Slide 1: FY17 Results
For personal use only FY17 Results Mark Coulter CEO Mark Tayler CFO
Slide 2: Temple & Webster is Australia's leading online retailer for the home
For personal use only Temple & Webster is Australia’s leading online retailer for the home. We are famous for offering the greatest range, the most inspiring content and world-class service. Our vision is to make the world more beautiful, one room at a time. Our mission is to deliver beautiful solut
Slide 3: Summary
FY17 statutory revenue of $64.5m includes $0.6m Summary revenue from Milan Direct UK which was closed during H1 FY17. FY17 revenue and gross margin from Australian For personal use only operations were $63.9m and $27.5m respectively. FY17 FY17 H2 FY16 revenue and gross margin from Australian REVENUE
Slide 4: The story
The Temple & Webster story For personal use only Temple & Webster was founded in 2011 with the aim of changing the way Australians shop for their homes. The business was named after William Temple and John Webster, two convict artisans commissioned by Governor Macquarie to make two ornamental chairs
Slide 5: templeandwebster.com.au is now the clear market leader
templeandwebster.com.au is now the clear market leader with a strong platform for growth For personal use only Page impressions (MONTHLY) Active customers (LTM) 10m+ ~160k Website users (MONTHLY) Product listings 1m 130k+ Email subscribers (WEEKLY) Sub-categories 1.3m+ ~180 Social media reach Averag
Slide 6: We operate in a $12.9 billion market, with only ~4% migrated online
We operate in a $12.9 billion dollar market, with only ~4% migrated online For personal use only A$12.9 billion addressable market Furniture and homewares online penetration rates by country from CY12 to CY16. Total 16% 15.1% A$12.9b 13.6% 14% 12.9% 11.7% 11.5% 12% 10.5% 10.0% 9.5% 10% 8.6% 7.6% 8%
Slide 7: Demographic and structural changes will drive strong market growth
Demographic and structural changes will drive strong market growth for years to come For personal use only 1 Millennials are now entering our core demographic 2 Structural changes in our favour Hypothetical distribution of homewares • New logistics entrants and furniture spend by age eg. SingPost, J
Slide 8: FY17 was a year of focusing on the core
FY17 was a year of focusing on the core 2HFY16 2HFY17 For personal use only 1. Simplified strategy Go-to-market strategy Multi-brand Single-brand Retail brands Temple & Webster, ZIZO, Milan Direct Temple & Webster Websites 5 1 Business model Flash sales / drop-shipping / inventory Drop-shipping (80%
Slide 9: This focus has significantly improved our economics
This focus has significantly improved our economics For personal use only Short-Mid 2HFY17 (post MD FY16 1HFY17 Term Target integration) Revenue 100% 100% 100% 100% Gross Margin 40.0% 42-44% 42.3% 43.6% Delivered Margin (after all distribution costs) 22.1% 27-29% 26.0% 29.9% Customer Service & Merch
Slide 10: Our customers have embraced the new templeandwebster.com.au
Our customers have embraced the new templeandwebster.com.au Active Customers – Net Revenue per Active Customer - For personal use only Temple & Webster (ex Milan Direct AU & UK) Temple & Webster (ex Milan Direct AU & UK) $340.00 170,000 ↑13% 160,000 $320.00 ↑20% 150,000 $300.00 140,000 $280.00 130,0
Slide 11: Why Temple & Webster is winning
Why Temple & Webster is winning For personal use only Largest range of Most World-class furniture and inspirational service and homewares in content and delivery the Southern services in our experience Hemisphere category Data- Best-in- Trade & driven class Commercial marketing technology division P
Slide 12: Largest range of furniture and homewares in our category
Temple & Webster has the largest range of furniture and homewares in our category For personal use only • Largest range (online & offline) • One-stop-shop: all styles, all products, all price points • ~80% of our sales drop-shipped without inventory risk; ~20% imported under the Milan Direct brand •
Slide 13: Strategic decision to shift the product mix towards furniture
In FY17 we made the strategic decision to shift the product mix towards furniture For personal use only Furniture vs Homewares Mix Category Mix FY17 Outdoor furniture Bed & Bath 40% Office furniture Decor 48% Lighting Homewares & textiles Rugs 8 point 60% 52% growth in furniture Furniture Furniture
