Slide 1: FY18 Financial Results
FY18 FINANCIAL RESULTS April 17, 2019
Slide 2: Disclaimer
1 Disclaimer This presentation is being furnished to you solely for your information and may not be reproduced or redistributed to any other person. This presentation might contain certain forward-looking statements that reflect the Company’s management’s current views with respect to future events
Slide 3: FY18 Executive Summary
2 FY18 Executive Summary • The OVS Group has increased its market share in 2018 thanks to the vitality of both its brands • However, a difficult market environment, highly unfavourable weather conditions and some one-off aspects of the termination of the commercial agreement with the former Sempione
Slide 4: FY18 Highlights
3 FY18 Highlights Total Net Sales excluding the sell-in to the former Sempione Fashion Group amounted to €1,391.6m decreasing by -1.7% compared to last €144.2m year. The decline is mostly attributable to the like-for-like performance of the Fall/Winter season during the months of September, October
Slide 5: Key Income Statement Items
4 Key Income Statement Items Despite a weak second half, high cash generation in the fourth quarter 31.01.2019 31.01.2019 31.01.2018 31.01.2018 Chg. Chg. % • Net Sales (excluding the sell-in to Sempione Fashion AG) € mln Reported Adjusted Reported Adjusted (Adjusted) (Adjusted) decreased by 1.7% in
Slide 6: Performance By Brand and Aggregate Performance
5 Aggregate Sales and EBITDA Performance in FY18 Net Sales (€mln) EBITDA (€mln) DOS & E-commerce Franchise & Marketplaces Sempione Fashion Sell-in 13.9% 10.4% Aggregate Performance 1,526 1,457 111 66 210 230 197 1,205 1,162 144 31 January '18 31 January '19 31 January '18 31 January '19 Margin % (*)
Slide 7: FY17-18 EBITDA Bridge
6 FY17-18 EBITDA Bridge Main factors behind the -€51.3m of EBITDA lost in the 2H18 vs. 2H17 Sales vs.2H17 €26.4m (€56.2m) Autumn with summer temperatures Increased mark- Cost savings downs Adjusted FY18EBITDA of €144.2m was down by €52.3m compared to the previous year. The FY18 EBITDA generation can
Slide 8: 31Jan19 Consolidated Trade Working Capital
7 31Jan19 Consolidated Trade Working Capital Change €mln 31 January '19 31 January '18 Jan19-Jan18 Trade Receivables 98.4 113.0 (14.5) Inventory 411.0 387.9 23.0 Trade Payables (351.0) (403.4) 52.4 Trade Working Capital 158.4 97.5 60.9 • Trade working capital was €60.9m higher compared to the one at
Slide 9: Capex
8 Capex 2018 Capex breakdown (€ mln) Refurbishment (€27.7m), maintenance (€4.6m) and other commercial projects (€3.9m) and other projects on the existing network (€6.7m) (c. 53.3% of total) Includes €27.7m of New openings refurbishments (of which (c. 17.9% of total) more than 65% made through a Vend
Slide 10: Capex Refurbishments
9 Capex_Refurbishments • In year 2018, 46 stores have been refurbished • The average cost amounted to €500 per square meter. • Results have been satisfactory, with a sales increase of about 10% during the first months of FY19 compared to the same period of last year. 2018 Refurbished store in Milan
Slide 11: Net Debt and Leverage
10 Net Debt and Leverage € mln 31st January 2019 31st January 2018 Net Debt 364.9 377.8 Net Debt 375.8 317.9 Excluding MtM (*) EBITDA LTM Adjusted 144.2 196.5 Leverage on EBITDA (**) 2.6x 1.6x Average Leverage on EBITDA (***) 2,97x 1,73x (*) Net Debt at 31st January excluding the MtM impact of €10.8
Slide 12: IVQ18 Net Debt & Cash Flow Evolution
11 IVQ18 Net Debt & Cash Flow Evolution -€105.6m -€57.8m October Adjusted Net Debt 2017 Adjusted Net Debt 2018 January € in millions 64.7 16.9 IVQ17 CF IVQ18 CF IVQ Cash generation Net Debt recovery is underway: IVQ strong cash generation of €64.7m, allowed the Group to decrease the gap vs. last yea
Slide 13: Consolidated Cash Flow Statement
12 Consolidated Cash Flow Statement €mln FY2018 FY2017 EBITDA Adjusted 144.2 196.5 Adjustments (69.8) (21.7) Change in Net Operating Working Capital (60.9) (49.3) Other changes in Working Capital 21.6 9.9 Capex, net of proceeds from HQ disposal (60.9) (68.0) Operating Cash Flow (25.8) 67.3 Financial
Slide 14: Outlook
13 Outlook • 2019 will be a year of recovery: whilst the Italian market backdrop remains challenging, a normalization of weather conditions should provide support, in particular for the second half of the year. • We expect an overall increase in net sales as a combination of (i) a modestly negative
Slide 15: Appendix
OVS Appendix
Slide 16: Consolidated Profit and Loss and related adjustments (1 of 2)
15 Consolidated Profit and Loss and related adjustments (1 of 2) o/w: o/w: o/w: Adjustments, o/w: Adjustments, 31.01.2019 o/w: non recurring; 31.01.2019 31.01.2018 o/w: non recurring; 31.01.2018 € mln forex Stock Option; Normalizations forex Stock Option; Normalizations Reported non recurring Adjust
Slide 17: Consolidated Profit and Loss and related adjustments (2 of 2)
16 Consolidated Profit and Loss and related adjustments (2 of 2) The following adjustments regarded as one-offs were carried out in 2018, with no impact on cash and/or not representative of the normal course of business operations. Specifically, at the EBITDA level, (i) €79.0 million represents non-
Slide 18: Consolidated Balance Sheet Statement
17 Consolidated Balance Sheet Statement €mln 31 January '19 31 January '18 Chg. Trade Receivables 98.4 113.0 (14.5) Inventory 411.0 387.9 23.0 Trade Payables (351.0) (403.4) 52.4 Net Operating Working Capital 158.4 97.5 60.9 Other assets/(liabilities) (86.3) (51.2) (35.1) Net Working Capital 72.1 46
Slide 19: Network Update as of 31Jan19
18 Network Update as of 31Jan19 Dos Franchising Total Stores Stores Stores st OVS Full Format As of 31 January 2018 546 198 744 Net Openings 7 25 32 st As of 31 January 2019 553 223 776 st OVS KIDS As of 31 January 2018 52 343 395 Net Openings 2 61 63 st As of 31 January 2019 54 404 458 st UPIM Full
Slide 20: Applying IFRS 16 at the transition date (February 1st, 2019)
19 Applying IFRS 16 at the transition date (February 1St, 2019) On January 2016 the IASB published IFRS 16 – Leases to replace IAS 17 and the interpretations IFRIC 4, SIC-15 and SIC-27. The new standard provides a new definition of a lease and introduces criteria based on the control (right of use)