Premier Investments Limited · ASX:PMV
Premier Investments — FY2013 Earnings Presentation
37 slides from Premier Investments's earnings presentation, Sep 17, 2013
Slide 1: Premier Investments Limited FY2013 results overview
Premier Investments Limited FY2013 results overview 17 September 2013
Slide 2: Agenda
Agenda 1 Premier Investments FY13 overview 2 Premier Investments FY13 consolidated financial results 3 Premier Retail results FY13 overview 4 Gross Margin 5 CODB reductions continuing 6 Premier Retail internet strategy delivering 7 Premier investing in growth 8 Supply chain transformation underway 9
Slide 3: Premier Investments FY13 Overview
PREMIER INVESTMENTS FY13 OVERVIEW 2
Slide 4: Premier Investments FY13 overview
1 Premier Investments FY13 overview • Reported group profit – Net profit after tax of $174.5 million (LY: $68.3 million) – Earnings per share of 112.4c (LY: 44.0c) • Premier commenced equity accounting its 25.7% investment in Breville Group from 1 March 2013 – One off after-tax benefit of $105.2 mil
Slide 5: Premier Investments FY13 overview
1 Premier Investments FY13 overview • Premier year end balance sheet strengthened – Cash on hand of $313.2 million, up $19.0 million – Premier Retail debt of $102.0 million, down $21.0 million – Inventories clean and in a strong position – Balance sheet at year end shows investment in associate (Bre
Slide 6: Premier Investments FY13 consolidated income statement
2 Premier Investments FY13 consolidated income statement Reported Pro forma 1 52 weeks 52 weeks 52 weeks 52 weeks to 27 July 2013 to 28 July 2012 to 27 July 2013 to 28 July 2012 $m’s Premier revenues (ex Premier Retail) 23.8 27.2 29.5 32.5 Premier expenses (ex Premier Retail) (4.4) (4.6) (4.4) (4.6)
Slide 7: Premier Investments summarised consolidated balance sheet
2 Premier Investments summarised consolidated balance sheet $m’s 27 July 2013 28 July 2012 Assets Cash and cash equivalents 313.2 294.2 Inventories 84.0 71.1 Property, plant and equipment 83.4 80.3 Other assets 41.4 45.7 Available-for-sale financial assets — 152.3 Investment in an associates 185.5 1
Slide 8: Premier Retail
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Slide 9: Premier Retail results FY13 overview
3 Premier Retail results FY13 overview • PBT up 9.3% to $76.7 million • EBIT margin up 31bps to 10.0%1 • EBIT up 4.1% to $83.7 million • Gross margin up by 117bps1 • Internet sales growing strongly – up 37% • Strong sales performance from Peter Alexander (up 17.7%) and Smiggle (up 14.5%) • Strong LF
Slide 10: Premier Retail financial results
3 Premier Retail financial results 52 weeks 52 Weeks to 27 July 2013 to 28 July 2012 Var LY $000’s Sales1 836,454 829,138 +0.9% LFL sales -1.8% -6.7% Gross Profit1 521,359 507,080 +2.8% Gross margin (%)1 62.3% 61.2% +117bps Employee Expenses (209,685) (196,870) +6.5% % sales 25.1% 23.7% +132bps Rent
Slide 11: Gross margin
4 Gross margin • Gross margin expanded by 117bps Gross margin—5 year history • Sourcing initiatives achieving better margin outcomes – Transition of local supply chain for Portmans and Jacqui E – Strategic partnerships with vendors – Diversifying international sourcing base – Improved vendor negotia
Slide 12: CODB reductions continuing
5 CODB reductions continuing Store rental growth (1) Store wages growth (2) Other CODB growth (3) • Total store rent expense held • Total store wages increased by • Other CODB were slightly down flat despite store openings and 4.0% in FY13 to support the on last year despite the ongoing growth in ex
Slide 13: Premier Retail internet strategy delivering
6 Premier Retail internet strategy delivering Internet • Online sales grew 36.5% in FY13, well ahead of On–line sales growth Australian on line growth* – all brands achieved significant growth • Customer service focus and leadership with next day delivery and world class platform • Mobile sites depl
Slide 14: Premier Retail investing in stores
7 Premier Retail investing in stores… 360 stores received capital investment during FY13 and 31 new stores were opened in FY13 • 20 new stores opened across Australia, New Zealand and Singapore • 141 stores received new display stands • 3 stores relocated and refurbished • 11 new stores opened acros
Slide 15: Premier Retail investing in brands
7 Premier Retail investing in brands… • Brand ambassadors creating connection with customers • Advertising and direct marketing programs achieving results • Leading on-line platform with mobile Shanina Shaik Jess Hart Nicole Pollard Tara Moss Peter Alexander Just Jeans Portmans Dotti Jacqui E Creati
Slide 16: Supply chain transformation underway
8 Supply chain transformation underway Australia • Strategic review of Australian Distribution Centre (DC) network requirements completed with outcome aligned to Premier Retail’s strategic plans – Consolidation of DC’s into one single National DC 21,000m2 in size in Victoria to be developed for and
Slide 17: Supply Chain transformation underway
8 Supply Chain transformation underway Singapore • DC established in Singapore to support growing Smiggle business • Partnership with leading global logistics provider • Project completed in May 2013 • Annual margin benefits of more than A$1m – full benefit in FY14 • Important platform for future in
Slide 18: Smiggle International expansion
9 Smiggle International expansion Smiggle Singapore • 4 stores opened in FY13 and 1 store opened in August 2013 • 17 stores now trading and very profitable • Opportunity for 5 more stores over next 2 years • Country Manager now appointed to manage larger business and future Malaysian expansion • Sin
Slide 19: Smiggle International expansion
