Samsonite Group S.a. · HKEX:1910
Samsonite — Samsonite International — FY2021 Earnings Presentation
39 slides from Samsonite's earnings presentation, Mar 16, 2022
Slide 1: 2021 Annual Results
2021 ANNUAL RESULTS MARCH 16, 2022 Samsonite International S.A. Stock Code: 1910
Slide 2: Disclosure Statement
Disclosure Statement This presentation and the accompanying slides (the “Presentation”), which have been prepared by Samsonite International S.A. (“Samsonite” or the “Company”), do not constitute any offer or invitation to purchase or subscribe for any securities, and shall not form the basis for, o
Slide 3: Agenda
Agenda Business Update Financial Highlights Outlook Q&A Page 3
Slide 4: We ended 2021 on a high note, and have strong momentum as we step into 2022
We ended 2021 on a high note, and have strong momentum as we step into 2022 Our strong fourth quarter result is evidence that our efforts to navigate the business through the challenges from the pandemic are working. We step into 2022 with great momentum, and are well-positioned to grow market share
Slide 5: Strong sales and Adjusted EBITDA recovery continued in Q4
Strong sales and Adjusted EBITDA recovery continued in Q4 Q4 sales growth improved to (28.0%)(1)(2) vs. Q4 2019 up from (37.6%)(1) in Q3 2021. Gross margin improved to 58.2% in Q4 2021 from 55.5% in Q3 2021, 52.4% in Q2 2021 and 48.7% in Q1 2021. Achieved positive Adjusted EBITDA of US$127.1 million
Slide 6: Our 2021 performance markedly improved vs prior year
Our 2021 performance markedly improved vs prior year Our 2021 sales improved to US$2,021 million, an increase of 35.1%(1)(2) year-on-year, and a decrease of 43.5%(1)(2) compared to 2019, driven by increased vaccination rates, easing of social-distancing measures, reopening of domestic travel, and an
Slide 7: Revenue and Adjusted EBITDA continued their trend of quarterly improvement
Revenue and Adjusted EBITDA continued their trend of quarterly improvement Consolidated Quarterly Net Sales and Adjusted EBITDA ($ in millions, except growth) Q1 2021 Q2 2021 Q3 2021 Q4 2021 2021 (1,2) Net Sales growth vs. 2019 (57.3%) (52.2%) (37.6%) (28.0%) (43.5%) Adj. EBITDA ($28.5) $11.5 $72.2
Slide 8: The sales recovery compared to 2019 accelerated in all regions in Q4
The sales recovery compared to 2019 accelerated in all regions in Q4 By region constant currency sales growth vs. 2019 (2) (2) North America saw sequential The recovery in Asia has lagged Europe also saw sequential Latin America also saw quarterly sales growth behind the other regions, but quarterly
Slide 9: We expect to see a sustained recovery in travel demand
We expect to see a sustained recovery in travel demand even amidst the current global COVID- 19 landscape and current geopolitical tensions Considering vaccine effectiveness and today’s high vaccination rates, we are hopeful that the effects of COVID-19 on everyday life will continue to moderate, dr
Slide 10: International travel has continued to recover
International travel has continued to recover, and is poised for an even stronger recovery over the course of 2022 Domestic Revenue Passenger-kilometers (RPK’s) vs. International RPK’s Domestic travel Domestic travel was negatively was negatively impacted by the impacted by the Delta variant. Omicro
Slide 11: Recovery scenarios for global air travel demand
While the spread of the COVID-19 Omicron variant has briefly impacted the recovery in global air traffic, demand is projected to improve over the course of 2022 Recovery scenarios for global air travel demand Baseline recovery at 85% of 2019 levels. Source: Bain & Company Global commercial air trave
Slide 12: Gross margin improved to 58.2% in Q4 2021
Gross margin improved to 58.2% in Q4 2021, and 54.5% for 2021 vs. 46.0% in 2020 Gross margin improved to 58.2% in Q4 2021 Quarterly Gross Margin Trend driven by increased sales, lower promotional activity due to strong demand and sell- through of our products, lower provisions for inventory reserves
Slide 13: Decisive actions translated to strong profitability and cash generation
The Company’s decisive actions have translated to strong profitability and cash generation(3) Quarterly Adjusted EBITDA and cash (burn)/generation(3) Significantly reduced our fixed cost structure with over US$200 million in annualized savings as well as tighter advertising spend and continued tempo
