Samsonite Group S.a. · HKEX:1910
Samsonite — Q1 2019 Earnings Presentation
20 slides from Samsonite's earnings presentation, May 14, 2019
Slide 1: 2019 First Quarter Results
2019 First Quarter Results May 14, 2019
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 or b
Slide 3: Business Overview
Business Overview Page 3 Sams@nite
Slide 4: Underlying business performance is stable, but macro headwinds impacted 1Q 2019
Underlying business performance is stable, but continued macro-economic headwinds in select markets negatively impacted 1Q 2019 Downward pressure on constant currency net sales from market challenges in the U.S., China (B2B), South Korea and Chile as discussed during the 2018 annual results presenta
Slide 5: Net sales growth constrained by FX and select market challenges
Net sales growth was constrained by FX and select market challenges, with all other markets up 3.4%(1) Net Sales Bridge EUR ($9.6m) RMB ($4.2m) INR ($3.2m) KRW ($2.4m) CLP ($2.4m) All other ($13.4m) +3.4%(1) Strong Q1 2018 growth of Impacted by tariffs and lower foreign China +5.9%(1), 15.5%(1) with
Slide 6: IFRS 16 significantly increases Adjusted EBITDA as traditionally reported
IFRS 16 significantly increases Adjusted EBITDA as traditionally reported (which excludes lease-related amortization and interest expense) (1) (1) For comparative purposes, Management believes Adjusted EBITDA, including lease amortization and lease interest expenses is a more appropriate measure bec
Slide 7: Adjusted EBITDA decrease mainly due to lower net sales, increased SG&A and IFRS 16
Adjusted EBITDA decrease is mainly due to flow through of lower net sales, increased SG&A related to 2018 DTC expansion and impact of IFRS 16 Adjusted EBITDA Bridge Sales ($35.2m) COGS ($15.4m) Advertising ($1.8m) Non-advertising SG&A ($14.3m) (2) (1) (1) (1) (1) (1) Stated on a constant currency ba
Slide 8: Non-advertising SG&A increase mainly due to Europe retail expansion
Non-advertising SG&A(1) increase from 1Q 2018 is mainly due to Europe retail expansion during 2018, Tumi growth in Asia and the impact of IFRS 16 Non-advertising SG&A Bridge US$19.1 million (2) (2) US$4.2 million to US$7.5 million support retail related to retail expansion driving and e-commerce Tum
Slide 9: Decreased Adjusted Net Income driven by lower Adjusted EBITDA
Decreased Adjusted Net Income driven mainly by lower Adjusted EBITDA, partly offset by savings on interest expense and taxes Adjusted Net Income Bridge (2) (2) (2) (1) (1) Excludes lease interest expense (2) 1Q 2018 (IFRS 16)” presents the Group's financial performance on a comparable basis for the
Slide 10: 1st Quarter 2019 Results
1st Quarter 2019 Results Page 10
Slide 11: 1st Quarter 2019 Results Highlights
1st Quarter 2019 Results Highlights (2) (2) Net sales decrease of 2.4%(1) Gross margin was up 14bp from Excluding the negative impact of Excluding the negative impact compared to a very strong 1Q 1Q 2018 largely due to a higher IFRS 16, Adjusted EBITDA margin of IFRS 16, Adjusted Net 2018, with macr
Slide 12: Excluding headwinds in four markets, 1Q 2019 sales growth was 3.4%
Excluding headwinds in four markets, 1Q 2019 sales growth was 3.4%(1) -6.1%(1) -43.3%(1) -7.6%(1) -12.6%(1) Tariff potential impact on B2B net sales, which made up Weakened consumer Lower retail traffic due to consumer sentiment affecting U.S. 28.8% of total China net sales sentiment from geopolitic
Slide 13: IFRS 16 significantly increases Adjusted EBITDA as traditionally reported
IFRS 16 significantly increases Adjusted EBITDA as traditionally reported (which excludes lease-related amortization and interest expense), but slightly reduces Adjusted Net Income. 1Q 2018 Adjusted 1Q 2018 IFRS 16 1Q 2018 (2) (2) Reported Adjustments (IFRS 16 Basis) 1Q 2019 Net sales 888.2 - 888.2
Slide 14: 1st Quarter Net Sales by Region
1st Quarter Net Sales by Region Constant Currency -6.2% -1.2% 2.3% -2.8% Growth +4.4%, excluding China B2B and South Korea Page 14
Slide 15: 1st Quarter Net Sales by Brand
1st Quarter Net Sales by Brand Net Sales Growth by Brand Samsonite net sales down 4.2%(1), primarily due to the economic headwinds in the U.S., China and South Korea. Excluding these three markets, Samsonite net sales were close to flat(1). Tumi net sales growth of 8.5%(1) with strong growth in Asia
Slide 16: Direct-to-consumer net sales continue to increase
Direct-to-consumer (“DTC”) net sales continue to increase as a percentage of the total business, driven by strong e-commerce growth DTC Net Sales Total DTC net sales growth of 4.5%(1), with 36.4% of total Company net sales coming from DTC channels in 1Q 2019 compared to 33.9% in 1Q 2018. Retail net
Slide 17: Non-travel net sales continue to become a larger proportion of the business
Non-travel net sales continue to become a larger proportion of the total business Net Sales by Category Non-travel net sales represented 41.7% of total 1Q 2019 net sales, up 120bp from 40.5% of total 1Q 2018 net sales. Constant Currency -4.4% 0.6% Growth Page 17 (1) Stated on a constant currency bas
Slide 18: 1st Quarter Advertising Spend
1st Quarter Advertising Spend Total Company advertising spend decreased by US$3.4 million, keeping spend as a percentage of sales roughly in line with prior year. 2018 focused on a global American Tourister advertising campaign and Tumi. The focus for 2019 is on the Samsonite and Tumi brands. Indica
Slide 19: Balance Sheet
Balance Sheet US$m March 31, December 31, March 31, $ C hg M a r- 19 % C hg M a r- 19 2018 2018 2019 v s . M a r- 18 v s . M a r- 18 Despite inventory levels being lower than Cash and cash equivalents 299.5 427.7 392.1 92.5 30.9% the same time last year, net working capital Trade and other receivabl
Slide 20: Working Capital
Working Capital Net working capital as of March 31, 2019 was 16.7% of net sales, which was above US$m March 31, March 31, $ Chg Mar-19 % Chg Mar-19 target levels due to lower than usual trade 2018 (1) 2019 vs. Mar-18 vs. Mar-18 payables and lower 1Q 2019 sales. Working Capital Items Inventory has be