Baby Bunting Group Ltd. · ASX:BBN
Baby Bunting — Shareholder Meeting (October 2020)
24 slides from Baby Bunting's shareholder meeting presentation, Oct 6, 2020
Slide 1: Annual General Meeting
Annual General Meeting 6 October 2020 Ian Cornell Chairman Matt Spencer CEO & Managing Director
Slide 2: Important notice and disclaimer
Important notice and disclaimer This document is a presentation of general background information about the activities of Baby Bunting Group Limited (Baby Bunting) current at the date of the presentation (6 October 2020). The information contained in this presentation is for general background infor
Slide 3: Ian Cornell, Chairman
Ian Cornell Chairman
Slide 4: Our vision is to be the most loved baby retailer for every family
Our core purpose is to support new and expectant Our vision is to be the parents in the early years most loved baby retailer of parenthood for every family, everywhere
Slide 5: FY20 pro forma results summary
FY20 pro forma(1) results summary Total sales growth up 11.8% vs pcp (2) SALES SALES Comparable store sales(3) growth of 4.9% (1H 1.0%, 2H 10.5%) $405.2M $186.4M Online (including click & collect) growth of 39.1% (1H 10.5%, 2H 66.1%) GROSS Gross Profit income $146.9m, up 15.9% GROSS PROFIT Gross Pro
Slide 6: Growth strategy - grow market share
Growth strategy - grow market share Focused investment in capability, IT systems and supply chain to support growth 1 Investment in digital to deliver the best possible customer experience across channels and enable new business models 2 Investment to grow market share from our core business 3 Growt
Slide 7: Caring and supporting others is at the heart of our culture
Caring and supporting others is at the heart of our culture Baby Bunting is a values driven organisation that seeks to be a good and responsible corporate citizen. As we grow, we continue to consider the ways in which we operate and the impact we have 1 Keeping our Team Safe 2 Promoting a Diverse an
Slide 8: Ian Cornell, Chairman
Ian Cornell Chairman 8
Slide 9: Matt Spencer, CEO & Managing Director
Matt Spencer CEO & Managing Director 9
Slide 10: FY20 operational objectives
FY20 operational objectives SALES • Progress our transformation program & SALES $405.2M strategic investments to plan $186.4M UP 11.8% vs pcp Comp 4.9% • Grow gross margin without compromising value to the consumer GROSS GROSS PROFIT • Accelerate our Private Label & Exclusive 36.2% PROFIT Product st
Slide 11: COVID-19
COVID-19 Category mix (% of total sales) Supporting our Team 20% 19% 21% 26% Pandemic leave implemented, COVIDsafe working, acknowledgment gifts for our Team members 32% 34% 35% 37% Operational impacts 47% 47% 44% 37% Increased costs, inventory impacts & delays to online deliveries by 3rd parties Fe
Slide 12: Online performance returns
Online Sales - % of total sales Online performance returns 20.9% Our multi-channel retail experience delivers 11.8% 14.5% sales growth: 9.5% 6.4% • FY20 online sales (incl. C&C) were 14.5% of total sales 4.3% • 1H FY20 online sales affected by website performance issues post-implementation in July 2
Slide 13: Delivering Great Range at Low Prices Everyday
Delivering Great Range at Low Prices Everyday Best Buys (EDLP) - % of Total Sales 27% 24.9% We continue to invest in our Best Buys program. 19.6% 21.0% Best Buys (EDLP) now making up 27% of total sales during Q1 FY21, compared to ~24% vs pcp. 15.5% Our strategy is to differentiate against pure-play
Slide 14: Competitive landscape - our market expansion continues
Competitive landscape - our market expansion continues Baby Bunting leads the industry in a fragmented market Baby Bunting $2.4bn estimated addressable market (1) Baby Bunting store numbers by state (breakdown by category) Other $0.2 billion Cots, mattresses Food, Nappies, and nursery furniture Clot
Slide 15: Growth from New Markets: Network Plan upgraded to 100+ stores
Growth from New Markets Network Plan 100+ upgraded to STORE NETWORK PLAN Store roll-out 100+ 100+ stores On the back of significant market share growth and the changes in competitive landscape, Baby Bunting has capacity to grow its # of stores network of stores to 100+ • +90% of all sales (incl. onl
Slide 16: New Zealand
(1) New Zealand $450m+ addressable market Following on from our launch of shipping online orders to New Zealand, we are conducting a strategic review of the New Zealand market, including: • Understanding the overall market and different geographic & demographic segments • Deep-dive into customer & p
Slide 17: Transformation – investing to grow
Transformation – investing to grow FY20: $4m capex and $4m project expenses $2.6m write down of old brand assets FY21: ~$10m capex and ~$4m project expenses ~$1m write down of plant & equipment (old support office) Significant business transformation project pipeline continues Brand Modernisation Co
Slide 18: Supply Chain Strategy
Supply Chain Strategy Supply chain evolution to improve gross margin. Lower our cost to serve. Improve the customer experience through speed to market and increased on-shelf stock availability Online Fulfilment Leveraging our store network to improve the customer experience through speed to market a
Slide 19: Exciting times ahead
Exciting times ahead We remain focused on executing our growth strategy: • Expansion of our store network plan to 100+ stores and alternative store formats • Grow gross margin whilst delivering value • Introduction of new Private Label brands & expansion of Exclusive products • Expansion of our serv
Slide 20: FY21 outlook
FY21 outlook Positive sales momentum continues Sales reflect the less discretionary nature of the maternity and baby goods category. Year-to-date (as at 2 October 2020), comparable store sales growth1 is 17.0%. All Victorian stores remain open. Sales have moderated in Melbourne Metro during Stage 4
Slide 21: Appendices
Appendices
Slide 22: Appendix 1: Statutory - Pro Forma Income Statement Reconciliation
Appendix 1: Statutory - Pro Forma Income Statement Reconciliation FY2020 FY2019 Add Add Statutory Pro Forma Pro Forma Statutory Pro Forma Pro Forma FY20 Adj (a) FY20 FY19 Adj (a) FY19 $ million Sales 405.2 405.2 368.0 (5.7) 362.3 Cost of sales (258.3) (258.3) (239.6) 3.9 (235.7) Gross Profit 146.9 1
Slide 23: Appendix 2: AASB 16 Transition Impact - Pro Forma Income Statement
Appendix 2: AASB 16 Transition Impact - Pro Forma Income Statement FY2020 FY2019 Remove AASB 16 Recognise Remove AASB 16 Recognise Pro Forma Pre-AASB 16 Pro Forma Pre-AASB 16 Depreciation and Operating Lease Depreciation Operating Lease FY20 FY20 FY19 FY19 Interest Expenses and Interest Expenses $ m
Slide 24: Glossary
Glossary Comparable Store Sales Growth • Calculated as a percentage change of the total sales generated from stores (including the online store) in a relevant period, compared to the total sales from the same set of stores in the prior financial year, provided the stores were open at the beginning o
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