Michael Hill International Ltd. · ASX:MHJ
Michael Hill International — FY2018 Earnings Presentation
24 slides from Michael Hill International's earnings presentation, Aug 27, 2018
Slide 1: For personal use only
For personal use only
Slide 2: Disclaimer
DISCLAIMER Certain statements in this announcement constitute forward-tooking statements. Forward-looking statements are statements (other than statements of historical fact) relating to future events and the anticipated or planned financial and operational performance of Michael Hill International
Slide 3: For personal use only
For personal use only
Slide 4: CEO and CFO Review
' j : CEO and CFO REVIEW «= OVERVIEW AND STRATEGIC SNAPSHOT = FINANCIAL HIGHLIGHTS = GROUP RESULTS * STRATEGIC SHIFTS = PRIORITIES FOR 2018-19
Slide 5: Overview and Strategic Snapshot
OVERVIEW AND STRATEGIC SNAPSHOT Revenues $575.5m NPAT continuing operations $34.8m EBIT from continuing operations $50.1m Full year dividend 5c Cash Flow Net Debt ete ED FY 18 was a year of recalibration and repositioning, with the closure of the US stores and Emma & Roe brand and a refocus on the t
Slide 6: Overview and Strategic Snapshot
OVERVIEW AND STRATEGIC SNAPSHOT = The Group has identified five strategic shifts that are designed to reposition Michael Hill from a traditional retailer to a differentiated omni-channel brand: = Omni-channel: Building capability to deliver a seamless customer experience = Customer loyalty: Building
Slide 7: Financial Highlights
FINANCIAL HIGHLIGHTS g TSSMLUDN gg OPERATIONS REVENUE GROSS MARGIN F AAG $54.9 MILLION F 0.4% | 5.0c OPERATING NET CASH INFLOW SAME STORE DIVIDEND + 37.8% SALES 2017: 5.0C EBIT 08 MILLION %50.1 MILLION NET DEBT CONTINUING S 2017: $39.4m OPERATIONS $ 17 + 84.6 MILLION NEW STORES NET PROFIT AFTER TAX
Slide 8: Financial Highlights
FINANCIAL HIGHLIGHTS 50.4% $10.3 MILLION E-COMMERCE SALES EQUITY RATIO GROWTH 9017: 52.0% 57.AN $89.1 MILLION EBIT FROM CONTINUING RETAIL SEGMENTS 1.6% $35.7 MILLION PCP SALES (CONTINUING OPERATIONS) 18.0% BRANDED COLLECTION SALES 2017: 14.2% 3.8% CANADA SAME STOR E SALES GROWTH 2.3% NEW ZEALAND SAM
Slide 9: Group Results
GROUP RESULTS = Revenue from continuing operations grew 4.4%, with same store sales up 0.4% = Gross margin for the Group was flat on prior year at 63.7% of revenue = Normalised EBIT before one-off items of $40.1m, down from $48.1m = EBIT from continuing operations of $50.1m « Full year dividend of 5
Slide 10: Michael Hill Australia Retail Segment
MICHAEL HILL AUSTRALIA RETAIL SEGMENT = Revenue grew by 1.2% in a tough retail market = Gross margin of 63.3%, up from 62.6% in prior year = Rising costs and a challenging retail environment impacted EBIT of $48.6m = 7 new stores opened during the year and 2 closed, giving a total of 171 trading at
Slide 11: For personal use only
For personal use only
Slide 12: Michael Hill New Zealand Retail Segment
MICHAEL HILL NEW ZEALAND RETAIL SEGMENT Revenue grew by 2.7% to NZ$125.2m Same store sales growth of 2.3% in a mature market EBIT of NZ$278m, in line with the prior year The focus in this mature market is on improving store locations and building average store sales through broadening our product of
Slide 13: For personal use only
For personal use only
Slide 14: Michael Hill Canada Retail Segment
MICHAEL HILL CANADA RETAIL SEGMENT Revenue grew by 16.0% to CA$130.8m Same store sales grew 3.8% EBIT increased 17.9% to a record CA$14.6m This segment continues to show good growth as it achieves scale and increases market share 8 new stores opened during the year and 1 closed, giving a total of 83
Slide 15: For personal use only
For personal use only
Slide 16: For personal use only
For personal use only
Slide 17: Omni-channel: Building Capability to Deliver a Seamless Customer Experience
OMNI-CHANNEL: BUILDING CAPABILIITY TO DELIVER A SEAMLESS CUSTOMER EXPERIENCE Evolving our online experience, including integration of digital and social channels with our store network, to enable a seamless experience for customers where and when they engage with us. = Target growth in e-commerce —
Slide 18: Customer Loyalty: Building Data Capability to Better Service Customers
CUSTOMER LOYALTY: BUILDING DATA CAPABILITY TO BETTER SERVICE CUSTOMERS Using data driven customer insights to deliver tailored customer experiences to drive brand loyalty and advocacy. = A focus on customer data and insights — Build our data and insights capability to be better informed and service
Slide 19: Unique Branded Collections: Escalate Our Growth of Branded Collections
UNIQUE BRANDED COLLECTIONS: ESCALATE OUR GROWTH OF BRANDED COLLECTIONS Through enhanced designer capability, create unique branded collections to meet growing customer demand for differentiated products. * Growth through proprietary branded collections — planning to grow revenue by increasing invest
Slide 20: Brand Position: Strengthen and Grow Brand Loyalty
BRAND POSITION: STRENGTHEN AND GROW BRAND LOYALTY Based on recent brand review, we will reposition our brand in market to meet the changing consumer landscape. = Better engagement with our customers — differentiate the brand from our competitors to create a point of difference and acquire market sha
Slide 21: Operational Excellence: Enhance Execution Capability and Agility
OPERATIONAL EXCELLENCE: ENHANCE EXECUTION CAPABILITY AND AGILITY Build capability and agility throughout the organisation to adapt quickly to a fast changing retail environment. = Improve IT infrastructure and systems — investment in our finance, HR, customer experience and inventory management syst
Slide 22: Priorities for 2018-19
PRIORITIES FOR 2018-19 = Open at least 10 new Michael Hill stores across all markets. = Reposition Michael Hill from a traditional retailer to a unique omni-channel retailer. Branded collection sales to grow as a percentage of total revenue. = Continued improvement in inventory management to deliver
Slide 23: For personal use only
For personal use only
Slide 24: Thank You
THANK YOU michael hill. INTERNATIONAL LIMITED 24
Michael Hill International — FY2018 Earnings Presentation on 6ix