Slide 14: Strong growth in our core brands as travel continues to recover
Strong growth in our core brands as travel continues to recover Net Sales Growth by Brand All three of our core brands saw strong growth across all regions for 2021 compared to 2020. Samsonite net sales growth of +36.3%(1) was largely driven by growth in North America +52.0%(1), Europe +43.1%(1) and
Slide 15: Ecodiver and Minter collections
Exciting, innovative, and sustainable collections are ready to capture demand as travel continues to recover The Ecodiver collection is made from water- resistant coated fabrics and was developed ECODIVER with sustainability, security and comfort in mind. Interior and exterior fabrics made of 100% r
Slide 16: Elevation Plus and CTS collections
New collections across brands, spanning both travel and non-travel products, are incorporating sustainable materials ELEVATION™ The Elevation™ Plus collection combines functionality, performance, and timeless design to address the needs of today’s global traveler. PLUS High performance polypropylene
Slide 17: Tumi relaunched the Alpha Bravo collection
Tumi relaunched the popular Alpha Bravo collection at the start of 2022 Celebrating over a decade of innovation and utilitarian design, TUMI's latest evolution of Alpha Bravo continues its legacy with the stellar Life in Forward Motion campaign. The Life in Forward Motion campaign stars F1 driver La
Slide 18: Our Responsible Journey
We continue to prioritize sustainability with ‘Our Responsible Journey’ In November 2021, we conducted a successful pilot initiative in Belgium, the Netherlands, and Luxembourg to accept and recycle old suitcases dropped off by customers. In five days, we received nearly 300 bags (including many fro
Slide 19: Samsonite's response to the crisis in Ukraine
Samsonite’s response to the crisis in Ukraine At Samsonite, we are deeply concerned about the humanitarian crisis that is unfolding as a result of the conflict in Ukraine. Our thoughts are with all who have been impacted, including our employees and their families as well as our customers and partne
Slide 20: Agenda
Agenda Business Update Financial Highlights Outlook Q&A Page 20
Slide 21: 2021 Results Highlights
2021 Results Highlights Net sales increased 35.1%(1)(3) Gross margin increased by 850bp from the Adjusted EBITDA increased by over After returning to profitability at the compared to prior year. extremely low gross margin in 2020, mainly US$400 million from prior year and Adjusted Net Income level f
Slide 22: Financial Highlights
Financial Highlights Net sales in 2021 increased from prior year by 35.1%(1)(2). The net sales recovery accelerated during the year, particularly in North America, Europe and Latin America. Compared to 2019, Q4 2021 net sales were down by 28.0% (1)(2) compared to Q4 2019, reflecting improvement from
Slide 23: Financial Highlights (cont'd)
Financial Highlights (cont’d) Net debt position improved to US$1,477 million as of December 31, 2021, with US$1,325 million of cash and cash equivalents and US$2,802 million of debt(1), from US$1,736 million as of December 31, 2020. The Company repaid a total of US$370 million of borrowings during t
Slide 24: Financial Highlights (cont'd)
Financial Highlights (cont’d) Net working capital at December 31, 2021 was US$157 million lower than December 31, 2020, with net working capital efficiency of 9.9% at December 31, 2021, improved from 23.2% at December 31, 2020. Reduction of inventory was primarily driven by strong product sell-throu
Slide 25: Sales higher than 2020 with sequentially improving growth in all regions
Sales were higher than 2020 with sequentially improving quarterly sales growth compared to 2019 in all regions Constant Currency Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Growth -44.6% 114.1% 123.5%(1) 104.4%(1) -25.9% 79.3% 38.2% 36.3% -62.1% 172.7% 87.4% 116.9% -48.8% 812.5% 229.8% 85.6% Con
Slide 26: The sales recovery compared to 2019 accelerated in all regions in Q4
