Douglas Ag · XETR:DOU
Douglas — Debt Investor Presentation (August 2022)
45 slides from Douglas's debt investor presentation, Aug 23, 2022
Slide 1: Operational & Financial Results
OPERATIONAL & FINANCIAL RESULTS Düsseldorf, August 23, 2022
Slide 2: Notice to Recipients
NOTICE TO RECIPIENTS This presentation and any materials distributed in connection herewith (together, Company nor any of its affiliates is under any obligation, and each such entity the “Presentation”) have been prepared by DOUGLAS GmbH (the “Company”) The information in this Presentation does not
Slide 3: Today's Speakers
TODAY’S SPEAKERS Group CEO Group CFO 3
Slide 4: Significant Sales & Earnings Growth
SIGNIFICANT SALES & EARNINGS GROWTH NET SALES EXCEED PRE-COVID LEVELS Net sales (lfl) growth of Lfl store sales grew by Adjusted EBITDA Integration of Disapo 35% vs. PY despite 67% vs. PY; 2% above more than doubled to is on schedule – disruption of supply pre-COVID level; €64m (PY: €24m), 11,000 ph
Slide 5: Net Sales Development Q3 2021/22
NET SALES DEVELOPMENT Q3 2021/22 In m€ GROUP TOTAL GROUP E-COMMERCE GROUP BRICK & MORTAR 830 644 +28.8% 554 +35.2% lfl 376 +47.5% 262 276 +5.3% -2.9% lfl +66.5% lfl Q3 2020/21 Q3 2021/22 Q3 2020/21 Q3 2021/22 Q3 2020/21 Q3 2021/22 › Strong performance despite geopolitical tensions, › Online sales gr
Slide 6: Strong Adjusted EBITDA and Margin Development
STRONG ADJUSTED EBITDA AND MARGIN DEVELOPMENT In m€ GROUP TOTAL Higher sales, combined with ongoing cost discipline in 75 personnel and operating expenses, drove adjusted EBITDA 64 and margin increase 55 35 Store Optimization Program: fully on track with lower rental 63.6 24 and personnel expenses;
Slide 7: E-Com and Brick & Mortar Complement Each Other
E-COM AND BRICK & MORTAR COMPLEMENT EACH OTHER IMPRESSIVE LONG-TERM E-COM GROWTH SALES SHARE E-COM AND BRICK & MORTAR NET SALES (in m€) 1,199 1,208 762 644 830 1,155 CAGR June 2022 817 LTM vs. FY 2010/11 59.3% 66.6% B&M 82.7% 585 423 383 324 June 2022 LTM vs. 261 FY 2020/21 180 40.7% 145 33.4% 106 6
Slide 8: Continued Strong Performance in E-Commerce
CONTINUED STRONG PERFORMANCE IN E-COMMERCE WELL POSITIONED FOR ONGOING STRUCTURAL SHIFT GROUP Q3 2021/22 (VS. PY) +5.3% -0.1%pts +2.1% E-Com net sales Conversion rate Average basket (incl. VAT) +3.1%pts +1.7%pts E-Com sales share Mobile sales share App sales share** +55% vs. pre-COVID New customers
Slide 9: DOUGLAS Expands Strong Market Position in Germany
DOUGLAS EXPANDS STRONG MARKET POSITION IN GERMANY (Q3 2021/22) DOUGLAS continued to gain market share in Germany at a very high level B&M was KEY growth driver due to COVID lockdown shift 2021 2022 DOUGLAS France and Italy saw slight losses, partly due to store closures Germany France Italy 9 Source
Slide 10: #ForwardBeauty.DigitalFirst Strategy Execution Update
