Samsonite Group S.a. · HKEX:1910
Samsonite — Samsonite International — H1 2014 Earnings Presentation
46 slides from Samsonite's earnings presentation, September 2014
Slide 1: 2014 Interim Results
GREGORY Sams nite 2014 INTERIM RESULTS STOCK CODE 1910
Slide 2: Disclosure Statement
Disclosure Statement This presentation and the accompanying slides (the “Presentation”) which have been prepared by Samsonite International S.A. (“Samsonite” or the “Company”) do not constitute any offer or invitation to purchase or subscribe for any securities, and shall not form the basis for or b
Slide 3: Agenda
Agenda Results Highlights Business Overview Financial Overview Outlook and Strategy for 2nd Half 2014 Q&A Page 3
Slide 4: First Half 2014 Results Highlights
First Half 2014 Results Highlights Record first half net sales with constant currency growth of 13.8% Net Sales Adj. EBITDA Adj. Net Income US$m $121.7 12.4% US$m $22.9 14.0% US$m $12.9 13.9% 1,200 200 $187 120 $1,105 $106 180 $984 $164 1,000 100 $93 160 140 800 80 120 +13.8% 600 growth 100 60 Const
Slide 5: Key Financial Highlights
Key Financial Highlights Net Sales Gross Margin Net Sales: Net sales increased by 13.8% on a constant US$m $121.7 12.4% US$m $65.7 12.6% currency basis to a record first half of US$1,105.3 million. 1,200 700 $1,105 Currency fluctuation had a negative impact of $984 $589 US$14.0 million on year-over-
Slide 6: Key Financial Highlights
Key Financial Highlights Adjusted EBITDA: Adj. EBITDA Adj. Net Income Adjusted EBITDA up 14.0% driven by strong sales growth and 30bp improvement in Adjusted EBITDA as a percentage of sales. Overall US$m $22.9 14.0% US$m $12.9 13.9% adjusted EBITDA margin improvement is due mainly to: 200 $187 120 1
Slide 7: Agenda
Agenda Results Highlights Business Overview Financial Overview Outlook and Strategy for 2nd Half 2014 Q&A Page 7
Slide 8: Business Highlights
Business Highlights Record net sales performance with all regions contributing strong constant currency growth, led by Asia +16.9%, Europe +10.3% and North America +8.4% (excluding Speck) and Latin America +20.4%. Health of the business is underpinned by continued strong world travel market, with 5%
Slide 9: Strong Sales Growth in All Regions
Strong Sales Growth in All Regions Net Sales Growth by Region Continued strong constant currency growth in Asia driven by American Tourister and Samsonite Red and led by India, US$m 13.8% 11.4% 12.7% 8.9% South Korea, China, Japan and Australia. The devaluation $450 $421.4 of many Asia currencies to
Slide 10: Asia – Continued strong growth and profitability
Asia – Continued strong growth and profitability On a constant currency basis, Asia net sales are up 16.9%, with all countries posting strong growth from prior year. Growth leaders include India +24.6%, South Korea +14.6%, China +8.1%, Japan +22.9% and Australia +35.2%. Growth fuelled by: Net Sales
Slide 11: China – Constant currency sales growth of 8.1%
China – Constant currency sales growth of 8.1% is expected to improve in 2nd half of 2014 Net Sales Sales Mix Sales growth of 8.1% on a constant currency basis is coming mainly from: US$ $7.8 8.3% 1H 2013 American Tourister up 18.0% and 120 3% Samsonite up 1.9%, with Samsonite Red $101.2 18% up 155.
