Mahindra Holidays & Resorts India Limited · NSE:MHRIL
Mahindra Holidays & Resorts India — Q4 FY20 Earnings Presentation
61 slides from Mahindra Holidays & Resorts India's earnings presentation, May 11, 2020
Slide 1: Cover letter to stock exchanges on Q4 FY20 results presentation
May 11, 2020 MHRIL/SE/20-21/11 Listing Compliance Department of Corporate Services National Stock Exchange of India Limited BSE Limited Exchange Plaza, Plot No. C/1, G Block Floor 25, PJ Towers, Bandra-Kurla Complex Dalal Street Bandra (E), Mumbai - 400 051 Mumbai 400 001 Scrip Code: MHRIL Scrip Cod
Slide 2: Q4 FY20 Investor Presentation
A INDIA’S Ry ia INDIA’'S XY, if _INDIA'S BEST. yy ¥ MOST POPULAR ¥ 4 FAVOURITE 4 COMPANIES TO \ Resort j¥ \ Resort jf \ WORK FOR - Ns cHaIn| & “SS cHAIN & “Ys ToP50, 2019 4” TIMESTRAVELAWARD 2019 HOLIDAYIQAWARD 2017 GREAT PLACE TOWORK INSTITUTE Mahindra Holidays & Resorts India Limited Q4 FY20 Inves
Slide 3: Disclaimer
This presentation may contain ‘forward looking statements’ within the meaning of applicable laws and regulations. Investors are cautioned that ‘forward looking statements’ are based on certain assumptions, which Mahindra Holidays & Resorts India Limited considers reasonable at this time and our view
Slide 4: Contents
AS renin Contents Unique & Leadership Q4 FY20 Holiday Club Resilient Position m Results Resorts, Oy Business Model Vacation Update Ownership
Slide 5: Business Model
Business Model Club Mahindra (CMH 25) Flagship Product Offering Target Profile of CMH 25 Member Product Portfolio Strategic Priorities Strengthen & Leverage Grow Member Base Brand Bliss for CMH 25 Create Marquee resorts in 50+ year unexplored destinations Member Engagement Age group Drive Operationa
Slide 6: Sales Network and Revenue & Cost Model
Sales Network and Revenue & Cost Model Sales Network Cost Model • 120+ branch offices, sales offices & channel partners • ASF funds maintenance, renovation of resorts & member servicing • Leads generated through Digital route, Referrals, Alliances, On-ground Events/Activities, Campaigns Revenue Mode
Slide 7: Unique & Resilient Business Model
Unique & Resilient Business Model 6
Slide 8: Unique Business Model
Unique Business Model Zero Debt Status Unique Consistently High Strong Balance Sheet Business Occupancy Model 7
Slide 9: Resilient Business Model
Resilient Business Model Income Admission Fee Annual Subscription Fee Resort - Members from Financing Resort - FIT Interest Recurring Revenue Streams : ASF*, Resort Income Value Creation Upfront Admission Fee Value Realized Residual Value*: Built-in Multiple Annuity Streams Opportunity for Upfront 2
Slide 10: Revenue Mix
Revenue Mix IND AS 18 IND AS 115 1% 2% 3% 5% 6% 7% 8% 9% 12% 11% 18% 19% Under IND AS 115 20% 27% 28% Cumulative 18% member base 17% 19% contributes to 72% of total 23% 22% income. 56% 53% 50% 33% 33% FY'16 FY'17 FY'18 FY'19 FY'20 VO Income Resort Income ASF Income Interest Non Operating Income 9
Slide 11: Company follows Ind AS 115 Accounting system from FY19
Company follows Ind AS 115 Accounting system from FY19 Ind AS VO Income Ind AS VO Income 18 115 60% non refundable admission fee Recognized over the tenure of recognized upfront, 40% of Entitlement Fee membership deferred over tenure of membership Ind AS Ind AS Cost 115 Cost 18 Direct Costs are char
