Premier Investments Limited · ASX:PMV
Premier Investments — H1 2015 Earnings Presentation
33 slides from Premier Investments's earnings presentation, Mar 23, 2015
Slide 1: Half Year 2015 results overview
DRAFT 6 Not For Release PREMIER PREMIER INVESTMENTS LTD INVESTMENTS LTD Half Year 2015 results overview Half Year 2015 results overview 23 March 2015 xx March 2015
Slide 2: Agenda
Agenda Premier Investments 1 1H15 overview 8 Smiggle International Premier Investments 1H15 2 consolidated financial results 9 Peter Alexander growth continues Supply chain 3 Premier Retail Performance 10 transformation continues 4 Gross Margin 11 Summary 5 CODB remains a focus 12 Dividends Premier
Slide 3: 1H15 overview
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Slide 4: Premier Investments 1H15 overview
1 Premier Investments 1H15 overview • Group profit – Profit before tax $78.7 million, up 12.2% on pcp – Net profit after tax $56.8 million, up 9.1% on pcp – Earnings per share of 36.5c, up 8.7% – Increased interim fully franked dividend of 21 cps (1H14: 20cps) – In addition to the ordinary dividend,
Slide 5: Premier Investments 1H15 overview
1 Premier Investments 1H15 overview • Premier Retail continuing to grow – Net profit before tax up 14.7% – Total sales increase of 4.8% pcp1 – Online sales up 23% – Peter Alexander sales up 14.6% – Smiggle sales up 18.9% – Smiggle UK results ahead of expectations: 19 stores now trading in the UK wit
Slide 6: Premier Investments 1H15 consolidated income statement
2 Premier Investments 1H15 consolidated income statement 26 weeks to 26 weeks to $m 24 Jan 2015 25 Jan 2014 Premier revenues (ex Premier Retail) 13.8 13.6 Premier expenses (ex Premier Retail) (2.3) (2.2) Premier Retail EBIT 70.0 61.5 Finance costs (2.8) (2.8) Net profit before income tax 78.7 70.1 I
Slide 7: Premier Investments summarised consolidated balance sheet
2 Premier Investments summarised consolidated balance sheet $m 24 Jan 2015 26 Jul 2014 Assets Cash and cash equivalents 286.0 313.3 Inventories 101.0 98.5 Property, plant and equipment 119.1 109.0 Other assets 61.5 32.1 Investment in associates 211.4 188.4 Intangible assets 854.6 854.6 Total assets
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Slide 9: Premier Retail performance: highlights
3 Premier Retail performance: highlights • Profit before tax up 14.7% • EBIT up 13.8% to $70.0m • EBIT margin up 112 bps to 14.3%1 • Total sales up 4.8%2; LFL sales up 1.1% • All key growth initiatives delivering – Online sales up 23% - continuing to grow well ahead of the market – investment to sup
Slide 10: Premier Retail performance: underlying financial results
3 Premier Retail performance: underlying financial results 26 weeks 26 Weeks $000 to 24 Jan 2015 to 25 Jan 2014 Var LY Sales1 490,837 468,355 +4.8% LFL sales +1.1% +4.4% Gross Profit1 311,179 290,651 +7.1% Gross margin (%)1 63.4% 62.1% 134bps Employee Expenses2 (118,318) (110,470) +7.1% % sales 24.1
Slide 11: Gross margin
4 Gross margin • Gross margin expanded by 134 bps despite Gross margin — 4 year history weaker AUD and highly competitive market • Strategies to offset the impact of the weaker 64.0% AUD have been effectively implemented 63.4% 63.5% across all brands and markets 63.0% 62.8% • Direct sourcing initiat
Slide 12: CODB remains a focus
5 CODB remains a focus • Costs continue to be well controlled despite strategic investment in growth initiatives, including online, Peter Alexander and Smiggle UK • Store rent increased by only 0.8% for the established brands, despite inflationary pressures built into leases • Labour productivity ga
Slide 13: Premier Retail online strategy delivering
6 Premier Retail online strategy delivering • Online sales up 23.0% for the half and up 29.5% for the past 12 months – well ahead of market growth of 6.6% for the 12 months Online sales growth ended January 2015 • Portmans and Dotti continuing to outperform with online sales up 35.0% 29.5% 35% and 3
Slide 14: Premier Retail investing in growth
7 Premier Retail investing in growth Premier Retail continuing to invest in new stores, upgrades and refurbishments to deliver sustainable sales growth; 182 stores received capital investment including 28 new stores that were opened in 1H15 • 8 new stores opened across Australia and New Zealand • 1
Slide 15: Premier Retail investing in growth
7 Premier Retail investing in growth • 10 new stores opened in the United Kingdom • 3 new stores opened across Australia and Singapore • 2 stores relocated • 13 Christmas kiosks opened in Australia • 24 stores received POS upgrades • 1 new store opened in Australia • 2 stores relocated • 2 new tempo
Slide 16: Smiggle International: United Kingdom
8 Smiggle International: United Kingdom • Results to date are ahead of our expectations • Positive profit contribution to group in 1H15 • 15 of the top 20 Smiggle stores globally are already in the UK • Smiggle now represented in 4 of the top 10 centres in England: London Westfield, Stratford Westfi
