32 slides from Compagnie Financiere Richemont Sa's proxy contest presentation, August 2022
Slide 1: Investor Presentation August 2022
INVESTOR PRESENTATION AUGUST 2022 1
Slide 2: Agenda
AGENDA Richemont is a Top Performing Company, Consistently Delivering Strong Financial Performance 1 and Attractive Returns Richemont’s Business is Strongly Positioned, Well-Managed with the Right Strategy and Set for 2 Continued Delivery of Excellent Results Richemont’s Governance is Strong, Divers
Slide 3: Richemont is a top performing company delivering strong financial performance and returns
I. RICHEMONT IS A TOP PERFORMING COMPANY, CONSISTENTLY DELIVERING STRONG FINANCIAL PERFORMANCE AND ATTRACTIVE RETURNS 3
Slide 4: Strong financial performance
STRONG FINANCIAL PERFORMANCE… Sales Operating Profit €19.2bn €3.4bn 16% ’20-22 CAGR +701bps ’20-22 Margin Jewellery Sales1 Watch Sales1 €8.3bn €6.1bn 27% ’20-22 CAGR 12% ’20-22 CAGR Well-diversified Geographic Exposure Japan 6% Middle East and Africa 8% Americas 22% Europe 23% Asia Pacific 41% S
Slide 5: Supported by solid financial position
…SUPPORTED BY SOLID FINANCIAL POSITION › Richemont preserves a strong capital base to: CHF59bn1 €5.3bn2 meet unexpected crises sustain future developments through long-term investment seize unexpected opportunities Market Net Cash capitalisation › Consistent approach to M&A, looking to acquire
Slide 6: Consistently delivered attractive returns to shareholders since IPO
RICHEMONT HAS CONSISTENTLY DELIVERED ATTRACTIVE RETURNS TO ITS SHAREHOLDERS SINCE IPO… TSR since Richemont IPO 12,000 Long Term Annualised TSR2 10,000 Richemont 14.1% Swiss Equities 8.4% European Equities 4.2% 8452 % 1 8,000 Indexed Total Return 6,000 4,000 2,000 Richemont IPO date: 975 % 11-Oct-198
Slide 7: Whilst progressively increasing its dividend
…WHILST PROGRESSIVELY INCREASING ITS DIVIDEND Richemont Dividend Evolution Over Last 10 Years (CHF) 0.9% 1.2% 1.6% 2.1% 2.6% 2.1% 2.4% 2.7% 2.0% 1.7% 3.0%5 4 3.25 2.00 2.00 1.90 Covid 1.80 1.70 impact2 1.60 3 1.40 1.34 1.00 0.55 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 DPS Dividend Yie
Slide 8: Best-in-class performance with recent acceleration
BEST-IN-CLASS PERFORMANCE WITH RECENT ACCELERATION L5Y TSR Pre-COVID TSR (since Jan-2020) L2Y TSR Local Currency (28)% 22 % 35 % 44 % 49 % 191 % 3% (4)% 12 % 13 % 61 % 55 % 13 % 23 % 29 % 42 % 63 % 98 % TSR 146 % 55 % 98 % 43 % 49 % 44 % 35 % 46 % 33 % 9% 12 % 13 % 29 % 23 % 13 % (28)% (4)% (6)% Swi
Slide 9: Richemont's business is strongly positioned and well-managed
II. RICHEMONT’S BUSINESS IS STRONGLY POSITIONED, WELL-MANAGED WITH THE RIGHT STRATEGY AND SET FOR CONTINUED DELIVERY OF EXCELLENT RESULTS 9
Slide 10: Enviable portfolio of enduring luxury brands across an attractive geographic footprint
ENVIABLE PORTFOLIO OF ENDURING LUXURY BRANDS ACROSS AN ATTRACTIVE GEOGRAPHIC FOOTPRINT OUR WORLD-CLASS DIFFERENTIATED PORTFOLIO OF ENDURING LUXURY BRANDS MAISONS ARE THE FOUNDATION OF RICHEMONT › Portfolio comprised of four pillars Sales by › Iconic, enduring luxury brands Segment1 › Leading Maisons
Slide 11: Leading from strength in jewellery
LEADING FROM STRENGTH IN JEWELLERY… Iconic, world-renowned brand Consistently delivers blockbuster results Delivering excellent performance, notably from Alhambra, Perlée and Lady Arpels Significant growth engine for Richemont Continues to go from strength-to-strength Showcases Richemont
Slide 12: Accelerating performance in Specialist Watchmakers