Slide 12: North America – Continued strong growth in a mature and competitive market
North America – Continued strong growth in a mature and competitive market Constant currency sales growth of 11.8%. Excluding Speck, sales increased by 8.4% on a constant currency basis, driven Net Sales Adjusted EBITDA by: US$ $35.3 11.4% US$ $3.6 6.3% 6.0% increase in U.S. Wholesale sales, 11.4% i
Slide 13: Europe – Sales growth of 10.3% on a constant currency basis
Europe – Sales growth of 10.3% on a constant currency basis with strong margin improvement On a constant currency basis, sales growth was 10.3%, led by Italy +13.1%(1), Turkey +36.9%(1), Russia +11.2%(1) and Germany +6.2%(1). Net Sales Adjusted EBITDA Italy +13.1%(1) and Spain +11.3%(1) continued to
Slide 14: Latin America – Constant currency sales growth of 20.4%
Latin America – Constant currency sales growth of 20.4% with early traction in Brazil Sales increased 20.4% on a constant currency basis. Strong sales growth in Chile and Mexico, up 10.2%(1) and Net Sales Adjusted EBITDA 13.1%(1), respectively. US$ $5.5 8.9% US$ $(1.0) -10.1% Brazil sales increased
Slide 15: Sales in Key Markets
Sales in Key Markets Strong constant currency growth in all key markets US$m $350 Includes $328.0 US$10.5 million 1H 2013 of Speck $296.5 1H 2014 $300 $250 $200 $150 Includes US$1.5 million of Lipault $101.2 $93.4 $92.1 $100 $76.6 $56.5 $63.6 $50 $35.3 $39.2 $35.9 $35.3 $34.5 $32.1 $29.7 $30.9 $30.8
Slide 16: Sales in Emerging Markets
Sales in Emerging Markets Continued brand penetration driving growth in emerging markets US$m $25 1H 2013 1H 2014 $19.8 $19.7 $20 Includes US$3.6 million disposition of inventory $15 from former distributors $11.9 $11.5 $10.6 $9.9 $9.8 $10 $9.1 $9.0 $7.3 $6.3 $5 $4.2 $4.3 $3.7 $3.4 $3.1 $2.9 $2.7 $0
Slide 17: 2014 Acquisitions
5) 2014 Acquisitions (ok) speck Lipault GREGORY. Pagel? Ser nite
Slide 18: 2014 Acquisitions: Lipault
2014 Acquisitions Lipault is a youthful, vibrant and chic French luggage brand known for its functional and fashionable designs. Acquired all of the outstanding capital stock on April 1, 2014 for EUR 20.0 million in cash, with a subsequent working capital adjustment of an additional EUR 0.1 million
Slide 19: 2014 Acquisitions: Speck
2014 Acquisitions Speck produces a diverse range of sleek, stylish, and functionally innovative products that provide superior military-grade protection for mobile devices across multiple brands and is particularly well-known for its “slim protection” designs such as the iconic CandyShell “hard-soft
Slide 20: 2014 Acquisitions: Gregory
2014 Acquisitions Gregory Mountain Products (“Gregory”) is an iconic technical outdoor backpack brand that is known as a pioneer in its field and is well-respected by active outdoor and adventure enthusiasts. The purchase of substantially all of the assets of Gregory was signed on June 18, 2014 and
Slide 21: Progress on 2012 Acquisitions
Progress on 2012 Acquisitions Sales growth of US$9.3 million, or 22.5% on a Sales growth of US$0.9 million, or 13.1% over 1H constant currency basis over 1H 2013. 2013. Design, sales and management is operated primarily Sourcing, distribution and back-office operations and in Chicago office. systems
Slide 22: Strong Sales Growth in All Brands
Strong Sales Growth in All Brands Net Sales Growth by Brand Continued growth in Samsonite with constant US$m 11.3% 14.9% 21.4% 13.1% NA -8.8% currency net sales up 11.8% $800 $743.7 Asia +15.4%(1), North America +9.7%(1), $700 $668.2 Europe +8.7%(1), Latin America +29.1%(1) 1H 2013 Strong constant c
Slide 23: Key Product Assortment
Key Product Assortment Samsonite - FIRELITE Samsonite Red - LIEBE Samsonite – SPARK Samsonite – B-LITE Samsonite – PRO DLX 4 Samsonite – COSMOLITE (DISNEY COLLECTION) Samsonite Red - NEWYORKER Samsonite – TEKTONIC Samsonite – SPHERE DRIVE Page 23 Samsonite – XENON2 Samsonite – SPIN TRUNK Samsonite –
Slide 24: Key Product Assortment
Key Product Assortment MERIDIAN BONAIR SKY 360 XLT AT - XPERTIZE HS - MV+ BUSINESS BAGS PASADENA SPOT-LITE IV ILITE X’TREME Page 24
Slide 25: Key Product Assortment
Key Product Assortment BTS Backpacks - SWERVE Office Backpacks - XBT Tech Hydration School Classic 2 Hydration Collection Backpacks - Collection Frame Packs – LYELL SENTINEL 65 XBT Collection BTS Backpacks - FATBOY Classic 2 Hiking Hydration Packs – Collection BARCROFT 10 Leisure Backpacks - Wheeled
Slide 26: Key Product Assortment
Key Product Assortment American Belting Reserve - Slim Brief Esperto - Esperto - Cross Vertical Tote Shoulder Bag 7R Classico Walker Collection Intensity SPL Denovo Esperto - Business Tote Heritage - Page 26 Esnoble Flap Brief
Slide 27: Key Product Assortment
Key Product Assortment Page 27
Slide 28: Key Product Assortment
