Mavi Giyim Sanayi Ve Ticaret A.s. · BIST:MAVI
Mavi Giyim Sanayi Ve Ticaret A.s — Investor Presentation (December 2019)
32 slides from Mavi Giyim Sanayi Ve Ticaret A.s's investor presentation, December 2019
Slide 1: Investor Presentation December 2019
INVESTOR PRESENTATION December, 2019 0
Slide 2: Disclaimer
Disclaimer This document does not constitute or form part of any offer to sell or issue or invitation to purchase or subscribe for, or any solicitation of any offer to purchase or subscribe for, any securities of the Company. The information, statements and opinions contained in this presentation do
Slide 3: Mavi Business Overview
MAVI BUSINESS OVERVIEW
Slide 4: Why We Believe Mavi is Exciting
Why We Believe Mavi is Exciting Aspirational denim centric lifestyle brand with broad appeal and celebrity endorsements World-class products and well-segmented- ranges with a focus on quality, sustainability and efficient supply chain Global multi-channel execution with Turkey retail, international
Slide 5: Highly Successful Lifestyle Brand
Highly Successful Lifestyle Brand… Business Overview Key Metrics ( 9M 2019 (exc IFRS16)) Brand & Product (9M 2019) Started operations in Istanbul in 1991, Mavi today is globally recognized as a highly successful casual lifestyle brand TRY2,148m Revenue TRY330m EBITDA #1 c.55%3 Lifestyle With str
Slide 6: With Strong International Presence
…With Strong International Presence Canada Europe Russia 375 # Retail Stores: 4 # Retail Stores: 2 # Retail Stores: 18 # Wholesale Doors: c.1,650 # Wholesale Doors: c.1,700 # Franchised Stores: 16 # FTEs: 67 # FTEs: 73 # Wholesale Doors: c.139 Mono-Brand # FTEs: 133 Stores in Turkey 60 International
Slide 7: Retail Expertise in Turkey
RETAIL EXPERTISE IN TURKEY
Slide 8: Multi Pillar Growth Strategy in Turkey Retail
Multi Pillar Growth Strategy in Turkey Retail • Physical Space Growth Expansion of store space LFL Growth New Store Openings Average Selling Space 500 sqm Above 16% Every Year 375 Stores in 80 Cities New Stores 600-800 sqm • New customer acquisition 1mn+ every year • Online Sales Growth mavi.com & M
Slide 9: Offering a Lifestyle Product Portfolio Across Women and Men
Offering a Lifestyle Product Portfolio Across Women and Men… Key Product Categories 45% 23% 14% 6% 6% 6% Denim Knits Shirts Jackets Accessories2 Others3 37% Women WOMEN 63% Men (share) 45% Denim MEN 55% Lifestyle (share) Minimising Fashion Risk and Seasonality With Various Styles Across Lifestyle Pr
Slide 10: And Growing Significantly in Each Category
…And Growing Significantly in Each Category Denim Products (TRYm) Lifestyle Products (TRYm) Knits Shirts 45% 23% 14% 320 311 235 239 199 193 188 147 165 651 104 611 526 501 397 2016 2017 2018 9M'18 9M'19 2016 2017 2018 9M'18 9M'19 Jackets Accessories1 6% 6% 135 97 98 2016 2017 2018 9M'18 9M'19 84 81
Slide 11: Diversified and Reliable Sourcing Model
Diversified and Reliable Sourcing Model Quality Driven Efficient Sourcing Structure with a focus on sustainability 45% Denim c.80% Made in 120+ Responsible c.20% Imported Suppliers 55% Non-Denim Turkey • Turkey Retail Net Sales Split • Quality textile ecosystem • Mainly outerwear and • Well-establis
