B&m European Value Retail Plc · LSE:BME
B&m European Value Retail — H1 FY2025 Earnings Presentation
28 slides from B&m European Value Retail's earnings presentation, November 2024
Slide 1: FY25 Interim Results Presentation
B&M European Value Retail S.A. FY25 Interim Results Presentation 26 weeks to 28 September 2024
Slide 2: Agenda
Agenda Introduction 1 Alex Russo Financials 2 Mike Schmidt Growth strategy 3 Alex Russo 4 Q&A 2
Slide 3: Introduction
Introduction Alex Russo Chief Executive Officer
Slide 4: Group highlights
Group highlights EDLP: Volume-led sales growth; 5-year container volumes up +40% at B&M UK £2,644m £274m Growing volume momentum, with broadening Group revenue Group adjusted EBITDA strength in General Merchandise +3.7% YoY +2.0% YoY Store rollout programme on track (30 openings in B&M UK, 5 in Fran
Slide 5: A reminder: significant opportunity for profitable growth
A reminder: significant opportunity for profitable growth Where we are Where we are going Currently at 764 B&M UK stores Our target is to open at least 1,200 B&M UK stores Upon reaching 1,200 B&M UK stores, our implied market Low market share and advantaged share1 will be c.3%. We will continue to d
Slide 6: Our approach is highly disciplined and driving sustainable sales growth
Our approach is highly disciplined and driving sustainable sales growth… B&M UK volume-led sales densities increasing (£ per sq ft) 375 Price: EDLP 325 275 FY19 FY20 FY21 FY22 FY23 FY24 H1 FY25 LTM Product: 10k SKUs B&M UK store estate successfully growing (Total stores) 800 700 Standards: +8/10 600
Slide 7: …with sales growth translating to profit growth
…with sales growth translating to profit growth 5,372 4,983 +40% growth in revenues 4,801 4,673 is underpinned by Net sales (£m) 3,813 growth in volumes (+40% growth in container imports) 1 FY20 FY21 FY22 FY23 FY24 (52w) FY25E Full year 640-660 Half year Sustainably growing 626 619 616 620-660 573 o
Slide 8: Financials
Financials Mike Schmidt Chief Financial Officer
Slide 9: Summary profit and loss
Summary profit and loss £m H1 FY25 H1 FY24 YoY Revenue 2,644 2,549 3.7% Adjusted EBITDA (pre-IFRS 16)1 274 269 2.0% % 10.4% 10.5% (18)bps Depreciation and amortisation (pre-IFRS 16) (44) (40) Operating impact of IFRS 16 28 34 Adjusted operating profit1 258 263 (1.8)% Adjusted diluted EPS (pre-IFRS 1
Slide 10: Store rollout drove total revenue growth in H1
Store rollout drove total revenue growth in H1 Year-on-year revenue progression (£m) Key highlights New space adding 7.3% sales growth in B&M UK LFL performance improved across half as seasonal effects moderated (Q1 (5.1)% and Q2 (1.9)%) France is progressing well Volume driven sales growth 10
Slide 11: Strong gross margin performance
Strong gross margin performance Year-on-year gross margin progression (%) Key highlights Good trading margin out-turn of +66bps year-on-year: • Mix benefits, favourable FX rates, freight benefits and limited markdowns B&M France and Heron margins remain robust Clean closing inventory position with e
Slide 12: Adjusted EBITDA
Adjusted EBITDA Group (£m) B&M UK (£m) 274 Key highlights 269 240 235 Group adjusted EBITDA1,2 increased 232 by 2.0% driven by sales growth 200 10.0% 10.5% 10.4% 10.6% 11.5% 11.3% B&M UK’s adjusted EBITDA1 margin broadly flat (15bps) H1 FY23 H1 FY241 H1 FY25 H1 FY23 H1 FY241 H1 FY25 Category Categor
Slide 13: Adjusted underlying operating costs as % of revenue
Adjusted underlying operating costs as % of revenue Group1,2,3 (£m) B&M UK1,3 (£m) 26.8% 25.8% Key highlights 26.5% 25.5% 26.0% 24.9% B&M UK underlying costs3 increased by 7.3% YoY primarily due to the increased store estate size (+7.3%) £611m £661m £710m £483m £509m £547m Productivity gains being d
Slide 14: Rapid payback from new store openings
Rapid payback from new store openings Cohort performance from most recent B&M UK openings Total openings (Apr-22 – Sep-23) Total openings (Apr-22 – Sep-23) 20 Garden centres 4 # of stores opened 35 4 Home Total investment (capex, opex and w/capital) 1 £50m 2 10 stores £257m 11 LTM revenues from coho
