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Investor PresentationQ2 2016
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This presentation contains forward-looking statements, other than historical
facts, which reflect the view of the Fund's management with respect to future
events. Such forward-looking statements reflect the current views of the Fund's
management and are made on the basis of information currently available.
Although management believes that its expectations are reasonable, it can give
no assurance that such expectations will prove to be correct. The forward-looking
statements contained herein are subject to these factors and other risks,
uncertainties and assumptions relating to the operations, results of operations
and financial position of the Fund. For more information concerning forward-
looking statements and related risk factors and uncertainties, please refer to the
Boyd Group’s interim and annual regulatory filings.
Forward-Looking Statements
3
Capital Markets Profile (as at August 12, 2016)
Stock Symbol: TSX: BYD.UN
Units and Shares Outstanding*: 18.3 million
Price (August 12, 2016): $82.69
52-Week Low / High: $54.16/$82.91
Market Capitalization: $1,513.2 million
Annualized Distribution (per unit): $0.504
Current Yield: 0.6%
Payout Ratio (TTM**): 12.2%
*Includes 231,937 exchangeable shares** Trailing twelve months ended June 30, 2016
4
Company Overview
• Leader and one of the largest operators of collision repair shops in North America by number of locations (non-franchised)
• Consolidator in a highly fragmented $35.0 billion market
• Second-largest retail auto glass operator in the U.S.
• Only public company in the auto collision repair industry in North America
• Recession resilient industry
By Country By Payor< 10% Customer Pay/Other
> 90% Insurance
< 10% Canada
U.S.
Revenue Contribution:
Chart1
U.S.
Canada
Sales
90
10
Sheet1
Sales
U.S.90
Canada10
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Chart1
< 10% Customer Pay
> 90% Insurance
Sales
10
90
Sheet1
Sales
< 10% Customer Pay10
> 90% Insurance90
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5
Collision Operations
• 337 company operated collision locations across 20 U.S. states; 41 company operated locations in Canada
• Operate full-service repair centers offering collision repair, glass repair and replacement services
• Strong relationships with insurance carriers
• Advanced management system technology
• Process improvement initiatives
• Single brand strategy in Canada and U.S.
6
North American Collision Repair Footprint
U.S. • Illinois (54)• Florida (53)• Michigan (41)• North Carolina (28)• Ohio (22)• Indiana (21)• Washington (20) • Georgia (20)• Arizona (17)• Colorado (16)• Maryland (10)• Louisiana (7)• Oregon (7)• Oklahoma (5)• Pennsylvania (5)• Nevada (4)• Utah (4) • Kansas (1)• Idaho (1)• Kentucky (1)
Canada• Manitoba (14) • Alberta (12)• British Columbia (12)• Saskatchewan (2)• Ontario (1)
41centers
337centers
6
7
Glass Operations
• Retail glass operations across 31 U.S. states Asset light business model
• Third-Party Administrator business that offers Notice of Loss, glass and related services with approximately: 5,500 affiliated glass provider locations 4,600 affiliated emergency road-side service
providers
• Canadian Glass Operations are integrated in the collision business
8
North American Glass FootprintU.S.
• Alabama• Arizona• Colorado• Connecticut• District of Columbia• Florida• Georgia• Idaho• Illinois• Indiana• Kentucky• Louisiana• Massachusetts• Maryland• Michigan• Missouri• Nevada• New Hampshire• New York• North Carolina• Ohio• Oklahoma• Oregon • Pennsylvania• Tennessee• Texas• Utah• Virginia• Washington• West Virginia• Wisconsin
8
9
Market Overview & Business Strategy
9
10
Large, Fragmented Market
• Revenue for North American collision repair industry is estimated to be approximately $35.0 billion annually (U.S. $32.3B, CDA $2.7B)
• 33,500 shops in the U.S.
