Leejam Sports Co. · TADAWUL:1830
Leejam Sports — Q1 2019 Earnings Presentation
37 slides from Leejam Sports's earnings presentation, 2019
Slide 1: Leejam Sports Company Investor Presentation Q1 2019
Leejam Sports Company Investor Presentation Q1 2019
Slide 2: Table of Contents
Table of Contents Page 1. Company Profile 3 2. Board Members 19 3. Financial Performance 21 4. Outlook FY 2019 34 5. Q&A 38 CONFIDENTIAL 2
Slide 3: 1. Company Profile
1. Company Profile CONFIDENTIAL 3
Slide 4: Largest Fitness center operator in the MENA Region
Largest Fitness center operator in the MENA Region An indigenous and localized Proud Saudi Brand 134 incl. 29 female 242k Operational Fitness Centers Active Members (31 March 2019) (31 March 2019) Added 8 centers in Q1 2019 Added 24k members (net) in Q1 2019 24% 15th Female members of total member b
Slide 5: Other Key Metrics
Other Key Metrics 217M SAR 178M SAR 40M SAR 33M SAR Revenues Revenues Net Income Net Income (Q1 2019) (Q1 2018) (Q1 2019) (Q1 2018) 22% growth 21% growth 99M SAR 63M SAR 180M SAR 174M SAR EBITDA EBITDA Net Income Net Income (Q1 2019) (Q1 2018) (FY 2018) (FY 2017) 57% growth on reported basis 275+ 47
Slide 6: Participated in Fitness Events in Q1 2019
Participated in 5 Fitness Events in Q1 2019 Basketball Championship Extreme FT Championship Strongest Man Championship Football Championship MOH event CONFIDENTIAL 6
Slide 7: Macro KSA Environment
Macro KSA Environment Government initiatives aim at supporting the health and fitness sector Indicator Male Female Total Prevalence of obesity 31% 42% 34% As part of the Vision 2030, the Saudi Government Prevalence of diabetes 17% 21% 19% plans to promote a healthier lifestyle among its citizens wit
Slide 8: Diverse Brand Portfolio to Serve the Market
Diverse Brand Portfolio to Serve the Market Male Brands Female Brands Other Brands CONFIDENTIAL 8
Slide 9: Key Milestones
Key Milestones - Start Planning - First “Fitness - Introduction of - The Company - Investcorp - Intro of PT - Launch of Phase Time” Fitness Time opens its 50th acquires 25.1% - UAE launch female fitness - First “Fitness standalone Pro category fitness center stake in Leejam - Exclusive centers Time”
Slide 10: Leejam 3.0: 6 Key Pillars
Leejam 3.0 Goal: To be Top 10 Fitness Company in the World and be Employer of Choice in KSA Enhance 6 Key Pillars to Customer Open Door Experience achieve Leejam 3.0 Policy in the next 3 years Invest In Improved Our People Corporate Governance Grow & Leverage Exceed Technology Shareholders Expectati
Slide 11: Market Leader with Strong Scale Advantage
Market Leader with Strong Scale Advantage Strong geographical footprint with presence in 28 cities Fitness Centres Evolution Geographic Footprint (as of 31 March 2019) (130) ● Sakakah Hafr (1) Al Batin (4) ● Tabuk ● (1) (3) Ha’il ● (1) ● Buraydah ● Jubail Yanbu Saihat ● (4) (2) Madinah ● Unaizah ●(2
Slide 12: Segmented Concept, Recognised Brand (1/3)
Segmented Concept, Recognised Brand (1/3) Key Features Males Males Males Male Females Females Females Targeted at (age) 25yrs+ 16yrs+ 16yrs+ Junior 25yrs+ 16yrs+ 16yrs+ # of Fitness Centres1 – KSA 4 49 41 4 - 23 5 # of Fitness Centres1 – UAE - 1 2 0 - - 1 12-month Price (SAR)2 8,925* 4,988* 3,255* 3
Slide 13: Segmented Concept, Recognised Brand (2/3)
Segmented Concept, Recognised Brand (2/3) State-of–art Spacious Facilities with a Customized Service Offering Available in each center to Competitions and tournaments assist with equipment use, organised on a regular basis Floor fitness regime etc. Special for members Trainers Events >1100 Flo
Slide 14: Segmented Concept, Recognised Brand (3/3)
Segmented Concept, Recognised Brand (3/3) Corporate Business The Company delivers services to corporate partners under the Fitness Time Wellness umbrella Fitness Time is an attractive partner for large corporate clients given its country wide footprint in 28 cities in KSA & UAE Opportunity to
Slide 15: Performance since IPO (Sept 2018)
Performance since IPO (Sept 2018) Net Income ACCOLADES: (SAR million) Consecutive growth in results post IPO LY on Sept 10, 2018. Leejam 3.0 in place with 6 key pillars. Opening of 21 centers over last 7 month (16% of our entire portfolio since 2005). New initiatives include launch of GEMs p
Slide 16: Other Significant Accolades
Other Significant Accolades Shaikh Mohammad Bin Rashid Award – in 2015 CONFIDENTIAL 16
Slide 17: Other Significant Accolades (contd.)
Other Significant Accolades (contd.) PNU the largest Fitness center in the world – operated by Fitness Time (in process of getting Guinness World Records Accreditation) CONFIDENTIAL 17
Slide 18: Other Significant Accolades (contd.)
