored in the cash impact of the one-off items in FY23.

Exhibit 4: Changes to forecasts

£m	FY23e	FY23e			FY24e	FY24e			FY25e
£m	Old	New	Change	y-o-y	Old	New	Change	y-o-y	New	y-o-y
Revenues	309.5	320.1	3.4%	10.2%	316.8	326.6	3.1%	2.0%	333.7	2.2%
Gross profit	134.7	135.9	0.9%	12.7%	142.1	142.7	0.5%	5.0%	150.1	5.2%
Gross margin	43.5%	42.4%	(1.1%)	0.9%	44.8%	43.7%	(1.1%)	1.3%	45.0%	1.3%
EBITDA	65.3	65.3	0.0%	15.9%	71.8	71.8	0.0%	9.9%	74.6	3.8%
EBITDA margin	21.1%	20.4%	(0.7%)	1.0%	22.7%	22.0%	(0.7%)	1.6%	22.4%	0.4%
Normalised operating profit	49.3	49.3	0.0%	15.0%	54.3	54.3	0.0%	10.1%	56.4	3.8%
Normalised operating margin	15.9%	15.4%	(0.5%)	0.6%	17.1%	16.6%	(0.5%)	1.2%	16.9%	0.3%
Reported operating profit	45.2	40.3	(10.8%)	(267.4%)	50.2	50.8	1.2%	26.0%	52.9	4.1%
Reported operating margin	14.6%	12.6%	(2.0%)	20.9%	15.9%	15.6%	(0.3%)	3.0%	15.8%	0.3%
Normalised PBT	37.3	36.8	(1.3%)	(3.0%)	43.3	43.3	0.0%	17.6%	46.4	7.1%
Reported PBT	33.2	26.2	(21.1%)	(186.9%)	39.2	39.8	1.6%	51.7%	42.9	7.7%
Normalised net income	30.0	29.6	(1.3%)	(6.0%)	34.4	34.4	0.0%	16.3%	36.9	7.1%
Reported net income	26.7	21.0	(21.3%)	(205.0%)	31.1	31.6	1.6%	50.5%	34.1	7.7%
Normalised basic EPS (p)	152.7	150.7	(1.3%)	(6.2%)	175.2	175.2	0.0%	16.3%	187.7	7.1%
Normalised diluted EPS (p)	152.3	150.2	(1.3%)	(6.2%)	174.6	174.7	0.0%	16.3%	187.1	7.1%
Reported basic EPS (p)	135.8	107.0	(21.3%)	(204.9%)	158.5	161.0	1.6%	50.5%	173.4	7.7%
Dividend per share (p)	94.0	94.0	0.0%	0.0%	97.0	97.0	0.0%	3.2%	101.0	4.1%
Net debt/(cash)	144.4	152.0	5.3%	0.7%	131.9	139.6	5.8%	(8.2%)	123.7	(11.4%)
Orders	254.1	232.7	-8.4%	-35.9%	283.7	265.3	-6.5%	14.0%	316.6	19.3%
Net debt/EBITDA (x)	2.3	2.4			1.8	1.9			1.7

Source: Edison Investment Research

Valuation

We compare XP Power to peers operating in the global power solutions market as well as UK electronics companies. Exhibit 5 summarises financial performance and Exhibit 6 valuation metrics. XP continues to trade at a discount to both groups on a P/E basis. We note that some peers in the global power converter market are seeing revenue declines this year before a rebound next year. In our view, XP’s exposure to diverse end markets helps soften the impact of semiconductor market cyclicality while still allowing the company to benefit from the structural growth of the sector.

The combination of the Comet damages award and increased capex for the Malaysian facility has pushed gearing to higher levels than historically. A reduction in gearing will be a factor in improving the stock’s rating and we expect the company to reduce net debt/EBITDA below 2x by the end of FY24. Any positive progress in the Comet case (reduction in legal fees owed to the other side or reduction in the size of the damages award) would also be positive for gearing and sentiment.

Exhibit 5: Peer financial metrics

	Market	Share	Listing	Revenue growth			EBITDA margin		EBIT margin
	cap (m)	Price	ccy	LY	CY	NY	CY	NY	CY	NY
XP Power	401	2,040	GBp	20.8%	10.2%	2.0%	20.4%	22.0%	15.4%	16.6%
Cosel	43,747	1,225	JPY	25.6%	5.5%	2.6%	18.1%	18.3%	N/A	N/A
Delta Electronics	952,577	366.5	TWD	22.2%	9.9%	12.9%	15.6%	16.2%	10.7%	11.5%
Advanced Energy Industries	4,548	121.16	USD	26.8%	-8.8%	8.5%	15.8%	17.8%	12.2%	14.4%
Comet Holdings	1,765	227	CHF	14.1%	-22.3%	22.5%	13.8%	21.0%	9.4%	17.3%

