Watches Of Switzerland Group Plc · LSE:WOSG
Watches Of Switzerland — The Watches of Switzerland Group — FY2021 Earnings Presentation
22 slides from Watches Of Switzerland's earnings presentation, July 2021
Slide 1: FY21 Results
The Watches of Switzerland Group FY21 Results July 2021 53 weeks ended 2 May 2021
Slide 2: Disclaimer
Disclaimer Cautionary note regarding forward-looking statements This presentation has been prepared by Watches of Switzerland Group PLC (the “Company”). It includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the us
Slide 3: Agenda
Agenda CEO Update Brian Duffy Chief Executive Officer Financial Review & Outlook Anders Romberg Chief Financial Officer Q&A The Watches of Switzerland Group FY21 Results, July 2021 3
Slide 4: CEO Update
The Watches of Switzerland Group CEO Update Brian Duffy, CEO
Slide 5: A Year of Strong Growth
A Year of Strong Growth Strong growth achieved despite in challenging markets Group Revenue +13.3% in constant currency Outstanding US performance; Revenue +38.5% in constant currency Strong result in the UK despite significant headwinds; Revenue +3.6% Adjusted EBIT + 38.9% Proud of our teams’ posit
Slide 6: Delivering on Strategic Goals
Delivering on Strategic Goals Adjusted EBIT (£m) and Adjusted EBIT Revenue (£m) margin* 1,000 90 10.0% 905.1 900 77.6 9.0% 810.5 80 800 8.6% 8.0% 70 700 55.9 7.0% 60 600 6.9% 6.0% 50 500 5.0% 40 400 4.0% 300 30 3.0% 200 20 2.0% 100 10 1.0% 0 0 0.0% FY20 FY21 FY20 FY21 * Operating profit before excep
Slide 7: Performance Driven by Luxury Watches, Domestic Clientele
Performance Driven by Luxury Watches, Domestic Clientele Revenue mix by market 27.8% 33.0% FY20 FY21 UK US 72.2% 67.0% Revenue mix by category 7.6% 6.2% 8.5% 6.7% FY20 FY21 Luxury watches Luxury jewellery Other 83.9% 87.1% Revenue mix by customer segment 10.5% 2.4% 2.9% 17.0% FY20 FY21 Domestic UK/E
Slide 8: Capital Investment in our Store Network Supporting UK Growth
Capital Investment in our Store Network Supporting UK Growth Maintained capital investment programme in the UK despite significant disruption - Network expansion: - New Watches of Switzerland Broadgate store, featuring a dedicated Rolex Room Watches of Switzerland, Broadgate, London - New Rolex mono
Slide 9: We Continue to Invest For Growth in the US, Where our Model Works
We Continue to Invest For Growth in the US, Where our Model Works Investments and initiatives exceeding expectations • Mono-brand boutique programme established • Eight new mono-brand boutiques opened, bringing total to 13 • Successful launch of ecommerce • Store elevation: • Four Mayors stores have
Slide 10: Driving Growth through Well-Invested Technology Platform and Enhanced Digital Activity
Driving Growth through Well-Invested Technology Platform and Enhanced Digital Activity Use of technology, enhanced digital activity and data to enhance and personalise the customer experience • Online • Virtual Luxury Watch and Jewellery Boutique • CRM • “By Personal Appointment” • Virtual new produ
Slide 11: UK: Digital Marketing Driving Awareness
UK: Digital Marketing Driving Awareness FY21 Digital Reach Monthly reach on social 46M Total campaign impressions 3.2BN Total campaign clicks 37m The Watches of Switzerland Group FY21 Results, July 2021 11
Slide 12: US: Impactful Event and PR Activity Driving Awareness and Sales
US: Impactful Event and PR Activity Driving Awareness and Sales FY21 Digital Reach Monthly impressions on social 2.5M Digital Campaign Impressions 373M PR impressions 5.1BN The Watches of Switzerland Group FY21 Results, July 2021 12
Slide 13: Our People
Our People The Watches of Switzerland Group FY21 Results, July 2021 13
Slide 14: The Watches of Switzerland Group Foundation
The Watches of Switzerland Group Foundation The Watches of Switzerland Group FY21 Results, July 2021 14
Slide 15: Financial Results & Outlook
The Watches of Switzerland Group Financial Results & Outlook Anders Romberg, CFO
Slide 16: Record Sales and Profitability
Record Sales and Profitability Profit & Loss (£m, pre-IFRS 16 and exceptionals) FY21* FY20 Yoy % • FY impacted by significant disruption in the UK and US: Group revenue 905.1 810.5 11.7% • estimated revenue loss c. £100 million in the UK Net margin 332.3 304.7 9.1% Margin % 36.7% 37.6% (88)bps • Net
Slide 17: Balance Sheet Strength
Balance Sheet Strength 2 May 26 Apr Balance Sheet (£m, pre-IFRS 16) 2021 2020 Yoy % • Continued investment with £23.1 million of expansionary Non-current assets capex (FY20: £20.7 million) Goodwill & Intangible assets 150.6 155.0 (2.8)% PPE 93.4 99.8 (6.4)% • Inventory levels -£17.0 million (-7.0%)
Slide 18: Excellent Free Cash Flow and Conversion
Excellent Free Cash Flow and Conversion Cash Flow (£m, pre-IFRS 16) FY21 FY20 Yoy % Free cash flow +£58.9 million (+115.9%) to £109.7 million Adjusted EBITDA 105.4 78.1 34.9% • Further improvement in working capital Share-based payments 0.8 - Working capital 13.9 (7.3) • Free cash flow conversion of
Slide 19: Balance Sheet Strength
Balance Sheet Strength • Net debt £43.9 million at 2 May 2021 • Reduction of £85.8 million vs 26 April 2020; £109.7 million free cash flow offset by expansionary capex Facility Expiring Amount • At 2 May 2021, the Group had a total of £197.5 million of available committed facilities UK Term Loan – U
Slide 20: Financial KPIs
Financial KPIs Return on Capital Employed Free cash flow (£m) 25.0% 120 109.7 19.7% 100 20.0% +390bps 15.8% +115.9% 80 15.0% 60 50.8 10.0% 40 5.0% 20 0.0% 0 FY20 FY21 FY20 FY21 4-Wall EBITDA % Adjusted EBITDA (£m) 20.0% 18.3% 120 +270bps 105.4 15.6% 100 15.0% +34.9% 78.1 80 10.0% 60 40 5.0% 20 0.0%
Slide 21: FY22 Guidance (pre-IFRS 16, 52 week basis)
FY22 Guidance (pre-IFRS 16, 52 week basis) FY22 guidance FY22 guidance assumes: Total Revenue £1.05 to £1.10 billion • Visibility of supply of key brands with no disruption to supply anticipated EBITDA margin & Adjusted EBITDA margin Flat to +0.5% vs last year • No further national lockdowns in any
Slide 22: Q&A
Q&A The Watches of Switzerland Group FY21 Results, July 2021 22
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