Tribhovandas Bhimji Zaveri Limited · NSE:TBZ
Tribhovandas Bhimji Zaveri — Q3 FY19 Earnings Presentation
24 slides from Tribhovandas Bhimji Zaveri's earnings presentation, February 2019
Slide 1: Investor Presentation Q3 & 9M FY19 Results
INVESTOR PRESENTATION Q3 & 9M FY19 RESULTS FEBRUARY 2019
Slide 2: Disclaimer
DISCLAIMER This presentation has been prepared by Tribhovandas Bhimji Zaveri Limited (“TBZ”) for informational purposes only and does not constitute or form any part of any offer, invitation or recommendation to purchase or subscribe for any securities in any jurisdiction, and no part of it shall fo
Slide 3: Discussion Summary
DISCUSSION SUMMARY • Q3 & 9M FY19 Results Update • About Us • Operational Summary • Business Model
Slide 4: Q3 FY19 Result Highlights
Q3 FY19 RESULT HIGHLIGHTS In Rs Mn REVENUES & GROSS MARGIN EBITDA & EBITDA MARGIN PAT & PAT MARGIN 5.1% 1.9% 13.5% 13.9% 4.1% 1.3% 111 5,476 5,917 301 74 226 Q3 FY18 Q3 FY19 Q3 FY18 Q3 FY19 Q3 FY18 Q3 FY19 OPERATING COSTS (%) REVENUE ANALYSIS Total Revenue Growth % 8.1% - Q3 FY19 Q3 3.5% 2.4% 1.3% 1
Slide 5: 9M FY19 Result Highlights
9M FY19 RESULT HIGHLIGHTS In Rs Mn REVENUES * & GROSS MARGIN EBITDA & EBITDA MARGIN PAT & PAT MARGIN 14.4% 14.6% 1.1% 4.1% 4.4% 1.0% 13,178 13,483 598 541 140 141 9M FY18 9M FY19 9M FY18 9M FY19 9M FY18 9M FY19 * Net of Excise Duty OPERATING COSTS (%) REVENUE ANALYSIS Total Revenue Growth % 2.3% - 9
Slide 6: Q3 FY19 Balance Sheet Update
Q3 FY19 BALANCE SHEET UPDATE LEVERAGE ANALYSIS (RS MN) 1.09 1.16 5,313 5,726 4,867 4,931 Mar-18 Dec-18 Equity Net Debt Net Debt/Equity GOLD INVENTORY BREAKUP (%) TOTAL DEBT BREAKUP (RS MN) 5,687 6,129 60.7% 59.6% 2,784 2,957 39.3% 40.4% 2,903 3,172 Mar-18 Dec-18 Mar-18 Dec-18 Own Gold Gold on Loan W
Slide 7: Q3 FY19 - Key Result Takeaways
Q3 FY19 - KEY RESULT TAKEAWAYS REVENUES: • Revenues increased by 8.1% YoY • Led by 7.0% same store sales growth • Healthy consumer sentiments during festivals and wedding season MARGINS: • Gross margin improved YoY from 13.5% to 13.9% in Q3 FY19 driven by improved gold and diamond mix • EBITDA incre
Slide 8: Q3 & 9M FY19 - Profit & Loss Statement
Q3 & 9M FY19 - PROFIT & LOSS STATEMENT Particulars (In Rs Mn) – Q3 FY19 Q3 FY18 YoY % 9M FY19 9M FY18 YoY % FY18 Standalone Net Revenues 5,917 5,476 8.1% 13,483 13,178 2.3% 17,514 COGS 5,098 4,735 7.7% 11,520 11,279 2.1% 15,053 Gross Profit 820 741 10.6% 1,963 1,899 3.4% 2,461 Gross Margin (%) 13.9%
Slide 9: Q3 & 9M FY19 - Balance Sheet
Q3 & 9M FY19 - BALANCE SHEET Particulars (In Rs Mn) – Standalone December-18 September-18 June-18 March-18 December-17 Shareholders Funds 4,931 4,823 4,879 4,867 4,803 Loan Funds 6,129 6,292 6,082 5,687 5,283 Gold on Loan 2,957 2,933 2,975 2,784 2,595 Working Capital Loan 3,172 3,359 3,107 2,903 2,6
Slide 10: Discussion Summary
DISCUSSION SUMMARY • Q3 & 9M FY19 Results Update • About Us • Operational Summary • Business Model
Slide 11: Why is TBZ Different?
