Migros Ticaret A.s. · BIST:MGROS
Migros Ticaret A.s — H1 2020 Earnings Presentation
29 slides from Migros Ticaret A.s's earnings presentation, 2020
Slide 1: Migros Ticaret A.Ş. 1H 2020 Financial Results
Migros Ticaret A.Ş. 1H 2020 Financial Results
Slide 2: Contents
Contents Market Share Evolution Sales Online Business Expansion Financial Overview Management Overview Financial Results
Slide 3: Market Share Evolution
Market Share Evolution Migros FMCG Market Share Evolution (%) 20 bps 18 16.9 16.7 16 14 80 bps 12 10 8.8 8 8.0 6 4 2 0 1H 2019 1H 2020 1H 2019 1H 2020 Total FMCG Modern FMCG Source: Nielsen 3 Note: FMCG: Fast Moving Consumer Goods, Modern and total FMCG market include all food-retail formats
Slide 4: Sales – 1H 2020 (TL million)
Sales – 1H 2020 (TL million) Sales Sales 2Q 2020 1H 2020 Strong growth in 2Q 2020 despite .lockdowns in May & high base of 20.2% 25.0% .2Q 2019 6,980 13,413 5,808 10,731 Exceptional growth in online business Continuing deterioration in shopping malls revenues 2Q 2019 2Q 2020 1H 2019 1H 2020 4
Slide 5: Covid-19: Consumer Trends
Covid-19: Consumer Trends Stocking up Normalization 1Q 2020 2Q 2020 LOW HIGH LOW HIGH F&V, meat, poultry, delicatessen F&V, meat, poultry, delicatessen Commodity products & basics Commodity products & basics Cleaning products & paper Cleaning products & paper Electronics & cosmetics Electronics & co
Slide 6: Covid-19 Impact on Business & Financials
Covid-19 Impact on Business & Financials Positives Challenges Covid-19 costs Strong sales turnover + + Strong cash flow generation Store performance in malls Improved inventory turnover Rental income in malls Foreign exchange losses 6
Slide 7: Online Service Channels
Online Service Channels 81 cities 6 cities 6 cities Istanbul 81 cities +30,000 SKU +2,000 SKU +13,000 SKU +2,150 SKU +2,300 SKU 510 online service stores 80 online service stores 51 online service stores Direct from farm to Available for courier consumers 70% Same day delivery Delivery within 30 min
Slide 8: Online Business Update
Online Business Update Online Orders Online Orders # of # of Online New Customers Customers Service Stores & x3 x10 x2.5 x3.5 x3 8 vs June 2019
Slide 9: Expansion
Expansion Number of Stores Online Service Stores (Total) (Total) +134 Sales Area +385 2,278 (K sqm) 556 2,144 3.1% 81 city 81 81 1,561 city city 1,515 171 35 city 1H 2019 1H 2020 1H 2019 1H 2020 1H 2019 1H 2020 120 new stores in 7M’20 365 new online service stores in 7M‘20 9
Slide 10: CAPEX (TL million)
CAPEX (TL million) % of Sales % of Sales 2.6% 2.6% 1.5% 1.2% 1.3% 488 168 ~440 399 341 130 2017 2018 2019 2020E 1H 2019 1H 2020 Expansion continues 10
Slide 11: Consolidated Gross Profit (TL million)
Consolidated Gross Profit (TL million) Gross Profit Gross Profit 2Q 2020 1H 2020 16.7% 21.5% 1,823 3,544 1,562 2,918 2Q 2019 2Q 2020 1H 2019 1H 2020 Margin 26.9% 26.1% Margin 27.2% 26.4% 11 All numbers in graphs w/ IFRS 16 impact
Slide 12: Consolidated EBITDA (TL million)
Consolidated EBITDA (TL million) Normalized Normalized EBITDA EBITDA 1H 2020 2Q 2020 19.5% 5.1% 1,092 520 914 EBITDA 495 EBITDA 1H 2020 2Q 2020 -11.3% 1.4% 587 1,092 520 1H 2019* 1H 2020 2Q 2019* 2Q 2020 1,076 8.5% 8.1% 8.5% 7.5% 2Q 2019 2Q 2020 1H 2019 1H 2020 Margin 10.0% 8.1% Margin 10.1% 7.5% Al
Slide 13: Overview
Overview – De-risking – Expectations
Slide 14: De-risking Balance Sheet
De-risking Balance Sheet Gross Euro Debt (mn) Net Debt (TL mn) 611 2,819 2.3x 2,755 517 1.9x 2,059 430 1.3x 1,094 184 0.7x <150 2018 1H 2019 2019 1H 2020 2020 E 2018 1H 2019 2019 1H 2020 without IFRS 16 Gross Euro debt decreased by € 333 mn in the past 12-months Significant decrease in TL net debt 1
Slide 15: Cash Position & Leverage
Cash Position & Leverage Without IFRS 16 With IFRS 16 (Total TL mn) 1H 2019 1H 2020 1H 2019 1H 2020 Cash & Cash Equivalents 2,154 2,991 2,154 2,991 TL 1,586 2,452 1,586 2,452 EUR 87 70 87 70 Financial Debt 4,909 4,086 7,946¹ 7,319¹ TL 1,524 2,668 4,561 5,901 EUR 517 184 517 184 Net Debt 2,755 1,094