#FORWARDBEAUTY.DIGITALFIRST STRATEGY EXECUTION UPDATE PREMIUM BEAUTY & HEALTH PLATFORM Brand positioning E-COMMERCE ONLINE SHOP PARTNER PROGRAM 10 ASSORTMENT CURATION / CRM Choice & innovation Inspiration & personalization SUPPLY CHAIN TECHNOLOGY Customer Operational excellence Data-driven culture P
Slide 11: Successful Partner Program in 6 Countries
SUCCESSFUL PARTNER PROGRAM IN 6 COUNTRIES ITALY GO-LIVE END OF MAY 2022 288 294k 193 179k Q3 2020/21 Q3 2021/22 Q3 2020/21 Q3 2021/22 NUMBER OF PARTNERS NUMBER OF PARTNER SKUS ALL COUNTRIES* ALL COUNTRIES* Partner Program live 11 * Incl. small brands via enablers; Source: Live SKU Report; Countries
Slide 12: First Sustainability Report 2021 Published in June
FIRST SUSTAINABILITY REPORT 2021 PUBLISHED IN JUNE 12
Slide 13: DOUGLAS' ESG Strategy: Four Pillars, Seven Material Topics
DOUGLAS’ ESG STRATEGY FOUR PILLARS – SEVEN MATERIAL TOPICS 1. Customer satisfaction & 4. Sustainable assortment 5. CO2 equivalent emission 7. Ownership of executive board experience & own brands reduction on ESG topics Customer satisfaction Clean beauty Scope 1: Direct emissions Incentivization Digi
Slide 14: ESG Pillars: People and Products
ESG PILLARS PEOPLE AND PRODUCTS › Our share of women in leadership positions has already › Almost 100% of new DOUGLAS Brands releases reached 54%; our aim is to keep this ratio at least close to since 2020 have been microplastic free this level › 93% of new DOUGLAS Brands releases in FY 20/21 › 18,2
Slide 15: ESG Pillars: Planet and Governance
ESG PILLARS PLANET AND GOVERNANCE › We want to be carbon-neutral by 2025. Thus, we aim to › We are continuously improving IT security and data privacy reduce Scope 1 and Scope 2 emissions by at least 50% mechanisms and compensate for remaining emissions › Our group risk management approach identifie
Slide 16: Category Trends
CATEGORY TRENDS POST-LOCKDOWN PUSH TO FRAGRANCES AND MAKE-UP › Strong growth in Germany due to › Recording very good growth, high catch-up effect particularly on lips, sets and nails › Growth driven by luxury brands, › Significant sales growth in vegan men’s fragrances and blockbuster products launc
Slide 17: Integration of Disapo on Schedule
INTEGRATION OF DISAPO ON SCHEDULE HEALTH OFFERING LIVE AT DOUGLAS.DE SINCE MAY April 22: Successful closing of Disapo acquisition May 22: Beauty & Personal Care and OTC assortment live on DOUGLAS.de as part of Partner Program (additional 11,000 SKUs) June 22: 360 marketing campaign for Health offeri
Slide 18: Strategic Milestones
STRATEGIC MILESTONES FIRST BEAUTY + HEALTH SUMMIT | LUXURY STORE “KÖ” › DOUGLAS Luxury Store with Professional › Two-day public congress on 2 + 3 September 2022 dedicated to the topics of beauty and health Beauty Suite opening end of August 2022 on › Panel talks, master classes and workshops; over 3
Slide 19: Closer Look: Q3 2021/22 Financials
