Temple & Webster Group Ltd · ASX:TPW
Temple & Webster — H1 FY16 Earnings Presentation
23 slides from Temple & Webster's earnings presentation, Feb 25, 2016
Slide 1: First Half Results and Guidance Update
For personal use only FIRST HALF RESULTS AND GUIDANCE UPDATE Brian Shanahan CEO and Co-Founder 31 Dec 2015 Deborah Kelly Group CFO 25/2/16
Slide 2: Summary: Proforma First Half Results FY16
Summary: Proforma First Half Results FY16 For personal use only • Temple & Webster is the #1 Online Retailer in the furniture & homewares category • 2015 has been a transformative year for the Group having completed the acquisition of ZIZO and Milan Direct, and the IPO in December • 1HFY16 Revenue w
Slide 3: Summary: First Half Results FY16
Summary: First Half Results FY16 For personal use only • The Group has redirected marketing mix to focus on online channels which has brought first time customer costs back towards historical trends • Initiatives to maximise synergies have been brought forward and being implemented, however, yet to
Slide 4: Increased investment in brand awareness activities
Increased investment in brand awareness activities For personal use only • Initial channel mix focused on building brand awareness, but has impacted First Time Customer acquisition rate • Future spend and channel mix focused on new customer acquisition • Cost per First Time Customer is trending back
Slide 5: Increased Revenue per Customer to $335
Increased Revenue per Customer to $335 For personal use only • Increased focus on higher price point offerings such as furniture, has changed buying habits and helped drive Revenue per Active Customer up to $335 from $310, up 8% • Our model (no/low inventory) provides flexibility to quickly change o
Slide 6: Revenue priorities for H2FY16 and H1FY17
Revenue priorities for H2FY16 and H1FY17 For personal use only Marketing • Increased focus on building first time customers through improved marketing 1 Activities optimisation Merchandising • Build out merchandising mix to provide a broader range of products across all 2 Mix key categories, price p
Slide 7: The Roadmap to EBITDA positive
The Roadmap to EBITDA positive For personal use only Achieve Breakeven § Demonstrate accelerated profitability § Extend market leading via platform position enhancements, further group integration and § Accelerate revenue offline offering § Securing funding growth through market through a pre-IPO sh
Slide 8: 1H16 Key Financials
For personal use only 8 1H16 KEY FINANCIALS
Slide 9: Pro Forma Profit & Loss
Pro Forma Profit & Loss For personal use only A$m FY13 FY14 FY15 1H16 Key observations Revenue 29.9 46.1 59.9 32.1 Cost of Sales (17.5) (26.8) (35.2) (19.8) § 1H16 Revenue is broadly in line with internal targets Gross Profit 12.4 19.3 24.7 12.3 § 2.8% lower gross margin driven by Distribution (5.6)
Slide 10: H1 Balance Sheet
H1 Balance Sheet For personal use only A$m 31 Dec 2015 Key observations Assets Cash and cash equivalents 27.7 § Strong balance sheet with $27m cash and zero debt Inventories 3.1 Other current assets 0.4 § Inventories reflect Milan Direct’s low inventory model Intangibles, incl goodwill 27.9 and stoc
Slide 11: Full Year 2016 Guidance
Full Year 2016 Guidance For personal use only Pro forma revenue guidance ($m) H2 Initiatives $90 • Changing merchandising mix to include greater offering of lower price-point categories (e.g. décor, soft $80 76.2* furnishings and bedding) • Launched Temple & Webster permanent online store $70 59.9 w
Slide 12: Strategy & Outlook
For personal use only 12 STRATEGY & OUTLOOK
Slide 13: Furniture and Homewares: a large addressable market with upside in Australia
The Group operates within the Furniture and Homewares category – a large addressable market with significant upside in Australia For personal use only Furniture and homewares Online Penetration A$12.1 billion addressable market rates by country from CY12 to CY14. Total 14.0% 12.8% A$12.1bn 11.4% 12.
Slide 14: Bringing together the leading online businesses to create the TPW Group
Over the last 7 months we’ve brought together the leading online businesses in our category to create the TPW Group For personal use only 30 July 2015 Mid-September 2015 December 2015 January 2016 Feb / March 2016 § Acquisition of § Wayfair Australia § TPW Group § Temple & Webster § Sydney Wayfair r
Slide 15: Building the platform for growth and EBITDA breakeven
We are focused on building the platform for growth and to reach EBITDA breakeven For personal use only ✔ Follow the customer and become #1 ✔ Capture Scale Benefits • Number 1 player in category • Supplier management being centralised • Multi-brand strategy in place • Marketing spend centralised and
Slide 16: Multiple Drivers of Growth
Multiple Drivers of Growth For personal use only Well capitalised, $27 million cash and zero debt § Invest in marketing and brand awareness to increase active customers Continue organic § Increase investment in data analytics to drive data driven sourcing, buying and merchandising decisions growth t
Slide 17: The Platforms
For personal use only 17 THE PLATFORMS
Slide 18: Temple & Webster
Temple & Webster For personal use only Temple & Webster Journal • 1.3 million members skewed to females and top quartile • Unique on-trend, desirable product – highly curated / merchandised product offerings continually providing desirable ‘discovery- based’ experiences • Customer engagement starts
Slide 19: ZIZO
ZIZO For personal use only • Previously the Australian subsidiary of Wayfair Inc., acquired in July 2015 and successfully integrated into the Temple & Webster Group • Applies the same market leading technology as the US$3bn Wayfair Inc (NYSE: W) in the US • Over 140,000 products consistently availab
Slide 20: Milan Direct
Milan Direct For personal use only Milan Direct • Leading online only furniture retailer • Targeting both consumers and commercial customers • Broad and deep range of approximately 14,000 products including home, office, outdoor, lighting, appliance and homewares • Capabilities and experience in pri
Slide 21: Summary: H1/FY16
Summary: H1/FY16 For personal use only § Transformation of the business is on track § Redirecting marketing mix to focus on online channels § Accelerating new growth initiatives and synergies § Downside risk estimate on the prospectus revenue guidance of $76.2m of up to 10% § $12bn market opportunit
Slide 22: For personal use only
~s oe 6) AjuoO @Sn feuossed JOS
Slide 23: We invite you to explore our brands for yourself
We invite you to explore our brands for yourself Please use the code TPW1H, to secure a 10% discount* on your next purchase. For personal use only APPENDIX TPW1H 23 *10% off next purchase • One time use only • Valid for 7 days (03/03/16) • See websites for T&Cs
Temple & Webster Group — H1 FY16 Earnings Presentation on 6ix