• Composition of the collision repair market in the U.S.:
U.S. Collision Repair Market
Source: The Romans Group, “A 2014 Profile of the Evolving North American Collision Repair Marketplace”
Independent Repair Shops
76.8%
Dealer-ownedShops23.2%
Single Shops72.1%
Large MSO
19.2%Small MSO and Franchises8.7%
Chart1
Large MSO
Small MSO and franchises
Single Shops
Sales
0.192
0.087
0.721
Sheet1
Sales
Large MSO19.2%
Small MSO and franchises8.7%
Single Shops72.1%
4th Qtr1.2
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Chart1
Dealer-owned shops
Independent Repair Shops
Sales
0.232
0.768
Sheet1
Sales
Dealer-owned shops23.2%
Independent Repair Shops76.8%
Single Shops75.5%
4th Qtr1.2
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11
Evolving Collision Repair Market
• Long-term decline of independent and dealership repair facilities Total number of independent and dealership collision repair locations has
declined by 19.3% from 2008 to 2014, and 57% over the past 30 years
• Large multi-shop collision repair operator (“MSO”) market share opportunity Large MSOs represented 5.7% of total locations in 2014 and 19.2% of estimated
2014 revenue (up from 9.1% in 2006) in the U.S. 81 MSOs had revenues of $20 million or greater in 2014 The top 10 MSOs together represent 65.9% of revenue of large MSOs MSOs benefit from standardized processes, integration of technology platforms
and expense reduction through large-scale supply chain management
Source: The Romans Group, “A 2014 Profile of the Evolving North American Collision Repair Marketplace”
12
Strong Relationships with Insurance Companies through DRPs
• Direct Repair Programs (“DRPs”) are established between insurance companies and collision repair shops to better manage auto repair 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
• Boyd is well positioned to take advantage of these DRP trends with all major insurers and most regional insurers
• Boyd’s relationship with insurance customers Top 5 largest customers contribute 49% of revenue Largest customer contributes 15% of revenue
12
13
Insurer Market Dynamics
Top 10 Insurer Market Share Insurer DRP Usage
Source: National Association of Insurance Commissioners Source: The Romans Group
Chart1
Top 10 Insurers
Other Insurers
Sales
0.711
0.289
Sheet1
Sales
Top 10 Insurers71.1%
Other Insurers28.9%
Single Shops75.5%
4th Qtr1.2
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Chart1
DRP
Other
Sales
0.55
0.45
Sheet1
Sales
DRP55.0%
Other45.0%
Single Shops75.5%
4th Qtr1.2
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14
Impact of Collision Avoidance Systems
• CCC estimates technology will reduce accident frequency by ~20% in next 25-30 years
• As per industry studies, decline should be somewhat offset by increases in average cost of repair (increased expense of technology)
• Large operators could also mitigate market decline by continued market share gains in consolidating industry
Source: CCC Information Services Inc.: Projections based on current projected annual rate of change - impact may increase with changes in market adoption and system improvements
All Rights Reserved Copyright 2015 CCC Information Services Inc.
Chart1
CY 2010
CY 2011
CY 2012
CY 2013
CY 2014
CY 2015
CY 2020
CY 2025
CY 2030
CY 2035
CY 2040
CY 2045
CY 2050
Estimated reduction in frequency
Impact of Crash Avoidance on Accident Frequency
-0.0008991849
-0.0011331618
-0.001511939
-0.0024170813
-0.004346987
-0.0072468905
-0.033
-0.068
-0.103
-0.138
-0.173
-0.208
-0.243
Sheet1
Estimated reduction in frequency
CY 2010-0.09%
CY 2011-0.11%
CY 2012-0.15%
CY 2013-0.24%
CY 2014-0.43%
CY 2015-0.72%
CY 2020-3.30%
CY 2025-6.80%
CY 2030-10.30%
CY 2035-13.80%
CY 2040-17.30%
CY 2045-20.80%
CY 2050-24.30%
15
Business Strategy
Operational excellence
New location and acquisition growth
Expense management
Same-store sales growth and optimize returns from existing operations
EnhanceUnitholder
Value
THE BOYD GROUP
UNITHOLDERS
15
16
Operational Excellence – WOW Operating Way
• Best-in-Class Service Provider Average cost of repair Cycle time Customer service Quality Integrity
• “WOW” Operating Way Implemented in over 85% of shops
17
Expense ManagementO
pera
ting
Expe
nses
as %
of S
ales
Well managed operating expenses as a % of sales
39.1% 38.4% 37.9% 37.8% 38.0% 38.0% 38.4% 38.8% 38.0% 37.1%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
17
18
-7%
-2%
3%
8%
13%
Q3-06
Q4-06
Q1-07
Q2-07
Q3-07
Q4-07
Q1-08
Q2-08
Q3-08
Q4-08
Q1-09
Q2-09
Q3-09
Q4-09
Q1-10
Q2-10
Q3-10
Q4-10
Q1-11
Q2-11
Q3-11
Q4-11**
Q1-12
Q2-12
Q3-12
Q4-12
Q1-13
Q2-13
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Q2-16
SSSG - Optimizing Returns from Existing Operations
Sam
e-St
ore
Sale
s Gro
wth
*
Same-store sales increases in 32 of 40 most recent quarters
*Total Company, excluding FX.
