Kering Sa · EURONEXT:KER
Kering Sa — Shareholder Meeting (April 2016)
64 slides from Kering Sa's shareholder meeting presentation, Apr 29, 2016
Slide 1: Combined Annual General Meeting
COMBINED ANNUAL GENERAL MEETING Palais Brongniart - Paris FRIDAY, APRIL 29, 2016
Slide 2: Opening Remarks
2016 ANNUAL GENERAL MEETING OPENING REMARKS François-Henri Pinault Chairman & CEO
Slide 3: Agenda and Regulatory Issues
2016 ANNUAL GENERAL MEETING A G E N D A A N D R E G U L AT O R Y I S S U E S Eric Sandrin Group General Counsel
Slide 4: Contents
CONTENTS • Full-Year 2015 highlights and financial results analysis • Strategy and Outlook • Sustainability • Governance • Conclusion • Statutory Auditors’ reports • Questions & Answers • Resolutions and vote
Slide 5: Introduction
2016 ANNUAL GENERAL MEETING INTRODUCTION François-Henri Pinault Chairman & CEO
Slide 6: Full-Year Highlights and Financial Results Analysis
2016 ANNUAL GENERAL MEETING F U L L - Y E A R 2 0 1 5 H I G H L I G H T S A N D F I N A N C I A L R E S U LT S A N A LY S I S Jean-François Palus Group Managing Director
Slide 7: Full-Year 2015 Highlights
FULL-YEAR 2015 HIGHLIGHTS GROUP REVENUE DYNAMICS GROUP REVENUE BREAKDOWN Change in % By region, and comparable growth in % FY 13 FY14 FY 15 RoW 10% (+3%) Western 15,4% Europe 31% (+10%) Asia Pacific FY 2015 26% (-1%) revenue 4,0% 4,5% 4,6% 4,0% €11.6bn 0,1% Japan North America Comparable Croissance
Slide 8: 2015 Operating Performance
2015 OPERATING PERFORMANCE GROUP RECURRING OPERATING INCOME GROUP EBITDA In €m, change and recurring operating margin in % In €m, change and EBITDA margin in % +3% -1% 1 664 -44 +65 2 056 +27 1 647 -5% +6% +3% 1 991 0 16,6% 14,2% 17,8% 19,8% 2014 H1 change H2 change 2015 2014 H1 change H2 change 201
Slide 9: Luxury Activities
LUXURY ACTIVITIES 2015 revenue: +16.4% reported; +4,1% comparable Solid operating performance X%: comparable growth +7% -3% 0% 7,865 +2% +10% 6,759 2014 FX impact Scope Retail Wholesale Royalties 2015 and others In €m 2015 Reported change Revenue 7,865 +16.4% Recurring operating income 1,708 +2.5% R
Slide 10: Sport & Lifestyle Activities
SPORT & LIFESTYLE ACTIVITIES 2015 revenue: +13,5% reported; +5,9% comparable Confirmed growth trajectory X%: comparable growth +9% 3,683 +12% +6% -1% 3,245 +3% 2014 Western North Japan Asia Pacific RoW 2015 Europe America In €m 2015 Reported change Revenue 3,683 +13.5% Recurring operating income 95
Slide 11: Financial Performance
FINANCIAL PERFORMANCE In €m 2015 2014 11,584 10,038 Revenue 7,074 6,296 Gross margin Recurring operating income 1,647 1,664 Other non-recurring operating income and expenses (394) (112) Net financial charges (249) (197) Corporate income tax (322) (326) Share in earnings of associates (2) (1) Net res
Slide 12: 2015 Balance Sheet – Healthy Financial Structure
2015 BALANCE SHEET – HEALTHY FINANCIAL STRUCTURE CONDENSED BALANCE SHEET LIQUIDITY OVERVIEW (in €m) €23.8bn 1,770 €11.6bn Equity Non-current €18.5bn assets €3.1bn Non-current liabilities 693 Current 639 €3.3bn 593 liabilities 536 448 Current assets €4.2bn €5.8bn Gross debt Cash €1.1bn Actif Assets P
Slide 13: Unchanged Dividend
UNCHANGED DIVIDEND DIVIDEND PER SHARE (in €) 4.00 4.00 3.75 3.75 3.50 2011 2012 2013 2014 2015* DIVIDEND PAYOUT (in %) 102.2% 59.8% 61.6% 64.0% 59.4% 49.6% 41.8% 42.9% 37.3% 38.5% 2011** 2012** 2013** 2014 2015* %%du ofRNPG recurring net income, poursuivi group share courant %%du ofcash flow disponi
Slide 14: Share Price Performance
Dec-10 SHARE PRICE PERFORMANCE Mar-11 Dec-11 Mar-12 Dec-12 Mar-13 Dec-13 Mar-14 Dec-14 Mar-15 Dec-15 Mar-16 Jun-11 Jun-12 Jun-13 Jun-14 Jun-15 Sep-11 Sep-12 Sep-13 Sep-14 Sep-15 Kering CAC 40 Since January 1st, 2011: Kering up +34%, CAC 40 up +15% Thomson Reuters, performance as of March 31, 2016
Slide 15: Strategy and Outlook
2016 ANNUAL GENERAL MEETING S T R AT E G Y A N D O U T L O O K François-Henri Pinault Chairman & CEO
Slide 16: A Strategic Vision Based on Four Pillars
