Slide 1: 1H FY16 Results Presentation
For personal use only 1H FY16 RESULTS PRESENTATION March 2016
Slide 2: Contents
Contents For personal use only 1 Results Overview 2 Key Line Items 3 Country Results 4 Cash Flow, Balance Sheet, Dividend 5 Growth Strategy Update 6 FY16 Outlook 7 Questions A Appendices 2
Slide 3: Results Overview
For personal use only Results Overview
Slide 4: Results Overview: Highlights
1 Results Overview: Highlights For personal use only Key Points • Top line sales growth • Gross margin improvement • Cost efficiencies implemented and delivering operating leverage Sales and Margin • Sales growth $16.6m (+7.2% at constant exchange rates, +9.3% at actual exchange rates) • Same store
Slide 5: Results Overview: Year-on-Year
1 Results Overview: Year-on-Year NZD $m*1 For personal use only 1H FY16 1H FY15 Var $ Var % SALES 196.0 179.4 16.6 9.3% GROSS PROFIT 123.1 106.3 16.8 15.8% Gross margin 62.8% 59.3% OPERATING EXPENSES (100.8) (99.5) (1.3) 1.3% % of Sales 51.4% 55.5% UK store exit costs (net) (0.5) - (0.5) EBITDA 21.9
Slide 6: Key Line Items
For personal use only Key Line Items
Slide 7: Sales
2 Sales For personal use only SALES: +9.3% to $196.0m Group Sales (NZD $m)*1 • Sales growth year on year:*2 $196.0 AU 8.9%, NZ 4.6%, UK 1.6% $179.4 $165.9 $167.6 $146.7 • At constant exchange rates sales $127.1 growth $12.9m / 7.2% • Online sales growth 23.5%, 6.6% of total sales 1H 1H 1H 1H 1H 1H F
Slide 8: Same Store Sales Growth
2 Same Store Sales Growth AU NZ For personal use only • Same store measurement period 12.4% 12.7% 26 weeks ending 31 Jan 2016 9.6% • One fewer week of promotional 6.4% 6.6% 6.5% 4.8% activity vs comparable period 4.3% 3.2% 3.1% 0.9% 1.3% • Cycling high clearance activity Q1 last year 1H FY11 1H FY12
Slide 9: Gross Margin %
2 Gross Margin % AU NZ UK GROUP For personal use only 68.1% 67.4% 66.1% 66.1% 64.6% 64.7% 63.9% 62.7% 62.7% 62.8% 61.4% 59.9% 60.2% 59.3% 58.6% 58.4% 57.7% 57.3% 56.0% 55.6% 53.1% 50.4% 50.7% 50.4% 1H FY11 1H FY12 1H FY13 1H FY14 1H FY15 1H FY16 • 1H gross margin increased 350 bps YOY 1H FY16 SHARE
Slide 10: Cost of Doing Business
2 Cost of Doing Business For personal use only OPERATING EXPENSES: +1.8% to $101.3m NZD $m 1H FY16 1H FY15 Var $ Var % • Total operating expenses decreased Rent 29.0 25.3 3.7 14.6% YOY 380 bps / 3.8% of sales % of Sales 14.8% 14.1% Other operating expenses 71.8 74.2 (2.4) (3.2)% • Rent expenses incl
Slide 11: Earnings Summary
2 Earnings Summary For personal use only EBITDA $21.9m EBIT $15.1m NPAT $9.4m 23.2 22.6 21.9 19.9 20.9 17.6 17.0 15.8 15.1 12.7 10.5 10.3 11.4 9.4 6.8 6.0 0.6 -1.8 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H FY11 FY12 FY13 FY14 FY15 FY16 FY11 FY12 FY13 FY14 FY15 FY16 FY11 FY12 FY13 FY14 FY
Slide 12: Country Results
For personal use only Country Results
Slide 13: Australia
3 Australia For personal use only SALES: +8.9% to $114.2m AUD $m*1 1H FY16 1H FY15 Var % • 5 new stores: • 2H FY15 Sales 114.2 104.9 8.9% • Sydney (Wetherill Park) • Adelaide (Glenelg) Same store sales growth 4.3% 0.9% • 1H FY16 • Melbourne (Eastland, Werribee) EBITDA (trading result)*2 9.3 3.1 200.
