Future Retail — Debt Investor Presentation (March 2020)
27 slides from Future Retail's debt investor presentation, Mar 9, 2020
Slide 1: Cover letter to stock exchanges on investor call
FUTURE RETAIUI 09th March, 2020 To, Dept. of Corporate Services (CRD) Listing Department BSE Limited National Stock Exchange of India Limited Phiroze Jeejeebhoy Towers, Sandra Kurla Complex, Dalal Street, Sandra East, Mumbai - 400 001 Mumbai - 400 051 Scrip Code: 540064 Symbol: FRETAIL Scrip Code of
Slide 2: Investor Update March 2020
y UTUREREDILE / 46 | | | ll | = \ \ \ Nez \ Ne March 2020 \
Slide 3: FUTURE RETAIUIIII .c
),' FUTURE RETAIUIIII tn 1 Update on Operations »» » 03 I • C: Cl) 2 Impact of COVID-19 >»> » 12 I • C: 3 USD Notes Issuance & Key Updates »» » 14 0 0 4 Liquidity Profile and Principal Uses of Cash »» » 16 ••0 5 Promoter Company & Pledge Shares »» » 21 Details Cl) Appendix .c 6 »» » 24 ~ FRL | Updat
Slide 4: Update on Operations
Update Update on on Operations Operations ~~~~~~~~~~~~~~=,~~ )))))o - -- o--------------- >>>>>------------ - ----· FRL | Update | March 2020 - - - - - - - - - - - - - - 0 »» »» 0 3 3
Slide 5: FRL: At a glance (1/2)
FRL: At a glance (1/2) FUTURE RETAIUllf Delivering one of the highest margin profiles Strong scale and efficiency profile Unparalleled network strength… Scale Depth Efficiency 65% 24% of FRL stores in Tier-I cities of FRL stores in Tier-III and • 1,388 Retail stores >350 mn Customer footfalls1 ~11%
Slide 6: FRL: At a glance (2/2)
), FRL: At a glance (2/2) FUTURE RETAIUIIII Entrenched Consumer-centric National Platform India's leading multi format pan India retailer 666 stores 164 stores 74 565 Big Bazar Easyday/WHSmith 75 Big Bazar #1 14.9% ( Fashion 67 Easyday/WH Smith Leading 22 fbb market player Market share 2 destination
Slide 7: FRL: Retail Network Overview
), FRL: Retail Network Overview FUTURE RETAIUIIII Fulfilling consumer needs across food, fashion & home # # of Scale Category Brands # # of cities Partner stores stores (FY19 Revenue (3) (3))) 290 148 Large Stores Large Stores BIG AZAAR: 290 148 Rs Rs 163,276 163,276 Mn Mn amazon ~ fbD 95 48 ., 95 4
Slide 8: Diverse and well-respected Board of Directors overseeing governance
), Diverse and well-respected Board of Directors overseeing governance FUTURE RETAIUIIII Kishore Biyani Rahul Garg Executive Chairman Non-Executive Director • Has over 40 years experience in the field of • Partner and Co-Head of India based Private manufacturing, marketing of ready-made Equity of Pr
Slide 9: 9M Like for Like Operating Performance (Without Ind AS 116)
), 9M Like for Like Operating Performance (Without Ind AS 116*) FUTURE RETAIUIIII Continuing to post robust growth in business Gross Margin Commentary Income from Operations (% / ₹ Mn) (₹ Mn) 43,604 1. In order to do a like for like 6.1% 156,730 147,683 39,393 10.7% comparison, the numbers depicted
Slide 10: FRL Financial Overview
), FRL Financial Overview FUTURE RETAIUIIII Consistent improvement in operating & financial metrics thereof Total Revenue (Rs. bn) Gross Margin (%) 27.8% 201.6 184.8 26.7% 26.7% 170.8 147.7 156.7 25.6% 24.8% 1 1 1 1 FY17 FY18 FY19 9M FY19 9M FY20 FY17 FY18 FY19 9M FY19 1 9M 1FY20 EBITDA (Rs. bn)/ EB
Slide 11: Update on Strategic Plans
), Update on Strategic Plans FUTURE RETAIUIIII Driving efficiencies, deleveraging and enhancement of leadership Optimisations, Efficiencies & Balance Sheet Deleveraging Enhancement of Leadership Expansions FRL has pruned its fixed costs Equity infusion of Rs 15,000 Mn Mr. Kishore Biyani, who a
Slide 12: Strategic Collaborations with Global Best
), Strategic Collaborations with Global Best FUTURE RETAIUIIII Best in their core domains are FRL’s strategic partners for Incremental Business Amazon Partnership 7‐Eleven Partnership Prime now deliveries through Future Retail •·····················································. Key Beneficiary ~
Slide 13: Impact of COVID-19
Impact Impact of of COVID-19 COVID-19 ~~~~~~~~~~~~~~~~½ >>>>> o - - - 0------------- >>>>>------------ - ---- FRL | Update | March 2020 - - - - - - - - - - - - - - @»» »» 0 12 1 2
Slide 14: Impact of COVID-19: Relatively Low Impact on FRL's business
