Mavi Giyim Sanayi Ve Ticaret A.s. · BIST:MAVI
Mavi Giyim Sanayi Ve Ticaret A.s — Investor Presentation (May 2018)
32 slides from Mavi Giyim Sanayi Ve Ticaret A.s's investor presentation, May 2018
Slide 1: Investor Presentation May 2018
INVESTOR PRESENTATION May 2018 0
Slide 2: Disclaimer
Disclaimer This document does not constitute or form part of any offer to sell or issue or invitation to purchase or subscribe for, or any solicitation of any offer to purchase or subscribe for, any securities of the Company. The information, statements and opinions contained in this presentation do
Slide 3: Mavi Business Overview
" MAVI BUSINESS OVERVIEW
Slide 4: Mavi investment highlights
ASPIRATIONAL lifestyle and customer- 1 centric BRAND with broad appeal and celebrity endorsements 2 Locally sourced WORLD-CLASS PRODUCTS with well segmented ranges 3 MULTI-CHANNEL EXECUTION with robust retail store economics 4 BEST-IN-CLASS COMMUNICATION STRATEGY enhancing brand awareness acro
Slide 5: Mavi: Highly Successful Lifestyle Brand
Mavi : Highly Successful Lifestyle Brand… Business Overview Key Metrics (2017) Brand & Product Started operations in Istanbul in 1991, Mavi today is globally recognized as a highly successful casual lifestyle brand TRY1,782m Revenue TRY252m EBITDA #1 c.54%3 Lifestyle With strong denim roots, Mav
Slide 6: …With Strong International Presence
…With Strong International Presence Canada Europe Russia 360 # Retail Stores: 3 # Retail Stores: 9 # Retail Stores: 14 # Wholesale Doors: c.1,800 # Wholesale Doors: c.1,400 # Franchised Stores: 18 # FTEs: 52 # FTEs: 158 # Wholesale Doors: c.125 Mono-Brand # FTEs: 108 Stores in Turkey 65 Internationa
Slide 7: Offering a Lifestyle Product Portfolio Across Men and Women
Offering a Lifestyle Product Portfolio Across Men and Women… Key Product Categories 44% 46% 17% 21% 13% 13% 9% 9% 6% 7% 11% 4% Other3 Denim All Non-Denim Products Knits Shirts Jackets Accessories2 Bottoms Skirts & Dresses Women Men 46% Denim All / 54% Lifestyle 37% Women / 63% Men % of 2017 Net Sale
Slide 8: …And Growing Significantly in Each Category
…And Growing Significantly in Each Category Denim Products (TRYm) Lifestyle Products (TRYm) Knits Shirts Denim All 46% 21% 13% 526,1 397,2 329,7 234,9 257,2 188,2 146,9 159,2 104,3 119,9 71,2 87,2 2014 2015 2016 2017 2014 2015 2016 2017 2014 2015 2016 2017 Denim Bottoms 43% Jackets Accessories1 9% 7
Slide 9: Minimising Fashion Risk and Seasonality Across Lifestyle Offering
Minimising Fashion Risk and Seasonality With Various Styles Across Lifestyle Product Offering Breakdown by Season (units) Mavi Women Style Groups Denim All FW17; SS17; 48% 52% Gold Casual Glam Pretty Istanbul&Basics Lifestyle excluding Premium Lifestyle Young Everyday Accessories1 FW17; SS17; 45% 55
Slide 10: Keeps Strong Track Record of Retailization in Turkey
Keeps Strong Track Record of Retailization in Turkey… # of Retail Stores Evolution in Turkey Turkey Retail Sales Evolution (TRYm) Net New 27 27 25 26 Retail Stores 1,133 857 704 551 261 287 209 236 2014 2015 2016 2017 2014 2015 2016 2017 Gross Selling Space Evolution in Turkey (Sqm k) Significant LF
Slide 11: Supported by High Like-for-like Growth Figures
