Super Retail Group Limited · ASX:SUL
Super Retail — H1 FY23 Earnings Presentation
44 slides from Super Retail's earnings presentation, Feb 16, 2023
Slide 1: FY23 Half Year Results Presentation
For personal use only FY HALF YEAR RESULTS 23 PRESENTATION 16 February 2023 Authorised for release by the Super Retail Group Board ABN: 81 108 676 204
Slide 2: Contents
For personal use only CONTENTS • Group highlights • FY23 first half financial results • Corporate strategy • ESG, sustainability and team • Dividends and capital management • Trading update • Appendix SUPER RETAIL GROUP rebel ambassador and Matilda’s 2 football player Mary Fowler
Slide 3: Group highlights
For personal use only Group highlights 3
Slide 4: Executive summary
Executive summary Record first half sales deliver strong first half profit • Sales up 15 per cent to $1.96 billion - driven by strong Black Friday and For personal use only Christmas peak trading performance • Group like-for-like sales growth of 11 per cent1 • Group gross margin 46.2 per cent – refl
Slide 5: Record first half sales result
Record first half sales result Sales revenue up 15 per cent to $1.96 billion For personal use only GROUP H1 SALES GROWTH SALES ($M) BY BRAND YOY SALES YOY LFL SALES GROWTH (%)1 GROWTH(%)1,2 18 15 13 11 1,958 7 (2) 1,776 1,705 55 54 1,403 1,444 TOTAL GROUP 15 11 Dec 18 Dec 19 Dec 20 Dec 21 Dec 22 (1)
Slide 6: Gross margin and CODB
Gross margin and CODB The Group has increased gross margin compared to pre-COVID levels while managing CODB as a % of sales For personal use only GROUP GROUP CODB AS GROUP PBT GROSS MARGIN A % OF SALES1 MARGIN Gross margin CODB as a % of sales Delivering remains above pre is being well improvements
Slide 7: Inventory levels normalising
Inventory levels normalising Group inventory reflects lower inventory volumes which have been partly offset by inflation in COGS and an increased weighting of higher value items in product mix. Inventory as a percentage of sales is starting to normalise to historic levels. For personal use only INVE
Slide 8: Margin protection and cost management
Margin protection and cost management The Group has a number of initiatives underway to protect margin and manage costs in anticipation of a more challenging macroeconomic environment For personal use only Supply chain Cost of Goods Sold Variable cost Strategic normalisation (COGS) efficiency plan p
Slide 9: Customer and brand highlights
Customer and brand highlights Added 1 million active club members in the past 12 months For personal use only 9.7m 72% 66 ACTIVE CLUB MEMBERS 1 CLUB MEMBER % OF CLUB MEMBER NPS SALES 66 63% 64 71% CLUB MEMBER CLUB MEMBER CLUB MEMBER CLUB MEMBER NPS % OF SALES NPS % OF SALES 68 88% 68 74% CLUB MEMBER
Slide 10: Store network highlights
Store network highlights Strong pipeline of new store openings in FY23 For personal use only 722 26 CURRENT STORES TARGETED STORE OPENINGS IN FY23 6 4 4 TARGETED STORE TARGETED STORE TARGETED STORE OPENINGS UPGRADES TO RCX OPENINGS FORMAT 10 6 TARGETED STORE TARGETED STORE OPENINGS OPENINGS SUPER RE
Slide 11: rebel rCX stores are proving to be a game changer
rebel rCX stores are proving to be a game changer rCX stores have helped deliver a step change in sales in high growth categories of basketball and football For personal use only BASKETBALL FOOTBALL 126% 23% 8% 60% 12% 9% SALES GROWTH H1 SALES BASKETBALL SALES AS SALES GROWTH H1 SALES FOOTBALL SALES
Slide 12: Digital and omni-retail highlights
Digital and omni-retail highlights Online sales are normalising post pandemic For personal use only H1 FY23 BRAND SALES BY CHANNEL $236m 12% In-store Click & Home GROUP ONLINE SALES ONLINE SALES % OF TOTAL SALES (%) Collect (%) Delivery (%) 92 6 2 84 6 10 49% 51% CLICK & COLLECT HOME DELIVERY % OF O
Slide 13: FY23 first half financial results and brand highlights
FY23 first half financial results and brand highlights For personal use only 13
Slide 14: Group results
