Currys Plc · LSE:CURY
Currys — Corporate Update (January 2024)
33 slides from Currys's corporate update, Jan 18, 2024
Slide 1: Currys plc 2023/24 Peak Trading update
Currys plc 2023/24 Peak Trading update 18 January 2024
Slide 2: We help everyone enjoy amazing technology
We help everyone enjoy ~ amazing technology. YOiw
Slide 3: Summary: a successful Peak
Group Summary: a successful Peak International UK&I Outlook Nordics rebounding after a Near term profits on track Cautious on market difficult year, through margin through gross margin recovery and cost discipline Expect profits ahead of improvements and cost consensus savings Greece disposal close
Slide 4: Group H1 performance summary
Financial performance Group H1 performance summary Revenue Adjusted EBIT Adjusted EPS £4,159m £31m Improved (7)% YoY +7% YoY +15% YoY Free cash flow H1 movement in Net Debt Total indebtedness £(10)m £(32)m £(1,482)m +£76m YoY +£117m YoY +£135m YoY Source: Results for the Half Year Ended 28 October 2
Slide 5: Peak summary: Like-for-Like Sales
Group Peak summary: Like-for-Like Sales UK&I Nordics Greece H1 Peak YTD H1 Peak YTD H1 Peak YTD (2)% (3)% (3)% (3)% (4)% (4)% (4)% (5)% (6)% Sources: Currys Internal information 5
Slide 6: Peak Tech Trends
Group Peak Tech Trends Super-Size Mobile Gaming TV Energy Headphones Refurbished Efficient 6
Slide 7: Guidance
Group Guidance Current year guidance • Group adjusted PBT expected to be £105-115m (vs consensus1 £104m) • Capital expenditure of around £70m (from £80m) • Net exceptional cash costs of around £50m • Annual pension contribution of £36m • Expect year end debt position to improve from £(97)m position
Slide 8: Nordics
Nordics
Slide 9: Consumer confidence has yet to materially recover
Nordics Consumer confidence has yet to materially recover Consumer confidence Norway Sweden Jan-21 Jan-22 Jan-23 Jan-21 Jan-22 Jan-23 Denmark Finland Jan-21 Jan-22 Jan-23 Jan-21 Jan-22 Jan-23 Source: Bloomberg 9
Slide 10: New leadership team, improved colleague and customer satisfaction
Nordics New leadership team, improved colleague and customer satisfaction Leadership team Colleague and customer satisfaction improving Nordics Colleague engagement 77 76 +2pts 75 YoY 74 Fredrik Tønnesen Lill Beate Pedersen CEO CFO Apr-22 Oct-22 Apr-23 Oct-23 Nordics Happy or Not customer satisfacti
Slide 11: Remain clear #1 in every market
Nordics Remain clear #1 in every market Nordic market share #1 market share in all countries 26.8% 29.7% 28.0% 28.4% 27.9% 26.0% 27.1% 25.5% 25.0% 24.2% Elkjøp #2 market share H1 19/20 H1 20/21 H1 21/22 H1 22/23 H1 23/24 Source: GfK Source: GFK and company reports, Data for FY 2022/23 11
Slide 12: Decisive actions taken on gross margin improvement
Nordics Decisive actions taken….. on gross margin improvement 1 2 • Accessories • New subscription • financing Grow services adoption Grow accessories adoption initiatives agreements • Increased adoption of services online • Increased visibility in stores • Improved credit terms • Improved availabil
Slide 13: Decisive actions taken on costs
Nordics Decisive actions taken….. on costs Central: Headcount reduction, offshoring and contractor removal IT: Group CIO – procurement and synergies Permanent GNFR: Consolidation and renegotiation with suppliers £25m pa cost savings Stores: Multiskilling colleagues for efficiency, lease renewals, st
Slide 14: UK&I
UK&I 14
Slide 15: Capable and committed colleagues
Capable and committed colleagues Our colleagues are more engaged UK&I Colleague Engagement Currys is now ranked 81 82 Top 5% 78 78 79 of Global Businesses for 77 colleague engagement +14 pts Yo3Y 68 Oct-20 Apr-21 Oct-21 Apr-22 Oct-22 Apr-23 Oct-23 Source: Glint survey 15
Slide 16: UK&I delivering robust gross margins and significant cost savings
Grow profits UK&I delivering robust gross margins and significant cost savings Gross margin showing continued improvements Significant cost savings UK&I Gross margin <£60m £300m >£240m H1 16/17 H1 17/18 H1 18/19 H1 19/20 H1 20/21 H1 21/22 H1 22/23 H1 23/24 Source: Currys internal information 16
Slide 17: Drivers of stable UK&I gross margin
Grow profits Drivers of stable UK&I gross margin 1 2 3 Not chasing less Solution selling Higher Services adoption profitable sales Total ‘Sold With’ adoption Credit adoption (%) Care & Repair adoption (%) Monetising improved data & analytics: 20.6% 18.2% • End-to-end profitability model +11pts +670b
Slide 18: Growing sales and margin through 'Sold With' solutions
Easy to Shop Growing sales and margin through ‘Sold With’ solutions Across every major category With improved execution Adoption is growing Computing TVs Instore: Accessories adjacent to products Instore adoption rate You’ll need: tech essentials +19pts YoY Peak 22/23 Peak 23/24 Appliances Mobile On
