Lindex Group Plc Class B · OMXHEX:LINDEX
Lindex Group Plc Class B — Stockmann Group — Conference Presentation (January 2015)
28 slides from Lindex Group Plc Class B's conference presentation, Jan 9, 2015
Slide 1: Stockmann Group January 2015
Stockmann Group January 2015 CFO Pekka Vähähyyppä
Slide 2: Stockmann in brief
Stockmann in brief • International multichannel retailer founded in 1862 Department Store Division • Preliminary revenue in 2014 16 department stores and 11 other approx. EUR 1 843 million stores in 4 countries; 3 online stores • Approx. 55 000 shareholders on Nasdaq OMX Helsinki Fashion Chain Divis
Slide 3: Stockmann today: over 650 stores in 16 countries, operations in 21 countries
Stockmann today: over 650 stores in 16 countries, operations in 21 countries Revenue by market area in 2014 ICELAND FINLAND NORWAY SWEDEN ESTONIA RUSSIA LATVIA LITHUANIA POLAND CZECH REPUBLIC SLOVAKIA CROATIA BOSNIA AND SERBIA HERZEGOVINA TURKEY CHINA PAKISTAN BANGLADESH Department Store Division, L
Slide 4: Per Thelin appointed Stockmann's new CEO as of 10 November 2014
Per Thelin appointed Stockmann’s new CEO as of 10 November 2014 • Born 1958, Swedish citizen • Latest consultant and senior advisor (clients e.g. Atria, Electrolux Retail) • Previous work experience: ‒ President & CEO, Inflight Service Group 2010-2011 ‒ President & CEO, Venue Retail Group AB 2006-20
Slide 5: New strategic direction
New strategic direction 9.1.2015 5
Slide 6: Stockmann Group's new strategy
Stockmann Group’s new strategy • Process of revising Stockmann’s strategy started in summer 2014 • New reporting structure as of 1 January 2015 • Stockmann Retail will focus on Stockmann department and online stores ‒ A new owner is searched for Hobby Hall ‒ Closing down Stockmann Beauty cosmetic st
Slide 7: Stockmann Group's strategic path
Stockmann Group’s strategic path • Focusing on key businesses • Streamlining other, non-core businesses • Ensuring efficiency and agility in all operations Stockmann Retail and Real Estate: ensuring a top- Developing Lindex notch shopping independently for a experience world-class fashion Downsizing
Slide 8: Strategic direction: Placing the inspirational customer experience at the core
Strategic direction: Placing the inspirational customer experience at the core Top-notch shopping Stockmann experience in Turnaround in Retail department and profitability online stores Enhancing Creating customers’ Maximum cash flow added shopping value to Real Estate experience by and growing valu
Slide 9: Developing Lindex into a world-class brand
Developing Lindex into a world-class brand • New Board of Directors elected to develop and govern Lindex independently, but as part of the Stockmann Group ‒ External Board members have extensive experience in fashion and international businesses • Lindex aims to achieve growth by opening new stores
Slide 10: Downsizing Seppälä's operations
Downsizing Seppälä’s operations • Focus on smaller-scale operations in Finland and Estonia due to unprofitable business ‒ Around 70 stores to remain in Finland and 19 in Estonia; closing around 50 stores in Finland during 2015 ‒ Closing remaining 30 stores in Latvia, Lithuania and Russia during 2015
Slide 11: Stockmann Retail's four strategic building blocks
Stockmann Retail’s four strategic building blocks Clear target Renewed group 1 customer focus Renewed value proposition New brand Highlighting identity Rationalized scope key product 2 of operations categories Optimal sales space & store network Efficient and Stores Modernized agile support 3 at the
Slide 12: Aiming at fundamentally transforming the current department store business
Aiming at fundamentally transforming the current department store business FROM TO • Everything for everybody • Clear value proposition and target group • Wide assortment offered to a wide • Optimized assortment highlighting target group key categories and signature areas • Revenue growth through br
Slide 13: Renewed value proposition: Signed for you
Renewed value proposition: Signed for you Stockmann is the destination for inspirational shopping providing a top-notch shopping experience Best-in- Best mix of Loyalty is class brands and truly service choices rewarded 9.1.2015 13
Slide 14: Highlighting key product categories
