Tribhovandas Bhimji Zaveri Limited · NSE:TBZ
Tribhovandas Bhimji Zaveri — Q3 FY2015 Earnings Presentation
32 slides from Tribhovandas Bhimji Zaveri's earnings presentation, Feb 4, 2015
Slide 1: Investor presentation Q3 & 9M FY15 results update
Investor presentation Q3 & 9M FY15 results update 04th February, 2015
Slide 2: Disclaimer
disclaimer This presentation has been prepared by Tribhovandas Bhimji Zaveri Limited (“TBZ”) for informational purposes only and does not constitute or form any part of any offer, invitation or recommendation to purchase or subscribe for any securities in any jurisdiction, and no part of it shall fo
Slide 3: Discussion summary
discussion summary Q3 & 9M FY15 Results Update 04 – 12 About Us 14 – 18 Financial & Operational Summary 20 – 22 Annexure 25 – 32
Slide 4: Q3 FY15 results update: profit analysis
q3 fy15 results update profit analysis (rs mn) 18.5% Sales 18.4% 14.4% 6,125 EBITDA 48.2% 8.4% 5,171 3.7% PAT 66.0% 3.7% 1.1% 436 191 226 65 Q3 FY14 Q3 FY15 Sales EBITDA PAT Gross Margin EBITDA Margin PAT Margin operational efficiency (%) Q3 FY15 2.4% 5.2% 1.0% 2.2% Q3 FY14 3.5% 2.9% 1.4% 2.3% Salar
Slide 5: Q3 FY15 results update: revenue analysis
q3 fy15 results update revenue analysis (rs mn) 33.7% 31.2% 14.4% 9.6% 4,596 3,975 1,064 1,341 Q3 FY14 Q3 FY15 Gold Sales Diamond Sales Gold GM Diamond GM average ticket size (rs) Q3FY15 Gold Diamond % of Sales – Q3 FY15 75.0% 21.9% 1,33,631 1,44,033 87,075 81,499 % of Sales – Q3 FY14 76.8% 20.6% Sa
Slide 6: 9M FY15 results update: profit analysis
9M fy15 results update profit analysis (rs mn) 17.6% 13.8% Sales 7.2% 14,712 EBITDA 50.3% 13,729 7.3% 3.4% PAT 82.5% 3.2% 0.5% 1,005 434 499 76 9M FY14 9M FY15 Sales EBITDA PAT Gross Margin EBITDA Margin PAT Margin operational efficiency (%) 9M FY15 3.0% 3.7% 1.2% 2.4% 9M FY14 3.7% 2.6% 1.2% 2.4% Sa
Slide 7: 9M FY15 results update: revenue analysis
9M fy15 results update revenue analysis (rs mn) 33.7% 29.4% 12.9% 9.0% 10,584 11,040 2,897 3,350 9M FY14 9M FY15 Gold Sales Diamond Sales Gold GM Diamond GM average ticket size (rs) 9M FY15 Gold Diamond % of Sales – 9M FY15 75.1% 22.9% 1,44,741 1,29,846 % of Sales – 9M FY14 77.1% 21.1% 80,828 83,175
Slide 8: Balance sheet update
balance sheet update inventory breakup (%) 6.6% 8.6% 21.0% 40.1% 40.4% 53.0% 79.0% 53.3% 51.0% 47.0% FY14 Dec-14 FY14 Dec-14 Others Diamond Gold Gold on Loan Own Gold leverage (rs mn) 1.1 1.1 1.1 1.1 4,952 4,827 5,031 5,123 4,476 4,440 4,477 4,554 Mar-14 Jun-14 Sep-14 Dec-14 Equity Net Debt Net Debt
Slide 9: Business scenario
business scenario Improved macro economic indicators – positive consumer sentiments, decrease in inflationary pressure, decline in oil prices. Relaxation of 80:20 gold import regulation; however customs duty remains unchanged. Improved gold availability resulting in negligible gold price premi
Slide 10: Key result takeaways
key result takeaways Q3 FY15 sales grew 18.4% YoY driven by higher footfalls (up 15.6%) and higher average ticket size (up 2.8%). Gold : Diamond mix improved from 76.8 : 20.6 in Q3 FY14 to 75.0 : 21.9 in Q3 FY15. Gross margin was largely impacted by the gold price volatility and tactical disco
Slide 11: Results update – Dec 2014