**Adjusting for the positive impact of hail in Q4-10, Q4-11 SSSG was 4.7%.
3-year average SSSG: 6.3%
5-year average SSSG: 4.9%10-year average SSSG: 4.4%
18
Chart1
Q3-06Q3-06
Q4-06Q4-06
Q1-07Q1-07
Q2-07Q2-07
Q3-07Q3-07
Q4-07Q4-07
Q1-08Q1-08
Q2-08Q2-08
Q3-08Q3-08
Q4-08Q4-08
Q1-09Q1-09
Q2-09Q2-09
Q3-09Q3-09
Q4-09Q4-09
Q1-10Q1-10
Q2-10Q2-10
Q3-10Q3-10
Q4-10Q4-10
Q1-11Q1-11
Q2-11Q2-11
Q3-11Q3-11
Q4-11**Q4-11**
Q1-12Q1-12
Q2-12Q2-12
Q3-12Q3-12
Q4-12Q4-12
Q1-13Q1-13
Q2-13Q2-13
Q3-13Q3-13
Q4-13Q4-13
Q1-14Q1-14
Q2-14Q2-14
Q3-14Q3-14
Q4-14Q4-14
Q1-15Q1-15
Q2-15Q2-15
Q3-15Q3-15
Q4-15Q4-15
Q1-16Q1-16
Q2-16Q2-16
Same-Store Sales Growth
Column1
-0.008
0.028
0.059
0.077
0.102
0.094
0.083
0.085
0.051
0.002
0.013
-0.057
-0.036
0.002
-0.063
-0.013
0.049
0.106
0.115
0.088
0.087
0.047
-0.005
-0.004
-0.013
-0.008
0.02
0.021
0.079
0.044
0.052
0.076
0.073
0.076
0.075
0.055
0.047
0.073
0.06
0.074
0.051
Sheet1
Same-Store Sales GrowthColumn1
Q3-06-0.80%
Q4-062.80%
Q1-075.90%
Q2-077.70%
Q3-0710.20%
Q4-079.40%
Q1-088.30%
Q2-088.50%
Q3-085.10%
Q4-080.20%
Q1-091.30%
Q2-09-5.70%
Q3-09-3.60%
Q4-090.20%
Q1-10-6.30%
Q2-10-1.30%
Q3-104.90%
Q4-1010.60%
Q1-1111.50%
Q2-118.80%
Q3-118.70%4.41%
Q4-11**4.70%-0.50%4.93%
Q1-12-0.40%6.30%
Q2-12-1.30%
Q3-12-0.80%
Q4-122.00%
Q1-132.10%
Q2-137.90%
Q3-134.40%
Q4-135.20%
Q1-147.60%
Q2-147.30%
Q3-147.60%
Q4-147.50%
Q1-155.50%
Q2-154.70%
Q3-157.30%
Q4-156.00%
Q1-167.40%
Q2-165.10%
19
Focus on Accretive Growth
• Goal: double the size of the business by 2020
• Implied average annual growth rate of 15%: Same-store sales Acquisition or development of single locations Acquisition of multiple-location businesses
• Well-positioned to take advantage of large acquisitions
20
+37
+54
+42
+64
+29
+38
45
82
136
178
242271
309
2010 2011 2012 2013 2014 2015 2016
New Location and Acquisition Growth
• May 2013: acquisition of Glass America added 61 retail auto glass locations• March 2016: acquisition of 4 retail auto glass locations
Collision repair locations added
20
Annual additions (MSO and single locations)
21
FinancialReview
21
Revenue Growth
(C$ millions)
22
Chart1
2010
2011
2012
2013
2014
2015
Revenue
256.8
357
434.4
578.3
844.1
1174.1
Sheet1
Revenue
2010256.8
2011357
2012434.4
2013578.3
2014844.1
20151174.1
Adjusted EBITDA Growth
(C$ millions)
23
$19.0$24.4
$29.8
$41.5
$69.0
$101.7
$0
$20
$40
$60
$80
$100
$120
2010 2011 2012 2013 2014 2015
24
Financial Summary
(C$ millions, except per unit and percent amounts)
3-months ended 6-months ended
June 30,2016
June 30,2015
June 30,2016
June 30,2015
Sales $331.0 $278.7 $681.4 $560.5
Gross Profit $152.7 $129.4 $310.8 $258.0
Adjusted EBITDA* $30.5 $25.5 $60.0 $46.7
Adjusted EBITDA Margin* 9.2% 9.2% 8.8% 8.3%
Adjusted Net Earnings* $13.6 $11.1 $26.5 $19.1
Adjusted Net Earnings* per unit $0.756 $0.677 $1.470 $1.166
Adjusted Distributable Cash* $29.8 $10.8 $33.6 $31.5
Adjusted Distributable Cash* per average unit and Class A common share $1.630 $0.652 $1.840 $1.896
Payout Ratio 7.7% 18.8% 13.6% 13.0%
Payout Ratio (TTM) 12.2% 15.7% 12.2% 15.7%
* Adjusted EBITDA, adjusted net earnings, and adjusted distributable cash are not recognized measures under International Financial Reporting Standards ("IFRS"). See the Fund’s 2016 Second Quarter MD&A for more information.
