Kmd Brands Limited · NZX:KMD
Kmd Brands — Kathmandu Holdings — H1 2013 Earnings Presentation
27 slides from Kmd Brands's earnings presentation, Mar 26, 2013
Slide 1: 1H FY13 Results Presentation
For personal use only 1H FY13 Results Presentation March 2013 1
Slide 2: Contents
Contents For personal use only • Results Overview • Key Line Items • Country Results • Cash Flow, Balance Sheet, Dividend • Growth Strategy Update • FY13 Outlook • Questions • Appendix 1 2
Slide 3: Results Overview
For personal use only Results Overview
Slide 4: Results Overview: Highlights
Results Overview: Highlights For personal use only Summary • Good growth given the difficult economic environment; • New store rollout on track; • Full year result still heavily dependent on second half performance. Sales and Margin • Sales growth $19.2m (13.1% above last year); • Same store sales g
Slide 5: Results Overview: Year-On-Year
Results Overview: Year-On-Year For personal use only Results Overview NZ $m*4 1H FY13 1H FY12 DIFF $ DIFF % Sales 165.9 146.7 19.2 13.1% Gross Profit 104.1 92.0 12.1 13.2% Gross Profit Margin 62.7% 62.7% Operating expenses*1 (83.2) (75.0) (8.2) 10.9% % of sales 50.1% 51.1% EBITDA 20.9 17.0 3.9 22.9%
Slide 6: Key Line Items
For personal use only Key Line Items
Slide 7: Sales
Sales For personal use only SALES: +13.1% to $165.9m SALES*1 Australia New Zealand United Kingdom • Sales growth year on year:*2 AU 21.5%, NZ 7.9%, UK (4.7)%. $165.9m $3.4m $146.7m 2.0% • At constant exchange rates sales $127.1m $3.7m 2.5% $59.0 $4.6m growth $23.2m / 15.8%. $106.6m 3.6% $54.7 35.6%
Slide 8: Same Store Sales Growth
Same Store Sales Growth For personal use only AU NZ 14.1% 12.4% 12.7% 9.9% 9.6% 6.4% • Same store sales growth 6.5% 3.7% (6.1% on constant currency basis); *1 1.3% • UK sales 4.7% below 1H 1H FY10 1H FY11 1H FY12 1H FY13 FY12; GROUP - Actual Rates GROUP - Constant Rates • 4 year 1H average: *2 ‒ AU
Slide 9: Gross Profit Margin %
Gross Profit Margin % For personal use only AU NZ UK GROUP 68.1% 66.1% 66.1% 64.7% 63.2% 62.7% 62.7% 61.3% 59.9% 59.7% 58.9% 57.7% 57.3% 58.4% 55.6% 53.1% 1H FY10 1H FY11 1H FY12 1H FY13 • August and January clearance sales at SHARE OF BUSINESS (GROSS PROFIT $) slightly lower margins, c. 20 bps impa
Slide 10: Cost of Doing Business
Cost of Doing Business For personal use only OPERATING EXPENSES: +10.9% to $83.2m • Operating expenses reduced as a NZ $m 1H FY13 1H FY12 DIFF $ DIFF % % of sales YOY; Rent 22.1 19.1 3.0 15.7% % of Sales 13.3% 13.0% • Rent as a % of sales increased. New flagship stores (Newmarket Other operating exp
Slide 11: Earnings
Earnings For personal use only EBITDA $20.9m, +22.9% EBIT $15.8m, +24.4% NPAT $10.3m, +71.7% EBITDA $m EBIT $m *1 23.2 19.9 20.9 17.6 17.0 15.1 15.8 12.7 1H FY10 1H FY11 1H FY12 1H FY13 1H FY10 1H FY11 1H FY12 1H FY13 16.5% 18.3% 11.6% 12.6% 14.2% 15.7% 8.7% 9.5% EBITDA margin % EBIT margin % NPAT $
Slide 12: Country Results
For personal use only Country Results
Slide 13: Australia
Australia For personal use only SALES: A$81.8m, +21.5% Same store sales growth: +9.6% EBITDA (trading result): A$9.0m, +47.5% • 13 New Stores opened since 1H FY12: A $m 1H FY13 1H FY12 DIFF ‒ 4 in 2H FY12: Tamworth, Shellharbour, Sales 81.8 67.3 21.5% The Rocks (Sydney), Moorabbin DFO (Melbourne); S
Slide 14: New Zealand