Highlighting key product categories • Stockmann’s future selection will have a stronger focus on fashion, cosmetics, food in Stockmann Delicatessen and home products ‒ Stockmann is planning to withdraw from the electronics and home appliances product category, sold today in department stores in Finl
Slide 15: Investing for the future
Investing for the future Department stores Omnichannel New distribution and commercial infrastructure center to open in concepts 2016 • Towards the store of • Foundations for • Combines existing the future: inspiring seamless experience warehouses to one in-store experience across the channels effic
Slide 16: Market environment and financial performance in 2014
Market environment and financial performance in 2014 9.1.2015 16
Slide 17: Retail market in brief
Retail market in brief • Finland ‒ Extremely difficult market situation continued: low consumer confidence, declining purchasing power, and drop in demand for non-food products ‒ Fashion market in Finland down 10% in November and in January- November market down 6% (TMA) ‒ Structural changes in comp
Slide 18: Value of rouble and oil has collapsed in 2014
Value of rouble and oil has collapsed in 2014 Rouble/EUR exchange rate in 2014 Oil price in 2014 9.1.2015 18
Slide 19: Omnichannel retail vs. traditional retail
Omnichannel retail vs. traditional retail • Share of online sales is growing, but online stores are not yet compensating for the dramatic decline in traditional retail • Stockmann focuses on developing omnichannel retail i.e. combining the department store network and online business 1. Inspirationa
Slide 20: Quarterly revenue, Stockmann Group
Quarterly revenue, Stockmann Group EUR mill. 700 600 -10% -8.9% 500 -8.3% -7.6%* -10.9% 400 300 200 100 0 1-3 4-6 7-9 10-12 Preliminary revenue 2012 2013 2014 * Excluding terminated franchising operations 9.1.2015 20
Slide 21: Quarterly operating profit, Stockmann Group
Quarterly operating profit, Stockmann Group EUR mill. 60 50 40 30 20 10 0 1-3 4-6 7-9 10-12 -10 -20 -30 -40 -50 2012 2013 2014 9.1.2015 21
Slide 22: Maturity structure of interest-bearing liabilities
Maturity structure of interest-bearing liabilities • EUR 700 million committed credit facilities, of which nearly EUR 300 million undrawn, due in February 2019 • EUR 150 million bond due in March 2018 EUR mill. 450 400 350 300 Commercial papers and overdrafts Finance leases 250 Pension loans 200 Loa
Slide 23: Stockmann's outlook for 2014
Stockmann’s outlook for 2014 • Guidance revised on 14 October 2014: Stockmann estimates that the Group’s euro-denominated revenue in 2014 will decline on 2013. The Group’s operating result excluding non- recurring items is expected to be negative in 2014 • Capital expenditure estimated to amount to
Slide 24: Appendixes
Appendixes 9.1.2015 24
Slide 25: Over 55 000 shareholders on Nasdaq Helsinki
Over 55 000 shareholders on Nasdaq Helsinki • Listed in the Helsinki stock • Major shareholders, shares (votes): exchange in 1942 ‒ HTT Holding Oy Ab 11.7% (10.7%) ‒ Föreningen Konstsamfundet 9.4% (15.1%) ‒ Svenska litteratursällskapet 7.6% (15.7%) • Two series of shares ‒ Niemistö Grouping 5.8% (9.
Slide 26: Current department stores in Russia
Current department stores in Russia MEGA SOUTH MOSCOW MEGA NORTH MOSCOW MEGA EAST MOSCOW METROPOLIS MOSCOW Opened 4/2004 Opened 12/2004 Opened 2/2007 Opened 2/2009 ROSTOKINO MOSCOW NEVSKY CENTRE ST. PETERSBURG EKATERINBURG Opened 3/2010 Opened 11/2010 Opened 3/2011 9.1.2015 26
Slide 27: Stockmann Group's revenue in Q3 2014
Stockmann Group’s revenue in Q3 2014 • Revenue down 10.9%, to EUR 405.0 million (EUR 454.4 million), or down 8.1% at comparable exchange rates • Revenue in Finland down 12.6% • International operations down 9.4%, or down 4.7% at comparable exchange rates ‒ Revenue was down on all markets ‒ The Russi
Slide 28: Stockmann Group's operating profit in Q3 2014
Stockmann Group’s operating profit in Q3 2014 • Gross margin 49.6% (49.5%) ‒ Increase in Lindex’s margin • Operating costs EUR 198.7 million (EUR 195.7 million) ‒ Marketing costs up in both divisions ‒ In the Q3 2013 operating costs were down due to non-recurring cost savings; savings from structura
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