A STRATEGIC VISION BASED ON 4 AXES 1 MULTIBRAND MODEL 2 ORGANIC GROWTH VALUE CREATION BY GROUP 3 AND BRANDS 4 SUSTAINABILITY
Slide 17: Our Strategic Vision: Multibrand Model
OUR STRATEGIC VISION: FOUR PILLARS 1 MULTIBRAND MODEL PHASE I CONSTRUCTION • Balanced portfolio: SO FT LUXURY HARD LUXURY SPO RT&LI FESTYLE - of complementary brands - built through acquisitions and Flagship Gucci Boucheron brand developed through organic Pomellato Generalist Jewelry growth Dodo Pum
Slide 18: Our Strategic Vision: Organic Growth
OUR STRATEGIC VISION: FOUR PILLARS 2 ORGANIC GROWTH CAPITAL LEVER ACCELERATOR BRAND ATTRACTIVENESS SAME-STORE PERFORMANCE ONLINE PRESENCE • Creation: • Develop productivity and sales energy, audacity density • A fundamental vector • Optimize in-store product to build, disseminate & maintain • Produc
Slide 19: Our Strategic Vision: Value Creation
OUR STRATEGIC VISION: FOUR PILLARS 3 VALUE CREATION Focus on organic growth REVENUE Slower network expansion Optimization of geo-pricing OPERATIONS Higher store productivity RETURN Supply Chain Management Improved Adaptation of organizations return on invested capital & generation of WOR
Slide 20: Sustainability
2016 ANNUAL GENERAL MEETING S U S TA I N A B I L I T Y M a r i e - C l a i r e D a ve u Chief Sustainability Officer & Head of international institutional affairs
Slide 21: 2015 Highlights (1/2)
2015 HIGHLIGHTS (1/2) Release of our first Group Environmental Profit & Loss Account (EP&L) • In May: 2013 results published and open source of our methodology • In November: 2014 results published and launch of a “Live chat” on Twitter Publication of a report co-written with BSR (Business for Socia
Slide 22: 2015 Highlights (2/2)
2015 HIGHLIGHTS (2/2) BOTTEGA VENETA • Bottega Veneta Atelier in Montebello Vicentino obtained LEED* Certification at Platinum level and Carbon Neutral Certification BRIONI • Brioni introduced luxurious sustainable Merino fibres in its collection, which meet the utmost of standards in terms of trace
Slide 23: Our Social Programmes
OUR SOCIAL PROGRAMMES Launching the “Hercules” programme • A worldwide supplier management programme has been launched to enable the Group’s brands to monitor compliance with social, environmental and ethical issues • This programme is also designed to improve supplier relations and support them in
Slide 24: Raising Awareness Internally & Externally
RAISING AWARENESS INTERNALLY & EXTERNALLY Running the 5th edition of our “Kering Sustainability Awards” • Kering took the opportunity of awarding the winning teams of the 5th edition of its internal contest to organise a broader event dedicated to sustainability in Hong Kong - over 150 guests attend
Slide 25: Our Perspectives
OUR PERSPECTIVES As a testimonial to the right path the Group has taken, Kering was referenced as a leader by several bodies in 2015 • For the second consecutive year, Kering was named industry leader of the Dow Jones Sustainability Index (DJSI) World and Europe, retaining the top spot within the Te
Slide 26: Governance
2016 ANNUAL GENERAL MEETING GOVERNANCE Patricia Barbizet Vice-Chair of the Board of Directors
Slide 27: Current Composition of the Board of Directors
CURRENT COMPOSITION OF THE BOARD OF DIRECTORS 11 MEMBERS, INCLUDING 4 INDEPENDENT DIRECTORS • Mr. François-Henri Pinault – Chairman • Mrs. Patricia Barbizet – Vice-Chairwoman • Mr. Luca Cordero di Montezemolo • Mrs. Yseulys Costes (independent) • Mr. Jean-Pierre Denis (independent) • Mr. Philippe La
Slide 28: Operation of the Board of Directors
OPERATION OF THE BOARD OF DIRECTORS 8 meetings held in 2015 and 3 meetings since the beginning of 2016 Average Director’s attendance rate in 2015: 92% Main issues covered: • Determination of the Group’s strategic priorities • Review of annual and interim financial statements • Analysis of the Group'
Slide 29: Board Committees
5 BOARD COMMITTEES BOARD OF DIRECTORS STRATEGY AND REMUNERATION COMMITTEE DEVELOPMENT COMMITTEE • Philippe LAGAYETTE (Chairman) • Patricia BARBIZET (Chairwoman) • Patricia BARBIZET • Yseulys COSTES • Yseulys COSTES • Philippe LAGAYETTE • Jean-Pierre DENIS • François-Henri PINAULT AUDIT COMMITTEE SUS