Slide 14: New Zealand
3 New Zealand For personal use only SALES: +4.6% to $68.2m NZD $m*1 1H FY16 1H FY15 Var % • Same store sales growth 3.1% Sales 68.2 65.2 4.6% • One new store open: Bayfair (Tauranga) Same store sales growth 3.1% 4.8% • Gross margin improvement 4.2% points EBITDA (trading result)*2 14.8 7.5 97.3% • T
Slide 15: United Kingdom
3 United Kingdom GBP £m*1 1H FY16 1H FY15 Var % For personal use only SALES: +1.6% to £1.5m Sales 1.5 1.5 1.6% • Covent Garden store closed • Bristol, Spitalfields to close Q3 Same store sales growth*2 0.2% 16.2% • Same store sales growth 1.5% (incl. Online) Online sales growth 5.6% 92.9% • Total op
Slide 16: Cash Flow, Balance Sheet, Dividend
For personal use only Cash Flow Balance Sheet Dividend
Slide 17: Cash Flow
4 Cash Flow For personal use only Capital expenditure $12.9m (LY $9.8m): NZD $m 1H FY16 1H FY15 NPAT 9.4 (1.8) • New stores capex $5.3m (LY $3.8m): • 4 new stores Change in working capital 7.3 (10.1) • 1 relocations Change in non-cash items 7.5 6.1 • Existing stores capex $0.4m (LY $2.1m) Operating
Slide 18: Balance Sheet
4 Balance Sheet For personal use only NZ $m 1H FY16 1H FY15 Stock Per Store *1 Inventories 103.3 97.3 $0.732 Property, plant and equipment 59.5 50.5 $0.651 $0.640 $0.634 $0.616 Intangible assets 237.3 236.3 $0.544 Other assets 21.6 26.6 Total assets (excl. cash) 421.7 410.7 Net interest bearing liab
Slide 19: Dividend
4 Dividend For personal use only • NZ 3.0 cents per share interim dividend • Dividend will be fully imputed for New Zealand shareholders • Dividend will be unfranked for Australian shareholders • Supplementary dividend of NZ 0.529 cents is payable to non-NZ shareholders • Record date 03 June 2016 •
Slide 20: Growth Strategy Update
For personal use only Growth Strategy Update
Slide 21: Growth Strategy Update: Australasia
5 Growth Strategy Update For personal use only Australasia (profitable growth leveraging existing assets) • Continued focus on brand equity, inspiring our customers, social media • Leverage brand engagement distinctiveness and build Brand and • Personalised communication, rewards and recognition thr
Slide 22: Growth Strategy Update: Australasia
5 Growth Strategy Update For personal use only Australasia (profitable growth leveraging existing assets) • Target 180 stores across Australasia Store network • Footprint expansion in • New store footprint expansion where return on capital investment justifies expansion Australasia • Targeted to inc
Slide 23: Growth Strategy Update: International
5 Growth Strategy Update For personal use only International (capital light expansion) • Blended model for international expansion to include wholesale, online and franchise partnerships • Dedicated resource with international wholesale experience has been recruited • Requirements between current ve
Slide 24: FY16 Outlook
For personal use only FY16 Outlook
Slide 25: FY16 Outlook
6 FY16 Outlook For personal use only • Customer focus supported by increased membership base and associated data analytics • Higher priority given to product with a reorganised product team • Focus on increasing market penetration in Australia while sustaining position in New Zealand • International
Slide 26: Questions
For personal use only Questions
Slide 27: Appendix – Historical Store count
Appendix 1 – Historical Store count For personal use only Permanent Open Stores 157 160 163 149 136 139 129 114 120 110 97 100 90 1H 2H 1H 2H 1H 2H 1H 2H 1H 2H 1H 2H 1H FY10 FY10 FY11 FY11 FY12 FY12 FY13 FY13 FY14 FY14 FY15 FY15 FY16 27
Slide 28: Appendix – Reconciliation of Country Trading Results
Appendix 2 – Reconciliation of Country Trading Results For personal use only 1H FY16 ($’000) Australia New Zealand United Kingdom Other Total EBITDA per Interim Report (NZD) 7,790 15,789 (212) (1,504) 21,863 Internal charges not trading related*1 (NZD) 2,333 (1,003) (1,330) - - EBITDA (trading resul