Slide 1: Half Year Financial Report 2017
HALF YEAR FINANCIAL REPORT 2017 Stockmann Group | 16 August 2017
Slide 2: Q2 2017 in Brief
Q2 2017 IN BRIEF Group’s gross margin • Stockmann Group 56.1% – Improved operating results for Stockmann Retail and Real Estate, decline for Lindex – Agreement signed to sell Delicatessen business operations in Finland to S Group (57.3) • Lindex – Operating profit down by EUR 15.5 million Group’s op
Slide 3: Strategy Towards Profitability
STRATEGY TOWARDS PROFITABILITY Stockmann Retail and Real Estate partnership Independent • Focus on fashion, development beauty and home of Lindex • Partners: cafés, Exit from retail books, toys, business in electronics, Russia wellness services etc. Withdrawal from • Department • New partner for non
Slide 4: Delicatessen in Finland Will Transfer to S-Group
DELICATESSEN IN FINLAND WILL TRANSFER TO S-GROUP • S-Group to buy Stockmann Delicatessen’s food business in Finland – 6 Delicatessen stores, Delicatessen kitchen, chain support operations and the whole personnel of around 800 people • Stores will continue under the Stockmann Delicatessen name as ten
Slide 5: Increased Focus on Fashion and Lifestyle
INCREASED FOCUS ON FASHION AND LIFESTYLE Group’s product sales per merchandise area in 2016 Food 15% Home 5% Cosmetics 9% Fashion 71% Excluding Hobby Hall and discontinued operations STOCKMANN 16.8.2017 5
Slide 6: Improved Operating Result During the Strategy Period
IMPROVED OPERATING RESULT DURING THE STRATEGY PERIOD Stockmann Group, rolling 12-month adjusted operating profit (EBIT) 40 30 20 10 0 -10 -20 1-12 4/2015- 7/2015- 10/2015- 1-12 4/2016- 7/2016- 2015 3/2016 6/2016 9/2016 2016 3/2017 6/2017 STOCKMANN 16.8.2017 6
Slide 7: Stockmann Group, Financial Performance in Q2 2017
STOCKMANN GROUP, FINANCIAL PERFORMANCE* IN Q2 2017 • Revenue EUR 281.3 million (320.7) QUARTERLY REVENUE – Down by 4.0% in comparable businesses EUR mill. 400 • Gross margin 56.1% (57.3%) 300 – Up in Stockmann Retail due to the divestment of Hobby Hall and improvements in the department store busine
Slide 8: Key Figures
KEY FIGURES Q2/2017 Q2/2016 1-6/2017 1-6/2016 1–12/2016 Equity ratio % 46.9 46.0 48.3 Gearing % 76.5 76.2 68.3 Net financial items* EUR mill. -10.8** -4.7 -15.4** -8.9 -23.1 Result for the period* EUR mill. -1.1 4.6 -28.0 -23.0 -7.5 Earnings per share* EUR -0.03 0.05 -0.42 -0.36 -0.18 Net earnings p
Slide 9: Extended Brand License Agreement in Russia
EXTENDED BRAND LICENSE AGREEMENT IN RUSSIA • Stockmann has signed an extended license agreement with AO Stockmann, a company owned by Reviva Holdings Limited, on the usage of the Stockmann brand in Russia in 2018-2023 • Reviva acquired Stockmann’s department stores in Russia in February 2016 with th
Slide 10: Market Environment and Outlook for 2017
MARKET ENVIRONMENT AND OUTLOOK FOR 2017 • Market environment – In Finland, economy has begun to recover, but consumers’ purchasing power is not expected to increase and purchasing behaviour is changing – In Sweden, fashion market expected to decline in 2017 – In the Baltics, outlook better than for
Slide 11: Lindex
LINDEX STOCKMANN 16.8.2017 11
Slide 12: Lindex, Highlights in Q2 2017
LINDEX, HIGHLIGHTS IN Q2 2017 • Increased sales in all markets except the Nordic countries, which resulted in decrease in total sales and profitability • Higher markdowns due to price-driven campaigning and larger summer sale • Continuously increased sales and traffic for e-commerce • Lindex mobile
Slide 13: Lindex, Financial Performance in Q2 2017
