Arvind Fashions Ltd. · NSE:ARVINDFASN
Arvind Fashions — Q1 FY20 Earnings Presentation
15 slides from Arvind Fashions's earnings presentation, August 2019
Slide 1: Arvind Fashions Limited Q1 FY20 Performance Highlights
Arvind Fashions Limited Q1 FY20 Performance Highlights Aug 2019 0
Slide 2: Disclaimer
Disclaimer This document by Arvind Fashions Limited (‘the Company’) contains forward-looking statements that represent our beliefs, projections and predictions about future events or our future performance. These forward-looking statements are necessarily subjective and involve known and unknown ris
Slide 3: FY20 Strategic Priorities
FY20 Strategic Priorities 01 Cash generation 02 Working capital reduction 03 Secondary sales focus 04 Sharper portfolio 2
Slide 4: Performance Snapshot – Q1 FY20
Performance Snapshot – Q1 FY20 Without IndAS116 Impact IndAS116 Q1 FY19 Q1 FY20 Growth Q1 FY20 Sales (Rs Crs.) 1007 901 (11%) 901 EBITDA (Rs Crs.) 40 (61) - 20 EBITDA % 4.0% (6.8%) - 2.2% PBT (Rs Crs.) (22) (133) - (144) PAT (Rs Crs.) (16) (90) - (98) Note: Includes revenue reversal of Rs 11 Crs. an
Slide 5: Performance Snapshot – Q1 FY20
Performance Snapshot – Q1 FY20 Without IndAS116 Impact Q1 FY19 Q1 FY20 Growth Sales (Rs Crs.) 958 912 (5%) EBITDA (Rs Crs.) 47 7 - EBITDA % 4.9% 0.8% - Note: Excludes brands planned to be discontinued 4
Slide 6: Brand Groupwise Performance – Q1 FY20
Brand Groupwise Performance – Q1 FY20 Sales (Rs Crs.) EBITDA (Rs Crs.) EBITDA % Q1 FY19 Q1 FY20 Growth Q1 FY19 Q1 FY20 Q1 FY19 Q1 FY20 Power 58 23 10.3% 4.5% 562 518 (8%) Brands Specialty 276 274 (1%) (8) (11) (2.9%) (4.0%) Retail Emerging 120 120 - (3) (5) (2.8%) (4.0%) Brands Total 958 912 (5%) 47
Slide 7: Power Brands
Power Brands 1. Strong secondary sales • Retail LTL: 5.2% • Overall retail growth: 11% • Online secondary growth: 37% • USPA continues to be No. 1 brand with improved market share in department stores 2. Aligning primary sales to secondary sales in the trade channel • Underlying growth in non-trade
Slide 8: Specialty Retail
Specialty Retail 1. Gap + Sephora delivered 25% growth with positive EBITDA 2. Multiple steps taken to restructure Unlimited business to curtail losses • 11 stores closed & 8 stores on notice – One time loss in Q1 of Rs (5.1 Crs.) • Retained stores will have double digit store EBITDA • Scaling up on
Slide 9: Emerging Brands
Emerging Brands Portfolio made sharper by initiating exit of 4 brands • Exit process in progress. Will be completed in Q2 • One time exit losses including royalty settlement with Principals fully provided in Q1 – Rs (68 Crs.) 8
Slide 10: Distribution Footprint
Distribution Footprint FY19 Exit Store Changes Q1 FY20 Closure Store Sq Ft Store Count Sq Ft (Lacs) Additions Count (Lacs) Power Brands 1018 8.9 30 21 1027 9.0 Unlimited 107 10.8 0 11 96 10.0 Speciality Retail 35 1.5 2 0 37 1.5 Total* 1390 23.7 36 72 1354 22.6 * Including Emerging Brands Present in
Slide 11: Progress on Key Focus Areas
Progress on Key Focus Areas Channels Category Leadership 1 1 2 Premium Casual/Denim Small Town Distribution Leadership Premium Kidswear Expansion – 75 Towns Leadership Continued dominance – 22 towns added in Q1 dept. stores mkt. share 28% sales growth at 27% 2 3 4 Online 37% sec. sales growth Innerw
Slide 12: Financials – P&L
Comparable P&L IndAS116 All Figures in Rs Cr. Q1 FY20 Q1 FY19 Q1 FY20 Revenue from Operations 900.9 1,006.8 900.9 Cost of Goods Sold 489.3 493.3 489.3 Employees' Emoluments 101.3 101.5 101.3 Others 371.3 371.7 290.5 Financials – EBIDTA (60.9) 40.3 19.8 Margin (6.8%) 4.0% 2.2% P&L Other Income Intere
Slide 13: IndAS116 Impact Summary
IndAS116 Impact Summary Impact on Income Statement (INR Crs) Particulars FY20 Q1 Lease Rent ( Other Exp (331) (81) IND AS 116 applicable from 1st Apr 2019 and replaced existing Ind AS17 grouping) No distinction between Financial and Operating Lease. EBIDTA 331 81 All leases to be recognised in
Slide 14: Outlook - Q2 FY20
Outlook - Q2 FY20 Impact of corrections on growth & EBITDA to continue in Q2 - June & July EOSS sales drop 01 necessitates that we correct primary sales to avoid overstocking in the channel and consequent returns 02 Complete exit of identified emerging brands and closure of loss making stores 03 Pos
Slide 15: Thank You!
Thank You!