Metro Brands Ltd. · NSE:METROBRAND
Metro Brands — 9M FY24 Earnings Presentation
49 slides from Metro Brands's earnings presentation, Jan 18, 2024
Slide 1: Letter to exchanges: Presentation of Investor/Analyst Meet
met ro BRANDS January 18, 2024 To, To, The Manager The Manager Listing Department Listing Department BSE Limited, National Stock Exchange of India Phiroze JeeJeeBhoy Towers, Ltd, Dalal Street, Mumbai – 400001 (E) Exchange Plaza, 5th Floor, Plot No. Maharashtra, India C/1, G Block, Bandra Kurla Compl
Slide 2: 9M FY24 Earnings Presentation
metro BRANDS METRO BRANDS LIM ITED 1 9M FY24 EARNINGS PRESENTATION 18th January 2024
Slide 3: Safe Harbor statement
Safe Harbor statement me~ro BRANDS • The information contained in this Presentation should be considered in the context of the circumstances prevailing at the time and has not been, and will not be, updated to reflect material developments which may occur after the date of the Presentation. The info
Slide 4: Agenda
met ro BRANDS Brief Overview Q3 & 9M FY24 Business Highlights Metro’s Strengths Levers of growth Sustainability Initiatives & Others Appendix: Industry Overview
Slide 5: Our Journey
Our Journey me~ro BRANDS FEET ON THE GROUND. • Strategic partnership with • Acquired Cravatex Foot Locker EYES ON THE FUTURE. Brands Ltd • Hits 800 stores • Exclusive license • Hits Marketcap of $4B • Exclusive tie up for Fila with Fitflop • Owns sportswear • Hits 600 stores brand Proline 2023 • Lis
Slide 6: Our story in numbers
Our story in numbers me~roBRANDS Company Facts Performance in 9M FY24 5 Rs 1,774 crores Revenue from operations store formats^ 12.1 % YOY growth 826 Rs 543 crores Stores ^ EBITDA 30.6 % EBITDA margin 31 !,• 72% States & Union territories ^ Revenue contribution of in-house brands at MBOs ^ 192 35% Ci
Slide 7: 65+ years of market presence
65+ years of market presence me~ro BRANDS KEY ENABLERS STRONG BRAND WIDE REACH CAPITAL-LIGHT COMPETENT OPERATIONAL PORTFOLIO BUSINESS MANAGEMENT EFFICIENCY ❖ One-stop-shop family ❖ Pan-India presence through ❖ Long-standing ❖ Chairman Mr Rafique A. ❖ Among the few footwear retailer catering to the 8
Slide 8: One Stop Shop for all Footwear Needs
One Stop Shop for all Footwear Needs me~ro BRANDS wt t"ETHO crocs- WALKWAY Dec’23 / 9MFY24 (MBO) (MBO) (EBO) (MBO) (EBO) i Target Customer Family Youth Premium Value Format Premium mm 313 229 206 70 8 No. of. Stores IG: (38%) (28%) (25%) (8%) (1%) - OUTLETS Cities 164 110 93 50 7 Mi Price Range (INR
Slide 9: One Stop Shop for all Footwear Needs: Network of Retail Outlets
One Stop Shop for all Footwear Needs me~ro Network of Retail Outlets (as of Dec’23) PAN India Presence with 826 Stores I 192 Cities I 31 States and UTs (As of Dec’23) .,..,... Zone wise1 Tier wise1 Location Wise1 7 West Tier III Metro ,-,J OUR PRESENCE ___________________________ South 30% 15% citie
Slide 10: Q3 & 9M FY24 Business Highlights
met ro BRANDS Brief Overview Q3 & 9M FY24 Business Highlights Metro’s Strengths Levers of growth Sustainability Initiatives & Others Appendix: Industry Overview
Slide 11: Q3 FY24 Business Highlights
Q3 FY24 Business Highlights me~ro BRANDS Standalone Consolidated In INR Crore Q3 FY24 Q3 FY23 YoY Growth% Q3 FY24 Q3 FY23 YoY Growth% Revenue 616 577 6.8% Revenue 636 599 6.1% EBITDA 209 204 2.6% EBITDA 200 205 -2.8% EBITDA% 33.9% 35.3% EBITDA% 31.4% 34.3% PAT 111 115 -3.0% PAT 99 113 -12.6% PAT% 18
Slide 12: 9M FY24 Business Highlights
9M FY24 Business Highlights me~roBRANDS Standalone Consolidated In INR Crore 9M FY24 9M FY23 YoY Growth% 9M FY24 9M FY23 YoY Growth% Revenue 1,704 1,538 10.8% Revenue 1,774 1,583 12.1% EBITDA 564 528 6.9% EBITDA 543 536 1.2% EBITDA% 33.1% 34.3% EBITDA% 30.6% 33.9% PAT 297 292 1.8% PAT 260 297 -12.4%
Slide 13: Q3 & 9M Business Highlights (Standalone)