CLOSER LOOK Q3 2021/22 FINANCIALS
Slide 20: Net Sales Development by Segment
NET SALES DEVELOPMENT BY SEGMENT GROUP Q3 2021/22 Total, in m€ DACHNL FRANCE 441 160 304 +45.0% 131 +22.1% GROUP 830 + 39.5% lfl + 27.7% lfl 644 +28.8% Q3 2020/21 Q3 2021/22 Q3 2020/21 Q3 2021/22 SOUTHERN EUROPE CENTRAL EASTERN EUROPE 124 117 113 + 35.2% lfl -5.7% 79 +42.5% + 24.9% lfl + 42.6% lfl Q
Slide 21: Net Sales Development by Segment: E-Commerce
NET SALES DEVELOPMENT BY SEGMENT E-COMMERCE Q3 2021/22 E-Commerce, in m€ DACHNL FRANCE 205 185 +10.5% GROUP -1.2% lfl 39 30 276 -23.4% 262 +5.3% Q3 2020/21 Q3 2021/22 Q3 2020/21 Q3 2021/22 - 2.9% lfl SOUTHERN EUROPE CENTRAL EASTERN EUROPE +87.3% lfl vs. pre- 22 23 16 18 +6.9% COVID +12.3% Q3 2020/21
Slide 22: Net Sales Development by Segment: Brick & Mortar
NET SALES DEVELOPMENT BY SEGMENT BRICK & MORTAR Q3 2021/22 Brick & Mortar, in m€ DACHNL FRANCE +98.9% 236 131 GROUP 119 93 +41.1% 554 + 107.5% lfl + 52.2% lfl +47.5% Q3 2020/21 Q3 2021/22 Q3 2020/21 Q3 2021/22 376 SOUTHERN EUROPE CENTRAL EASTERN EUROPE 107 98 -8.5% +56.1% + 66.5% lfl 90 57 + 27.7% l
Slide 23: Adjusted EBITDA Development by Segment
ADJUSTED EBITDA DEVELOPMENT BY SEGMENT Q3 2021/22 Adjusted EBITDA1, in m€ DACHNL FRANCE 50 20 18 +12.7% 26 +90.4% GROUP 11.3% 13.4% 12.4% 64 8.6% Q3 2020/21 Q3 2021/22 Q3 2020/21 Q3 2021/22 +166.0% SOUTHERN EUROPE CENTRAL EASTERN EUROPE 7.7% 24 9 18 3.7% 7.4% 11 +60.7% Adjusted EBITDA n/m Margin -3.
Slide 24: P&L Overview
P&L OVERVIEW Q3 2021/22 In m€ Q3 2020/21 Q3 2021/22 ∆% Reported EBITDA: Improved substantially and turned Net sales 643.9 850.1 32.0% positive again in particular due to higher net sales, Margin improved adj. Net sales 1 643.9 829.7 28.8% significantly which is attributable to better COGS ratio as w
Slide 25: Net Working Capital and Capex
NET WORKING CAPITAL AND CAPEX ONGOING IMPROVEMENTS AND INVESTMENT DISCIPLINE In m€ NET WORKING CAPITAL CAPEX 21 248 19 188 Q3 2020/21 Q3 2021/22 30.06.21 30.06.22 › Strong limit control and use of replenishment software › Ongoing cautious spending policy against the background of RELEX in DE, AT & C
Slide 26: Free Cash Flow
FREE CASH FLOW IMPACTED BY WORKING CAPITAL AND M&A In m€ ADJUSTED FCF DEVELOPMENT 78 75 FREE CASH FLOW BRIDGE Q3 2021/22 2 Q3 2019/20 Q3 2020/21 Q3 2021/22 -14 75 64 5 41 -21 55 -21 -24 30 1 2 3 Adj EBITDA CAPEX Working Capital TAX Others Adj FCF EBITDA Free Cash Flow M&A FCF (POST M&A) Adjustments4
Slide 27: Liquidity Headroom and Leverage
LIQUIDITY HEADROOM AND LEVERAGE ONGOING COST AND CASH DISCIPLINE CASH BALANCE TOTAL NET LEVERAGE1 Net liquidity above prior In m€ year level 10.0 Positive Net Cashflow within the 16.7% 430 last 12 months mainly as a 7.0 7.2 6.7 result of our strong performance and to a lower 369 amount from positive
Slide 28: SOP Implementation Overview