Slide 19: Getting it Right First Time more often
Easy to Shop Getting it Right First Time more often We have improved on our execution on Delivery & Installation Focus on key areas of failure Repeat visit rate Customer availability Product damage Incorrect product 21/22 22/23 YTD 23/24 Long Term Technical failures Target Source: Currys internal in
Slide 20: Right First Time drives profits
Easy to Shop Right First Time drives profits Better proposition and execution drive increased direct and indirect profits Direct cost savings Lower customer Increased adoption Enables delivery Right First Time reduces acquisition costs charging repeat visits and costs Reduced advertising spend Insta
Slide 21: Improvements across every area of the shopping experience
Easy to Shop Improvements are across every area of the shopping experience… Customers are happier… … across all areas of the customer journey Store NPS Store Purchase CSAT Delivery CSAT +4pts +2pts YoY +5pts YoY YoY 19/20 20/21 21/22 22/23 YTD Peak 22/23 Peak 23/24 Peak 22/23 Peak 23/24 23/24 Online
Slide 22: Customers are noticing the improvements
Easy to Shop Customers are noticing the improvements UK&I NPS UK&I NPS YoY +4pts YoY 80% of UK&I customers say colleagues are the main reason for a “great experience” 19/20 20/21 21/22 22/23 YTD 23/24 Sources: Company information – Voice of the customer NPS survey sent to all customers 7 days post p
Slide 23: Customers for life are built through our range of services
Customers for Life Customers for life are built through our range of services We help you We help you get We help get We help give your afford amazing the most out of you started tech longer life tech Protection | Repair | Refurbish your tech Delivery | Installation | Set up Connectivity | Help & su
Slide 24: Services are a significant revenue stream in their own right
Customers for Life Services are a significant revenue stream in their own right We help you We help you get We help get We help give your afford amazing the most out of you started tech longer life tech Protection | Repair | Refurbish your tech Delivery | Installation | Set up Connectivity | Help &
Slide 25: Credit is valuable and growing
Customers for Life Credit is valuable and growing Credit is an important driver of lifetime value We are growing Credit 2.2m +25% Credit customers +20% More credit are happier customers FY 21/22 FY 22/23 YTD 23/24 Non-credit Credit 20.6% +240 +20% bps Spend more on Higher credit services adoption Pe
Slide 26: Care & Repair adoption growing in both channels
Customers for Life Care & Repair adoption growing in both channels Adoption growing with big opportunity online Store Adoption Rate Online Adoption Rate +480bps Yo2Y +140bps Yo2Y Peak 21/22 Peak 22/23 Peak 23/24 Peak 21/22 Peak 22/23 Peak 23/24 Source: Currys internal information 26
Slide 27: Care & Repair is based on unique capabilities
Customers for Life Care & Repair is based on unique capabilities We repair all product categories and work closely with our major suppliers Major Categories Major Vendor Brands Sources: Currys Internal information And 40 more… 27
Slide 28: Mobile is back into profit and now gaining share
Customers for Life Mobile is back into profit and now gaining share Currys mobile market share is growing Driven by premium devices and iD Total handset market share % Strong in premium (>£900) Strong in foldable Currys ARP +15% YoY 2018-19 2019-20 2020-21 2021-22 2022-23 YTD 2023-24 iD Mobile – Our
Slide 29: iD Mobile growth has accelerated
Customers for Life iD Mobile growth has accelerated iD – our award winning MVNO Active subscribers <15% churn rate Customer first approach. Great network and customer service, award winning value. 1.6m +29% Benefits as standard: YoY o Data rollover 1.3m o Inclusive roaming in 50 destinations 1.2m o
Slide 30: Maintaining strong liquidity & balance sheet
Group Maintaining strong liquidity & balance sheet Net debt & pension deficit £(820)m £(805)m £(313)m £(213)m £(346)m £(319)m <£(150)m 400 200 0 (200) (400) (600) (800) (1,000) 18/19 19/20 20/21 21/22 22/23 H1 23/24 Proforma FY 23/24* Net cash/(debt) Working capital facilities Pension deficit (IAS19
Slide 31: Summary
Group Summary • Solid results, and progress, in a tough environment • Nordics now recovering, driven by gross margin improvement • Continued momentum in UK&I - gross margin stable and cost savings on track • Services growth driving improvements in gross margins and customer lifetime value • Strong b
Slide 32: We help everyone enjoy amazing technology
We help everyone enjoy ~ amazing technology. YOiw
Slide 33: www.currysplc.com
Visit our corporate website www.currysplc.com 33