), Impact of COVID - 19 FUTURE RETAIUIIII Relatively Low Impact on FRL’s business First case was reported on 31st Dec 2019 in Wuhan – China and since then 100,000+ cases confirmed in more than 100 countries China accounts for 13% of world exports and 11% of world imports & the lockdown has affec
Slide 15: USD Notes Issuance & Key Updates
USD USD Notes Notes Issuance Issuance & & Key ~ Updates Updates ---------------------- ---------.,)>>>> 0 - 0------------------------>>>>>---------- - - ----· FRL | Update | March 2020 - - - - - - - - - - - - - - 0 »» »» 0 14 1 4
Slide 16: Key Updates post USD Notes Issuance
), Key Updates post USD Notes Issuance FUTURE RETAIUIIII On track for security perfection and fall away of cross-guarantees S. Particulars Details / Timelines Status Remarks No. Fair Value of Valuation report and Fairness opinion obtained from agencies of 1 Assets to be Value of Rs. 39,516 Mn intern
Slide 17: Liquidity Profile and Principal Uses of Cash
Liquidity Liquidity Profile Profile and and Principal Uses of Cash ----------------------- -----------0))>>> 0 - 0------------------------>>>>>---------- - - ----· FRL | Update | March 2020 - - - - - - - - - - - - - - @»» »» 0 16 1 6
Slide 18: Debt Position: Movement in Debt
), Debt Position FUTURE RETAIUIIII Rs. Mn 35,600 Movement in Debt 60,421 39,821 (15,000) As on 30-Sep-2019 Proceeds from $ Bond Issuance Reduction from Warrants Where does these two major Conversion changes lead us today? Since Sep’2019 the two largest changes to debt position have been: Increas
Slide 19: Debt Maturity Profile & Liquidity Assessment
), Debt Maturity Profile & Liquidity Assessment FUTURE RETAIUIIII 59% 30% WC Facilities (Tenor: 1-yr revolver) Total Debt of Dollar Bond Rs 60,421 Mn (Tenor: 5-yrs), INR Term Loans/NCD (Tenor: Avg. 2.5 yrs) 11% With respect to the long-term borrowings, only c. Rs. 1,500 Mn is due for payment in FY
Slide 20: WC Requirement & Capex Plans
), WC Requirement & Capex Plans FUTURE RETAIUIIII Principal uses of cash Working Emphasis is on following tight WC management policy through following measures: Capital Reduction in inventory days: sharper buying, cutting long tail of SKUs, supply Requirements chain initiatives, better inventory
Slide 21: Resultant Outcome
), Resultant Outcome FUTURE RETAIUIIII The multipronged approach of: Driving operating efficiencies Focus on working capital and potential release thereof Calibrated approach in capex Enhancement of leadership To ensure further enhancement of existing EBITDA and operating cashflows thereof. FRL | Up
Slide 22: Promoter Company & Pledge Shares Details
Promoter Company & & Pledge Shares Shares Details --------- ------------- -----------0))>>> 0 - 0------------------------>>>>>---------- - - ----· FRL | Update | March 2020 - - - - - - - - - - - - - - @»» »» 0 21 2 1
Slide 23: Promoter Company & Pledge Share Details
), Promoter Company & Pledge Share Details FUTURE RETAIUIIII FRL Shares linked debt at Encumbrance levels in Maturity profile of this FRL shares linked debt holding companies FRL shares at holding companies INRmn 29,214 6yrs 27,290 2.7 yrs Sep-19 At Present Nov-19 At Present Average Door to Door Not
Slide 24: FRL – Shareholding Structure
), FRL – Shareholding Structure FUTURE RETAIUIIII FRL Shareholding (Dec 19) Future Corporate Resources Pvt Ltd 51% 49% Future Coupons Pvt Ltd Public Promoter Shareholding in FRL After 1st April 9.8%* As on Date 2020 41.1% 1 )r Total Shares outstanding 527,398,439 542,202,399 FUTURE RETAIUIIII 49.1%*
Slide 25: Appendix
Appendix Appendix ~~~~~~~~~~~~~~~~~ >>>~>~ > O- - - 0------------------------>>>>>------------ - ----· FRL | Update | March 2020 - - - - - - - - - - - - - - 0 »» »» 0 24 2 4
Slide 26: 9M Operating Performance (With Ind AS 116)
), 9M Operating Performance (With Ind AS 116) FUTURE RETAIUIIII Continuing to post robust growth in business Gross Margin (*) Commentary: Income from Operations (*) (% / ₹ Mn) 1. EBITDA Margin on account of (₹ Mn) 43,604 Ind AS 116 is 13.1% vis-à-vis 156,730 147,683 6.1% 39,393 10.7% the EBITDA with
Slide 27: Future Retail: Right Next To You
),' FUTURE RETAIUIIII FUTURE RETAIL: RIGHT NEXT TO YOU This report contains forward-looking statements, which may be identified by their use of words like ‘plans’, ‘expects’, ‘will’, ‘anticipates’, ‘believes’, ‘intends’, ‘projects’, ‘estimates’, or other words of similar meaning. All statements that
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