Slide 17: Smiggle International: United Kingdom stores currently trading with a further 14 identified to open
8 Smiggle International: United Kingdom 19 stores currently trading with a further 14 identified to open prior to Christmas 2015 • 19 stores currently trading in the UK • A further 14 new stores identified to open in CY2015 • Negotiations for a further 40 stores are underway 16
Slide 18: Smiggle International: Singapore
8 Smiggle International: Singapore Smiggle Singapore continues to be a significant profit driver for the group • 19 stores now trading in Singapore • New ION Orchard store opened on 7th February 2015 in prime Orchard Road Singapore (store no 19) • Very profitable market and continues to improve from
Slide 19: Peter Alexander growth continues
9 Peter Alexander growth continues Three year strategic growth plan on track • Total sales up 14.6% • 8 new stores opened in 1H15, including new flagship in Brisbane CBD • 5 new stores confirmed to open in 2H15 • Potential for further stores in Aust (5-10 in FY16) and NZ (3-5 in FY16) • Significant
Slide 20: Supply Chain transformation continues
10 Supply Chain transformation continues New Australian national distribution centre operational • 4 brands (Just Jeans, Jacqui E, Dotti, Jay Jays) operating from the new National DC • All brands to be operating by the end of May 2015 • DC operational capability well established with optimisation of
Slide 21: Summary
11 Summary Online growth continues to outperform the broader market • 1H15 growth of 23% - well ahead of the market • Continued investment in technology, people and marketing to maximise growth • Multi channel initiatives delivering incremental sales and EBIT • Online channel extremely profitable wi
Slide 22: Summary
11 Summary Smiggle International driving future growth • Smiggle performing well in all markets • UK results exceeding expectations, with 19 stores currently trading and 14 more identified to open in CY15 • 15 of the top 20 Smiggle stores are in the UK • UK market reported a small profit contributio
Slide 23: Summary
11 Summary Core brands strategies on track • Jay Jays turnaround strategy delivering pleasing results with strong sales growth and margin expansion • Just Jeans “Anchored in denim” strategy delivering strong sales and profit growth • Jacqui E continues to perform well • Portmans and Dotti started 2H
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Slide 25: Dividends
12 Dividends • The Premier Board has declared an increased interim fully franked dividend of 21 cps (FY14 Interim: 20 cps) • The Board’s decision to pay ordinary dividends is always shaped by: – Assessment of the result – Outlook for the market – Confidence in the operational performance of Premier’
Slide 26: Brand by brand performance
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Slide 27: Highlights
13 Highlights • Total sales growth 18.9% • Positive LFL sales growth • 2 new stores opened in Australia • 19 stores now trading in the United Kingdom, with a further 14 identified for CY2015 • New flagship store opened at ION Orchard in Singapore (store number 19) in February 2015 • Continuing focus
Slide 28: Highlights
13 Highlights • Total sales growth 14.6% • Positive LFL sales growth • 6 new stores opened in Australia, including flagships in Brisbane CBD, Miranda and Macquarie • 2 new stores opened in NZ (the first new stores in NZ for 4 years) • Focus on social media to drive data base signups and brand awaren
Slide 29: Highlights
13 Highlights • Strong LFL sales in 1H15 – momentum from FY14 continuing • Strong gross margin growth from better assortment, improved sourcing and lower markdowns • Increase in full price sales and reduced clearance markdowns confirming we are on track and clear with our target customer • New brand
Slide 30: Highlights
13 Highlights • Total sales growth 3.6% • Stronger LFL sales growth • “Anchored in Denim” strategy delivering results with strong growth from fashion & core denim • New brands performing well – The first season of Guess delivered promising results – Calvin Klein re-launching during 2015 • New store
Slide 31: Highlights
13 Highlights • Total sales growth 2.8% • LFL sales growth stronger • Strong result for the season • Margin continuing to improve through: – Sourcing initiatives delivering lower costs – Improved merchandise assortment reducing markdowns • Strong growth from dresses • Continued focus on climatic ran
Slide 32: Highlights
13 Highlights • Strong start to new season (2H15) • New season fashion ranges selling well • Online sales up 32% in 1H15 and a very profitable channel • Highly responsive supply chain enabling turnaround of new fashion items in 6-8 weeks • Introduction of rejuvenated key volume seasonal programs del
Slide 33: Highlights
13 Highlights • 2H15 commenced well with improved sales momentum • Key product focus areas include: – Skirts and Knitwear continue to be a key growth area with continued momentum in the start of 2H15 – Dresses category strengthening in key silhouettes and fabrications – Tailoring/Workwear new collec