Piquadro S.p.a · MIL:PQ
Piquadro — Mediobanca Italian Conference 2010
27 slides from Piquadro's conference presentation, Mar 29, 2010
Slide 1: Presentation – Paris, March 29 2010 – Mediobanca Italian Conference
PRESENTATION Paris – March, 29 2010 - Mediobanca Italian conference 1
Slide 2: Important Information
IMPORTANT INFORMATION • The information provided in this presentation is being furnished to you solely for your information on a confidential basis. Neither this document nor any copy thereof may be reproduced, redistributed or passed on, in whole or in part, to any other person. Neither this presen
Slide 3: A Rapid Path to Success
A RAPID PATH TO SUCCESS €52m 1998-2003 CAGR: +26.1% (1) 2004/05-2008/09 CAGR: +28.1% (2) €46m €36m Launch of Piquadro brand €25m €19m €16m 30,00% 29,50% 27,8% €13m 25,10% €10m €6m €8m €5m 1998 1999 2000 2001 2002 2003 2004 2004/05 2005/06 2006/07 2007/08 2008/09 SALES EBITDA Margin • Strong top line
Slide 4: Unique and Distinctive Brand Identity
UNIQUE AND DISTINCTIVE BRAND IDENTITY • Distinctive brand for “moving” people in leather goods industry • Aspirational brand: high quality, technological mood, innovation, design and ergonomic performance • Premium/performance positioning 4
Slide 5: Premium/Performance Positioning
PREMIUM/PERFORMANCE POSITIONING VALUE PROPOSITION Performance Fashion Lifestyle • Clear distinction from competitors at comparable price level through commitment to innovation, design, high Luxury - quality and ergonomic performance. PRICE POSITIONING • A different approach: Value for me. Premium •
Slide 6: Brand Awareness
B R A N D A W A R E N E S S (Elite research 2009 – Eurisko- GFK Group ) BAGS’ BRANDS KNOWN, OWNED AND WISHED (Italian market ) 6 Basis: total sample =1000 (%) KNOWN OWNED WISHED LOUIS VUITTON 64 SAMSONITE 24 LOUIS VUITTON 30 SAMSONITE 53 LOUIS VUITTON 23 GUCCI 16 GUCCI 48 GUCCI 13 SAMSONITE 15 PRADA
Slide 7: Brand Awareness – Brands Trend
B R A N D A W A R E N E S S (Elite research 2009 – Eurisko- GFK Group) BAGS’ ,BRANDS TREND (Italian market) 7 Basis: total sample =1000 (%) LOUIS VUITTON PRADA GUCCI 60 60 60 40 40 40 28 30 DESIDERATA 21 22 17 16 16 16 17 17 18 15 17 16 20 27 23 POSSEDUTA 20 14 20 13 10 10 15 12 14 16 13 16 13 11 12
Slide 8: Brand Awareness – Top 15
B R A N D A W A R E N E S S (Elite research 2009 – Eurisko- GFK Group) BAGS’ ,BRANDS TOP 15 (Italian market) 8 Basis: total sample =1000 (%) OTHERS REFERENCES 65 CHANEL COCCINELLE DOLCE E GABBANA LOUIS VUITTON FENDI ARMANI FURLA TOD'S HOGAN 55 MANDARINA GUCCI PRADA DUCK RATIONALITY HERMES HEDONISM S
Slide 9: Wide, Complementary Mono-Brand Product Mix
WIDE, COMPLEMENTARY MONO–BRAND PRODUCT MIX • Complementary and extensive product offering, including professional bags, travel items, women’s bags, small leather goods and other accessories • Product strategy: Basic Collections and Seasonal Collections • Basic Collections (80%/75% of turnover): long
Slide 10: Flexible and Efficient Business Model
FLEXIBLE AND EFFICIENT BUSINESS MODEL THE MANAGMENT • Internal product development and centralized procurement system. • Partly-outsourced production (70%) Efficient guaranteed by select, controlled third-party Procurement manufacturers (China, Taiwan, Hong Kong). Flexible • From 30% to 40% in-house
Slide 11: Manufacturing: The Factory
MANUFACTURING:THE FACTORY • Partly-outsourced production (from 60% to 70%) guaranteed by select, controlled third-party manufacturers (Far East). 11
Slide 12: Testing & Quality Control
TESTING & QUALITY CONTROL • Tumble Test • Adhesion of Coating Tensile • Veslik Test on Leather Seam Breaking • Handle Jerk • Mileage Test • A unique Quality and Testing department in Europe Leather Industry. • More than twenty control both on raw material (leather and metal accessories) and finished
Slide 13: International Multi-Channel Distribution Network
INTERNATIONAL MULTI–CHANNEL DISTRIBUTION NETWORK International Presence • Presence in approx. 50 countries with strategic mix of DOS and Wholesale channel. • Growing mono-brand network of 79 Stores (35 DOS, 44 franchised stores) in the most important cities worldwide. Design aspects conceptualized b
Slide 14: Distribution Network – DOS
INTERNATIONAL MULTI–CHANNEL DISTRIBUTION NETWORK–DOS DOS Opening Year DOS Opening Year 1 ) Milano Via Della Spiga 33 2000 18 ) Valdichiana (Arezzo), Outlet Store 2008 2 ) Milano Linate Airport 2002 19 ) Noventa di Piave (Venezia), Outlet Store 2008 3 ) Roma Galleria Colonna 38 2003 20 ) Dubai Burjum