Slide 15: Continued cash discipline
Continued cash discipline Cash flow overview (£m) Capex development (£m) H1 FY25 H1 FY24 New stores Infrastructure and freehold EBITDA (post-IFRS 16) 369 399 Maintenance 59 Change in working capital (86) (37) 48 28 Other 20 (10) 18 Cash generated from operations 303 352 11 17 Income tax paid (61) (5
Slide 16: Growth strategy
Growth strategy Alex Russo Chief Executive Officer
Slide 17: Growth strategy agenda
Growth strategy agenda Introduction 1 Alex Russo Price 2 Gareth Bilton Product 3 Gareth Bilton, Lesley Buchanan & Vianney Deregnaucourt Standards 4 James Kew Discipline 5 Alex Russo & Vianney Deregnaucourt 17
Slide 18: Senior management team
Senior management team Key highlights B&M UK Trading Director succession Alex Mike Gareth James Jon plan well progressed Russo Schmidt Bilton Kew Parry Chief Executive Chief Financial Trading Director Retail Director Supply Chain Develop first from within the business Officer Officer Director Strong
Slide 19: Price: EDLP is the core of the business
Price: EDLP is the core of the business Big 4 price indexed to B&M (100)1 140 130 Max 120 Min 110 100 B&M 90 FY23 HY24 FY24 HY25 Grocery Every Day General Rigour on price Low Price Merchandise benchmarking every week No high-low complexity! Price gap consistently Customer transparency higher than in
Slide 20: Product: Range improvements & lower price points broaden the appeal
Product: Range improvements & lower price points broaden the appeal Low price points Seasonal & trend changes Award winning best-selling products Creating customer moments Direct sourcing to get better costs SKU count discipline 20
Slide 21: Product: UK and France synergies
Product: UK and France synergies Sourcing and development Unique Direct product & sourcing using packaging Hong Kong Brand name development buying office Joint range Shared buying sign offs scale In-store Leveraging B&M UK private label Specific market needs portfolio 21
Slide 22: Standards: Store operations
Standards: Store operations Store standards – constant focus with 350+ store visits each week Strong link between retail, buying and logistics driving smoother, lower-cost flow of goods from factory to warehouse to shelf Disciplined approach to primary & secondary space – enhancing customer experien
Slide 23: New stores pipeline
New stores pipeline Key highlights B&M new store openings 30 gross new stores opened in H1 in FY24 & FY25 YTD Stores by postcode sector per 100,000 people 44 ex-Wilko stores1 now open with 8 still 0.0-0.5 to open 0.5-1.0 Expect 45 gross new stores in FY25 and 1.0-1.5 targeting a similar number in FY
Slide 24: Long-term supply chain in place
Long-term supply chain in place B&M UK: New import centre – Ellesmere Port B&M France: WMS implementation & DC extension • Leasehold site dedicated solely for general merchandise • WMS implementation in H1 increased productivity in the inbound containers DC, improved availability in stores and oppor
Slide 25: B&M France - progress update
B&M France - progress update France store estate by region, 28 September 2024 Key highlights • LFL growth driven by increased customer transactions • Continued to drive FMCG ranging • Disciplined control on SKU count and inventory management • 5 new stores opened in H1 with 6 more planned in H2; at
Slide 26: Heron Foods – progress update
Heron Foods – progress update Key highlights • Adjusted EBITDA margin % demonstrates another good period of retail execution • Consistently high store standards and excellent core stock availability • Support local families for the cheapest possible price • 4 new stores opened in H1, target of 18-20
Slide 27: FY25 summary & outlook
FY25 summary & outlook Summary Outlook Well set up in the Golden Quarter…price, product Growing volume momentum into H2, with broadening and standards strength in General Merchandise New store openings performing well and well- FY25 Group adjusted EBITDA (pre-IFRS 16) now structured pipeline expecte
Slide 28: Q&A
Q&A
B&M European Value Retail — H1 FY2025 Earnings Presentation on 6ix