Slide 12: IND AS 115
IND AS 115 ▪ Income recognized equally over the tenure of membership (4% per year for 25 year product) as against 60% upfront in AS 18 ▪ Only incremental costs to obtain the membership are amortized over the tenure of membership ▪ Unit economics remains the same over the tenure of the membership ▪ N
Slide 13: Movement of Deferred Revenue
Movement of Deferred Revenue Rs in Lakhs FY 20 FY 19 Annual Annual Vacation Vacation Particulars Subscription Total Subscription Total Ownership Ownership Fees Fees Opening Balance 510,745 13,187 523,932 493,103 12,239 505,342 i) Addition during the year 61,063 30,679 91,742 71,295 27,643 98,938 ii)
Slide 14: VO Income
VO Income Rs in Lakhs Time Band As at Mar'20 As at Mar'19 < 1 Year - Vacation Ownership 37,496 34,112 1 - 2 Years 36,925 33,812 2 - 3 Years 36,505 33,329 3 - 4 Years 36,152 33,019 4 - 5 Years 35,920 32,878 > 5 Year 354,139 343,595 Closing Balance 537,137 510,745 FY21 VO Income accrual from Deferred
Slide 15: Unique Business Model - Strong Balance Sheet
Unique Business Model - Strong Balance Sheet Deferred Strong Cash Receivables Strong Asset Revenue Position Base Rs. 5,519 Cr Rs. 781 Cr Rs. 1,682 Cr Rs. 1,835 Cr* Income which Organic Growth Opportunity for Includes Land will be can be met Inorganic Assets recognized over without relying growth thr
Slide 16: Unique Business Model - Consistently High Occupancy
Unique Business Model - Consistently High Occupancy 95% 81% 85% 85% 83% 80%* 4,000 82% 3,732 75% 3,700 3,595 3,472 3,400 55% 3,152 3,100 2,816 2,879 35% 2,800 2,500 15% FY15 FY16 FY17 FY18 FY19 FY20 Room Inventory (Units) Occupancy % *Lower occupancy across all resorts due to the COVID-19 impact in
Slide 17: Cash position
Cash position 781 ₹ In Crs 572 470 265 84 26 FY15 FY16 FY17 FY18 FY19 FY20 16
Slide 18: Key Takeaways
Key Takeaways ▪ Strong and Resilient Business model • Growing cumulative member base of 258000+ generates multiple annuity revenue streams ▪ Predictability of Revenue streams • VO Income (Growing VO income from Deferred Revenue) • Track record of consistently high Occupancy (80%+) ensures resort rev
Slide 19: Leadership Position in Vacation Ownership
Leadership Position in Vacation Ownership 18
Slide 20: Leadership Position in Vacation Ownership
Leadership Position in Vacation Ownership Choice of 2.58 Lakh+ Member 60 Domestic resorts base Trusted Brand & 51 International Track record of over resorts two decades Through our Inventory Significant Recurring exchange program 192 Member Income Partners Hotels across Engagement streams/Revenue 10
Slide 21: Resort Diversity
Resort Diversity Hill Stations Beaches Cities ▪ Manali, Shimla, Naldhera, Kandaghat, ▪ Varca, Emerald Palms, Acacia Palms - ▪ Cochin Rishikesh, Mysuru Goa ▪ Nadiad ▪ Dharamshala, Kanatal, Binsar, Bhutan, ▪ Cherai ▪ Dubai Kashmir ▪ Pondicherry ▪ Kuala Lumpur ▪ Mussorie, Naukuchiatal, Srinagar ▪ Ganpa
Slide 22: Member Engagement
Member Engagement Dreamscapes Heart-to-Heart Curated Vacations Exchange Program • • Festivals & theme-based • Creating choice of Wide variety of in-city • In-city meets include experiences especially vacation experiences for destinations for members for leisure & edutainment curated for members memb
Slide 23: Slide 23