results update – dec 2014 particulars (in mn) Q3 Q3 Q2 9M 9M YoY QoQ YoY FY14 (Quarterly FY15 FY14 FY15 FY15 FY14 % % % (₹) unaudited) (₹) (₹) (₹) (₹) (₹) Revenues 6,125 5,171 18.4% 4,263 43.7% 14,712 13,729 7.2% 18,181 COGS 5,241 4,214 24.4% 3,688 42.1% 12,681 11,308 12.1% 15,096 Gross Profit 884 9
Slide 12: Results update – Dec 2014
results update – dec 2014 particulars (in mn) DEC-14 SEP-14 JUN-14 MAR-14 (Quarterly unaudited) (₹) (₹) (₹) (₹) Shareholders Funds 4,554 4,477 4,440 4,476 Loan Funds 5,568 5,654 5,500 5,680 Other Long Term Liabilities 49 47 45 63 Sources of Funds 10,172 10,178 9,985 10,219 Gross Block 1,328 1,299 1,
Slide 13: Discussion summary
discussion summary Q3 & 9M FY15 Results Update 04 – 12 About Us 14 – 18 Financial & Operational Summary 20 – 22 Annexure 25 – 32
Slide 14: About us: why is TBZ different?
about us: why is tbz different ? Pedigree Strong Brand Value 150 years in jewellery business High sales productivity - First jeweller to offer buyback ₹ 274 k per sq ft per annum (at guarantee in 1938 mature stores) Professional organisation High footfalls conversion - 80% spearheaded by 5
Slide 15: About us: key milestones
about us: key milestones Strong legacy of around 150 years build on trust Flagship store Introduced 100% Diamond facility Recommended opened in Zaveri pre-hallmarked expansion - ~6k special dividend Bazaar, Mumbai jewellery to ~24k sq ft of 7.5% on the special occasion First to launch Turnover cross
Slide 16: About us: shareholding structure
about us: shareholding structure shareholding pattern – dec 2014 public 15.96% 9.94% institutional promoters 74.10% Key institutional investors % Holding Smallcap World Fund INC 6.50% HSBC Global Investments 4.05% Goldman Sachs India Fund 1.11% 16
Slide 17: About us: retail presence
about us: retail presence Present across 22 cities Pan-india presence with 28 stores in 10 states with a retail space of ~91,000 sq ft. spread across 22 cities in 10 states. Number of Stores Till date Large Format 22 Small Format 6 Tier I 17 Tier II 4 Metros 7 Total Stores 28 Total Area ~91,000 17
Slide 18: About us: retail footprint expansion
about us: retail footprint expansion High Sales productivity (revenue / year / sq ft) 91,058 ₹301 88,093 82,368 ₹270 ₹255 ₹ 214 ** ₹204 ₹ 214 47,796 44,196 44,196 27 28 25 14 14 14 FY10 FY11 FY12 FY13 FY14 9M FY15 Carpet Area (sq ft) No. of Retail Outlets Revenue / average sqft * (₹ ’000 / sq ft) *
Slide 19: Discussion summary
discussion summary Q3 & 9M FY15 Results Update 04 – 12 About Us 14 – 18 Financial & Operational Summary 20 – 22 Annexure 25 – 32
Slide 20: Financial summary
financial summary revenues (rs mn) ebitda (rs mn) pat (rs mn) 18,243 850 CAGR - 20% CAGR – 29% 1,476 CAGR – 35% 16,583 1327 1,221 13,855 11,939 572 551 888 8,849 392 6,689 484 322 168 104 FY09 FY10 FY11 FY12 FY13 FY14 FY09 FY10 FY11 FY12 FY13 FY14 FY09 FY10 FY11 FY12 FY13 FY14 margins (%) leverage &
Slide 21: Operational summary
operational summary gold & diamond volumes gold & diamond sales mix (%) 51,995 53,220 48,662 4,361 75% 77% 43,808 73% 73% 72% 41,726 4,110 3,792 3,710 3,654 25% 22% 22% 23% 21% FY10 FY11 FY12 FY13 FY14 FY10 FY11 FY12 FY13 FY14 Gold Sales (Kgs) Diamond Sales (cts) Gold Diamond gold & diamond margins
Slide 22: Operational summary