Slide 14: The content experience is a core strategic advantage
The Temple & Webster content experience is a core strategic advantage Since launch, Temple & For personal use only Webster has been an industry leader in creating a seamless content-led shopping environment, resulting in a highly engaged audience that turns to our brand for inspiration as well as pu
Slide 15: World-class customer service and delivery experience
World-class customer service and delivery experience For personal use only Fast & easy Hassle free delivery returns Expert Scalable advice; care team live-chat (Manila) FY17: FY18: Customer Better bulky satisfaction delivery up by ~40% experience Pg 15
Slide 16: We continue to invest into our foundations which will allow us to scale
We continue to invest into our foundations which will allow us to scale For personal use only Marketing & Data Technology Trade & Commercial FY17 FY17 FY17 • Reduced cost per customer by 34% • Migrated the entire business onto world- • Established dedicated trade & (2HFY16 vs 2HFY17) class, purpose
Slide 17: FY17 key financials
For personal use only FY17 key financials Mark Tayler CFO Pg 17
Slide 18: Pro forma profit and loss
Pro forma profit and loss Australian Operations • Revenue from Australian A$m FY15 FY16 FY17 FY16 FY17 Growth operations up ~11% For personal use only Revenue 59.9 61.7 64.5 57.7 63.9 10.7% Cost of Sales (35.2) (37.0) (37.0) (34.6) (36.4) • Gross margin (in dollar Gross Profit 24.7 24.6 27.5 23.1 27
Slide 19: The Australian operations grew at ~11%
The Australian operations grew at ~11% For personal use only Revenue, $m ↑~5% ↑~11% 64.5 63.9 61.7 57.7 While we consciously sacrificed some revenue under the revised plan, the focus on the core allowed us to significantly reduce our operating costs, enhancing our path to profit FY16 Pro Forma Reven
Slide 20: Margin levels continue to improve
Margin levels continue to improve For personal use only Delivered Margin % • Increased higher margin private label (owned inventory) sales, 35.0% mostly furniture 30.0% • Implemented strategic pricing 25.0% point increases across the Temple & Webster range 20.0% 15.0% • Lowered warehousing costs as
Slide 21: The group is nearing profitability
The group is nearing profitability For personal use only EBITDA, $’000s H1 FY16 E H2 FY16 H1 FY17 H2 FY17 0 -2,000 -4,000 -6,000 -8,000 • As a result of revenue growth, improved margins and a lower cost base, the EBITDA position continues to improve as the Group pushes towards profitability • The Gr
Slide 22: Balance sheet
Balance sheet A$m 30-Jun-17 • Strong balance sheet position For personal use only Assets Cash & Cash Equivalents 8.7 with $8.7m cash and no debt Inventories 1.4 Other current assets 0.9 • Cash flow positive Q4 Intangibles, (inc. goodwill) 7.7 PPE 0.2 Total Assets 18.9 • Inventory metrics continue to
Slide 23: Inventory metrics continue to improve
Inventory metrics continue to improve For personal use only Average inventory Weeks of cover 3,500,000 26 24 3,000,000 22 20 2,500,000 18 2,000,000 16 14 1,500,000 12 10 1,000,000 8 6 500,000 4 2 0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY16 FY16 FY16 FY16 FY17 FY17 FY17 FY17 FY16 FY16 FY
Slide 24: Outlook
Outlook July and August have been a For personal use only good start to the new financial year with all key metrics in line with expectations. The Company remains confident that the current trajectory will deliver our plan of reaching profitability during CY18, with FY19 being the first full year of
Slide 25: Why TPW?
Why TPW? For personal use only Leading online ~$13 billion Largest range in retailer in the market with only the country with furniture and ~4% having the most homewares moved online inspirational market content & services World-class, Clear path Best positioned purpose built to profit for customer,
Slide 26: Q&A
For personal use only Q&A Pg 26
Slide 27: Disclaimer
Disclaimer This presentation (Document) has been prepared by Temple & Webster Group Limited ACN 608 595 660 (T&W Group or the Company). This For personal use only Document is a presentation to provide background information on the Company and its subsidiaries and is not an offer or invitation or rec
Slide 28: For personal use only
For personal use only