Slide 12: Strong Track Record of Retailization in Turkey
Strong Track Record of Retailization in Turkey… # of Retail Stores Evolution in Turkey Turkey Retail Sales Evolution (TRYm) Net New 25 26 13 8 Stores 1,471 1,353 1,133 1,094 300 308 857 287 261 2016 2017 2018 9M 2019 2016 2017 2018 9M 2019 9M 2019 Gross Selling Space Evolution in Turkey (Sqm k) Sign
Slide 13: Supported by High Like-for-like Growth Figures
…Supported by High Like-for-like Growth Figures 22.8% 22.5% 20.5% 1 14.1% 14.7% 12.0% 9.9% 1 Transaction2 10.8% # Growth (%) -0.4% 2016 2017 2018 9M 2019 2016 2017 2018 9M 2019 •Q3 LFL performance continued to be 21.0% strong at 20.1% LFL with 2.3% transaction growth and17.4% basket size growth Bask
Slide 14: Best-in-Class Loyalty Program (Kartuş) Since 2007
Best-in-Class Loyalty Program (“Kartuş”) Since 2007 Strong Appeal to Under 35 Across Majority of New Loyalty Card Holders Both Genders are Under 35 8.0M 5.7M % of Turkey’s Total Loyalty Card Active Active Loyalty Card Members per Age Group (%) Population (2018) New Loyalty Card Members per Age Group
Slide 15: Successful Brand Strategy
SUCCESSFUL BRAND STRATEGY
Slide 16: Best-in-Class Communication
Best-in-Class Communication Aspirational denim centric lifestyle brand with celebrity endorsements 60+% 3M Brand Social Media 263 M+ Awareness with Impressions Followers Top of Mind Mavi is recognized with a Bronze Effie, the prestigious award of the advertising world, for its "Çok Serenay" campaign
Slide 17: Celebrities
Celebrities “Mavi is a brand of superior quality, which is the foremost attribute I look for when I, as an entrepreneur, invest because quality is always appreciated.” Richard Branson (Istanbultalks, 2016) Richard Branson Katherine Heigl Heidi Klum Kate Hudson Colin Farrell Kendall Jenner Liam Hemsw
Slide 18: International & E-Com Markets
INTERNATIONAL & E-COM MARKETS
Slide 19: Growing Global Footprint
Growing Global Footprint c.5,000 doors in 60 monobrand Online channels c.2 million denim 35 countries stores share 29.0% (inc. pieces sold in Wholesale e- international (24 own- com) markets opearated, 36 franchise USA EUROPE 12% Retail 16% E-com 3% E-com c.1,350 Wholesale: Online wholesale c.1,700
Slide 20: E-Commerce Platform to Deliver Future Growth
E-Commerce Platform to Deliver Future Growth Global E-Commerce Revenue Turkey E-Commerce Revenue % Sales 5.9% 7.5% % Sales 2.4% 3.1% 160.4 54.8 7.0 105.5 71.0 35.2 10.6 60.1 18% -34% 47.9 89.4 24.6 45.4 97% 95% 9M 2018 9M 2019 9M 2018 9M 2019 mavi.com & Marketplace Wholesale E-Com Mavi.com Turkey -
Slide 21: E-Commerce Potential in Turkey
E-Commerce Potential in Turkey Turkey Has a Strong E-Commerce Potential3 E-Commerce Penetration Mavi Share of Online Sales Still Below Overall Comparable Markets 5.3% % Share of E-Commerce in Retail (2018)1 E-Commerce penetration in Turkey (China 24%, USA 14%, UK 17%, Germany 11%) Internet Penetrati
Slide 22: Strong Financial Performance
STRONG FINANCIAL PERFORMANCE
Slide 23: Mavi Delivers Strong Operational Results