SOP IMPLEMENTATION OVERVIEW FULLY ON TRACK, 100% OF RUN RATE SAVINGS ACHIEVED STATUS 30/06/2022 STORE CLOSURES / LEASE FTE REDUCTIONS1 RENT NEGOTIATIONS KEEP TERMINATIONS (CURRENT EST.) OPEN STORES1 (# OF STORES) Contracts terminated Store 58% re-negotiation 60% Stores closed 93% in closure stores c
Slide 29: Summary Q3
SUMMARY Q3 DOUGLAS continued on growth path as B&M business further recovered post lockdowns E-Commerce maintained high sales level and was more than twice as high compared to pre-COVID Adjusted EBITDA more than doubled to reach €64m Higher sales and strict cost management led to improved adjusted E
Slide 30: Appendix
Slide 31: Adjustments to EBITDA
ADJUSTMENTS TO EBITDA Consulting fees: EBITDA ADJUSTMENTS In Q3 2021/22 primarily related to OWAC and strategic projects (in m €) Q3 2020/21 Q3 2021/22 9M 2020/21 9M 2021/22 PPA: Former acquisitions Reported EBITDA -22.7 43.1 -39.3 211.5 COVID-19: Consulting fees 3.2 8.9 27.0 19.3 mainly state subsi
Slide 32: Selected Segmental KPIs
SELECTED SEGMENTAL KPIS Q3 2021/22 In m€ REPORTED EBITDA CAPEX Q3 2020/21 Q3 2021/22 Q3 2020/21 Q3 2021/22 DACHNL 2.1 46.7 DACHNL 5.2 3.4 France 14.3 25.9 France 2.1 3.2 Southern Europe -7.9 -6.5 Southern Europe 1.0 2.2 Central Eastern Europe 9.7 17.5 Central Eastern Europe 1.6 3.4 Consolidation 0.0
Slide 33: Deep Dive into LFL Net Sales Development
DEEP DIVE INTO LFL NET SALES DEVELOPMENT QUARTERLY OVERVIEW LIKE FOR LIKE NET SALES DEVELOPMENT Q3 2020/21 Q4 2020/21 Q1 2021/22 Q2 2021/22 Q3 2021/22 DACHNL -3.5% 2.6% 11.7% 43.9% 39.5% France 28.7% 10.6% 14.7% 29.4% 27.7% Southern Europe 35.4% 8.1% 24.7% 32.3% 24.9% Central Eastern Europe 32.9% 16
Slide 34: Net Sales Development by Segment
NET SALES DEVELOPMENT BY SEGMENT GROUP 9M 2021/22 Total, in m€ DACHNL FRANCE 1,402 GROUP 1,113 +26.0% 542 629 2,840 +16.1% + 26.9% lfl 2,367 +20.0% + 21.1% lfl 9M 2020/21 9M 2021/22 9M 2020/21 9M 2021/22 SOUTHERN EUROPE CENTRAL EASTERN EUROPE 434 449 + 27.1% lfl +3.3% 362 260 +39.7% + 26.8% lfl 9M 2
Slide 35: Net Sales Development by Segment: E-Commerce
NET SALES DEVELOPMENT BY SEGMENT E-COMMERCE 9M 2021/22 E-Commerce, in m€ DACHNL FRANCE 678 664 -2.0% 156 137 -12.2% GROUP -5.2% lfl 974 952 -2.3% 9M 2020/21 9M 2021/22 9M 2020/21 9M 2021/22 -4,5% lfl SOUTHERN EUROPE CENTRAL EASTERN EUROPE 66 70 75 81 + 97.9% +6.9% +7.5% lfl vs. Pre- COVID 9M 2020/21
Slide 36: Net Sales Development by Segment: Brick & Mortar
NET SALES DEVELOPMENT BY SEGMENT BRICK & MORTAR 9M 2021/22 Brick & Mortar, in m€ DACHNL FRANCE + 36.7% lfl 738 435 +69.7% 492 GROUP 386 +27.5% 1,890 + 82.6% lfl +37.6% 9M 2020/21 9M 2021/22 9M 2020/21 9M 2021/22 1,374 SOUTHERN EUROPE CENTRAL EASTERN EUROPE 369 378 + 55.5% lfl +2.7% + 54.1% lfl 282 1
Slide 37: Adjusted EBITDA Development by Segment
