Samsonite Group S.a. · HKEX:1910
Samsonite — Samsonite International — H1 2022 Earnings Presentation
45 slides from Samsonite's earnings presentation, Aug 17, 2022
Slide 1: 2022 Interim Results
2022 INTERIM RESULTS AUGUST 17, 2022 Samsonite International S.A. Stock Code: 1910
Slide 2: Disclosure Statement
Disclosure Statement This presentation and the accompanying slides (the “Presentation”), which have been prepared by Samsonite International S.A. (“Samsonite” or the “Company”), do not constitute any offer or invitation to purchase or subscribe for any securities, and shall not form the basis for, o
Slide 3: Agenda
Agenda Business Update Financial Highlights Outlook Q&A Page 3
Slide 4: Sales recovery continues to pick up momentum
Sales recovery continues to pick up momentum Our 1H 2022 net sales improved to US$1,270 million, an increase of 75.3%(1)(2) year-on-year, and a decrease of 20.4%(1)(2) compared to 2019, driven by increased travel demand across most of the world, particularly within international travel in last sever
Slide 5: Samsonite is well-positioned to grow as travel rebounds
Samsonite is well-positioned to grow as travel rebounds Travel has dramatically increased in most regions. Global RPKs - % change vs. the same month in 2019 Source: IATA Monthly Statistics+ Samsonite is continuously innovating our product lines for all our brands, and we are well-positioned with exc
Slide 6: Strong sales and Adjusted EBITDA recovery continued in Q2 2022
Strong sales and Adjusted EBITDA recovery continued in Q2 2022 Net sales growth(1)(2) vs. 2019 Q2 2022 (16.1%)(1)(2) Q2 2022 sales growth continued to improve to (16.1%)(1)(2) vs. Q2 2019 as travel demand continued to pick up momentum across most of the world, with the exception of China. Gross marg
Slide 7: Net sales increased by US$471 million; Adjusted EBITDA margin improved to 15.4%
Net sales increased by US$471 million compared to prior year, and Adjusted EBITDA margin improved to 15.4% in 1H 2022, up 320 basis points from 1H 2019 Consolidated Net Sales and Adjusted EBITDA 1H 2022 Adjusted EBITDA margin was approximately 320 basis points better than 1H 2019. Additionally, 1H 2
Slide 8: Sales recovery continued to improve in all regions
Sales recovery continued to improve in all regions By region constant currency net sales growth vs. 2019 (2) (2) (2) (2) (3) Europe continued to see sequential quarterly North America continued to see a strong The recovery in Asia has lagged Latin America continued net sales growth improvement compa
Slide 9: Many countries in Asia are easing travel restrictions
Many countries in Asia (except China) are easing their travel restrictions, which is fueling an expected strong recovery in their markets in the 2nd half Southeast Asia (2) Australia India South Korea China Many countries within Asia have been lifting or easing their travel restrictions, which has h
Slide 10: International travel has continued to recover
International travel has continued to recover, and is poised for an even stronger recovery over the rest of 2022 Domestic Revenue Passenger-kilometers (RPKs) vs. International RPKs Domestic travel was negatively impacted by the Delta variant. Source: IATA Monthly Statistics+ Domestic travel has reco
Slide 11: The travel recovery has varied across regions
The travel recovery has varied across regions, with the strongest recoveries in North America, Latin America, and Europe Total Market – Revenue Passenger-Kilometers (RPKs) – comparison to same month in 2019 Most markets showed strong improvement into May 2022, but Asia continues to be held back by C
Slide 12: Gross margin improved to 55.7% in 1H 2022
Gross margin improved to 55.7% in 1H 2022, a 490 basis point increase compared to prior year 1H 2022 gross margin was approximately 490 basis Gross Margin Comparison points above 1H 2021 driven primarily by increased sales, price increases, lower promotional activity, and lower provisions for invent
Slide 13: Airline travel is back, and travel demand remains strong
Airline travel is back, and travel demand remains strong as consumers’ pent-up desire to travel stays highs London’s Heathrow Airport Limits Passengers Amid Staff Shortages, Surging Demand Lufthansa to Bring Back A380 in Reversal as Travel Demand Soars 'Revenge travel' is surging. Here's what you ne
Slide 14: As the world moves again, our teams are focused on execution for our customers
As the world moves again, our teams are energetically focused on execution for our customers Page 14
Slide 15: Diversity and Inclusion are an integral part of our ESG goals
Diversity and Inclusion are an integral part of our ESG goals Our Company is committed to its Environmental, Social & Governance (ESG) goals and Diversity & Inclusion (D&I) journey. We are engaging with all our employees as we come back to the office. We completed our first ever employee survey arou
Slide 16: Exciting, innovative, and sustainable collections: UPSCAPE
Exciting, innovative, and sustainable collections are ready to capture demand as travel continues to recover Choose comfort with UPSCAPE! Enjoy carefree travelling thanks to its lightness, the shock- UPSCAPE absorbing suspension wheels and its removable & washable interior lining. The collection fea
Slide 17: Exciting, innovative, and sustainable collections: ELEVATION PLUS
Exciting, innovative, and sustainable collections are ready to capture demand as travel continues to recover ELEVATION™ PLUS is a full collection of sizes and styles that address the specific needs of today’s global traveler. Functionality, performance, timeless design and considered details and fe
Slide 18: Exciting, innovative, and sustainable collections: STRYDE 111
Exciting, innovative, and sustainable collections are ready to capture demand as travel continues to recover STRYDE 111 is travel reimagined. An engineered state of the art collection, carefully protecting every detail for the ultimate upgraded experience that will forever change the way you pack.
