Cnova NV — H1 2020 Earnings Presentation
23 slides from Cnova NV's earnings presentation, Jul 23, 2020
Slide 1: Cnova First Half 2020 Activity & Financial Performance
Cnova First Half 2020 Activity & Financial Performance July 23, 2020
Slide 2: Disclaimer
Disclaimer Forward-Looking Statements This presentation contains forward-looking statements. Such forward-looking statements may generally be identified by, but not limited to, words such as “anticipate,” “assume,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “poten
Slide 3: Agenda
Agenda 2Q20 Business Highlights & Strategic Update 1H20 Commercial & Financial Performance Outlook 3
Slide 4: 2nd Quarter 2020 Business Highlights & Strategic Update
2nd Quarter 2020 Business Highlights & Strategic Update Main Highlights Covid-19: Cnova remained fully operational and successfully reacted to handle an increasing demand 1 2 3 Strong GMV Accelerating Dynamic client growth marketplace recruitment 2Q20 Total GMV 2Q20 Marketplace GMV 2Q20 Customer bas
Slide 5: Covid-19 update: Cnova remained fully operational
Covid-19 update Company maintained fully operational Cnova remained fully operational, keeping employees’ safety first ▪ All headquarter employees have been working from home from 16/03 ▪ All 10 warehouses have been fully operational under strict sanitary measures (temperature check) Safety policy w
Slide 6: 3 axes to successfully face Covid-19 impacts on the business activity
Covid-19 update Cnova quickly reacted to successfully face pandemic impact 3 axes to successfully face Covid-19 impacts on the business activity 1 Delivery ▪ Reduced the minimum basket for free home delivery to 25€ adaptation ▪ Transferred orders to express carriers to offset the reduction of nation
Slide 7: 2nd Quarter 2020 Strategic Update
Agenda 2nd Quarter 2020 Strategic Update ➔ Booming Product Sales Expanding B2C ➔ Marketplace Acceleration Products & Services ➔ Services Expansion Fast-growing customer ➔ Strong Customer Growth base driven by enhanced UX ➔ Delivery Time Reduction Developing profitable ➔ Ramping Up B2B Offers busines
Slide 8: +25% GMV growth in 2Q20 driven by accelerating product sales
Expanding B2C Products & Services +25% GMV growth in 2Q20 driven by accelerating product sales Marketplace and Direct Sales contributed for 20 pts to GMV growth over the quarter Product mix evolution towards more recurring and high margin categories 2Q20 GMV growth acceleration +72% +54% +30% Toys G
Slide 9: Acceleration of the marketplace
Expanding B2C Products & Services Acceleration of the marketplace 2Q20 Marketplace share Total SKUs available FFM SKUs available In millionS In thousands 4.6 % 4.4 % +6.2 pts +29% +57% 4.2 % 71 99 4.0 % 46.3% 3.8 % 55 3.6 % 40.1% 63 3.4 % 3.2 % 2Q19 2Q20 2Q19 2Q20 2Q19 2Q20 ▪ Dynamic marketplace GMV
Slide 10: Service expansion still dynamic in a challenging context
Expanding B2C Products & Services Service expansion still dynamic in a challenging context A fast-growing energy offer ▪ Launch of a 100% French and renewable energy offer ▪ Strong +79% subscriber base growth and +57% GMV over the quarter Strongly impacted by Covid, travel is bouncing thanks to incr
Slide 11: Customer growth driven by new, loyal clients and traffic dynamism
Fast-growing customer base Customer growth driven by new, loyal clients and traffic dynamism Strong customer growth driven by new clients Total clients (in millions) ▪ 4.3m clients in 2Q20: +25% growth +25% • Of which close to 1m new clients: +41% growth 3.4 4.3 2Q19 2Q20 ▪ Strong re-purchase trend:
Slide 12: Best-positioned to answer new delivery environment
Fast-growing customer base Best-positioned to answer new delivery environment Best-in class 8 large cities delivered same-day 1.3m SKUs eligible to express delivery delivery 55% of small parcels express delivered 24k pickup points network1 1 Shifting to home delivery 2 Reducing delivery times Home d
Slide 13: Developing our B2B monetization
Developing new profitable businesses Developing our B2B monetization B2B monetization platform: +23% in 1H20 Growing our suppliers and marketplace sellers’s business 2 specialized teams For our 1,500 suppliers For our 12,000 sellers An efficient Product sponsoring Display digital marketing ◼ More pr
Slide 14: Acceleration of international development
Developing new profitable businesses Acceleration of international development A fast-growing asset-light model generating increasing revenues Existing partnerships with European players 25 countries 88 websites connected x2.5 vs n-1 x2 GMV growth in 2Q20 14
Slide 15: Supporting the French economy and citizens through COVID
Solidarity actions Supporting the French economy and citizens through COVID Supporting the French economy ▪ Maintaining French SMEs activity: simplified marketplace enrollment and new local delivery feature ▪ Lead B2B masks supplier: 40m masks distributed to SMEs, professionals and public institutio
Slide 16: Agenda
Agenda 2nd Quarter 2020 Business Highlights & Strategic Update 1H20 Commercial & Financial Performance Outlook 16
Slide 17: GMV underlying growth drivers
1H20 Commercial & Financial Performance GMV underlying growth drivers Solid organic growth driven by an accelerating marketplace +5.2pts1 +24.8% +13.5pts -0.7pt +2.7pts +12.0% +1.4pts +6.7pts +6.9pts +1.2pts 1H20 2Q20 ▪ Marketplace: the driving force of 1H20 growth, with a +20% growth and +39% in 2Q
Slide 18: Gross margin
1H20 Commercial & Financial Performance Gross margin Gross margin (% of net sales, € million, y-o-y growth) ▪ Strong +2.8 pts acceleration in gross margin as well as strong double- 250 001.50 digit growth in gross profit thanks to: 20.3% +2.8 pts • Marketplace GMV share reaching Gross profit 200 001
Slide 19: SG&A
1H20 Commercial & Financial Performance SG&A SG&A (% of net sales) ▪SG&A accounted for 19.4% of net sales in 1H20, increasing by +0.5 points y-o-y 19.4% • Fulfillment (8.4%; +0.2 pt): full year 18.9% 2.4% 2.3% impact of the new 60,000 sqm warehouse 4.9% • Marketing (3.7%; -0.2 pt): increased free 4.
Slide 20: EBITDA
1H20 Commercial & Financial Performance EBITDA EBITDA1 (€ million) Before IFRS 16 After IFRS 16 restatement restatement ▪EBITDA +€30m increase to reach €48m 48.4 • Outstanding marketplace growth +30.3 32.4 • Direct sales margin improvements • Increased monetization revenues +27.4 18.1 5.0 1H19 1H20
Slide 21: LTM Free Cash Flow
1H20 Commercial & Financial Performance Free Cash flow of €36m on a 12-month basis LTM Free Cash Flow (€ million, twelve months) Other cash Repayment Change in FCF before FCF from Change in Financial EBITDA operating & interests Working Net CAPEX financial continuing Other net financial expenses exp
Slide 22: Agenda
Agenda 2nd Quarter 2020 Business Highlights & Strategic Update 1H20 Commercial & Financial Performance Outlook 22
Slide 23: Outlook: Growth & Profitability
Outlook 3 strategic priorities levered on a unique combination of assets 1 Fast expanding marketplace supported by the strong growth of Fulfilment by Cdiscount 2 Increased B2B revenues driven by digital marketing platform and new B2B offers 3 International expansion leveraging our products catalog a