…AND ACCELERATING PERFORMANCE IN SPECIALIST WATCHMAKERS Portfolio of world’s best watch Maisons Watch Maisons with enduring brand heritage representing the pinnacle of horology Combining history with state-of-the-art design and cutting-edge technology Successful management action to improve perf
Slide 13: Building scale and driving performance in Fashion & Accessories
BUILDING SCALE, ENDURING BRAND EQUITY AND DRIVING PERFORMANCE IN FASHION & ACCESSORIES Building scale and investing for the long-term Record revenues in FY2022 €2,056m Richemont’s scale and financial resources positions FY22 Revenue +53% Maisons to invest today, to realise their full potential F
Slide 14: Farfetch / Alabbar partnership is an important milestone in online journey
FARFETCH / ALABBAR PARTNERSHIP IS AN IMPORTANT MILESTONE IN RICHEMONT'S ONLINE JOURNEY YNAP to become a neutral platform with no controlling shareholder Transaction Rationale Sets a path to establishing the pre-eminent online luxury destination Step change in Richemont Maisons’ omni-channel di
Slide 15: Proven track record of disciplined portfolio management
RICHEMONT HAS A PROVEN TRACK RECORD OF DISCIPLINED PORTFOLIO MANAGEMENT WE DO NOT BUY GOODWILL, Disciplined acquirers, dispassionate portfolio managers WE CREATE IT WE EMPOWER ALL OUR Providing the optimal conditions for our Maisons to thrive MAISONS & BUSINESSES WITH A FOCUS ON LONG-TERM Nurturing
Slide 16: Consistent track-record of nurturing brands across three luxury categories
CONSISTENT TRACK-RECORD OF NURTURING BRANDS ACROSS THREE LUXURY CATEGORIES Purchased for cumulative 2nd largest contributor to Jewellery ~€310m in 1999-2001 Richemont’s jewellery segment by sales Has become one of the world’s iconic jewellery brands under Annual free cash flow Richemont’s stewar
Slide 17: Recent acceleration of financial performance
RECENT ACCELERATION OF FINANCIAL PERFORMANCE Sales (€m) Operating Profit (€m) 27% 0% (5)% 44% 17% 14% 11% 11% 18% 19,181 3,390 13,989 14,238 13,144 11,013 1,844 1,943 1,518 1,478 FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 Earnings per Share1 (€) Net Cash Generate
Slide 18: Operational performance strong versus peers since Covid
RICHEMONT’S OPERATIONAL PERFORMANCE HAS BEEN STRONG VERSUS PEERS SINCE COVID Sales CAGR Operating Profit CAGR Pre-Covid to Latest Fiscal Year Pre-Covid to Latest Fiscal Year 16.1% 49.4% 9.7% 16.1% 0.5% 10.2% (5.8%) (0.1%) Other Large Soft Other Large Soft Luxury Luxury Luxury Luxury (Dec 19-21) (Dec
Slide 19: Richemont is well positioned for the future
RICHEMONT IS WELL POSITIONED FOR THE FUTURE 3 RESILIENCE 2 Fortress balance sheet to weather economic cycles and seize opportunities STRATEGY 1 Proven strategy of nurturing our Maisons to drive sustainable growth PORTFOLIO Enviable portfolio of enduring luxury Maisons 19
Slide 20: Richemont's governance is strong, diverse and independent
III. RICHEMONT’S GOVERNANCE IS STRONG, DIVERSE AND INDEPENDENT, AND HAS BEEN A KEY ENABLER OF ITS LONG-TERM SUCCESS 20
Slide 21: Committed to continual process of best-in-class governance
RICHEMONT IS COMMITTED TO A CONTINUAL PROCESS OF DELIVERING BEST-IN-CLASS GOVERNANCE Recent Board refresh actions demonstrate commitment to increasing independence › Last 3 Board appointments – Wendy Luhabe, Patrick Thomas and Jasmine Whitbread – are diverse and independent with strong credentials i
Slide 22: Long track-record of improving board independence
LONG TRACK-RECORD OF IMPROVING BOARD INDEPENDENCE All proxy advisors deem 50% or more of the board to be independent ISS Glass Lewis Ethos +39% +41% +45% 63% 56% 50% 22% 11% 11% 2015 2022 2015 2022 2015 2022 Source: Proxy advisors. 22
