33 slides from S.p. Apparels's earnings presentation, November 2017
Slide 1: Cover letter to stock exchanges: Q2 Financial Presentation
S.PAPPARELS LTD. a Regd. Office : 39-A, Extension Street, Kaikattipudur, AVINASHI - 641 654, Tirupur Dt., Tamil Nadu, India. Phone : +91-4296-714000 E-mail : spindia@s-p-apparels.com Web : www.s-p-apparels.com CIN No.: L18101TZ2005PLC012295 16"" November, 2017 The Listing Department The Listing Depa
Slide 2: Q2 & H1 FY18 Results Update
Q2 & H1 FY18 RESULTS UPDATE November 2017
Slide 3: Disclaimer
DISCLAIMER This presentation and the following discussion may contain “forward looking statements” by S.P. Apparels Limited (“SPAL” or the Company) that are not historical in nature. These forward looking statements, which may include statements relating to future results of operations, financial co
Slide 4: Key Highlights – Results
KEY HIGHLIGHTS – Q2 & H1 FY18 RESULTS Sustained Performance in Garment Exports Division despite Volatile Currency Movements Significant Growth in SPUK Operations Strong Sales Traction in Retail Division Retail Division achieved Operational Break-even in Q2 FY18 Adj. EBITDA margin 2 improve
Slide 5: Results Update agenda
Q2 & H1 FY18 RESULTS UPDATE Company Overview Business Strategy & Outlook Financial Overview & Shareholding Structure
Slide 6: Results Key Highlights
Q2 & H1 FY18 RESULTS KEY HIGHLIGHTS Q2 FY18 YoY ANALYSIS In Rs Mn REVENUES 1 Adj. EBITDA & EBITDA MARGIN 2 PBT & PBT MARGIN 3 PAT & PAT MARGIN 3 1,719.2 1,702.2 17.6% 18.6% 13.0% 9.1% 8.8% 5.7% 302.5 317.1 223.7 156.2 150.4 97.6 Q2 FY17 Q2 FY18 Q2 FY17 Q2 FY18 Q2 FY17 Q2 FY18 Q2 FY17 Q2 FY18 EBITDA
Slide 7: Division Wise Analysis – Q2 FY18
Q2 & H1 FY18 RESULTS DIVISION WISE ANALYSIS In Rs Mn Q2 FY18 YoY ANALYSIS – TOTAL REVENUE BREAKUP 1 DIVISION REVENUES SHARE Q2 FY17 Q2 FY18 Garments * 90.7% 87.5% 1,719.2 1,702.2 Retail 9.3% 12.5% 160.2 212.8 Adj. EBITDA MARGIN % 2 Q2 FY17 Q2 FY18 33 % Garments * 20.0% 20.4% Retail -6.3% 6.3% 1,559.
Slide 8: Division Wise Analysis – H1 FY18
Q2 & H1 FY18 RESULTS DIVISION WISE ANALYSIS In Rs Mn H1 FY18 YoY ANALYSIS – TOTAL REVENUE BREAKUP 1 DIVISION REVENUES SHARE H1 FY17 H1 FY18 Garments * 91.6% 90.0% Retail 8.4% 10.0% 3,358.7 3,264.3 281.5 327.3 Adj. EBITDA MARGIN % 2 H1 FY17 H1 FY18 16 % Garments * 18.5% 20.1% Retail -8.0% 3.2% 3,077.
Slide 9: Result Analysis
Q2 & H1 FY18 RESULTS RESULT ANALYSIS FINANCIAL UPDATE: • Q2 FY18 total revenues 1 marginally declined by 1% YoY to Rs 1,702.2 mn. • Revenues were flat in garments division and grew by 33% in retail division. • Garments division revenues were flat due to ‘Brexit’ impact. • Retail division growth was
Slide 10: Consolidated Profit & Loss Statement
Q2 & H1 FY18 RESULTS CONSOLIDATED PROFIT & LOSS STATEMENT Particulars (In Rs Mn) Q2 FY18 Q2 FY17 YoY % H1 FY18 H1 FY17 YoY % Revenue from Operations 1,661.3 1,670.4 -0.5% 3,167.4 3,292.5 -3.8% Gain on account of Foreign Currency Fluctuations 40.8 48.8 - 96.9 66.2 - Total Revenues 1,702.2 1,719.2 -1.