Slide 24: Covid-19 Impact on Q4
Covid-19 Impact on Q4 The outbreak of Coronavirus (COVID-19) pandemic has caused significant disturbance and slowdown of economic activity in March-20. The Company has evaluated impact of this pandemic on its business operations in March-20, as summarized below: Membership Traditionally March is a p
Slide 25: Q4 FY20 Performance
Q4 FY20 Performance IND AS 115 & 116 Membership Total Base Income Member Addition Total Income Margin Occupancy 3,616* Levels Rs. 256 Cr Occupancy PBT Margin 1.3% 72.2%* YOY growth 11.4% 232 bps YOY growth *Member addition and occupancies were adversely affected in Q4 due to COVID-19 impact in March
Slide 26: FY-20 Performance
FY-20 Performance IND AS 115 & 116 Membership Total Base Income Member Addition Total Income Margin Occupancy 15,697* Levels Rs. 1037 Cr PBT Margin Occupancy 7.6% 80.3%* YOY growth 12.0% 155 bps YOY growth *Member addition and Occupancies were adversely affected due to COVID-19 impact in March-20. 2
Slide 27: Cumulative Member Base
Cumulative Member Base 2,58,336 ** 2,43,574 * 2,35,792 2,18,138 1,99,617 1,83,431 FY-15 FY-16 FY-17 FY-18 FY-19 FY-20 * Net of one-off cancellation of 9,556 overdue members, in Q4 FY19. ** Lower Member addition in March-20 due to the COVID-19 impact. 26
Slide 28: Occupancy Trend
Occupancy Trend Occupancy Trend 85% 85% 82% 83% 81% 80%* FY-15 FY-16 FY-17 FY-18 FY-19 FY-20 *Lower occupancy across all resorts due to the COVID-19 impact in March-20. 27
Slide 29: Our growing International presence
Our growing International presence 51 destinations & growing…. UAE & Asia – 9 destinations Europe & US – 42 destinations •Bangkok -1 •Finland - 25 •Kuala Lumpur -1 •Sweden – 2 •Singapore -1 •Spain - 6 •Srilanka -1 •Orlando – 7 •Dubai - 1 • Las Vegas - 2 •Bhutan – 2 •Phuket – 1 •Pattaya - 1 28
Slide 30: Slide 30
Slide 31: Member
Member JANTA CURFEW: #HolidayFromHome 21 DAYS LOCKDOWN: #21DaysOfFamilyMoments The #HolidayFromHome campaign was launched within #21DaysOfFamilyMoments campaign was launched on the declaration of 1hr of the PMO announcing the #JantaCurfew #21DaysLockdown where daily magical family ideas will be shar
Slide 32: Marketing campaign
Marketing campaign Television Print
Slide 33: Slide 33
Slide 34: Q4 Income Trend
Q4 Income Trend IND AS 115 & 116 VO Income Resort Income Rs. Crs Rs. Crs +4% 89 85 55 -11% 49 Q4 FY19 Q4 FY20 Q4 FY19 Q4 FY20 ASF Income Interest & Non-Operating Rs. Crs Rs. Crs Income +9 % 76 69 43 -2% 42 Q4 FY19 Q4 FY20 Q4 FY19 Q4 FY20 33
Slide 35: Q4 Performance Trend
Q4 Performance Trend IND AS 115 & 116 Total Income PBT Rs. Crs Rs. Crs +1% 256 252 +27% 29 23 Q4 FY19 Q4 FY20 Q4 FY19 Q4 FY20 FY20 numbers are post IND AS 116 impact. 34
Slide 36: Income Break Up – Q4 FY'20
Income Break Up – Q4 FY’20 Rs. In Lakhs Growth Total Income Q4 FY20 Q4 FY19 YoY Income from Vacation Ownership 8,876 8,509 4.3% ASF 7,555 6,909 9.4% Resort Income 4,888 5,481 -10.8% Room 1,046 1,223 -14.5% F&B 2,977 3,248 -8.3% Holiday Activity & Others 865 1,010 -14.4% Interest & Others 2,748 2,930
Slide 37: Impact of Ind AS 116 – Standalone Q4 FY'20
Impact of Ind AS 116 – Standalone Q4 FY’20 (Rs. in lakhs) Standalone (Audited) Quarter ended Quarter ended March 31, 2020 March 31,2019 Sl. No Particulars Amount without Amount without Impact of Ind As reported adoption of Ind adoption of Ind AS 116 AS 116 AS 116 1. Profit prior to Rent, Finance cos