Q3 & 9M Business Highlights (Standalone) me~ro BRANDS Revenue from Operations and Revenue per sq.ft Gross Profit and Gross Margins 5,700 4,900 5,750 5,050 5,000 4,450 5,200 60.0% 57.5% 59.7% 57.2% 60.0% 57.1% 60.3% ♦ ♦ ♦ ♦ ♦ ♦ ♦ 460 ♦ ♦ ♦ ♦ ♦ ♦ ♦ 616 577 556 410 372 497 514 532 344 463 360 333 298 2
Slide 14: Q3 & 9M Business Highlights (Consolidated)
Q3 & 9M Business Highlights (Consolidated) me~ro BRANDS Revenue from Operations Gross Profit and Gross Margins 59.7% 57.4% 59.2% 55.9% 59.1% 56.8% 59.9% 460 ♦ ♦ ♦ ♦ ♦ ♦ ♦ 636 599 583 381 544 556 410 355 508 476 360 344 303 304 316 310 273 260 210 160 9M FY23: 1,583 9M FY24: 1,774 110 9M FY23: 931 ;
Slide 15: Strategic partnership with Foot Locker
Strategic partnership with Foot Locker me~ro BRANDS About Footlocker ❑ Foot Locker, Inc. is an American premium sports & athleisure retailer with 50-year history, global revenue of ~ $8 billion and 2,600 retail stores with operation in 26 countries across North America, Europe, Asia, Australia, and
Slide 16: Update on implementation of Bureau of Indian Standards for footwear
Update on implementation of Bureau of Indian Standards for footwear me~ro BRANDS ❑ The Department for Promotion of Industry and Internal Trade (DPIIT) issued BIS Quality Control Order (QCO) for footwear which is mandatory from 1st January 2024 for most categories of footwear. ❑ BIS QCO implementatio
Slide 17: Key business updates – Cravatex Brands Limited
Key business updates – Cravatex Brands Limited me~ro BRANDS Results of Cravatex Brands Ltd incorporated with MBL financials w e.f 1st December 2022 Q3 FY24 In INR Crore 9M FY24 In INR Crore MBL MBL MBL MBL Consolidat Cravatex excluding Consolid Cravatex excluding ed Cravatex ated Cravatex Revenue fr
Slide 18: Year wise Store additions - Standalone
Year wise Store additions - Standalone me~ro BRANDS Stores 504 +9% 551 +6% 586 +6% 624 +18% 739 +4% 766 +4% 795 +4% 826 31 826 27 29 115 38 35 47 - 85 9M FY24 : 87 419 B Opened^ Closed^ ,--------, IL _______ Relocation^ II B B B B 95 10 1---, I 3 I L..--- 57 10 1---, I - I L..--- 59 24 1---, I 3 I L
Slide 19: Profit & Loss Statement (Standalone)
Profit & Loss Statement (Standalone) me~ro BRANDS In INR Crore Particulars Q3 FY24 Q2 FY24 Q3 FY23 9M FY24 9M FY23 FY23 Revenue from Operations 616 532 577 1,704 1,538 2,052 Other Income 16 18 15 51 36 55 Total Income 633 550 592 1,755 1,573 2,107 EXPENSES Purchases of stock-in-trade 307 200 275 831
Slide 20: Profit & Loss Statement (Consolidated)
Profit & Loss Statement (Consolidated) me~ro BRANDS In INR Crore Particulars Q3 FY24 Q2 FY24 Q3 FY23 9M FY24 9M FY23 FY23 Revenue from Operations 636 556 599 1,774 1,583 2,127 Other Income 16 16 15 46 36 54 Total Income 651 572 613 1,820 1,619 2,182 EXPENSES Purchases of stock-in-trade 303 209 288 8
Slide 21: Metro's Strengths
met ro BRANDS Brief Overview Q3 & 9M FY24 Business Highlights Metro’s Strengths Levers of growth Sustainability Initiatives & Others Appendix: Industry Overview
Slide 22: Our Key Strengths
Our Key Strengths BRANDS 1 One of India's largest pan India footwear retailers1 with a brand appeal among aspirational consumer segments 2 Pivoting from primarily "Offline" to an "Omni-channel" enabled footwear & accessories retailer Wide range of brands and products catering to all occasions across
Slide 23: One of India's largest pan India footwear retailers
1 One of India's largest pan India footwear retailers1 with a brand appeal among aspirational consumer segments me~ro BRANDS 551 586 624 739 826 13% 14% 13% 16% 13% 15% 14% 15% 13% 15% 23% 21% 24% 22% 25% 23% 25% 22% 24% 22% …with diversified presence across regions2 31% 31% 31% 32% 32% 32% 31% 33%
Slide 24: Pivoting from Offline to Omni-channel retailer
2 Pivoting from primarily "Offline" to an "Omni-channel" enabled footwear and accessories retailer E-commerce – Online & Omnichannel “Highest number of Instagram Followers among key footwear ❑ Majority of online business comes through leading e-commerce retailers in India” (CRISIL) 2.5% 2.5% 8.4% 7.