…Supported by High Like-for-like Growth Figures 13.6% 22.8% 11,8% 3 20,1% Transaction2 9,9% # Growth 7,3% 14,7% 14.1% (%) 1 10,8% 2014 2015 2016 2017 2014 2015 2016 2017 7,4% 6,9% 7,1% Strong brand positioning & top of mind 3 Basket Size 3,9% Increased traffic & conversion driven by Growth (%)
Slide 12: Complimentary and Growing Wholesale Channel in Turkey
Complimentary and Growing Wholesale Channel in Turkey 73 franchised stores under long-term Franchised contracts with similar product assortment Stores like in retail stores Overall mono-brand strategy is to grow retail Domestic Wholesale Net Revenues (TRYm) business Usually individual multibra
Slide 13: Best-in-Class Loyalty Program (Kartuş) Since 2007
Best-in-Class Loyalty Program (“Kartuş”) Since 2007 Strong Appeal to Under 35 Across Majority of New Loyalty Card Holders Both Genders are Under 35 6.5M 4.7M % of Turkey’s Total Loyalty Card Active Active Loyalty Card Members per Age Group (%) Population (2016) New Loyalty Card Members per Age Group
Slide 14: Award Winning Branding Strategy
Award Winning Branding Strategy According to the Consumer’s Voice Survey, Mavi, with its product and service quality, is the leader of the apparel industry among the brands 40.000.000+Tv Views that create highest customer loyalty. Digital (Mediacat & IPSOS & Kalder, April 2017) 20.000.000+Impression
Slide 15: Highly Experienced Management Team and Directors
Highly Experienced Management Team and Directors Ersin Akarlılar Ahmet Ashaboglu Cüneyt Yavuz Chairperson Independent Non- CEO Executive Director With Mavi since 1991 CFO of Koc Holding since Mavi’s Chief Executive Officer 2006 since 2008 Primarily responsible for Mavi’s international strate
Slide 16: Continued Growth
“You won’t catch me in a tie. I like comfortable clothes such as my. Mavi Jeans, Belstaff jacket and Armani button-down shirt. They are comfortable enough for flights and nice enough for meetings. Richard Branson = CONTINUED |GROWTH
Slide 17: Rapidly Growing Addressable Market
Rapidly Growing Addressable Market… Evolution of Apparel Market in Turkey Value CAGR Comments 2011A-2016A 2016A-2019E 56 The apparel market in Turkey is Mavi Future Customers expected to grow at an annual expected CAGR of 7% between 13% 11% 2016 and 2019, following an annual 46 14 CAGR of 9% betwe
Slide 18: Will Enable Continued Growth in Turkey
.. Will Enable Continued Growth in Turkey Historical (2014-16) Future (2017-2019) Rationale Average 26 net new stores p.a. In line with historical 8.5k sqm expansion of existing trends and further >40%1 selling space growth Mavi Selling Space Growth stores in 2015 and 2016 expansion opportunities po
Slide 19: Global Footprint to Grow Keeping 80%-20% Ratio
Global Footprint to Grow in Line Keeping 80%-20% Ratio1 Strategic Growth Initiatives Increase Share of Lifestyle 34 # of Mono- # Full Time Local Wholesale Retail Women / Men Product Heritage Pure Online Brand Stores Employees Office Expansion Roll-Out Revenues Expansions Roll-out E-Commerce Wholesal
Slide 20: E-Commerce Platform to Deliver Future Growth
E-Commerce Platform to Deliver Future Growth Global Mavi E-Commerce has Potential to Reach ~3% by 2019E Turkey Has a Strong E-Commerce Potential mavi.com Revenue (TRYm) E-Commerce Penetration Turkey 3.4% 39 Website 22 11 14 The percentage of E-Commerce penetration in Turkey (vs. China 17.1%, USA 10.