Mavi Delivers Strong Operational Results Revenue Evolution (TRYm) Gross Profit Evolution (TRYm) Gross 51.0% 50.9% 51.3% 52.4% 49.8% Margin (%) 2,353 2,148 1,208 1,782 1,778 1,069 1,368 907 931 698 2016PF 2017 2018 9M 2018 9M 2019 2016PF 2017 2018 9M 2018 9M 2019 EBITDA Evolution (TRYm) Net Profit (T
Slide 24: Strong Cash Conversion
Strong Cash Conversion Cash Conversion1 (exc. IFRS 16) Main Working Capital Items TRYm 2017 2018 9M 2018 9M 2019 111% 87% 79% 75% Trade & Other Receivables3 140.2 188.1 242.0 274.4 % Sales 7.9% 8.0% 11.0% 10.1% Inventories 320.4 457.2 435.9 515.0 2017 2018 9M 2018 9M 2019 % COGS 36.6% 39.9% 41.3% 37
Slide 25: Efficient Capex Management and Healthy Leverage Ratios
Efficient Capex Management and Healthy Leverage Ratios CAPEX Debt Breakdown (31 October 2019) % Sales 4.1% 2.8% 2.4% 3.4% 8% Average Cost of Debt 9% 3% TRY TRY 15.7% 72.8 66.1 73.8 8% EUR EUR 2.0% 43.0 USD 14% USD 4.3% RUB 66% RUB 13.4% CAD CAD 4.0% 2017 2018 9M 2018 9M 2019 92% Blended 12.3% Net De
Slide 26: Updated Management Guidance for 2019FY
Updated Management Guidance for 2019FY Initial Guidance Updated Guidance Consolidated Revenue Growth 25% 21% 15 net new stores 15 net new stores Turkey Retail Stores 10 expansions 10 store expansions Turkey Retail LFL Growth 18% 20% EBITDA Margin 14.5% 14% Net Debt/EBITDA Below 1x 0.1x Up to 4% of U
Slide 27: Thank You
THANK YOU Contact : investorrelations@mavi.com duygu.inceoz@mavi.com
Slide 28: Highly Experienced Board of Directors
Highly Experienced Board of Directors Ersin Akarlılar Ahmet Ashaboglu Cüneyt Yavuz Chairperson Independent Non- CEO Executive Director With Mavi since 1991 CFO of Koc Holding since 2006 Mavi’s Chief Executive Officer Primarily responsible for Mavi’s Previously worked at McKinsey since 2008
Slide 29: Financial Statements: Income Statement
Financial Statements Income Statement (2019 figures inc. IFRS 16) TRYm Q3 2018 Q3 2019 Change (%) 9M 2018 9M 2019 Change (%) Rev enue 715.2 808.1 13.0% 1,777.7 2,148.3 20.8% Cost of Sales (340.9) (400.4) 17.4% (846.5) (1,079.2) 27.5% Gross Profit 374.3 407.7 8.9% 931.3 1,069.1 14.8% Gross Margin 52.
Slide 30: Financial Statements: Balance Sheet
Financial Statements Balance Sheet (2019 figures inc. IFRS 16) TRYm 31 January 2018 31 October 2019 Change (%) Assets Current Assets Cash and Cash Equiv alents 266.6 344.9 29.4% Trade Receiv ables 168.6 258.4 53.3% I nv entories 457.2 515.0 12.6% Other Current Assets 92.9 90.8 (2.3%) Total Current A
Slide 31: Financial Statements: Cash Flow Statement
Financial Statements Cash Flow Statement (2019 figures inc. IFRS 16) TRYm 9M 2018 9M 2019 Profit¹ 101.2 95.0 D&A Expense 52.1 206.3 Net Finance Expense / (I ncome) 75.0 175.6 Tax Expense 29.5 27.7 Other Non-Cash I tems 36.8 23.8 Cash Flow from Operating Activ ities 294.6 528.3 Δ in Net Working Capit
Slide 32: Financial Statements – IFRS 16 Impacts
Financial Statements – IFRS 16 Impacts IFRS 16 APPLIED AS OF FEBRUARY 1, 2019 9M 2019 Impact (TRY in millions) Decrease as all non-performance leases are capitalized RENT EXPENSE -180.3 and are subjected to depreciation and interest expense DEPRECIATION & Increase due to depreciation of capitalized
Mavi Giyim Sanayi Ve Ticaret A.S. — Investor Presentation (December 2019) on 6ix