Slide 16: 2020 Guidance (Consolidated)
2020 Guidance (Consolidated) Sales Growth EBITDA Margin Expansion Target CAPEX . 20-22% 8-8.5%* 160 ~TL 440 new stores mn from 19-21% maintained from 120 from ~400 * with IFRS 16 impact 16
Slide 17: Next Normal Initiatives & Opportunities
Next Normal Initiatives & Opportunities Enriching frozen portfolio Fintech in retail Homemade meals New investment & pizza Food Atelier in offline & online 17
Slide 18: Appendix - I
Appendix - I − Operations − Sustainability
Slide 19: Migros at a Glance
Migros at a Glance 2,278 Stores The only food retailer listed in BIST Sustainability CDP Turkey TL 23 Climate Leader Index for in all 81 cities 33,268 1,500+ 6 years in a row employees billion suppliers sales 2019 CDP Grade: International Operations Included BIST Corporate in 2 countries Governance
Slide 20: Sales Area Split – 1H 2020
Sales Area Split – 1H 2020 40 sqm - 3,500 sqm 3,500 sqm – 8,500 sqm 250 sqm – 2,000 sqm 200 sqm – 1,600 sqm 200 sqm – 3,500 sqm Supermarkets Hypermarkets Macrocenter Wholesale Ramstore 77% 17% 3% 1% 2% 2,101 55 60 20 42 20
Slide 21: Store Portfolio
Store Portfolio 30 June 2019 30 June 2020 Sales area Sales area 2,101 # of stores (th sqm) # of stores (th sqm) Supermarkets Migros 1,154 972.0 1,243 1,022.0 (M, MM,MMM) 55 Migros Jet 814 164.8 858 176.4 Hypermarkets 5M 56 280.4 55 268.9 Wholesale 21 12.0 20 11.5 60 Macrocenter Macrocenter 54 38.1 6
Slide 22: Migros Better Future Plan
Migros Better Future Plan Combating climate Waste management change and circular economy Consistent and rapid Preventative flow of product data solutions for pollution Innovative Efficient use of implementations resources Compliance with Value added human rights and activities to raise equal opportu
Slide 23: Sustainability
Sustainability Carbon Footprint Food Waste 2019: 26.6%* 2019: 17% (completed 2023 target) by 2030: 50% by 2024: 7% Score: A- Energy Consumption Gender Equality 2019: 16.3% Current: 28% 50% by 2024: 18.5% by 2024: 30% (executive +) 23 *2019 data has been independently verified on the basis of ISO 140
Slide 24: Waste Management & Biodiversity Conservation
Waste Management & Biodiversity Conservation Combating Food Waste Combating Plastic Waste Day-end clearance on perishables: Plastic bags: 74% 4,956 tons of food 405 tons less plastic on PL products Food Donation: 4,029,533 meals Good Agricultural Practices GAP certified F&V: 812,114 tons Fresh Lefto
Slide 25: Appendix - II
e@ Vir Appendix - Il — Financials
Slide 26: IFRS Consolidated Income Statement Summary – 1H 2020
IFRS Consolidated Income Statement Summary – 1H 2020 (TL million) 1H 2020 1H 2019 Net Sales 13,413 10,731 Cost of sales -9,868 -7,813 Gross Profit 3,544 2,918 Operating Expenses -2,949 -2,329 Other Operating Income / (Expense) -144 -240 Operating Profit 451 349 Income / (Expense) from Investment act
Slide 27: IFRS Consolidated Balance Sheet Summary – 1H 2020
IFRS Consolidated Balance Sheet Summary – 1H 2020 (TL million) 1H 2020 2019 Current Assets 6,341 5,277 Non-current Assets 8,748 9,184 Total Assets 15,089 14,461 Current Liabilities 8,976 7,544 Non-current Liabilities 6,061 6,594 Total Liabilities 15,037 14,138 Equity 53 323 Total Liabilities and Equ
Slide 28: Ownership Structure
Ownership Structure Direct Shareholding Structure Indirect Shareholding Structure AG Anadolu Grubu BC Partners Holding A.Ş. & related funds AG Anadolu Grubu BC Partners 100.00% Free Float Holding A.Ş. & related funds 38.04% 50.00% 11.96% MH Perakendecilik Kenan Investments Free Float Migros Ticaret
Slide 29: Disclaimer Statement
Disclaimer Statement Migros Ticaret A.Ş. (the “Company”) has prepared this presentation for the sole purpose of providing information about its business, operations and financial results. The informaation in this presentation is subject to updating, revision and amendment. The information in this pr