Slide 30: Components of Gross Remuneration of Chairman & CEO and Group MD
COMPONENTS OF THE GROSS REMUNERATION OF THE CHAIRMAN & CEO AND OF THE GROUP MANAGING DIRECTOR A fixed salary (no employment contract for the CEO) A variable portion based on the Kering Group’s financial performance The amount is established on achieving (or exceeding) two specifically defined financ
Slide 31: Remuneration of the Chairman & CEO
COMPONENTS OF THE GROSS REMUNERATION OF THE CHAIRMAN & CEO For the year 2015 2014 2013 Fixed part (in €’000) 1,100 1,100 1,100 Variable part (in €’000) 1,159 1,561 1,239 Directors’ fees (in €’000) 127 121 177 Allowance and other benefits (in €’000) 19 20 19 Total cost 3,494 4,089 3,596 (incl. employ
Slide 32: Remuneration of the Group Managing Director
COMPONENTS OF THE GROSS REMUNERATION OF THE GROUP MANAGING DIRECTOR For the year 2015 2014* 2013 Fixed part (in €’000) 1,086 1,086 1,024 Variable part (in €’000) 947 1,276 949 Directors’ fees (in €’000) 188 132 142 Allowance and other benefits (in €’000) 1,240 1,240 580 Total cost 3,782 4,088 3,056
Slide 33: Composition of the Board of Directors
COMPOSITION OF T H E B O A R D O F D I R E C TO R S
Slide 34: Mrs. Laurence Boone
COMPOSITION OF THE BOARD OF DIRECTORS MRS. LAURENCE BOONE Graduated of the Faculty of Economics of Paris-X Nanterre University and has a PhD in economics from the London Business School Director of Kering’s Board from 2010 to 2014 Advisor of economic and financial affairs at the Office of the Presid
Slide 35: Mrs. Sophie L'Hélias
COMPOSITION OF THE BOARD OF DIRECTORS MRS. SOPHIE L’HÉLIAS Inactive member of the New York and Paris Bars. Holds an MBA from INSEAD, an LLM from the University of Pennsylvania, and a Masters of Laws from the Law schools of the University of Pantheon-Sorbonne-Paris I, following law studies at the Uni
Slide 36: Mrs. Sapna Sood
COMPOSITION OF THE BOARD OF DIRECTORS MRS. SAPNA SOOD Has an MBA from IMD Business School and Bachelor of Engineering in Chemical Engineering from the University of Sydney Started her career as an Applications Engineer with Fisher-Rosemount Held various senior positions within The Linde Group (Austr
Slide 37: Potential Composition of the Board of Directors
POTENTIAL COMPOSITION OF THE BOARD OF DIRECTORS 11 MEMBERS, INCLUDING 6 INDEPENDENT DIRECTORS • Mr. François-Henri Pinault – Chairman • Mrs. Patricia Barbizet – Vice-Chairwoman • Mrs. Laurence Boone (independent) • Mrs. Yseulys Costes (independent) • Mr. Jean-Pierre Denis (independent) • Mrs. Sapna
Slide 38: Conclusion
2016 ANNUAL GENERAL MEETING CONCLUSION François-Henri Pinault Chairman & CEO
Slide 39: Statutory Auditors' Reports
2016 ANNUAL GENERAL MEETING S TAT U T O R Y A U D I T O R S ’ R E P O R T S Frédéric Moulin Deloitte & Associés Statutory Auditor
Slide 40: Contents
CONTENTS • Report on the company financial statements • Report on the consolidated financial statements • Other reports issued by the Statutory Auditors
Slide 41: Report on the Company Financial Statements
REPORT ON THE COMPANY FINANCIAL STATEMENTS (resolution 1) Kering S.A. company financial statements: certification without qualification • Pages 321 - 322 of the Reference Document • In our opinion, the financial statements give a true and fair view of the financial position and the assets and liabil
Slide 42: Report on the Consolidated Financial Statements
REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS (resolution 2) Kering Group consolidated financial statements: certification without comment or qualification • Page 303 of the Reference Document • In our opinion, the consolidated financial statements give a true and fair view of the financial positi
Slide 43: Other Reports Issued by the Statutory Auditors (1/2)
OTHER REPORTS ISSUED BY THE STATUTORY AUDITORS (1/2) Report on internal control and risk management procedures • Page 174 of the Reference Document • We have nothing to report on the information in respect of the Company’s internal control and risk management procedures relating to the preparation a