Slide 11: Consolidated Balance Sheet
Q2 & H1 FY18 RESULTS CONSOLIDATED BALANCE SHEET Particulars (Rs Million) Sep-17 Particulars (Rs Million) Sep-17 Equities & Liabilities Assets Shareholder's Funds Non-Current Assets Share Capital 251.7 a. Property, Plant and Equipment 2,995.3 Other Comprehensive Income -40.3 Other Equity 3,501.8 b. C
Slide 12: Company Overview
Q2 & H1 FY18 Results Update COMPANY OVERVIEW Business Strategy & Outlook Financial Overview & Shareholding Structure
Slide 13: Brief Profile
COMPANY OVERVIEW BRIEF PROFILE ▪ SPAL is one of the leading manufacturers and exporters of knitted garments for infants and children in India. ▪ Provides end-to-end garment manufacturing from greige fabric to finished products including body suits, sleep suits, tops and bottoms. BUSINESS OVERVIEW ▪
Slide 14: Our Evolution
COMPANY OVERVIEW OUR EVOLUTION 2007-08 Amalgamation with Sri Balaji 2016 2003 Bakkiam Spinning Mills ▪ Listed on BSE / NSE Set-up first in-house embroidery facility at Thekkalur 2008-13 ▪ Repayment of Loans to Streamlining of operations to integrate the reduce leverage 1989 2004 factories, increase
Slide 15: Leading Manufacturer & Exporter of Infant & Children Wear in India
COMPANY OVERVIEW LEADING MANUFACTURER & EXPORTER OF INFANT & CHILDREN WEAR IN INDIA SPAL IS A SPECIALIZED PLAYER IN THE HIGHLY CHALLENGING INFANT & CHILDREN WEAR KNITTED GARMENT INDUSTRY INDUSTRY’S UNIQUE CHALLENGES SPAL’S CORE COMPETENCIES 1 Demonstrated manufacturing excellence for over two decade
Slide 16: Preferred Vendor to Reputed International Brands
COMPANY OVERVIEW PREFERRED VENDOR TO REPUTED INTERNATIONAL BRANDS SPAL IS THE PREFERRED VENDOR FOR KNITTED GARMENTS FOR INFANTS AND CHILDREN TO REPUTED INTERNATIONAL BRANDS AND RETAILERS WHY SPAL? • Expertise to concurrently manage multiple large orders with a diversified product range including bod
Slide 17: Strategically Located & Integrated Manufacturing Facilities
COMPANY OVERVIEW STRATEGICALLY LOCATED & INTEGRATED MANUFACTURING FACILITIES INTEGRATED BUSINESS LOCATION ADVANTAGE: MODEL • All 23 manufacturing facilities are located within a radius of ~125 km of our Registered Office near Product Development Tirupur (leading hub in India for knitted garments for
Slide 18: Strategically Located & Integrated Manufacturing Facilities
COMPANY OVERVIEW STRATEGICALLY LOCATED & INTEGRATED MANUFACTURING FACILITIES Spinning Dyeing 17
Slide 19: Strategically Located & Integrated Manufacturing Facilities
COMPANY OVERVIEW STRATEGICALLY LOCATED & INTEGRATED MANUFACTURING FACILITIES Printing Automated Embroidery Sewing Automated Sewing Assembly Line Semi-Automated Inventory Management 18
Slide 20: Strong In-house Design Expertise
COMPANY OVERVIEW STRONG IN-HOUSE DESIGN EXPERTISE STRONG DESIGN IS SPAL’S CORE COMPETENCY • SPAL’s core competency lies in understanding latest fashion and trends to suit the customers buying preferences. • Dedicated in-house design and merchandising team of designers located at our Corporate Office
Slide 21: Stringent Quality Controls & Compliance
COMPANY OVERVIEW STRINGENT QUALITY CONTROLS & COMPLIANCE • Strong adherence to the highest standards of quality, assurance and compliance. • Stringent quality control checks consisting of inspection and testing of fabric, greige and processed yarn, trims, accessories, packing materials and of each p
Slide 22: Building Retail Presence in India