Slide 38: Profit & Loss Statement – Q4 FY'20
Profit & Loss Statement – Q4 FY’20 Rs. In Lakhs As reported (With impact of IND AS 116) Without impact of IND AS 116 Particulars Q4 FY20 Q4 FY19 YoY Gr Q4 FY20 Q4 FY19 YoY Gr Revenue from Operations 24,067 23,829 1.0% 24,067 23,829 1.0% Non-Operating Income 1,485 1,384 7.3% 1,442 1,384 4.2% Total In
Slide 39: Transition to IND AS 116 – Key Takeaways
Transition to IND AS 116 – Key Takeaways • The Ministry of Corporate Affairs (MCA) vide notification dated March 30, 2019 has made Ind-AS 116 "Leases" (Ind-AS 116) applicable w.e.f. April 1, 2019. • The Company has applied the modified retrospective approach as per para C5(b) of Ind-AS 116 to existi
Slide 40: Note on Adoption of Lower Tax Rate
Note on Adoption of Lower Tax Rate The Taxation Law (Amendment) Ordinance, 2019 With an intent to promote growth and investments, the Ministry of Finance has announced important fiscal reliefs vide Press Note dated 20 September 2019. • The Ordinance has reduced the corporate tax rates for domestic c
Slide 41: Slide 41
Slide 42: FY20 Income Trend
FY20 Income Trend IND AS 115 & 116 VO Income Resort Income Rs. In Crs +10% 347 Rs. In Crs 315 +4% 220 228 FY19 FY20 FY19 FY20 ASF Income Interest & Non-Operating Rs. In Crs Rs. In Crs 291 Income +11% 261 2% 167 171 FY19 FY20 41 FY19 FY20
Slide 43: FY20 Performance Trend
FY20 Performance Trend IND AS 115 & 116 Total Income PBT Rs. In Crs +8% 1037 Rs. In Crs 963 124 +24% 100 FY19 FY20 FY19 FY20 *FY20 numbers are post IND AS 116 impact 42
Slide 44: Income Break Up –FY'20
Income Break Up –FY’20 Rs. In Lakhs Growth Total Income FY-20 FY-19 YoY Income from Vacation Ownership 34,671 31,546 9.9% ASF 29,130 26,140 11.4% Resort Income 22,828 21,971 3.9% Room 4,802 4,631 3.7% F&B 14,010 13,386 4.7% Holiday Activity & Others 4,016 3,954 1.6% Interest & Others 11,072 12,172 -
Slide 45: Impact of Ind AS 116 – Standalone FY'20
Impact of Ind AS 116 – Standalone FY’20 (Rs. in lakhs) Standalone (Audited) Year ended Year ended March 31, 2020 March 31,2019 Sl. No Particulars Amount without Amount without Impact of Ind As reported adoption of Ind adoption of Ind AS 116 AS 116 AS 116 1. Profit prior to Rent, Finance cost, Deprec
Slide 46: Profit & Loss Statement – FY'20
Profit & Loss Statement – FY’20 Rs. In Lakhs As reported (With impact of IND AS 116) Without impact of IND AS 116 Particulars FY-20 FY-19 YoY Gr FY-20 FY-19 YoY Gr Revenue from Operations 97,701 91,829 6.4% 97,701 91,829 6.4% Non-Operating Income 6,011 4,515 33.1% 5,968 4,515 32.2% Total Income 103,
Slide 47: Summarized Balance Sheet
Summarized Balance Sheet Rs. in Lakhs Description As at 31 Mar 2020 As at 31 March 2019 ASSETS Property, Plant & Equipment 2,08,178 2,02,146 Right of Use Asset (IND AS 116) 17,427 - Trade receivables 1,68,188 1,62,091 Cash and cash equivalents (regrouped) 78,073 57,193 Deferred Tax (Net) 24,836 42,5
Slide 48: HCRO
HCRO We Create and Sell Dream Holidays
Slide 49: Figures of the Resorts
Figures of the Resorts Spa Hotels 8 Other Holiday Resorts 25 Hotel Rooms 1,149 Timeshare apartments 1,560 Villas Apartments 600 Restaurants & Bars 44 Aqua Parks with Saunas 8 Spa Treatment Departments 8 Golf Courses 4 Angry Birds Activity Parks 4 Shopping Centre 1 48