Slide 25: Wide range of brands and products (1/3)
3 Wide range of brands and products catering to all occasions across age groups and market segments resulting in strong customer loyalty (1/3) Product presence across multiple categories through Own and Third party brands Own Brands Casual Formal Sports Accessories Third Party Brands Skechers Adidas
Slide 26: Wide range of brands and products (2/3)
3 Wide range of brands and products catering to all occasions across age groups and market segments resulting in strong customer loyalty (2/3) Own Brands contribute ~ 70-75% of total store product sales at MBOs Targeting Mid and Premium Segment through 5 different Brand Outlets Average Realization P
Slide 27: Wide range of brands and products (3/3)
3 Wide range of brands and products catering to all occasions across age groups and market segments resulting in strong customer loyalty (3/3) Repeat Sales to Members of Loyalty programs Club Metro (2007*) – Loyalty Program Members (Mn) % Total Product Sales 7.3 56% 55% 56% 6.5 54% 4.9 5.6 4.5 50% F
Slide 28: Asset light business with an efficient operating model
4 Asset light business with an efficient operating model leading to sustained profitable growth 1 2 3 4 Outsourced Leveraging scale Identification of Variable Cost Manufacturing of operations store location Structure ✓ One of the few footwear ✓ One of the highest gross ✓ Robust store selection ✓ Lea
Slide 29: Efficient operating model through vendor engagements and TOC supply chain
5 Efficient operating model through deep vendor engagements and TOC based supply chain Long Standing Relationships with Vendors • 250+ vendors dealt with over last 3 fiscal years • 20+ years of relationship with certain vendors Demand Driven Inventory Norms New Designs and Styles • Optimum capital e
Slide 30: Platform of choice for third party brands
6 Platform of choice for third party brands looking to expand in India Why brands prefer Metro platform Successful brand partnership Market Store ❑ Metro entered into an agreement with Crocs in Apr 2015, position economics Number of Crocs EBOs as amended by way of an addendum agreement entered in Ju
Slide 31: Board of Directors
7 Board of Directors1 ARUNA BHAGWAN ADVANI, ARVIND KUMAR SINGHAL, MANOJ KUMAR MAHESHWARI, IQBAL HASANALLY DOSSANI, Independent Director Independent Director Independent Director Whole Time Director ❖ Holds bachelor’s degree in science ❖ Holds Bachelor of Engineering degree ❖ Holds bachelor’s degree
Slide 32: Promoters and Key Managerial Personnel
7 Strong promoter background and an experienced and entrepreneurial management team with a proven track record RAFIQUE A. MALIK, FARAH MALIK BHANJI, ALISHA RAFIQUE MALIK, Chairman Managing Director President - Sports Division, E-Commerce and CRM ❖ Over 50 years of experience in the ❖ Over 20 years o
Slide 33: Strong track record of growth, profitability and financial discipline
8 Strong track record of growth, profitability and financial discipline Revenue from Operations Gross Profit and Gross Margins EBITDA and EBITDA Margins 17,500 16,800 10,150 15,450 19,800 54.9% 55.6% 54.9% 57.9% 58.1% 27.7% 27.5% 21.5% 30.6% 32.0% 2,127 1,235 681 1,217 1,285 1,343 410 714 777 337 35
Slide 34: Levers of growth
Brief Overview Q3 & 9M FY24 Business Highlights Metro’s Strengths Levers of growth Sustainability Initiatives & Others Appendix: Industry Overview
Slide 35: Key Strategies
Key Strategies 1 3 5 2 4 Store Inorganic E-Commerce Expansion Plans Opportunities Expansion Leverage Multi-channel Evaluation basis Target to open 200 Leverage existing Leverage Sports & Platform targeted returns, stores (excluding Fila capabilities to increase Athleisure Segment and Foot Locker) in
Slide 36: To Summarize