ADJUSTED EBITDA DEVELOPMENT BY SEGMENT 9M 2021/22 Adjusted EBITDA1, in m€ DACHNL FRANCE 165 133 +24.0% 107 GROUP 88 +22.2% 280 12.0% 11.8% 16.2% 17.1% +44.5% 194 9M 2020/21 9M 2021/22 9M 2020/21 9M 2021/22 SOUTHERN EUROPE CENTRAL EASTERN EUROPE 1.2% 7.9% 65 Adjusted 42 +53.0% EBITDA Margin 35 8.2% 9
Slide 38: Selected Segmental KPIs
SELECTED SEGMENTAL KPIS 9M 2021/22 In m€ REPORTED EBITDA CAPEX 9M 2020/21 9M 2021/22 9M 2020/21 9M 2021/22 DACHNL 31.1 148.4 DACHNL 29.5 8.6 France 61.7 116.8 France 5.8 7.9 Southern Europe -38.8 -6.1 Southern Europe 3.3 5.2 Central Eastern Europe 34.4 63.9 Central Eastern Europe 6.2 5.8 Consolidati
Slide 39: Overview Segmental Structure
OVERVIEW SEGMENTAL STRUCTURE BRICK & MORTAR, NEW STRUCTURE SINCE Q1 2021/22 DACHNL FRANCE Austria France Germany Monaco Switzerland The Netherlands CENTRAL EASTERN EUROPE Bulgaria SOUTHERN EUROPE Croatia Andorra Czech Republic Italy Estonia Portugal Hungary Spain Latvia Lithuania Poland Romania Slov
Slide 40: P&L Overview
P&L OVERVIEW 9M 2021/22 Reported EBITDA: In m€ 9M 2020/21 9M 2021/22 ∆% Increased significantly over prior year in particular due to higher net sales, Net sales 2,367.3 2,865.2 21.0% improved COGS ratio leading to higher gross profit margin and general cost adj. Net sales 1 2,367.3 2,840.2 20.0% dis
Slide 41: Free Cash Flow
FREE CASH FLOW 9M 2021/22 In m€ ADJUSTED FCF DEVELOPMENT 232 FREE CASH FLOW BRIDGE 9M 2021/22 186 186 280 9M 2019/20 9M 2020/21 9M 2021/22 -57 10 -38 186 -9 -68 118 -24 94 Adj EBITDA CAPEX 1 Working Capital ² TAX Others ³ Adj FCF EBITDA Free Cash Flow M&A FCF POST M&A Adjustments (pre M&A) (Cash eff
Slide 42: Cash Flow Statement
CASH FLOW STATEMENT 9M 2021/22 Cash flow from operating activities CASH FLOW STATEMENT Increased due to EBITDA increase and higher sales in brick & mortar 9M 2020/21 9M 2021/22 Cash flow from investing activities Outflow increased due to Net cash flow from operating activities 16.8 170.4 payment of
Slide 43: Net Working Capital
NET WORKING CAPITAL NET WORKING CAPITAL Net Working Capital Continues to be a key focus; In m€ 248 efficient management 221 supported by AI-based 184 188 replenishment software RELEX NWC as % of LTM net sales 76 Inventory Lower inventory due tighter 8.0% 5.9% 2.3% 6.5% 5.2% inventory management and
Slide 44: Evolution of Capital Structure
EVOLUTION OF CAPITAL STRUCTURE CASH AND DEBT1 STRUCTURE AS OF 30 JUNE 2022 Senior PIK Notes: m€ x Adj. x Mgmt. Adj. Maturity Pricing In m€ EBITDA3 EBITDA4 › Type of interest payments is generally at Cash and Equivalents 271 Douglas’ discretion › Douglas intends to RCF (€170m Volume)² 0 Jan 26 E+4.75
Slide 45: Premium Store Network Footprint
PREMIUM STORE NETWORK FOOTPRINT ACROSS EUROPE NUMBER OF STORES Limited store openings* Decrease in number of stores driven by SOP Portfolio realignment across Europe will result in further reduction in number of stores 2,171 1,910 30 Jun 2021 (m€) – 137 30 Jun 2022 133 Store openings 14 2,034 1,777