LINDEX, FINANCIAL PERFORMANCE IN Q2 2017 • Revenue down 7.7% to EUR 162.1 million (175.6), QUARTERLY REVENUE or down 7.6% excluding Russian stores in 2016 EUR mill. – Comparable store sales -5.1% due to decrease in the Nordic countries 200 150 • Gross margin 60.6% (65.8%) – Higher markdowns than in
Slide 14: International Expansion
INTERNATIONAL EXPANSION • Store network on 30 June 2017 – 478 stores in 16 countries, 5 60 of which 41 franchising stores 100 – 4 stores opened and 2 closed in Q2 2017 210 10 9 • New stores & markets in 2017 8 – Over 15 new own stores in 2017 2 3 – Net increase of stores lower, due to 26 some store
Slide 15: Lindex Way Forward
LINDEX WAY FORWARD • Intensified action to improve sales and profitability • Launch of new assortment concepts for all business areas • Pants solution – a new and easy way to find favourites and shop – Both in the stores and online • Implementing and developing the new marketing set up – Focus on di
Slide 16: Stockmann Retail
STOCKMANN RETAIL STOCKMANN 16.8.2017 16
Slide 17: Stockmann Retail, Highlights in Q2 2017
STOCKMANN RETAIL, HIGHLIGHTS IN Q2 2017 • Operating result excluding Hobby Hall improved by EUR 9.2 million – Improved gross margin – Efficiency programme generating cost savings according to plan • Comparable revenue has stabilised, good sales for regular priced items – Best growth in Tallinn, Riga
Slide 18: Stockmann Retail, Financial Performance in Q2 2017
STOCKMANN RETAIL, FINANCIAL PERFORMANCE* IN Q2 2017 • Revenue EUR 109.1 million (136.7) QUARTERLY REVENUE – Revenue in comparable businesses on a par with the previous year EUR mill. 200 • Gross margin 45.8% (45.3 or 43.3 incl. Hobby Hall) 150 – Increase mainly due to the divestment of Hobby Hall wi
Slide 19: High Quality Selection at the Heart of Stockmann
HIGH QUALITY SELECTION AT THE HEART OF STOCKMANN OWN SELECTION: FOOD EXPERIENCES & FASHION, BEAUTY & HOME PARTNER OFFERING MUOTI - KAUNEUS - KOTI - THE CURATOR THE GUIDE THE INSPIRER STOCKMANN 16.8.2017 19
Slide 20: Autumn Campaign Will Focus on Inspiring Fashion & Lifestyle Content
AUTUMN CAMPAIGN WILL FOCUS ON INSPIRING FASHION & LIFESTYLE CONTENT • Omnichannel approach: print magazine, web, mobile, social media, marketing campaigns, newsletters, store visual merchandise etc. STOCKMANN 16.8.2017 20
Slide 21: Real Estate
REAL ESTATE STOCKMANN 16.8.2017 21
Slide 22: Real Estate, Highlights in Q2 2017
REAL ESTATE, HIGHLIGHTS IN Q2 2017 • Increased revenue and operating profit – Main reason for the increase was higher rental income particularly in Nevsky Centre • Partners offer new experiences to customers in the stores – Summer restaurant terraces opened on the department store roofs in Helsinki
Slide 23: Real Estate, Financial Performance in Q2 2017
REAL ESTATE, FINANCIAL PERFORMANCE IN Q2 2017 • Value of the properties EUR 940.1 million at 30 June 2017 QUARTERLY REVENUE (944.7 on 31 March 2017 and 950.1 on 1 January 2017) EUR mill. 20 • Occupancy rate 99.6% (96.7%) 15 • Net operating income from own properties EUR 12.9 million (10.2) 10 – Aver
Slide 24: Real Estate, Stockmann-Owned Properties
REAL ESTATE, STOCKMANN-OWNED PROPERTIES Key figures Fair value of properties 30.6.2017 1.1.2017, EUR mill. Gross leasable area (GLA) 142 000 sqm, of which 42% in Finland Helsinki flagship building Book House, Helsinki 950.1 (1.1.2016: 918.2) Occupancy rate Occupancy rate 99.8 Occupancy rate 100.0 99
Slide 25: Thank You, Q&A
THANK YOU, Q&A STOCKMANN 16.8.2017 25
Slide 26: Further Information
FURTHER INFORMATION: www.stockmanngroup.com investor.relations@stockmann.com twitter: @stockmanngroupF