Slide 23: Benefits of current shareholder / governance construct
BENEFITS OF CURRENT SHAREHOLDER / GOVERNANCE CONSTRUCT Taking a long-term view on sustainable value Long-term view creation, unencumbered by the desire for “quick wins”, is core to Richemont’s DNA Commitment to our long-standing strategic Strategic stability objectives creates the stable foundations
Slide 24: All board members represent all shareholders
ALL BOARD MEMBERS REPRESENT ALL SHAREHOLDERS 1 All existing Board members were elected by the majority of Class ‘A’ votes cast 2 The Board nomination committee comprises 50% or more independent directors 3 The Board benefits from diversity of culture, nationality, skills and gender Shareholders have
Slide 25: Richemont board is already skilled in areas where Mr Trapani has experience
STRONG BOARD: THE RICHEMONT BOARD IS ALREADY SKILLED IN AREAS WHERE MR TRAPANI HAS EXPERIENCE Our Board Skills & Experience1 Mr Trapani › Directors with breadth and depth of talent Luxury Goods Industry 44% › Composition balances diversity of talent with relevant Senior Exec. 44% experience › Ongoin
Slide 26: Board recommends voting against Mr Francesco Trapani as a candidate
IV. RICHEMONT BOARD RECOMMENDS VOTING AGAINST MR FRANCESCO TRAPANI AS A CANDIDATE 26
Slide 27: Mr Trapani is conflicted and cannot be considered independent
MR TRAPANI IS CONFLICTED AND CANNOT BE CONSIDERED INDEPENDENT Mr Trapani has significant ties to LVMH and continues to be 1 personally active in the luxury sector Sold Bulgari to LVMH in 2011, having served as CEO since 1984 Served as President of LVMH Watches and Jewellery from 2011 to 2014 Served
Slide 28: Appointing Mr Trapani is not additive to Richemont's board
APPOINTING MR TRAPANI IS NOT ADDITIVE TO RICHEMONT’S BOARD 1 Appointing Mr Trapani would represent a step backwards for Board independence and size, while also decreasing cultural diversity and increasing average age 2 Appointing Mr Trapani would bring nothing to the table that the Board does not al
Slide 29: Independent directors stand behind Wendy Luhabe as 'A' shareholder representative
THE INDEPENDENT DIRECTORS STAND BEHIND WENDY LUHABE AS THE BEST ‘A’ SHAREHOLDER REPRESENTATIVE South African, age 65 Ms Luhabe has served on Richemont’s Board as a Non-executive Director since 2020. She is considered a pioneering and leading businesswoman in South Africa, and has served extensively
Slide 30: Wendy Luhabe contributes to the board in key areas, while Mr Trapani would not
WENDY LUHABE CONTRIBUTES TO THE BOARD IN KEY AREAS, WHILE MR TRAPANI WOULD NOT Wendy Luhabe Mr Trapani Deemed non-independent due to ties Board with Bluebell and LVMH 1 Independence Maintains Board independence Would decrease Board’s independence Committee Would cause independence to Maintains commi
Slide 31: Conclusion
CONCLUSION Richemont has a multi-decade track-record of differentiated financial performance leading to highly attractive, sustainable shareholder value creation Commitment to continually improving governance with a well-qualified and majority independent board seeking to drive value creation for al
Slide 32: At Richemont, we craft the future
At Richemont, we craft the future Buccellati • Cartier • Van Cleef & Arpels • A. Lange & Söhne • Baume & Mercier • IWC • Jaeger-LeCoultre • Panerai • Piaget • Roger Dubuis • Vacheron Constantin • Watchfinder & Co. • NET-A-PORTER • MR PORTER • THE OUTNET • YOOX • ONLINE FLAGSHIP STORES • Alaïa • AZ F