operational summary sssg - total (%) sssg - gold (%) sssg - diamond (%) 31.3 34.2 28.2 29.6 31.2 24.1 -5.1% 11.2 12.2 excl. 12.0 9.1 9.0 coins 4.6 3.5 -0.2 -8.6 -9.9 -9.3 -15.8 FY09 FY10 FY11 FY12 FY13 FY14 FY09 FY10 FY11 FY12 FY13 FY14 FY09 FY10 FY11 FY12 FY13 FY14 average ticket size (rs ‘000) foo
Slide 23: Thank you
Thank you Prem Hinduja, CEO Nilesh Dalvi Tribhovandas Bhimji Zaveri Limited Dickenson Seagull IR +91 022 30735000 +919819289131 prem.hinduja@tbzoriginal.com nilesh.dalvi@dickensonir.com
Slide 24: Annexure
annexure
Slide 25: Awards & recognition
awards & recognition “Asia’s most promising brands – 2014 ” World Consulting & Research Corporation (WCRC) - 2014 “Best jewellery company award” Gems & Jewellery Trade Council of India Excellence Awards - 2014 “Best diamond jewellery & bracelet design” Indian Jeweller Jeweller’s Choice Design
Slide 26: Business model: product
business model: product Wedding (65%) Gold Gross Margins – 11% (75%) Stock Turns – 2.5x - 3x Fashion (35%) Wedding (40%) ₹ 18,243 mn Diamonds Gross Margins – 35% FY14 (25%) Stock Turns – 1x Fashion (60%) Wedding sales to drive strong volumes Wedding & fashion sales to drive future growth 26
Slide 27: Business model: manufacturing (gold)
business model: manufacturing Gold Procurement Raw Material - Bullion Sources: Exchange & purchase of old jewellery Bullion dealers Banks - imported gold Banks - domestic gold (gold deposits) on loan Gold jewellery manufacturing is outsourced. Vast nation-wide network of 150 vendors
Slide 28: Business model: manufacturing (diamond)
business model: manufacturing Diamond Procurement Raw Material - Cut & polished diamonds (VVS grade) Sources: DTC site holders Other vendors In-house diamond jewellery manufacturing leading to exclusive designs, lower costs, and higher margins Manufacturing Manufacturing facility at Kandiv
Slide 29: Business model: retail
business model: retail Efficient Inventory Management Hub & spoke model - roi optimisation Small Stores 1,000 - 1,500 sq ft Across the city SMALL Smaller range STORE Lower price points (up to ₹ 500k) Inventory - ₹ 93 mn Gold : Diamond - 70 : 30 SMALL LARGE FORMAT SMALL Large Stores STORE S
Slide 30: Business model: economics
business model: economics Particulars Large Format Small Format Size sq ft Above 3,000 1,000 – 1,500 Average Sales per sq ft in Year 1 (₹) 250,000 250,000 Gold : Diamond 75:25 75:25 Gross Margin - Gold : Diamond 11% : 35% 11% : 35% Blended Gross Margins 17.2% 17.2% Store Costs: Advertising 2.5% 2.5%
Slide 31: Business model: scalability
business model: scalability TBZ has an aggressive expansion plan of tripling its retail network from 50,000 sq ft in FY12 to around 150,000 sq ft. TBZ has a plan to open 43 new stores (25 large format stores with average space of 3,000 sq ft and 18 small format stores with average space of 1,000
Slide 32: Gold metal loan: efficient sourcing channel
gold metal loan : efficient sourcing channel gold metal loan origination gold metal loan repayment TBZ takes 10 kg gold from a bank on lease on day 0. TBZ repays the gold daily based on actual sales of gold The contract for gold lease is 180 days. jewellery. TBZ provides a bank guarantee wor
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