Slide 15: Distribution Network – Franchising
INTERNATIONAL MULTI–CHANNEL DISTRIBUTION NETWORK–FRANCHISING FRANCHISING Opening Year FRANCHISING Opening Year 1 ) Roma Via Frattina 125 2002 23 ) Jedda Arabia Saudita Red Sea Mall 2009 2 ) Mosca, Russia MEGA Shopping Mall 2004 24 ) Mosca, Russia TC Atrium 2009 3 ) Padova Via Dante 19 2006 25 ) Mosc
Slide 16: Summary Income Statement
SUMMARY INCOME STATEMENT IAS-IFRS 9M (€m) FY Ending March 31, (ending Dec 31) 2007 A 2008 A 2009 A 2009 A 2010 A Net sales 35.7 45.9 51.7 36.9 36.9 % growth 51.6% +28.6% +12,4% - +0,1% Other revenues 0,9 0,7 0,9 0.7 0.5 Material costs (7.8) (7.9) (9.8) (6.5) (5.6) Service costs (14.0) (19.2) (20.6)
Slide 17: Strong Top Line Growth
STRONG TOP LINE GROWTH FY Net Sales: up 28,1% p.a. * 51,7 46.0 (€m) 35.7 9M Net Sales • In 9M DOS + 39.8% (SSSG 36,90 36,94 +2,2% at current exchange 31,85 rate /+0.1% at constant 25.0 25,32 exchange rate); Wholesale 19.2 down 7.5% mainly impacted by Europe negative trend . 2004/05A 2005/06A 2006/07
Slide 18: Sustainable High Profitability
SUSTAINABLE HIGH PROFITABILITY EBITDA: up 34.6% pa * • 9M 09/10 EBITDA down 200 9M EBITDA € 13.6m € 14.4m bps impacted by new start-up € 10.7m € 10.4 m € 9.7 m shop openings and slight € 5.9m negative operative leverage due to wholesale sales’ decrease. 2005/06 2006/07 2007/08 2008/09 2008/09H 2009/
Slide 19: Group Net Income and Income Taxes
GROUP NET INCOME AND INCOME TAXES Net Income: up 19% pa * (€m) 9M Net Profit € 6.4m € 7.5m € 5.3m € 4.9 m € 5.4 m 2006/07 2007/08 2008/09 2008/09H 2009/10H % of sales: 14.9% 14.0% 14.5% • 9M 09/10 Net Profit in slight decrease down 9,7%. FY Ending March 31, • Low impact of interest expenses notwiths
Slide 20: Summary Balance Sheet
SUMMARY BALANCE SHEET IAS-IFRS As of March 31 9M (€m) (as of Dec. 31) 2007A 2008A 2009A 2009 A 2010 A Net Working Capital 8.0 12.8 14.5 17.6 17.5 Net Tangible Assets 10.3 10.2 11.5 11.5 11.0 Net Intangible Assets 1.0 1.2 1.2 0.7 1.4 Net Financial Assets 0.6 0.9 1.3 1.5 1.0 Severance Staff, Provision
Slide 21: Lean Capital Structure
LEAN CAPITAL STRUCTURE Total Capitalization Net Debt/ 0.6 1.4 0.9 0.6 IAS-IFRS Equity (€m) 32 (€m) 27.4 30.0 As of March 31 As of Dec 31 31 30 2007A 2008A 2009A 2009A 29 28 24.1 27 0.3 0,2 Short-term Net Debt 2.1 1.6 2.8 5.8 26 25 24 19.0 0.1 Long-term Net Debt 13.1 12.4 14.5 12.6 23 22 (7.2) 21 20
Slide 22: Cash Generative Business Model
CASH GENERATIVE BUSINESS MODEL Cash Conversion(1) 2,3% • The Company has high 13,7% 14,4% conversion of EBITDA into 24.2% operating cash flow : 37.1% 22,1% 15.1% 10.2% • Limited Capex requirement Total 83,3% EBITDA 60.8% 64,2% • Efficient working capital 52.7% management • High performance in 2006/0
Slide 23: Cash Generative Business Model: 12 Months Rolling
CASH GENERATIVE BUSINESS MODEL: 1 2 M O N T H S R O L L I N G A S O F DEC. 31, 2 0 0 9 NET DEBT 2.055 3.922 €/000 14.965 1.931 7.022 7.110 11.265 11.272 +7 +4.155 +3.100 +88 +1.867 +124 -13.034 Net Debt as Operating NWC Capex Dividends Other Taxes Financial Net Debt as Dec. 2008 Cash Flow Movements
Slide 24: The Path Ahead
THE PATH AHEAD Focus on aspirational content and brand awareness: profitability and cash generation International Focus on Logistic/Manufacturing/ internationalization Financial platform in Asia Development of Exploiting target Brand Extension: positioning inTravel new licensing Items and agreement
Slide 25: Focus on Internationalization
FOCUS ON INTERNATIONALIZATION • New franchised stores in Italy and Europe as a way to reinforce and rationalise distribution • Expansion of presence in international markets adapting collection to local customers • Focus on “high potential markets” (mainly Far East’s one) in retail CHINA - BEIJING J
Slide 26: Apparel Project
APPAREL PROJECT Introducing some “contamination” of Piquadro values with Exploration in more marketable new business apparel values areas which could drive new growth to core business Marketing campaign driving Piquadro Brand Awareness as Lifestyle Brand New agreement with Studio Osti to create a ne
Slide 27: Continuously Translating and Creating Sustainable Cash Generation
CONTINUOUSLY TRANSLATING AND CREATING, SUSTAINABLE CASH GENERATION Top line growth/stability in relation to the Maintaining high profitability more than market conditions average Industry Efficient working capital management Low capital intensive business model HIGH CASH FLOW GENERATION 27