Group results For personal use only $m H1 FY23 H1 FY22 Change Total sales1 1,958.2 1,705.1 14.8% Total segment EBITDA 404.5 329.4 22.8% Segment D&A 163.6 146.6 11.6% Total segment EBIT 240.9 182.8 31.8% Net finance costs 22.6 21.8 3.7% Segment PBT 218.3 161.0 35.6% Segment income tax expense 64.8 48
Slide 15: Segment results
Segment results For personal use only $m H1 FY23 H1 FY22 Segment Sales EBIT PBT Sales EBIT PBT Supercheap 728.6 115.7 108.1 616.1 82.9 75.9 Auto rebel 681.9 91.4 84.1 605.6 74.8 68.3 BCF 447.6 35.9 31.0 418.5 35.6 31.2 Macpac 101.4 16.5 15.9 65.5 (0.8) (1.5) Group and (1.3) (18.6) (20.8) (0.6) (9.7)
Slide 16: Supercheap Auto highlights
Supercheap Auto highlights For personal use only Supercheap Auto is Australia and New Zealand’s favourite1 specialty automotive parts and accessories retail business • Record first half sales • Record club member NPS score • In-store service program undertook a record number of fitments (380,000) •
Slide 17: Supercheap Auto results
• For personal use only Total sales increased by 18 per cent to $729 million driven by like-for-like sales $m H1 FY23 H1 FY22 Change growth on the pcp • Like-for-like sales of 15 per cent reflected growth in transaction volumes and higher average transaction value (ATV)1 Sales 728.6 616.1 18.3% • Au
Slide 18: rebel highlights
rebel highlights For personal use only rebel is Australia’s leading sporting goods retailer. We empower our customers to achieve their sporting dreams and passions. • Record first half sales • Record monthly sales in December 2022 • Launched redesigned rebel website in October 2022 • Opened 13th reb
Slide 19: rebel results
• Total sales increased by 13 per cent to $682 million driven by like-for-like sales growth For personal use only • Like-for-like sales increased by 11 per cent reflecting higher ATV driven by double digit $m H1 FY23 H1 FY22 Change growth in transaction volumes1 • December was a record month deliver
Slide 20: BCF highlights
BCF highlights For personal use only BCF is Australia’s favourite1 outdoor retailer, with stores in every Australian state and territory • Record first half sales • Record Boxing Day sales • Successful launch of BCF’s first Superstore format in Townsville • Club members represented 88 per cent of fi
Slide 21: BCF results
For personal use only • Total sales increased by 7 per cent to $448 million driven by contribution from $m H1 FY23 H1 FY22 Change new stores and the expanded Townsville superstore which opened in October 2022 • Like-for-like sales fell by 2 per cent.1 Transaction volumes increased however ATV Sales
Slide 22: Macpac highlights
Macpac highlights For personal use only Macpac is New Zealand’s original technical outdoor brand, that instils the confidence and spirit you need to take on anything • Record first half sales of over $100 million • Record first half profit • > 50 per cent growth in customer transactions • Expanded s
Slide 23: Macpac results
• Total sales increased by 55 per cent to $101 million driven by like-for-like sales growth For personal use only $m H1 FY23 H1 FY22 Change and new store openings • Like-for-like sales increased by 69 per cent in Australia and by 32 per cent in New Zealand1 Sales 101.4 65.5 54.8% • La Nina weather c
Slide 24: Group and unallocated
Group and unallocated For personal use only • Group and unallocated includes corporate costs not allocated to segments and customer, omni, digital and loyalty development costs $m H1 FY23 H1 FY22 Change • As previously flagged, costs relating to investment in personalisation and loyalty will now be
Slide 25: Group balance sheet
Group balance sheet • Total inventory is $33 million lower compared to December 2021 and $76 $m 31 Dec 22 2 Jul 22 For personal use only million higher compared to July 2022 (reflecting accumulation of stock to meet demand in the peak trading period) Inventory • December 2022 inventory balance refle
Slide 26: Returns, capital ratios and fx
Returns, capital ratios and fx • Normalised EPS of 68.0 cents is 36 per cent above H1 FY22 For personal use only • The Directors have determined to pay a fully franked interim H1 FY23 H1 FY22 Change dividend of 34.0 cents per share • Group dividend policy is to pay out total annual ordinary Normalis