Average power solution companies				22.2%	-3.9%	11.6%	15.8%	18.3%	10.7%	14.4%
Diploma	4,297	3,206	GBp	28.6%	18.3%	8.7%	21.4%	21.4%	18.6%	18.7%
DiscoverIE	764	793	GBp	18.4%	2.2%	3.6%	14.6%	14.6%	11.3%	11.4%
Electrocomponents	3,690	779.4	GBp	16.8%	4.2%	6.4%	14.2%	14.6%	12.4%	12.8%
Gooch & Housego	149	577	GBp	0.6%	12.9%	8.9%	13.6%	15.1%	7.5%	9.1%
TT Electronics	282	159.6	GBp	3.1%	3.1%	0.7%	10.8%	11.7%	7.9%	8.6%

Average UK electronics companies				13.5%	8.2%	5.7%	14.9%	15.5%	11.5%	12.1%

Source: Edison Investment Research, Refinitiv (as at 31 July)

Exhibit 6: Peer valuation metrics

	P/E (x)		EV/EBIT (x)		Dividend yield
	CY	NY	CY	NY	CY	NY
XP Power	13.64.0	11.7	11.2	10.2	4.6%	4.8%
Cosel	10.6	10.2	N/A	N/A	3.0%	3.1%
Delta Electronics	26.8	22.4	21.4	17.6	2.2%	2.4%
Advanced Energy Industries	26.3	20.4	21.8	17.0	N/A	0.0%
Comet Holdings	48.2	22.5	40.7	18.0	1.5%	1.8%

Average power solution companies	28.0	18.9	28.0	17.5	2.2%	1.8%
Premium/(discount)	-51%	-38%	-60%	-42%	107%	160%
Diploma	26.1	24.6	20.3	18.6	1.9%	2.0%
DiscoverIE	22.2	21.3	15.9	15.2	1.5%	1.6%
Electrocomponents	13.6	12.3	9.9	9.0	2.7%	2.9%
Gooch & Housego	19.5	15.1	15.9	12.0	2.2%	2.3%
TT Electronics	8.3	7.4	8.3	7.6	4.3%	4.7%

Average UK electronics companies	18.0	16.2	14.1	12.5	2.5%	2.7%
Premium/(discount)	-24%	-28%	-21%	-19%	83%	76%

Source: Edison Investment Research, Refinitiv (as at 31 July)

Exhibit 7: Financial summary

	£'m	2018	2019	2020	2021	2022	2023e	2024e	2025e
Year end 31 December		IFRS	IFRS	IFRS	IFRS	IFRS	IFRS	IFRS	IFRS
INCOME STATEMENT
Revenue		195.1	199.9	233.3	240.3	290.4	320.1	326.6	333.7
Cost of Sales		(102.8)	(109.8)	(123.2)	(132.0)	(169.8)	(184.2)	(183.9)	(183.5)
Gross Profit		92.3	90.1	110.1	108.3	120.6	135.9	142.7	150.1
EBITDA		49.2	44.5	56.8	55.5	56.4	65.3	71.8	74.6
Normalised operating profit		42.9	35.0	46.0	45.1	42.9	49.3	54.3	56.4
Amortisation of acquired intangibles		(2.8)	(3.2)	(3.2)	(2.8)	(4.1)	(3.5)	(3.5)	(3.5)
Exceptionals		(0.8)	(5.1)	(5.4)	(12.6)	(62.9)	(5.5)	0.0	0.0
Share-based payments		0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
Reported operating profit		39.3	26.7	37.4	29.7	(24.1)	40.3	50.8	52.9
Net Interest		(1.7)	(2.7)	(1.7)	(1.3)	(4.9)	(12.5)	(11.0)	(10.0)
Joint ventures & associates (post tax)		0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
Exceptional & other financial		0.0	0.0	0.0	0.0	(1.2)	(1.6)	0.0	0.0
Profit Before Tax (norm)		41.2	32.3	44.3	43.8	38.0	36.8	43.3	46.4
Profit Before Tax (reported)		37.6	24.0	35.7	28.4	(30.2)	26.2	39.8	42.9
Reported tax		(7.2)	(3.2)	(4.0)	(5.4)	10.6	(5.0)	(8.0)	(8.6)
Profit After Tax (norm)		33.9	27.9	39.2	35.4	31.9	29.8	34.7	37.1
Profit After Tax (reported)		30.4	20.8	31.7	23.0	(19.6)	21.3	31.9	34.3
Minority interests		(0.2)	(0.3)	(0.2)	(0.4)	(0.4)	(0.3)	(0.3)	(0.3)
Discontinued operations		0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
Net income (normalised)		33.7	27.6	39.0	35.0	31.5	29.6	34.4	36.9
Net income (reported)		30.2	20.5	31.5	22.6	(20.0)	21.0	31.6	34.1

Basic average number of shares outstanding (m)		19.1	19.2	19.3	19.5	19.6	19.6	19.6	19.6
EPS - basic normalised (p)		176.1	144.1	201.8	179.4	160.6	150.7	175.2	187.7
EPS - diluted normalised (p)		172.8	141.4	198.4	176.3	160.1	150.2	174.7	187.1
EPS - basic reported (p)		157.8	107.0	163.0	115.8	(102.0)	107.0	161.0	173.4
Dividend (p)		85	55	74	94	94	94	97	101