Slide 19: Innovation within our non-travel products
The Company also continues its commitment to innovation within our non-travel products The ONGOING collection combines the perfect balance of simplicity and attention to details. Clean lines with ONGOING sustainable materials are the winning elements of ONGOING, and it is suitable for everyday adven
Slide 20: Our commitment to innovation across all our brands
Our commitment to innovation across all our brands Tumi is introducing the next generation of its iconic Tegra-Lite® collection with a relaunch in Q3 2022. The collection will feature a new Tegra material construction with recycled core inlay, and recycled fabrics on the interior. Competitive weight
Slide 21: We will lean into marketing spend in 2H 2022
We will lean into marketing spend in 2H 2022 to drive growth and capitalize on the continued recovery in travel Page 21
Slide 22: Our brands have created several campaigns now launching
Our brands have created several campaigns which are now launching Page 22
Slide 23: New collaborations with RAZER and STAPLE
Exciting new collaborations with RAZER and STAPLE will help drive increased brand awareness with new consumers and audiences TUMI has teamed up with Razer, the leading global lifestyle brand for This collaboration with STAPLE celebrates our shared gamers. Together, they reimagined TUMI bestsellers a
Slide 24: TUMI | BULLET TRAIN
TUMI | BULLET TRAIN THE CASE EVERYONE IS AFTER IN CINEMAS 8.5.22 TUMI teamed up with Sony Pictures starring in the summer blockbuster film, “Bullet Train,” featuring our 19 Degree Aluminum Briefcase. 150 limited-edition cases are for sale globally on TUMI.com and select TUMI Stores; with various ent
Slide 25: Agenda
Agenda Business Update Financial Highlights Outlook Q&A Page 25
Slide 26: 1H 2022 Results Highlights
1H 2022 Results Highlights n/m n/m Net sales increased by US$471 Gross margin increased by 490bp from 1H Adjusted EBITDA increased by US$213 Adjusted Net Income million, or 75.3%(1)(2), compared to 2021, driven by increased sales, lower million from 1H 2021 and reached 15.4% of increased by US$187 m
Slide 27: Significant improvement in Adjusted EBITDA from Q1 to Q2
Significant improvement in Adjusted EBITDA from Q1 to Q2 was driven mainly by the continued sales recovery and higher gross margin Net sales improved to US$697 million in Q2 2022 from US$574 million in Q1 2022. Adjusted EBITDA increased by US$49 million to US$122 million in Q2 2022 Q2 compared to US
Slide 28: Financial Highlights
Financial Highlights Net sales in 1H 2022 increased from prior year by 75.3%(1)(2) to US$1,270 million. Net sales performance in Q2 2022 continued its sequential quarterly improvement compared to 2019, with Q2 2022 net sales down by 16.1%(1)(2), reflecting improvement from Q1 2022, which was down by
Slide 29: Financial Highlights (cont'd)
Financial Highlights (cont’d) Gross margin increased by 490bp from 1H 2021. The improvement was tempered by the non- renewal of the Generalized System of Preferences program in the United States ("GSP") since January 2021, which has resulted in increased duty costs on goods imported to the U.S. from
Slide 30: Financial Highlights (cont'd)
Financial Highlights (cont’d) Net debt position was US$1,478 million as of June 30, 2022, with US$1,065 million of cash and cash equivalents and US$2,543 million of debt(1), compared to a net debt position of US$1,817 million as of June 30, 2021. Net debt is only up US$173 million from pre-pandemic
Slide 31: Net sales were higher in all regions in 1H 2022
Net sales were higher in all regions in 1H 2022 compared to the prior year as the recovery in travel continued Constant Currency Q1 Q2 1H Q1 Q2 1H Q1 Q2 1H Q1 Q2 1H Growth 91.6%(1) 50.5%(1) 66.2%(1) 22.2% 46.3% 34.0% 169.7% 187.9%(1) 180.1%(1) 151.9% 150.1% 151.1% Constant Currency Q1 Q2 1H Q1 Q2 1H
Slide 32: Adjusted EBITDA performance surpassed pre-pandemic levels in all regions but Asia
The Adjusted EBITDA performance in 1H 2022 surpassed pre-pandemic levels both in terms of dollars and margins in all regions but Asia By region Adjusted EBITDA Adjusted EBITDA in 1H 2022 has surpassed 1H 2019 levels in all regions except for Asia, which has lagged behind the other regions due to a s