Slide 44: Other Reports Issued by the Statutory Auditors (2/2)
OTHER REPORTS ISSUED BY THE STATUTORY AUDITORS (2/2) Special report on the authorization to grant existing free shares (resolution 15) • Authorization to grant existing free shares to employees, or certain categories thereof, as determined from among the employees of the Company or related companies
Slide 45: Q&A
Q&A
Slide 46: Resolutions and Vote
2016 ANNUAL GENERAL MEETING RESOLUTIONS AND VOTE Eric Sandrin Group General Counsel
Slide 47: First Resolution
FIRST RESOLUTION (acting as an Ordinary M eeting) Approval of the parent company financial statements for the year ended December 31, 2015
Slide 48: Second Resolution
SECOND RESOLUTION (acting as an Ordinary M eeting) Approval of the consolidated financial statements for the year ended December 31, 2015
Slide 49: Third Resolution
THIRD RESOLUTION (acting as an Ordinary M eeting) Appropriation of 2015 net income Distribution of cash dividend of €4.00 (*) per share (*) corresponding to an interim dividend of €1.50 per share paid on January 25, 2016, and a final dividend of €2.50 Payment date: May 6, 2016
Slide 50: Fourth Resolution
FOURTH RESOLUTION (acting as an Ordinary M eeting) Agreements referred to in Articles L.225-38 et seq. of the French Commercial Code • Sale by Kering of an interest held by a subsidiary • This agreement falls within the framework of the Group’s reorganisation around its core business
Slide 51: Fifth Resolution
FIFTH RESOLUTION (acting as an Ordinary M eeting) Appointment of Sophie L’Helias as Director
Slide 52: Sixth Resolution
SIXTH RESOLUTION (acting as an Ordinary M eeting) Appointment of Sapna Sood as Director
Slide 53: Seventh Resolution
SEVENTH RESOLUTION (acting as an Ordinary M eeting) Appointment of Laurence Boone as Director
Slide 54: Eighth Resolution
EIGHTH RESOLUTION (acting as an Ordinary M eeting) Renewal of the term of office of Jean-Pierre Denis as a Director
Slide 55: Ninth Resolution
NINTH RESOLUTION (acting as an Ordinary M eeting) Setting of the annual amount of Directors’ fees allocated to members of the Board of Directors
Slide 56: Tenth Resolution
TENTH RESOLUTION (acting as an Ordinary M eeting) Advisory opinion on the remuneration due or awarded to François-Henri Pinault, Chairman and Chief Executive Officer, for 2015
Slide 57: Eleventh Resolution
ELEVENTH RESOLUTION (acting as an Ordinary M eeting) Advisory opinion on the remuneration due or awarded to Jean-François Palus, Group Managing Director, for 2015
Slide 58: Twelfth Resolution
TWELFTH RESOLUTION (acting as an Ordinary M eeting) Reappointment of KPMG SA as principal Statutory Auditor
Slide 59: Thirteenth Resolution
THIRTEENTH RESOLUTION (acting as an Ordinary M eeting) Appointment of Salustro Reydel as substitute Statutory Auditor
Slide 60: Fourteenth Resolution
FOURTEENTH RESOLUTION (acting as an Ordinary M eeting) Authorisation to be given to the Board of Directors to trade in the Company’s shares Authorisation Resolution number Term of authorisation Conditions Outstanding 18 months Maximum purchase price: €250 (April 2015) (October 2016) Maximum of 10% o
Slide 61: Fifteenth Resolution
FIFTEENTH RESOLUTION (acting as an Extraordinar y M eeting) Authorisation to be given to the Board of Directors to make free grants of existing shares to employees and executive corporate officers of the Company and Group companies Authorisation Resolution number Term of authorisation Conditions Ove
Slide 62: Sixteenth Resolution
SIXTEENTH RESOLUTION (acting as an Ordinary and Extraordinar y M eeting) Powers for formalities
Slide 63: Kering Brands
Gucci • Bottega Veneta • Saint Laurent • Alexander McQueen • Balenciaga • Brioni Christopher Kane • McQ • Stella McCartney • Tomas Maier • Boucheron • Dodo • Girard-Perregaux JeanRichard • Pomellato • Qeelin • Ulysse Nardin • Puma • Cobra • Volcom
Slide 64: a Cusp
a Cusp