To Summarize…. SOURCING & VENDOR WIDE RANGE OF RELATIONS PRODUCTS PREFERRED PARTNER ASSET LIGHT BUSINESS FOR THIRD PARTY MODEL BRANDS ALLIED PRODUCTS (Accessories, Foot care, PAN INDIA PRESENCE Shoe care, etc.) MULTI-CHANNEL BRAND VINTAGE RETAIL PLATFORM 35
Slide 37: Sustainability Initiatives & Others
Brief Overview Q3 & 9M FY24 Business Highlights Metro’s Strengths Levers of growth Sustainability Initiatives & Others Appendix: Industry Overview
Slide 38: CSR & Sustainability Initiatives (1/7)
CSR & Sustainability Initiatives (1/7) Environment Processing of Old & Discarded Footwear (ODF) in an eco-friendly manner ❑ Under this project, ODF is collected & then sorted, cut, and again sorted material wise as below: • Rubber and Plastic materials are sent for recycling. • Other totally worn of
Slide 39: CSR & Sustainability Initiatives (2/7)
CSR & Sustainability Initiatives (2/7) Environment Solar rooftops installed at both of our warehouses with a combined capacity of 240 KW. The solar rooftops generated 221 MWh of power. Distributed more than 18,000 footwear pairs to the less fortunate rural school children of Maharashtra, Gujarat, Od
Slide 40: CSR & Sustainability Initiatives (3/7)
CSR & Sustainability Initiatives (3/7) Health & Well-being Launched project “Ek Kadam Aage” to empower 150 Mumbai Railway Station based Shoe Shiners covering the aspects of their livelihood, healthcare and financial literacy trainings Through another project, we are working to create awareness, educ
Slide 41: CSR & Sustainability Initiatives (4/7)
CSR & Sustainability Initiatives (4/7) Health & Well-being Contributed towards Capex for building a Head and Neck Cancer Hospital in Mumbai. 40
Slide 42: CSR & Sustainability Initiatives (5/7)
CSR & Sustainability Initiatives (5/7) Health & Well-being We are creating awareness and early detection of hypertension, diabetes & oral cancer through screening in cobbler as well as other vulnerable communities. We donated Footwear pairs to more than 1200 children residing in 41 childcare institu
Slide 43: CSR & Sustainability Initiatives (6/7)
CSR & Sustainability Initiatives (6/7) Education We are supporting more than 80 children of under privileged families with their school fees and uniform expenses. We are supporting a college to construct a new classroom to decongest the existing ones, so that school children can study comfortably. 4
Slide 44: CSR & Sustainability Initiatives (7/7)
CSR & Sustainability Initiatives (7/7) Education We supported more than 200 trainees by providing them practical exposure We supported two rural schools of Satara & Sindhudurg districts of through on-the-job training at Metro Brands Ltd retail outlets, thus enhancing their Maharashtra, to introduce
Slide 45: Awards & Recognition
Awards & Recognition Forbes India Leadership Awards 2022 MAPIC India Retail Awards PETA India – Vegan Fashion Awards Farah Malik Bhanji and Alisha Malik won the Most Admired Retailer of the year Best Vegan Shoe Line,2022 GenNext Entrepreneur award for a Footwear Category, 2023 successful expansion a
Slide 46: Appendix: Industry Overview
Brief Overview Q3 & 9M FY24 Business Highlights Metro’s Strengths Levers of growth Sustainability Initiatives & Others Appendix: Industry Overview
Slide 47: Industry Overview (1/2)
Industry Overview (1/2) Low per capita footwear consumption in India as compared to other countries Per Capita footwear consumption India Per Capita Consumption of Footwear (2019) Per capita consumption of footwear (pairs) 8.1 6.4 2.0 – 2.1 6.2 6.2 1.9 5.8 1.6 4.3 4.0 1.2 3.3 3.2 2.5 1.9 USA Japan U
Slide 48: Industry Overview (2/2)
Industry Overview (2/2) Organized Retail Penetration - Footwear Segment wise market composition Category wise market composition In Percentage (%) 10% 10% 10% 6% 7% 8% 38% 9% 11% 13% 35% 30% 32% 34% 31% 33% 23% 27% 28% 23% 62% 60% 58% 56% 56% 51% FY15 FY20 FY21 FY22P FY25P FY15 FY20 FY25P FY15 FY20
Slide 49: Thank You
Crocs 4% Se a metro BRANDS