Slide 27: Group cash flow
Group cash flow • Operating cash flow of $439 million was approximately $282 $m 31 Dec 22 25 Dec 21 Change For personal use only million above pcp and reflects the following: • Strong first half trading, especially over the peak Operating cash flow 439.3 157.0 179.8% Christmas trading period Store c
Slide 28: Corporate strategy
Corporate strategy For personal use only SUPER RETAIL GROUP 28
Slide 29: Our strategy
Our strategy STRATEGIC DRIVERS 1 GROW THE FOUR CORE BRANDS For personal use only 2 GROWING ANNUAL LEVERAGE CLOSENESS TO CUSTOMER VALUE OUR CUSTOMER PRIMARY VALUE LEVERS 3 CONNECTED OMNI-RETAIL SUPPLY CHAIN BEING AN EFFICIENT OMNI-RETAILER ENSURING ORGANIC GROWTH AND CAPITAL DISCIPLINE 4 SIMPLIFY THE
Slide 30: Delivering on our strategy in FY23
Delivering on our strategy in FY23 For personal use only GROW THE FOUR LEVERAGE CLOSENESS CONNECTED OMNI- SIMPLIFY THE EXCEL IN OMNI- CORE BRANDS TO OUR CUSTOMER RETAIL SUPPLY CHAIN BUSINESS RETAIL EXECUTION Current Focus Areas • 5-year Brand strategies • Active customer growth remains • Continuing
Slide 31: Customer engagement
Customer engagement Ongoing investment on customer engagement via a loyalty platform and one-to-one communication For personal use only LOYALTY: The loyalty solution will deliver a set of defined engagement capabilities valued by the customers of each brand H1 2023 H2 2023 H1 2024 PROJECT BUILD MARK
Slide 32: ESG, sustainability and team
ESG, sustainability and team For personal use only 32
Slide 33: ESG, sustainability and team
ESG, sustainability and team ESG ratings Workplace Gender Team For personal use only Equality Agency - Team engagement score of 80 which is WGEA above the Achiever’s benchmark for comparable companies. Maintained WGEA’s citation ‘Comprehensive’ rating from the Australian for Employer of Choice for O
Slide 34: Dividends and capital management
Dividends and capital management For personal use only SUPER RETAIL GROUP 34
Slide 35: Dividends and capital management
Dividends and capital management For personal use only • The Group applies the following key principles in relation to dividends and capital management: • Dividend payout policy – pay ordinary dividends equating to 55 per cent to 65 per cent of underlying NPAT, fully franked • Balance sheet – mainta
Slide 36: Trading update
Trading update For personal use only SUPER RETAIL GROUP 36
Slide 37: Trading update
Trading update • As at week 32 the Group has delivered like-for-like sales growth of 10 per cent For personal use only H1 total sales growth H1 LFL sales growth1 H2 LFL sales growth YTD1 LFL sales growth YTD1 Supercheap Auto 18% 15% 8% 14% rebel 13% 11% 13% 11% BCF 7% (2%) 3% (1%) Macpac 55% 54% 30%
Slide 38: Appendix – Performance trends and segment notes
Appendix 1 – Performance trends and segment notes For personal use only 38
Slide 39: Performance Trends
Performance Trends Reported Sales ($m) Reported Total Segment EBIT (pre-AASB16) ($m) For personal use only 256 225 1,958 168 1,776 1,705 1,403 1,444 125 1,296 1,324 100 115 114 115 1,096 1,159 1,216 101 94 1,037 93 759 62 Dec 11 Dec 12 Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Dec 18 Dec 19 Dec 20 Dec 21 D
Slide 40: Segment note (post AASB 16) H1 FY23
Segment note (post AASB 16) H1 FY23 For personal use only 40
Slide 41: Segment note (post AASB 16) H1 FY22
Segment note (post AASB 16) H1 FY22 For personal use only 41
Slide 42: Segment note (pre AASB 16) H1 FY23
Segment note (pre AASB 16) H1 FY23 For personal use only 42
Slide 43: Segment note (pre AASB 16) H1 FY22
Segment note (pre AASB 16) H1 FY22 For personal use only 43
Slide 44: Important notice and disclaimer
Important notice and disclaimer This presentation has been prepared by Super Retail Group Limited ABN 81108 676 204 ("SRG") and provides summary information about the activities of SRG and its subsidiaries current as at the date For personal use only of this presentation. The information in this pre