Slide 50: Key Facts
Key Facts ▪ Holiday Club Resorts is the largest vacation ownership company in Europe and the leading leisure travel company in Finland ▪ A total of 33 resorts - 25 in Finland, 2 in Sweden, 6 in Spain (5 in Gran Canary, 1 in Costa del Sol) ▪ Mahindra Holidays owns 100% of HCR Oy ▪ ~62,000 families an
Slide 51: Financial Performance Holiday Club
Financial Performance 50 Holiday Club
Slide 52: Comments FY19-20
COMMENTS FY19-20 ❑ Turnover in March-20, traditionally a peak month, has been adversely affected due to COVID-19. ❑ Turnover of 157.3 m€ in FY 20 as compared to 161.1 m€ in FY 19. ▪ Turnover was lower by 7.8 m€ YOY; due to impact of COVID-19 ▪ YTD Dec 2019, turnover was up by 4.0 m€ YOY ▪ SPA Hotel
Slide 53: Turnover : 2019-20
Turnover : 2019-20 Turnover by Business Areas* Euro Mn FY'20 FY'19 Particulars YTD Dec'19 Q4 FY 20 FY'20 YTD Dec'18 Q4 FY 19 FY'19 Timeshare 30.14 8.72 38.86 32.81 11.92 44.73 Spa Hotels 53.23 19.35 72.58 48.69 22.00 70.69 Renting 5.79 1.98 7.76 5.15 1.93 7.08 Real Estate Management 4.45 1.41 5.86 4
Slide 54: P&L 2019-2020
P&L 2019-2020 Euro Mn FY'20 FY'19 Particulars YTD Dec'19 Q4 FY 20 FY'20 YTD Dec'18 Q4 FY 19 FY'19 Turnover 118.46 38.87 157.33 114.41 46.68 161.09 Operating Profit 4.35 2.38 6.73 0.86 6.93 7.79 Less: Depreciations and impairments 4.32 1.35 5.67 4.28 1.45 5.73 (Add)/Less Financial (income) and expens
Slide 55: Slide 55
Slide 56: Segment Revenue
Segment Revenue IND AS 115 & 116 Rs. In Lakhs Particulars Q4 FY'20 Q4 FY'19 FY'20 FY'19 - MHRIL 25,758 25,570 104,753 97,635 - HCRO 37,299 39,430 138,163 131,269 Total Segment Revenue 63,057 65,000 242,916 228,904 - Other Unallocable Revenue 86 665 199 662 Revenue from Operations 63,143 65,665 243,1
Slide 57: Segment Profitability (PBT)
Segment Profitability (PBT) IND AS 115 & 116 Rs. In Lakhs Particulars Q4 FY'20 Q4 FY'19 FY'20 FY'19 - MHRIL 3,050 2,282 12,666 10,017 - HCRO 2,400 4,052 2,601 300 PBT before Ind AS 116 & Consolidation adjustments 5,450 6,334 15,267 10,317 - Ind AS 116 Impact (646) - (2,024) - Segment Results 4,804 6
Slide 58: Impact of Ind AS 116 – Consolidated Q4 FY'20
Impact of Ind AS 116 – Consolidated Q4 FY’20 (Rs. in lakhs) Consolidated (Audited) Quarter ended Quarter ended March 31, 2020 March 31,2019 Sl. No Particulars Amount without Amount without Impact of Ind As reported adoption of Ind adoption of Ind AS 116 AS 116 AS 116 1. Profit prior to Rent, Finance
Slide 59: Impact of Ind AS 116 – Consolidated FY'20
Impact of Ind AS 116 – Consolidated FY’20 (Rs. in lakhs) Consolidated (Audited) Year ended Year ended March 31, 2020 March 31,2019 Sl. No Particulars Amount without Amount without Impact of Ind As reported adoption of Ind adoption of Ind AS 116 AS 116 AS 116 1. Profit prior to Rent, Finance cost, De
Slide 60: Consolidated Profit & Loss Statement
Consolidated Profit & Loss Statement IND AS 115 & 116 Rs. In Lakhs Particulars Q4 FY'20 Q4 FY'19 FY'20 FY'19 Income from Operations 61,661 63,459 237,187 223,899 Non Operating Revenue 1,482 2,206 5,928 5,667 Total Income 63,143 65,665 243,115 229,566 Cost of vacation ownership weeks 9,854 9,307 37,3
Slide 61: Thank You
Mahindra Holidays & Resorts India — Q4 FY20 Earnings Presentation on 6ix