Adairs Ltd. · ASX:ADH
Adairs — Shareholder Meeting (October 2020)
28 slides from Adairs's shareholder meeting presentation, Oct 26, 2020
Slide 1: Adairs Limited Annual General Meeting
Adairs Limited Annual General Meeting 26 October 2020
Slide 2: Michael Butler, Chairman
1 Michael Butler Chairman
Slide 3: Your Board
Your Board 2 Michael Butler (Chair) Trent Peterson Kate Spargo Kiera Grant Simon West David MacLean Mark Ronan, MD&CEO Michael Cherubino Non-executive Directors Executive Directors Independent Company secretary: Fay Hatzis
Slide 4: FY20 (2H in review)
FY20 (2H in review) 3 Share price performance during key COVID-19 period
Slide 5: Chairman's Report
4 CHAIRMAN’S REPORT
Slide 6: Our new National Distribution Centre
Our new National Distribution Centre 5
Slide 7: The last 5 years – our growing online channel
0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% FY15 - Q4 FY16 - Q1 FY16 - Q2 Note: FY16 - Q3 FY16 - Q4 FY17 - Q1 FY17 - Q2 FY17 - Q3 FY17 - Q4 FY18 - Q1 Source: Adairs (unaudited) FY18 - Q2 FY18 - Q3 FY18 - Q4 FY19 - Q1 FY19 - Q2 Group online sales % 1 FY19 - Q3 FY19 - Q4 (rolling 12 months by
Slide 8: The last 5 years – our growing online channel
The last 5 years – our growing online channel 7 Online contribution 2 ($m) Online contribution margin2 (% of Online sales) (rolling 12 months by quarter) (rolling 12 months by quarter) $70 +342% 40% $60 35% 30% $50 25% $40 20% $30 15% $20 10% $10 5% $0 0% FY15 - Q4 FY16 - Q1 FY16 - Q2 FY16 - Q3 FY16
Slide 9: Mark Ronan, CEO
8 Mark Ronan CEO
Slide 10: FY20 highlights
FY20 highlights 9 COVID-19 has highlighted the resilience of our model and strength of our brands Omni-channel ► Group Sales +12.9% to $388.9m strategy drives ► Group online sales up 110.5% to $124.2m record sales ► Adairs online sales up 61.4%; Mocka sales up 30.4%2 ► Stores sales –7.3% with LFL st
Slide 11: Our market
Our market 10 We have a very large addressable market … and we have a strong record of growing market share in Australia Sales CAGR – Adairs/Mocka v Market (Home3) ► online is expected to move towards 15%-20% of category sales in line with overseas experience ► being omni-channel means the entire ma
Slide 12: Our 5 drivers of future growth
11 Our 5 drivers of future growth 1 Proven and resilient business model 2 Profitable store formats 3 Digital transformation 4 Mocka 5 Omni Supply Chain Strategy
Slide 13: Drivers of Future Growth – our business model
Drivers of Future Growth – our business model 12 Our current business model is proven, resilient and offers material scope to grow 1 Proven and resilient business model High exposure to online growth Strong brands (that we own and control) ► Adairs online sales +61.4% and Mocka +38.8% in ► Lower cos
Slide 14: Drivers of Future Growth – profitable store formats
Drivers of Future Growth – profitable store formats 13 Our stores are key to being omni and retain significant growth potential 2 Profitable store formats ► All Stores are profitable with relatively short lease terms ► Larger stores are more profitable ► Significant upsizing opportunities remain wit
Slide 15: Drivers of Future Growth – digital transformation
Drivers of Future Growth – digital transformation 14 Our digital strategy was the engine room for 3 Digital transformation growth in FY20 and this will continue well into the future Development of our digital strategy & channel ► Accelerating our digital transformation through additional investment
Slide 16: Drivers of Future Growth - Mocka
Drivers of Future Growth - Mocka 15 Mocka is a highly complementary and profitable pure play online retailer with significant market opportunities, particularly in Australia 4 Mocka ► Australian brand awareness is growing rapidly ► Cross-promotion opportunities being trialled ► Expansion of Australi
Slide 17: Drivers of Future Growth – Supply chain
Drivers of Future Growth – Supply chain 16 Our new NDC will assist in enabling our digital strategy and delivering profitable growth for the next decade 5 Omni Supply Chain Strategy New National Distribution Centre ► DHL to operate – we will focus on customers and product ► Faster and more efficient
Slide 18: FY21 trading and business update
FY21 trading and business update 17 In the first 17 weeks of FY21 Sales, unaudited Growth ► Sales across all channels for the have been well ahead (first 17 weeks of FY21) over PCP of the same period last year Adairs stores -0.6% ► Online sales account for 41% of total sales (Adairs Adairs stores (L
Slide 19: Meeting Resolutions
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Slide 20: 1. Annual Financial Report
1. Annual Financial Report 19 “To receive and consider the Financial Report of the Company and its controlled entities and the Reports of the Directors and Auditor for the year ended 28 June 2020.”
Slide 21: 2. Re-election of Director
2. Re-election of Director 20 “That David MacLean, being eligible, be re-elected as a Director of the Company.” Usable Votes and Proxies Received Votes / Proxies % of Eligible Votes Cast (excluding abstentions) For: 79,810,229 76.03% Open/Undirected (Chairman) 123,452 0.12% Open/Undirected (Other) 3
Slide 22: 3. Remuneration Report
3. Remuneration Report 21 “That the Remuneration Report for the year ended 28 June 2020 be adopted.” Usable Votes and Proxies Received Votes / Proxies % of Eligible Votes Cast (excluding abstentions) For: 78,275,525 79.41% Open/Undirected (Chairman) 126,221 0.13% Open/Undirected (Other) 398,510 0.40
Slide 23: 4. Approval of long term incentive grant of options to Mark Ronan
4. Approval of long term incentive 22 grant of options to Mark Ronan “That approval be given for all purposes, including ASX Listing Rule 10.14, for the grant of options to Mark Ronan as his annual long term incentive for the year ended 27 June 2021 on the terms described in the explanatory notes ac
Slide 24: 5. Approval of long term incentive grant of options to Michael Cherubino
5. Approval of long term incentive 23 grant of options to Michael Cherubino “That approval be given for all purposes, including ASX Listing Rule 10.14, for the grant of options to Michael Cherubino as his annual long term incentive for the year ended 27 June 2021 on the terms described in the explan
Slide 25: 6. Approval of the financial assistance
6. Approval of the financial assistance 24 “That, for the purposes of section 260B(2) of the Corporations Act 2001 (Cth), approval is given for the financial assistance to be provided by Mocka Products Pty Ltd (ACN 152 476 349) from time to time in connection with the Acquisition as described in the
Slide 26: 7. Re-insertion of Proportional Takeover Provisions in the Constitution
7. Re-insertion of Proportional 25 Takeover Provisions in the Constitution “That the proportional takeover provisions contained in Rule 6 of the Company’s Constitution be inserted for a period of three years with effect from the date of the Annual General Meeting.” Usable Votes and Proxies Received
Slide 27: Meeting Closed
26 MEETING CLOSED
Slide 28: Disclaimer
Strong Omni Channel Execution 27 Disclaimer Some of the information contained in this presentation contains “forward-looking statements” which may not directly or exclusively relate to historical facts. These forward-looking statements reflect Adairs Limited current intentions, plans, expectations,