Slide 21: Strong Financial Performance
STRONG FINANCIAL PERFORMANCE
Slide 22: Mavi Delivers Strong Operational Results
Mavi Delivers Strong Operational Results Revenue Evolution (TRYm) Gross Profit Evolution (TRYm) Gross 49% 50% 51.0% 50,9% Margin (%) 1.782 1.368 906 1.053 698 895 524 435 2014 2015 2016PF 2017 2014 2015 2016PF 2017 EBITDA Evolution (TRYm) Net Profit (TRYm) EBITDA Profit 12% 12% 13.0% 14,1% Margin (%
Slide 23: Strong Cash Conversion
Strong Cash Conversion Cash Conversion1 Main Working Capital Items 118% 111% TRYm 2014 2015 2016PF 2017 92% 84% Trade & Other Receivables3 93.8 89.1 132.9 140.2 % Sales 10.5% 8.5% 9.7% 7.9% Inventories 154.7 177.3 287.8 320.4 2014 2015 2016PF 2017 % COGS 33.6% 33.6% 42.9% 36.6% TRYm 2014 2015 2016PF
Slide 24: Efficient Capex Management and Healthy Leverage Ratios
Efficient Capex Management and Healthy Leverage Ratios CAPEX Debt Breakdown (31 January 2018) % Sales 6,9% 5,4% 4,8% 4,1% 72,8 EUR Cost of Debt1 61,5 57,1 62,6 10% USD TRY 11.42% - 18.13% 14% USD 4.05% - 4.69% EUR 0.00% - 2.99% TRY 76% Blended 9.96% 2014 2015 2016PF 2017 Net Debt / EBITDA 1.0x 0.4x
Slide 25: Resilient to FX Movements
Resilient to FX Movements Gross Margin Evolution (%) 51% 51% Mavi sources approximately 80% of COGS from Turkey in TRY 50% COGS 49% Negotiating with suppliers / customers for adverse FX movements 2014 2015 2016PF 2017 Data Rebased to 100 140 163 Mavi has 2/3 of its rents in Turkey denominated
Slide 26: FY 2018 Guidance
FY 2018 Guidance 25% consolidated sales growth 25 new retail store openings in Turkey 16% Turkey retail LFL growth Consolidated EBITDA margin above 14% (targeting 50bps improvement) Net Debt / EBITDA below 1x Capex : Up to 5% of consolidated sales 25 25
Slide 27: Thank You
THANK YOU Contact : investorrelations@mavi.com
Slide 28: Financial Statements: Income Statement
Financial Statements Income Statement TRYm Q4 2016 Q4 2017 Change (%) 2016 2017 Change (%) Revenue 335.3 431.2 28.6% 1,307.9 1,781.7 36.2% Cost of Sales (162.6) (209.6) 29.0% (640.9) (875.3) 36.6% Gross Profit 172.7 221.6 28.3% 667.0 906.3 35.9% Gross Margin 51.5% 51.4% 51.0% 50.9% Administrative Ex
Slide 29: Financial Statements: Balance Sheet
Financial Statements Balance Sheet 31 January 2017 31 January 2018 Change (%) Assets Current Assets Cash and Cash Equivalents 158.1 266.3 68.5% Trade Receivables 109.4 113.0 3.3% Inventories 287.8 320.4 11.3% Other Current Assets 70.1 61.8 (11.9%) Total Current Assets 625.4 761.4 21.7% Non-Current A
Slide 30: Financial Statements: Cash Flow Statement
Financial Statements Cash Flow Statement TRYm 2016 2017 Profit¹ 51.8 90.0 D&A Expense 46.5 61.9 Net Finance Expense / (Income) 48.9 68.0 Tax Expense 16.6 22.2 Other Non-Cash Items 7.7 17.0 Cash Flow from Operating Activities 171.5 259.1 Δ in Net Working Capital² (27.5) 27.9 Income Tax Paid (16.1) (1
Slide 31: Q4 2017 Channel Growth Performance
Q4 2017 Channel Growth Performance Global Revenue (TRYm) Turkey Revenue (TRYm) Channel Channel Growth Growth 1.453 1.121 44% 1.782 298 20% 76% 249 263 345 1.308 857 1.133 32% 561 31 36 42% 227 302 396 Q4 2016 Q4 2017 2016 2017 431 1.182 335 890 33% International Revenue (TRYm) 103 89 238 315 Proform
Slide 32: Q4 2017 Margin Performance
Q4 2017 Margin Performance Revenue (TRYm) Gross Profit (TRYm) 51.5% 51.4% 51.0% 50.9% 1.782 906 1.308 667 335 431 173 222 Q4 2016 Q4 2017 2016 2017 Q4 2016 Q4 2017 2016 2017 EBITDA (TRYm) Net Income (TRYm) 10.6% 10.3% 13.0% 14.1% -0.3% 1.4% 4.0% 5.1% 252 90 170 52 36 44 6 (1) Q4 2016 Q4 2017 2016 20
Mavi Giyim Sanayi Ve Ticaret A.S. — Investor Presentation (May 2018) on 6ix