24
25
Strong Balance Sheet(in C$ millions) June 30, 2016 December 31, 2015
Cash $47.9 $72.9
Long-Term Debt $69.6 $66.5
Convertible Debentures* $51.3 $75.1
Obligations Under Finance Leases $12.2 $13.0
Net Debt (total debt, including current portion and bank indebtedness, net of cash)
$85.3 $81.8
Net Debt / Adjusted EBITDA (TTM) 0.74x 0.80x
* On January 5, 2016, the Fund completed the early redemption and cancellation of its 5.75% Convertible Unsecured Subordinated Debentures due December 31, 2017. The principal amount of $24.2 million was converted or redeemed. 25
26
Financial Flexibility
• Cash of $47.9 million
• Net Debt to EBITDA TTM ratio of 0.74x
• 5-year committed facility of US$150 million which can increase to US$250 million with accordion feature, maturing July 2020
• ~$350 million of “dry powder” available
• Only public company in the industry Access to all capital markets
27
Distributions
Annualized Distribution per Unit (C$)
Annualized distributions have increased by 60% since 2010
$0.315$0.330
$0.345$0.360
$0.420$0.450
$0.468 $0.480$0.492 $0.504
$0.00
$0.05
$0.10
$0.15
$0.20
$0.25
$0.30
$0.35
$0.40
$0.45
$0.50
$0.55
Apr 10 -May 10
Jun 10 -Aug 10
Sept 10 -Nov 10
Dec 10 Jan 11-Oct 11
Nov 11 -Oct 12
Nov 12 -Oct 13
Nov 13 -Oct 14
Nov 14 -Oct 15
Nov 15 -Present
27
28
Five-year Return to Unitholders
-200%
0%
200%
400%
600%
800%
1000%
1200%
31-Dec-10 31-Dec-11 31-Dec-12 31-Dec-13 31-Dec-14 31-Dec-15
Boyd Group S&P/TSX Composite S&P/TSX Income Trust
5-year total return: 906.2%*
S&P/TSX Composite12.1%
S&P/TSX Income Trust60.6%
*Source: Toronto Stock Exchange. Total return based on reinvestment of dividends.
29
Delivering long-term value to unitholders
• Best performing company on Toronto Stock Exchange, 2005-2015
Total Return: 12/30/2005-12/31/2015
S&P/TSX Composite Index
+15.42%
The Boyd Group Income Fund
+4,655%
Source: Thomson One, includes reinvested distributions
30
Experienced & Committed Management Team
Brock Bulbuck President & CEO
Pat Pathipati Executive Vice President & CFO
Tim O’Day President & COO, U.S. Operations
Eric Danberg President, Canadian Operations
31
Outlook
• Increase North American presence through: Drive same-store sales growth through enhanced capacity
utilization, development of DRP arrangements and leveraging existing major and regional insurance relationships
Acquire or develop new single locations as well as the acquisition of multi-location collision repair businesses
• Margin enhancement opportunities through operational excellence and leveraging scale over time
• Double size of the business by 2020
32
Summary
Stability
Unitholder Value
Growth
+
=
Strong balance sheet Insurer preference for MSOs Recession resilient
Cash distributions/conservative payout ratio
5-year total unitholder return of 906.2%
$35 billion fragmented industry High ROIC growth strategyMarket leader/consolidator
in North America
Focus on enhancing unitholders’ value
32
Slide Number 1Forward-Looking StatementsCapital Markets Profile (as at August 12, 2016)Company OverviewCollision OperationsNorth American Collision Repair FootprintGlass OperationsNorth American Glass FootprintSlide Number 9Large, Fragmented MarketEvolving Collision Repair MarketStrong Relationships with �Insurance Companies through DRPsInsurer Market DynamicsImpact of Collision Avoidance SystemsBusiness StrategyOperational Excellence – WOW Operating WayExpense ManagementSSSG - Optimizing Returns �from Existing OperationsFocus on Accretive Growth New Location and Acquisition GrowthSlide Number 21Revenue GrowthAdjusted EBITDA GrowthFinancial SummaryStrong Balance SheetFinancial FlexibilityDistributionsFive-year Return to UnitholdersDelivering long-term value to unitholdersExperienced & Committed �Management TeamOutlookSummary
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