New Zealand For personal use only SALES: NZ$59.0m, +7.9% Same store sales growth: +1.3% EBITDA (trading result): NZ$11.1m, +2.8% NZ $m 1H FY13 1H FY12 DIFF Sales 59.0 54.7 7.9% • 2 new stores opened since 1H FY12: ‒ 2 in 2H FY12: Masterton, plus re-opening Same store sales growth 1.3% 12.7% of Victo
Slide 15: United Kingdom
United Kingdom For personal use only SALES: UK£1.8m, -4.7% Same store sales growth: -4.7% EBITDA (trading result): UK£(0.4)m, +20.0% • Total operating expenses (excl. depreciation): ‒ 1H FY13 75.3% of sales; UK £m 1H FY13 1H FY12 DIFF ‒ 1H FY12 81.9% of sales. Sales 1.8 1.9 (4.7)% • 1.8% of Group Gr
Slide 16: Cash Flow, Balance Sheet, Dividend
For personal use only Cash Flow Balance Sheet Dividend
Slide 17: Cash Flow
Cash Flow For personal use only • Capital expenditure $10.7m vs 1H FY12 NZ $m 1H FY13 1H FY12 $10.3m: ‒ New stores capex: $6.4m: NPAT 10.3 6.0 ‒ 9 new stores; Change in working capital (19.9) (28.7) ‒ 3 relocations; ‒ In progress stores for 2H FY13. Change in non-cash items 4.0 4.8 ‒ Existing stores
Slide 18: Balance Sheet
Balance Sheet For personal use only • Inventories ($m) per store down 1.7%:*1 0.8 NZ $m 1H FY13 1H FY12 $0.651 $0.640 0.6 $0.544 Inventories 84.5 76.8 $0.423 0.4 Property, plant and equipment 44.7 37.9 0.2 Intangible assets 245.6 248.2 0 1H FY10 1H FY11 1H FY12 1H FY13 Other assets 11.7 6.0 • Invent
Slide 19: Foreign Currency
Foreign Currency For personal use only FORWARD HEDGING POSITION 2H FY13 1H FY14 • Effective US$ hedge rates 1H FY13: ‒ A$/US$ 1.007 1H FY13 vs 0.938 1H FY12; A$ / US$ % covered 90%+ 90%+ ‒ NZ$/US$ 0.782 1H FY13 vs 0.736 1H FY12. Effective Rate 0.999 1.015 • Forward Hedging Position: NZ$ / US$ % cove
Slide 20: Dividend
Dividend For personal use only • NZ 3.0 cents per share interim dividend; • Full year payout ratio remains within expected 50 to 60% of NPAT; • AU dividend will be fully franked; • NZ dividend will be fully imputed; • Record date 07 June 2013, Payment date 18 June 2013; • Future years’ interim divid
Slide 21: Growth Strategy Update
For personal use only Growth Strategy Update
Slide 22: Growth Strategy Update
Growth Strategy Update GROWTH STRATEGY UPDATE For personal use only • New stores continue to perform to expectation • Previous 150 target • 15 stores per annum remains annual target New store increased to170 stores rollout • Flagship store programme almost complete overall (AU and NZ). • Small forma
Slide 23: Growth Strategy Update (continued)
Growth Strategy Update (continued) For personal use only GROWTH STRATEGY UPDATE • Invest in growth • SKU count at maximum categories • More investment in depth than width • Maximise sales • Best in field programme established to enhance technical credibility (XT Enhance productivity of existing prod
Slide 24: FY13 Outlook
For personal use only FY13 Outlook
Slide 25: FY13 Outlook
FY13 Outlook For personal use only Kathmandu • Store roll out is on track for 15 new stores in FY13. 5 sites already confirmed for 2H FY13 at The Glen (Melbourne), Eastgardens (Sydney), Hobart, Pukekohe and Westgate (Auckland); • In final stages of the UK restructure and will be completed early FY14
Slide 26: Questions
For personal use only Questions
Slide 27: Appendix – Reconciliation of Country Trading Results
Appendix 1 – Reconciliation of Country Trading Results For personal use only Australia (NZ $m) 1H FY13 1H FY12 New Zealand (NZ $m) 1H FY13 1H FY12 Segment profit 1.9 3.7 Segment profit 9.1 8.8 Net interest 1.1 1.1 Net interest 0.9 0.8 Facility fees 0.2 0.5 Facility fees 0.2 0.5 Depreciation 3.4 2.7