9 Smiggle International expansion Smiggle UK • Extensive market research has been completed on the United Kingdom • The Board has concluded that the opportunity in the UK is significant and the complexities of entry and doing business in this market are manageable • The UK is a market with the capac
Slide 20: Smiggle International expansion
9 Smiggle International expansion United Kingdom UK Australia Population 62m 22m Large population, with large number of target Female aged 5-14 yrs 3.4m 1.4m customers % living in urban areas 80% 89% Large and growing economy with large GDP ($US bn) $2,440 $1,521 personal stationery market GDP growt
Slide 21: Smiggle International expansion
9 Smiggle International expansion Smiggle UK Next Steps • First store at Westfield Stratford, London to open in February 14 • Five to eight stores planned to open in 2HFY14 • Potential to open between 20-40 stores per year (from FY15) with strong potential for the brand geographically throughout the
Slide 22: Smiggle International expansion
9 Smiggle International expansion Smiggle Malaysia • Confirmed opportunity for 6-8 stores in Kuala Lumpur • Discussions with landlords progressing, however we continue to adopt a “zero compromise” strategy on the locations for each store • Malaysia will be managed from Singapore and will require min
Slide 23: Peter Alexander Growth to accelerate
10 Peter Alexander Growth to accelerate • New leadership in the Peter Alexander business with a clear vision and strategy to grow business by 40% to 50% over the next 3 years • The Peter Alexander brand in Australia and New Zealand will be the number one sleepwear/lifestyle designer brand in the mar
Slide 24: In summary
11 In summary Core Brands • Turnaround strategy delivering for womenswear brands – Dotti, Portmans, Jacqui E • Focus on Jay Jays recovery a top priority • New leadership for Just Jeans with brand well placed for future growth Online • All 7 brands online and mobile sites – growing faster than the ma
Slide 25: In summary
11 In summary Smiggle • UK market entry confirmed – first store signed to open in February 2014 • Major growth opportunity in the UK market for Smiggle over the next 5 years – 200+ stores Supply Chain • Australian national distribution centre to be developed for and owned by Premier • New Zealand an
Slide 26: Dividends
DIVIDENDS 25
Slide 27: Final dividend
12 Final dividend • The Premier Board has declared an increased final fully franked dividend of 19 cps (FY12: 18 cps) • Full Year fully franked dividend of 38 cps (FY12: 36 cps) • The board’s decision to pay a dividend is always shaped by: – Assessment of the result – Outlook for the market – Confid
Slide 28: The Just Group brand by brand performance
THE JUST GROUP BRAND BY BRAND PERFORMANCE
Slide 29: Overview of Results
13 Overview of Results Sales $100.7m Var LY +17.7% Store movements July 12 Open Close July 13 Australia 40 11 0 51 New Zealand 8 0 0 8 48 11 0 59 Highlights • Outstanding results in FY13 • Sales up 17.7% • On-line sales continuing to grow off very strong base • 11 new stores opened • Judy Coomber no
Slide 30: Overview of Results
13 Overview of Results Sales $89.6m Var LY +14.5% Store movements July 12 Open Close July 13 Australia 98 15 1 112 New Zealand 22 1 0 23 Singapore 12 4 0 16 132 20 1 151 Highlights • Strong result for the year • Singapore performance has been excellent with 16 stores trading in this market at year e
Slide 31: Overview of Results
13 Overview of Results Sales $108.3m Var LY +7.3% Store movements July 12 Open Close July 13 Australia 93 0 5 88 New Zealand 21 0 0 21 114 0 5 109 Highlights • Total sales grew 7.3% • On-line sales more than doubled with Dotti recognised as leader in this important channel • New store clustering and
Slide 32: Overview of Results
13 Overview of Results Sales $107.9m Var LY +2.5% Store movements July 12 Open Close July 13 Australia 93 0 3 90 New Zealand 12 0 0 12 105 0 3 102 Highlights • Total sales +2.5% • Strengthened sourcing partnerships to deliver faster product delivery and material margin improvement • Successfully lau
Slide 33: Overview of Results
13 Overview of Results Sales $66.3m Var LY -2.3% Store movements July 12 Open Close July 13 Australia 83 0 3 80 New Zealand 21 0 0 21 104 0 3 101 Highlights • Material profit improvement • Strong second half sales results with positive LFL growth and positive momentum • Stores closed delivering impr
Slide 34: Overview of Results
13 Overview of Results Sales $196.4m Var LY -3.3% Store movements July 12 Open Close July 13 Australia* 203 0 4 199 New Zealand 45 0 0 45 248 0 4 244 * Includes one group store Highlights • New Group General Manager Matthew McCormack appointed in August 2013 to drive improved performance • More dedi
Slide 35: Overview of Results
13 Overview of Results Sales $167.2m Var LY -11.1% Store movements July 12 Open Close July 13 Australia 194 0 10 184 New Zealand 36 0 0 36 230 0 10 220 Highlights Turnaround Strategy Continuing • Product strategy focusing on: – ‘Famous For’ Categories, key item programmes and refreshed basics progra
Slide 36: Reconciliation between reported and pro forma
A Appendix Reconciliation between reported and pro forma • Due to a change in Breville Group Ltd’s (BRG) Board, PMV was required to commence equity accounting BRG from 1 March 2013 giving rise to a one off reclassification gain of $105.2m (after tax). • Pro forma numbers are stated as if the 25.7% h
Slide 37: Overview of Premier's non-IFRS financial information
A Appendix Overview of Premier’s non - IFRS financial information • IFRS financial information is financial information that is presented in accordance with all relevant accounting standards. • Non-IFRS financial information is financial information that is presented other than in accordance with al