The sales recovery compared to 2019 accelerated in all regions in Q4 By region constant currency sales growth vs. 2019 (2) (2) North America saw sequential The recovery in Asia has lagged Europe also saw sequential Latin America also saw quarterly sales growth behind the other regions, but quarterly
Slide 27: Channel mix shifted back towards wholesale and retail
Channel mix shifted back towards wholesale and retail, and acceleration in travel category sales shifted the sales mix back towards travel compared to prior year Comparison of sales by channel Comparison of Travel vs. Non-travel sales 13.7% (1)(2) (12.1% of Net Sales) 18.0% (1)(2) 48.1% (1)(2) (42.5
Slide 28: The Company has aggressively reduced SG&A costs
The Company has aggressively reduced SG&A costs to navigate the pandemic which has positioned the business for strong profitability as sales continue to recover SG&A within Adjusted EBITDA(1) 2021 fixed SG&A expenses were US$371 million lower than 2019 due mainly to actions taken to restructure the
Slide 29: Adjusted EBITDA Bridge 2020 – 2021
Higher net sales and gross margin as well as fixed SG&A savings significantly improved Adjusted EBITDA compared to prior year Adjusted EBITDA Bridge 2020 – 2021 US$56.5 million (1)(2) (1) (1)(2) (1) (1)(2) Gross margin and SG&A initiatives in 2020 and 2021 drove significant Adjusted EBITDA improveme
Slide 30: Cash generation improved by US$560 million from 2020 to 2021
Cash (burn) / generation(1) improved by US$560 million from 2020 to 2021 Full year cash burn/generation(1) Quarterly cash (burn)/generation (US$m): • Q1 ’21 – ($64.6) • Q2 ‘21 – ($27.3) • Q3 ‘21 – $116.1 • Q4 ‘21 - $175.6 Higher cash generation in 2021 compared to 2019, on sales that were US$1.6 bil
Slide 31: Quarterly Adjusted EBITDA and cash generation improved every quarter in 2021
Quarterly Adjusted EBITDA and cash (burn) / generation(1) improved every quarter in 2021 Quarterly Adjusted EBITDA and cash (burn)/generation(1) Achieved positive Adjusted EBITDA in Q2, Q3 and Q4 2021 and significant cash generation(1) in the 2nd half due to the improving net sales and Adjusted EBIT
Slide 32: Balance Sheet
Balance Sheet US$m December 31, December 31, December 31, $ Chg Dec-21 % Chg Dec-21 Net debt of US$1,477 million 2019 2020 2021 vs. Dec-20 vs. Dec-20 at December 31, 2021, which Cash and cash equivalents 462.6 1,495.0 1,324.8 (170.2) -11.4% decreased by approximately Trade and other receivables, net
Slide 33: Working Capital
Working Capital US$m December 31, December 31, December 31, $ Chg Dec-21 % Chg Dec-21 Net working capital at December 31, 2019 2020 2021 vs. Dec-20 vs. Dec-20 2021 was US$157 million lower than at Working Capital Items Inventories $ 587.3 $ 455.9 $ 348.4 $ (107.4) -23.6% December 31, 2020 driven mai
Slide 34: Continued to tightly manage our capex and software additions in 2021
Continued to tightly manage our capex and software additions in 2021 Capital Expenditure by project type US$m 2020 2021 The majority of capex in 2021 Retail 7.1 8.0 was related retail remodels, and Product Development / R&D / Supply 11.0 7.6 investment in machinery and equipment for product Informat
Slide 35: Agenda
Agenda Business Update Financial Highlights Outlook Q&A Page 35
Slide 36: Outlook
Outlook Our strong 2021 results, particularly in the second half of the year, underscore the positive impact of our decisive actions over the last two years. We step into 2022 with great momentum, and are well-positioned to grow market share at a fundamentally higher operating margin profile in the
Slide 37: Outlook (cont'd)
Outlook (cont’d) We remain focused on improving and maintaining our gross margins through reduced discounting and promotional activity; price increases to mitigate increased product costs, duties, and freight; and working closely with our suppliers to manage these increasing cost pressures. We inten
Slide 38: Outlook (cont'd)
Outlook (cont’d) We ended the year with a lean inventory position primarily driven by strong sell-through and demand for our products, though shipping and freight constraints also played a factor. We are investing more into our working capital, primarily inventory, to support the ongoing recovery in
Slide 39: Agenda
Agenda Business Update Financial Highlights Outlook Q&A Page 39
Samsonite International — FY2021 Earnings Presentation on 6ix