Other Significant Accolades (contd.) Cover page story by CBI “IHRSA” magazine on LEEJAM 3.0 in April 2019 issuance & Article coverage in CEO magazine by Khaleej Times CONFIDENTIAL 18
Slide 19: 2. Board Members
2. Board Members CONFIDENTIAL 19
Slide 20: Board Members
Board Members Ali Al-Sagri Hamad Al-Sagri Dr. Mohammed Al-Kinani Chairman Board Member (Executive ) Board Member (independent) Hisham Al-Khaldi Vice Chairman & MD Board Member (independent) Tareq Al-Angari Abdulelah Al-Nemr Hessah Al-Sagri Board Member (independent) Board Member (independent) Board
Slide 21: 3. Financial Performance
3. Financial Performance CONFIDENTIAL 21
Slide 22: Q1 Revenue and Net Income
Q1 Revenue and Net Income Revenue (SAR million) Key Messages: # of Fitness Centres 119 133 Revenue was 22% higher vs. LY, mainly due to: - new Male Centres 1 5 - new & Converted Female 1 3 8 new centers openings in CY, Centres ramping-up of 22 non-LFL centers opened LY, LFL growth of 4% (15%
Slide 23: Revenue Break-Down
Revenue Break-Down Revenue by Type Center Revenue by Brand (%, Q1 2019) (%, Q1 2019) No. of centers by category Q1 2019 2018 2017 2016 FT Men 52 49 50 48 PRO Men 43 41 42 40 Plus Men 4 4 4 3 Junior 4 4 8 9 Basic 0 0 0 1 Academy & Kidizinia 2 2 0 1 FT Female 23 20 4 0 PRO Female 6 6 4 0 Source: Compa
Slide 24: Q1 2019 vs. Q1 2018 Revenue Bridge
Q1 2019 vs. Q1 2018 Revenue Bridge `In SR 000 Key Messages: Increase in LFL revenue mainly driven by higher LFL subs. income of 15%. Non- LFL includes 22 centers opened during 2018. Increase in PT revenue mainly due to roll-out of additional PT centers (Q1 CY: 89 vs. Q1 LY: 63). Increase in
Slide 25: Q1 2019 P&L
Q1 2019 P&L `In MSR Key Messages: Q1 LY Q1 CY ∆% Q1 Net income was higher by 21% vs. LY due to increase in number of operating centers, in particular female centers, resulting in growth of revenue. Centers # (EOP) 119 134 13% Increase in revenue was mainly due to; Average # Of Centers 119 131 10
Slide 26: Q1 2019 vs. Q1 2018 Net Income Bridge
Q1 2019 vs. Q1 2018 Net Income Bridge `In SR 000 Key Messages: GP of male centers improved mainly due to LFL growth 15% vs. Q1 LY. Female centers continue to contribute significantly towards the overall company profitability. Corporate witnessed growth due to new corporate wellness contracts (
Slide 27: Financial Impact of Centers opened in Q4 2018 & Q1 2019
Financial Impact of Centers opened in Q4 2018 & Q1 2019 No. of Centres 11 8 Ave. No. of Centres 11 4.7 23% (51%) 23% (51%) 6% Net profit Margin % Q4 LY Openings Q1 CY Openings Q4 LY Openings Q1 CY Openings Q1 Impact Key Messages: 11 centers opened during Q4 LY of which 10 were female and 1 male ce
Slide 28: COGS & SG&A
COGS & SG&A COGS (SAR million) Key Messages: 9% increase in average COGS / center is mainly due to higher operational cost of female centers (15-20% higher female salaries vs. male counterpart), depreciation under IFRS 16, consumables, repairs, rising government levies and cost of outsourced clean
Slide 29: Balance Sheet Shareholders' Equity and Debt
Balance Sheet Total Assets (SAR million) Key Messages: Increase in total assets by 52% is due to transition to IFRS 16, where the Company recognized right- of-use assets of SR 885M and corresponding lease liabilities of SR 977M. Adjustment to opening retained earnings was SR 94M under modified r
Slide 30: Loans & Finance Charges
Loans & Finance Charges Loans and Finance Charges (SAR million) IFRS 16 SR 8M Key Messages: YOY Increase in loans to support center expansion. Approximate 50-60% split by managing the portfolio between floating & fixed rated borrowings. Weighted average cost of borrowings approximate 4.46%.
Slide 31: Cash Generation & Returns
Cash Generation & Returns Cash Flow From Operations (SAR million) Cash flow / EBITDA 49% 89% 112% Dividend Declared and Pay-out (SAR million) Dividend Ratio 60% 60% 60% . * Company continues to pay 60% dividend of distributable income (54% of net income). CONFIDENTIAL 31
Slide 32: Q1 2019 Male & Female Segments
Q1 2019 Male & Female Segments Female Centers continue to make Material Contribution in Q1 2019 Female Centers Openings Q1 2019 Female centers Ramp-up Evolution Revenue and Gross Profit per centre (SAR million) Gross Margin 53% 38% 3% 43% CONFIDENTIAL 32
Slide 33: Ave. Female Centres Performance
Ave. Female Centres Performance Based on last 3 months performance Revenue and Gross Profit per centre (SAR million) Gross Margin, average 40% - 55% 30% - 35% CONFIDENTIAL 33
Slide 34: 4. Outlook FY 2019
4. Outlook FY 2019 CONFIDENTIAL 34
Slide 35: Outlook FY 2019
Outlook FY 2019 Tentative Guidance: Leejam 3.0 in full swing. No. of centres Growth Q1 revenue & net income witnessed 22% & 21% growth vs. LY, despite ramping- up of 19 centers opened in last 6 months. The momentum is expected to continue during 2019, with revenue growth of 10-12% driven by: f
Slide 36: Disclaimer
DISCLAIMER Leejam Sports Company makes no representation or warranty of any kind, express, implied or statutory regarding this document or the materials and information contained or referred to on each page associated with this document. The material and information contained on this document is pro
Slide 37: Thank You Q&A
Thank Q&A You CONFIDENTIAL 38
Leejam Sports Company — Q1 2019 Earnings Presentation on 6ix