Revenue growth (%)		17.0	2.5	16.7	3.0	20.8	10.2	2.0	2.2
Gross Margin (%)		47.3	45.1	47.2	45.1	41.5	42.4	43.7	45.0
EBITDA Margin (%)		25.2	22.3	24.3	23.1	19.4	20.4	22.0	22.4
Normalised Operating Margin		22.0	17.5	19.7	18.8	14.8	15.4	16.6	16.9

BALANCE SHEET
Fixed Assets		129.2	137.4	135.2	150.5	255.1	277.1	280.6	283.4
Intangible Assets		97.7	99.6	98.8	108.8	147.4	147.9	148.9	149.7
Tangible Assets		30.7	35.9	33.5	38.5	91.5	113.0	115.5	117.5
Investments & other		0.8	1.9	2.9	3.2	16.2	16.2	16.2	16.2
Current Assets		105.1	96.0	107.0	121.7	226.6	200.1	201.2	205.9
Stocks		56.5	44.1	54.2	74.0	114.4	98.4	98.2	98.1
Debtors		33.0	34.8	30.2	30.8	42.4	43.8	44.7	45.7
Cash & cash equivalents		11.5	11.2	13.9	9.0	22.3	14.4	18.8	26.7
Other		4.1	5.9	8.7	7.9	47.5	43.5	39.5	35.5
Current Liabilities		(26.8)	(30.4)	(34.7)	(49.0)	(106.2)	(104.6)	(104.6)	(105.6)
Creditors		(22.4)	(25.2)	(28.3)	(44.7)	(52.6)	(60.0)	(60.0)	(61.0)
Tax and social security		(4.2)	(3.1)	(4.9)	(2.5)	(4.9)	(4.9)	(4.9)	(4.9)
Short term borrowings		0.0	(1.6)	(1.5)	(1.8)	(2.6)	(2.6)	(2.6)	(2.6)
Other		(0.2)	(0.5)	0.0	0.0	(46.1)	(37.1)	(37.1)	(37.1)
Long Term Liabilities		(70.1)	(64.1)	(43.0)	(50.8)	(236.0)	(227.8)	(219.6)	(211.4)
Long term borrowings		(63.5)	(57.3)	(35.2)	(39.9)	(223.1)	(214.9)	(206.7)	(198.5)
Other long term liabilities		(6.6)	(6.8)	(7.8)	(10.9)	(12.9)	(12.9)	(12.9)	(12.9)
Net Assets		137.4	138.9	164.5	172.4	139.5	144.8	157.6	172.2
Minority interests		(1.0)	(0.7)	(0.7)	(0.9)	(0.8)	(0.9)	(0.9)	(1.0)
Shareholders' equity		136.4	138.2	163.8	171.5	138.7	143.9	156.7	171.3

CASH FLOW
Op Cash Flow before WC and tax		49.2	44.5	56.8	55.5	56.4	65.3	71.8	74.6
Working capital		(21.6)	10.6	(6.2)	(4.0)	(33.5)	22.0	(0.7)	0.2
Exceptional & other		3.2	(4.4)	(1.7)	(10.9)	(57.7)	(14.5)	0.0	0.0
Tax		(4.1)	(4.5)	(3.3)	(4.2)	(4.1)	(1.0)	(4.0)	(4.6)
Net operating cash flow		26.7	46.2	45.6	36.4	(38.9)	71.8	67.2	70.2
Capex		(15.0)	(16.3)	(14.9)	(21.9)	(19.4)	(40.0)	(23.0)	(23.0)
Acquisitions/disposals		(35.4)	0.0	(0.5)	0.0	(33.0)	0.0	0.0	0.0
Net interest		(1.5)	(2.7)	(1.3)	(0.9)	(5.5)	(12.5)	(11.0)	(10.0)
Equity financing		0.6	0.5	3.5	0.6	0.0	0.0	0.0	0.0
Dividends		(15.6)	(17.2)	(7.3)	(18.4)	(19.0)	(18.6)	(19.1)	(19.6)
Other		0.0	(1.5)	(1.7)	(1.7)	(5.8)	(1.7)	(1.7)	(1.7)
Net Cash Flow		(40.2)	9.0	23.4	(5.9)	(121.6)	(1.0)	12.4	15.9
Opening net debt/(cash)		9.0	52.0	41.3	17.9	24.6	151.0	152.0	139.6
FX		(2.7)	1.7	0.0	(0.8)	(4.8)	0.0	0.0	0.0
Other non-cash movements		(0.1)	0.0	0.0	0.0	0.0	0.0	0.0	0.0
Closing net debt/(cash)		52.0	41.3	17.9	24.6	151.0	152.0	139.6	123.7

Source: XP Power, Edison Investment Research

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