WHY IS TBZ DIFFERENT ? Pedigree Strong Brand Value • 150+ years in jewellery business • Healthy sales productivity • First jeweller to offer buyback • High footfalls conversion - 80% guarantee in 1938 • High ticket size - Gold – Rs 91 k, • Professional organisation Diamond - Rs 129 k spearheaded by
Slide 12: Key Milestones
KEY MILESTONES STRONG LEGACY OF MORE THAN 150 YEARS BUILT ON TRUST Retail footprint Flagship store Introduced 100% Diamond facility crosses 84k sq ft 2nd Franchise opened in Zaveri pre-hallmarked expansion - ~6k 1st Franchise across 20 cities store opened Bazaar, Mumbai jewellery to ~24k sq ft store
Slide 13: Retail Presence
RETAIL PRESENCE Present across 29 cities PAN-INDIA PRESENCE WITH 41 STORES in 14 states WITH A RETAIL SPACE OF ~120,699 SQ. FT. SPREAD ACROSS 29 CITIES IN 14 STATES NUMBER OF STORES TILL DATE Ludhiana Large Format (> 2,000 sq. ft.) 31 Noida Small Format (<= 2,000 sq. ft.) 10 Total Stores 41 Total Ar
Slide 14: Retail Footprint Expansion
RETAIL FOOTPRINT EXPANSION 1,20,699 1,10,666 1,02,930 98,200 41 91,058 88,093 37 82,368 32 30 27 28 25 FY13 FY14 FY15 FY16 FY17 FY18 9M FY19 No. of Retail Outlets Carpet Area (sq. ft.) 14
Slide 15: Discussion Summary
DISCUSSION SUMMARY • Q3 & 9M FY19 Results Update • About Us • Operational Summary • Business Model
Slide 16: Operational Summary
OPERATIONAL SUMMARY GOLD & DIAMOND VOLUMES 52,010 43,808 45,111 39,958 40,762 4,706 4,361 4,216 3,931 3,738 FY14 FY15 FY16 FY17 FY18 Gold Sales (kgs) Diamond Sales (cts) SSSG - TOTAL (%) AVERAGE TICKET SIZE (RS ‘000) 139 131 129 4.0 122 115 0.1 84 85 91 73 80 -2.1 -9.9 -16.5 FY14 FY15 FY16 FY17 FY18
Slide 17: Discussion Summary
DISCUSSION SUMMARY • Q3 & 9M FY19 Results Update • About Us • Operational Summary • Business Model
Slide 18: Business Model: Manufacturing (Gold)
BUSINESS MODEL: MANUFACTURING Gold PROCUREMENT • Raw Material - Bullion Sources: • Exchange & purchase of old jewellery • Bullion dealers • Banks - imported gold • Banks - domestic gold (gold deposits) on loan • Gold jewellery manufacturing is outsourced. • Vast nation-wide network of 150 vendors •
Slide 19: Business Model: Manufacturing (Diamond)
BUSINESS MODEL: MANUFACTURING Diamond PROCUREMENT • Raw Material - Cut & polished diamonds Sources: • DTC site holders • In-house diamond jewellery manufacturing leading to exclusive designs, lower costs, and higher margins Manufacturing facility at Kandivali, Mumbai MANUFACTURING • spread over ~24,
Slide 20: Business Model: Retail
BUSINESS MODEL: RETAIL EFFICIENT INVENTORY MANAGEMENT HUB & SPOKE MODEL - ROI OPTIMISATION SMALL STORES • <= 2,000 sq ft SMALL • Across the city STORE • Smaller range • Lower price points (up to Rs 500k) SMALL LARGE FORMAT SMALL LARGE STORES STORE STORE STORE • > 2,000 sq ft • Standalone high street
Slide 21: Business Model: Scalability
BUSINESS MODEL: SCALABILITY • TBZ has an expansion plan to increase its retail space from ~120,699 sq. ft. at present to around 1,50,000 sq. ft. over near term. • TBZ plans to carry out the expansion through mix of franchisee route and addition of its own stores. • All the prospective expansion loca
Slide 22: Gold Metal Loan: Efficient Sourcing Channel
GOLD METAL LOAN: EFFICENT SOURCING CHANNEL GOLD METAL LOAN ORIGINATION GOLD METAL LOAN REPAYMENT • TBZ takes 10 kg gold from a bank on lease on day 0. • TBZ repays the gold daily based on actual sales of • The contract for gold lease is 180 days. gold jewellery. • TBZ provides a bank guarantee worth
Slide 23: Awards & Recognition
AWARDS & RECOGNITION • “DIAMOND VIVAH JEWELLERY OF THE YEAR” Retail Jeweller India Awards - 2018 • “INDIA’S MOST PREFERRED JEWELLERY BRAND” UBM India - 2017 • “BEST RING DESIGN OVER Rs. 2,50,000” JJS-IJ Jewellers Choice Design Awards - 2016 • “TV CAMPAIGN OF THE YEAR” 12th Gemfields Retail Jeweller
Slide 24: Contact Details
Saurav Banerjee Nilesh Dalvi Chief Financial Officer IR Consultant Tribhovandas Bhimji Zaveri Limited Dickenson Seagull IR +91 022 30735000 +91 9819289131 saurav.banerjee@tbzoriginal.com nilesh.dalvi@dickensonir.com 24
Tribhovandas Bhimji Zaveri — Q3 FY19 Earnings Presentation on 6ix