Slide 33: Net Sales Bridge 1H 2021 – 1H 2022
1H 2022 net sales are up from prior year by US$566 million, excluding the impact of currency devaluation to the USD, suspending Russia operations and China lockdowns during Q2 Net Sales Bridge 1H 2021 – 1H 2022 +$601.4m (+75.2%) (+151.1%) (+180.1%) (+71.0%) (+66.2%) EUR -US$22.5 million TRY -US$9.8
Slide 34: Stronger growth in wholesale and retail channels
Stronger growth in our wholesale and retail channels, and an acceleration in our travel category net sales compared to prior year as travel recovers Comparison of net sales by channel Comparison of Travel vs. Non-travel net sales 37.4% (1)(2) 40.0% (1)(2) 96.4% (1)(2) US$m US$m 74.6% (1)(2) 104.5% (
Slide 35: Fixed SG&A savings driving stronger profitability than before the pandemic
Significant fixed SG&A savings actions implemented since 2020 are driving stronger profitability than before the pandemic on net sales that are still 20.4%(1)(3) below 1H 2019 Adjusted EBITDA Bridge 1H 2019 – 1H 2022 US$190.5 million Focused on maintaining as much of this savings as possible as the
Slide 36: The Company has maintained fixed SG&A savings
The Company has continued to maintain fixed SG&A savings from our cost reduction initiatives SG&A within Adjusted EBITDA(1) 1H 2022 fixed SG&A expenses were US$162 million lower than 2019, but US$33 million higher than prior year due mainly to temporary cost savings rolling off and inflationary incr
Slide 37: Positive Q2 cash generation despite working capital investment
Positive Q2 cash generation(1) despite continued investment into our working capital, primarily replenishment of inventory Quarterly cash generation (burn)(1) (1) Total cash generation (burn) is calculated as the total increase (decrease) in cash and cash equivalents per the consolidated statements
Slide 38: Balance Sheet
Balance Sheet US$m June 30, December 31, June 30, $ Chg Jun-22 % Chg Jun-22 2021 2021 2022 vs. Jun-21 vs. Jun-21 Cash and cash equivalents 1,058.2 1,324.8 1,064.6 6.4 0.6% Trade and other receivables, net 163.8 206.2 253.4 89.5 54.7% Net debt of US$1,478 million at Inventories, net 390.4 348.4 468.8
Slide 39: Working Capital
Working Capital US$m June 30, December 31, June 30, $ Chg Jun-22 % Chg Jun-22 Compared to December 31, 2021 net 2021 2021 2022 vs. Jun-21 vs. Jun-21 working capital was US$106 million Working Capital Items higher as we continued to replenish Inventories $ 390.4 $ 348.4 $ 468.8 $ 78.4 20.1% Trade and
Slide 40: Building our inventory position to support the recovery
We have been able to build our inventory position to support the ongoing recovery in travel despite the challenges with shipping delays and factory capacity constraints Inventory balance evolution We have been able to build a clean inventory position despite the challenges we have seen with shipping
Slide 41: Tight focus on capex while investing in key initiatives
Continuing tight focus on capex while beginning to invest in selective key initiatives Capital Expenditure by project type The majority of capex in 1H 2022 US$m 1H 2021 1H 2022 was related to retail remodels Retail 2.7 5.5 and investment in our European plants to expand capacity and Product Developm
Slide 42: Agenda
Agenda Business Update Financial Highlights Outlook Q&A Page 42
Slide 43: Outlook
Outlook As travel continues to rebound, we are well positioned to grow net sales at a fundamentally higher operating margin as shown in our 1H 2022 results. We remain focused on maintaining our gross margins at historical levels through reduced discounting and promotional activity; price increases t
Slide 44: Outlook (cont'd)
Outlook (cont’d) We will maintain disciplined expense management on our fixed SG&A expenses, and expect certain fixed SG&A savings to carry into the second half and into next year. We will look to make disciplined and selective investments in core strategic functions to support our sales growth. We
Slide 45: Agenda
Agenda Business Update Financial Highlights Outlook Q&A Page 45
Samsonite International — H1 2022 Earnings Presentation on 6ix