Key Product Assortment Plume Business Case Wheeled Lady Plume Weekend Bag Wheeled Lady Plume Weekend Bag Originale Plume Spinner Lady Plume Handbag Pliable Pliable Upright Upright Page 28
Slide 29: Key Product Assortment
Key Product Assortment STOUT 65 Satchel – LAGUNA PACE 3 and TEMPO 3 GARDEN TAPESTRY DEVA JADE SERIES AMBER 60 BALTORO TEMPO 3 SUNBIRD KLETTER Z SERIES Page 29
Slide 30: Strong Sales Growth Across All Major Product Categories
Strong Sales Growth Across All Major Product Categories Net Sales Growth by Product Category Travel remains our largest product category and 10.1% 24.6% 1.1% 49.6% 15.2% traditional strength with 11.2% constant currency US$m $900 growth. $797.8 Casual category net sales increased 28.1%(1), driven by
Slide 31: Continued Expansion in Points of Sale
Continued Expansion in Points of Sale Over 2,000 POS added in North America wholesale, Total Points of Sale primarily from additional doors at sporting goods retailers for High Sierra but also in discounters, department stores, mass merchants and consumer electronics retailers. Retail Wholesale 48,8
Slide 32: Selection of Recently Opened Stores
Selection of Recently Opened Stores Hartmann - Beijing New Lufthansa Golden Street Mall, Beijing, China – July 2014 Hartmann – Taipei Mega City Mall, Taipei, Taiwan – July 2014 Page 32
Slide 33: Selection of Recently Opened Stores
Selection of Recently Opened Stores American Tourister – Yeonsinnae, Gyeonggi-do, Korea Samsonite – Boulevard des Capucines, Paris, France Xtrem – La Serena, Chile Samsonite Red – Wheelock Place, Singapore Page 33
Slide 34: Advertising campaigns continue to drive sales growth in all regions
Advertising campaigns continue to drive sales growth in all regions Advertising Spend US$m 1H 2013 Advertising spend is up US$5.3 million, or $35 1H 2014 $31.6 8.2%, from US$64.1 million to US$69.4 $30 $28.1 million, year over year. $25 Advertising spend of 6.3% of sales in 1H $20.6 $20 $18.4 2014 i
Slide 35: Targeted Brand & Product Advertising Asia
Targeted Brand & Product Advertising Asia Samsonite Red Samsonite – “Firelite” American Tourister Samsonite Business Leather Page 35
Slide 36: Targeted Brand & Product Advertising North America
Targeted Brand & Product Advertising North America High Sierra Samsonite American Tourister Hartmann Page 36
Slide 37: Targeted Brand & Product Advertising Europe
Targeted Brand & Product Advertising Europe High Sierra Samsonite American Tourister Page 37
Slide 38: Targeted Brand & Product Advertising Latin America
Targeted Brand & Product Advertising Latin America Page 38
Slide 39: Agenda
Agenda Results Highlights Business Overview Financial Overview Outlook and Strategy for 2nd Half 2014 Q&A Page 39
Slide 40: Key Financial Highlights
Key Financial Highlights Adjusted EBITDA margin continues to improve, up 30bps from 1H 2013 to 16.9%. Adjusted net income up 13.9%, with earnings per share on an adjusted basis increasing from US$0.066 at June 30, 2013 to US$0.075 at June 30, 2014. Net cash position decreased US$103.2 million from D
Slide 41: Strong Balance Sheet
Strong Balance Sheet Net cash position of US$106.6 million as of June 30, 2014, is down $103.2 million US$m June 30, December 31, June 30, $ C hg J un- % C hg J un- from December 31, 2013 due primarily to 2014 2013 2013 14 v s . J un- 13 14 v s . J un- 13 the acquisitions of Speck (US$85 million) Ca
Slide 42: Efficiently Managing Working Capital
Efficiently Managing Working Capital Net working capital efficiency of 16.0%(1) is temporarily higher than the target level of US$m June 30, December 31, June 30, $ Chg jun-14 % Chg jun-14 14.0%. 2014 2013 2013 vs. jun-13 vs. jun-13 Working Capital Items Inventory turnover days increased from 105 In
Slide 43: Capital Expenditure
Capital Expenditure Capital Expenditure by Project Type 2014 Retail capex consists mainly of new stores and remodels in Asia of US$m 1H 2014 1H 2013 US$4.1 million, Europe of US$2.5 million, North America of US$1.2 million and Retail 9.0 8.9 Latin America of US$1.2 million. Capex on product developm
Slide 44: Agenda
Agenda Results Highlights Business Overview Financial Overview Outlook and Strategy for 2nd Half 2014 Q&A Page 44
Slide 45: Outlook & Strategy for 2nd Half of 2014
Outlook & Strategy for 2nd Half of 2014 Continue to gain market share and drive growth by leveraging the strength of our brands; Samsonite, American Tourister, High Sierra, Hartmann, Speck, Gregory and Lipault. Allocate more resources, particularly marketing, to drive American Tourister sales growth
Slide 46: Agenda
Agenda Results Highlights Business Overview Financial Overview Outlook and Strategy for 2nd Half 2014 Q&A Page 46
Samsonite International — H1 2014 Earnings Presentation on 6ix