COMPANY OVERVIEW BUILDING RETAIL PRESENCE IN INDIA SPAL’s PRESENCE ACROSS LARGE FORMAT STORES 21
Slide 23: Building Retail Presence in India
COMPANY OVERVIEW BUILDING RETAIL PRESENCE IN INDIA SPAL IS STRENGTHENING ITS RETAIL PRESENCE BY EXPANDING THE REACH OF CROCODILE BRAND OUR RETAIL STORE PRESENCE • SPAL undertakes manufacturing and retailing activities in India under the ‘Crocodile’ brand. • SPAL sells wide range of adult menswear pr
Slide 24: Qualified Management with Deep Understanding of Apparel Sector
COMPANY OVERVIEW QUALIFIED MANAGEMENT WITH DEEP UNDERSTANDING OF APPAREL SECTOR Mr P. Sundararajan ` Ms S. Latha Mr S. Chenduran Chairman and Managing Director Executive Director Director Operations • Four years of experience in the • Founder director of SPAL with 32 Founder director of SPA with 25
Slide 25: Board of Directors – Wide Spectrum of Experience
COMPANY OVERVIEW BOARD OF DIRECTORS – WIDE SPECTRUM OF EXPERIENCE Mr A.S. Anandkumar Mr P. Yesuthasen Independent Director Independent Director • 44 years of experience in banking • 41 years of experience in banking • Masters of Science from the University • MS in Business Administration, Cass of Ma
Slide 26: Business Strategy & Outlook
Q2 & H1 FY18 Results Update Company Overview BUSINESS STRATEGY & OUTLOOK Financial Overview & Shareholding Structure
Slide 27: Capacity Expansion & Backward Integration
BUSINESS STRATEGY & OUTLOOK CAPACITY EXPANSION & BACKWARD INTEGRATION Existing Business Model SPAL proposes to utilize Rs 750.7 mn from the Net IPO Proceeds towards: 1. Enhancing spinning capacity – Capex of Rs 472.4 mn Product Development • Spinning capacity from 16,896 to 22,272 spindles • Blow ro
Slide 28: Expand Retail Presence Across India
BUSINESS STRATEGY & OUTLOOK EXPAND RETAIL PRESENCE ACROSS INDIA PROPOSED EXPANSION OF RETAIL PRESENCE OVER THREE YEARS • Growing aspiration levels of people in Tier II, III and IV cities in India along with rising brand awareness and higher disposable income makes these smaller urban areas as focal
Slide 29: Financial Overview & Shareholding Structure
Q2 & H1 FY18 Results Update Company Overview Business Strategy & Outlook FINANCIAL OVERVIEW & SHAREHOLDING STRUCTURE
Slide 30: Financial Overview
FINANCIAL OVERVIEW Figures are as per the I-GAAP standards, In Rs Million REVENUES EBITDA & EBITDA MARGIN PAT & PAT MARGIN CAGR: 10 % CAGR: 18 % CAGR: 126 % 9.5% 14.6% 16.0% 16.9% 6.5% 6,357 14.2% 5,328 12.8% 1.5% 2.1% 619 4,285 4,509 4,726 0.6% 853 1,073 639 689 347 550 67 100 24 FY13 FY14 FY15 FY1
Slide 31: IPO Proceeds Utilisation
IPO PROCEEDS UTILISATION Utilization of Net proceeds as on 30th September 2017 Utilization Amount Amount Pending Particulars (Rs million) Planned Utilized Utilization Expansion and modernization of manufacturing facility 701.6 147.8 553.8 Repayment or prepayment of debt 630.0 630.0 0.0 Opening of ne
Slide 32: Shareholding Structure
SHAREHOLDING STRUCTURE SHAREHOLDING PATTERN – 30th September 2017 KEY SHAREHOLDERS – 30th September 2017 Goldman Sachs India Ltd 5.32% Non-Institutions 24.7% Promoters DSP Blackrock Micro Cap Fund 4.91% 60.2% Ashish Kacholia 4.47% Birla Sun Life Insurance Company Ltd 2.55% Institutions The Scottish
Slide 33: For Further Queries
FOR FURTHER QUERIES: Mr. V. Balaji Ms. Pushpa Mani / Mr. Nilesh Dalvi Chief Financial Officer IR Consultant Email: balaji.V@s-p-apparels.com Email: pushpa.mani@dickensonir.com nilesh.dalvi@dickensonir.com Contact no: +91 9911684123 / 9819289131