Myer Holdings Limited · ASX:MYR
Myer — FY2021 Earnings Presentation
33 slides from Myer's earnings presentation, Sep 16, 2021
Slide 1: Full Year 2021 Results
16 September 2021 FULL YEAR 2021 RESULTS CUSTOMER FIRST PLAN CONTINUES TO DELIVER NET PROFIT AFTER TAX1 UP $65.1 MILLION TO $51.7 MILLION NET CASH IMPROVED BY $103.9 MILLION TO $111.8 MILLION FY21 RESULTS (post-AASB 16) for the 53 weeks to 31 July 2021, compared to FY20: • Total sales2 up 5.5% to $2
Slide 2: CEO comments and board update
Myer’s Chief Executive Officer and Managing Director, John King, said: “This result is a testament to the hard work of our team, and we are starting to see the business thrive despite the extraordinary market conditions. Our significantly improved FY21 results, including growth in profitability for
Slide 3: Investor and Analyst briefing
Investor and Analyst briefing Myer’s CEO and Managing Director John King and CFO Nigel Chadwick will host a teleconference for investors and analysts today at 9.30am (Melbourne time). Participants can register for the conference by clicking here (or see below for full link) Registered participants w
Slide 4: Full Year 2021 Results
MYER HOLDINGS LTD FULL YEAR 2021 RESULTS TO 31 JULY 2021 JOHN KING NIGEL CHADWICK Chief Executive Officer Chief Financial Officer
Slide 5: Important information
Important information The information in this document is general only and does not purport to be complete. It should be read in conjunction with Myer’s other periodic and continuous disclosure announcements. Investors or potential investors should not rely on the information provided as advice for
Slide 6: Agenda
AGENDA FY21 SUMMARY FY21 RESULTS CUSTOMER FIRST PLAN CONCLUSION APPENDICES 3
Slide 7: FY21 Results Summary
FY21 SUMMARY FY21 Results Summary Strong Sales growth • Total sales 1 up 5.5% to $2,658.3 million, held back by forced store closures • Group online sales 2 up 27.7% to $539.5 million; 20.3% of total sales • Comparable total sales 3 up 0.9%; 8.4% in 2H21 • Operating Gross Profit (OGP) up 10.2% to $1
Slide 8: Store network continues to complement online
FY21 SUMMARY Store network continues to complement online • CBD stores materially impacted with Comparable sales1 down 22.3% • Comparable sales1 in non-CBD stores grew in FY21 by 1.7% • Comparable sales1 improved as year progressed: 2H21 up 8.4% (Q3 up 5.8%; Q4 up 10.9%) FY21 Comparable Sales1 25.3%
Slide 9: 2H highlights – strong finish to the first 3 years of the Plan
FY21 SUMMARY 2H highlights – strong finish to the first 3 years of the Plan A more resilient business because of the Customer First Plan • 2H21 was profitable1, first time since FY17 • B&M network traded well, when stores were able to trade • Our team members continue to deliver outstanding service
Slide 10: Agenda
AGENDA FY21 SUMMARY FY21 RESULTS CUSTOMER FIRST PLAN CONCLUSION APPENDICES 7
Slide 11: Income statement (post-AASB 16)
FY21 RESULTS Income statement (post-AASB 16) • Total Sales1 increased, but adversely impacted by COVID-19 closures $ MILLIONS FY21 FY20 Change and reduced CBD footfall; comparable sales3 were up 0.9% Total Sales1 2,658.3 2,519.4 5.5% • Group online sales4 grew by 27.7% YoY Operating Gross Profit 1,0
Slide 12: Income statement (pre-AASB 16)
FY21 RESULTS Income statement (pre-AASB 16) • 2H21 returns to profit for the first time since 2H17 $ MILLIONS FY21 FY20 Change • OGP margin increased 10.3% from higher sales volume, stronger Total Sales1 2,658.3 2,519.4 5.5% performance of high margin categories and lower markdowns Operating Gross P
Slide 13: Operating gross profit
FY21 RESULTS Operating gross profit Operating Gross Profit ($m) • A focus on profitable sales has been a cornerstone of the Customer First Plan 2 (10) 1,056 • OGP margin increased by 168bps reflecting: 49 • Higher margins in Home related categories with continued strong demand and lower markdowns 56
Slide 14: Cost of Doing Business
FY21 RESULTS Cost of Doing Business Myer Group Cost Structure ($m) Cost of Doing Business ($m) – with net JobKeeper and Rent & Outgoings Waivers excluded -0.3% 719 1 717 2 -0.3% 653 (as reported) 666 (as reported) (2) 312 304 19 (17) 193 207 6 (8) 719 717 213 206 FY20 FY21 CODB FY20 1 Inflation Inve
Slide 15: Operating cash flow (post-AASB 16)
FY21 RESULTS Operating cash flow (post-AASB 16) • Operating cash flow (before interest & tax) increased by $67 million $ MILLIONS FY21 FY20 to $365 million EBITDA1 390.0 305.3 • Working capital movement includes the increase in inventory levels Less implementation costs and ISIs (7.6) (221.4) as a r
Slide 16: Balance sheet (post-AASB 16)
FY21 RESULTS Balance sheet (post-AASB 16) • Inventory up 19% due to forced store closures in Q4 1 $ MILLIONS FY21 FY20 • Creditors reflects the business continuing to pay merchandise suppliers per agreed terms or better Inventory 305.2 256.0 • Net cash at end of period of $111.8 million; a $103.9 mi
Slide 17: Customer First Plan has generated less need for large debt facilities
FY21 RESULTS Customer First Plan has generated less need for large debt facilities Net Cash ($m) – FY18 to FY21 • Remained in a net cash position throughout 2H21; only in a net debt position for 21 days during 1H21 112 • Q4 store closures have negatively impacted inventory balances and cash generati
Slide 18: Agenda
AGENDA FY21 SUMMARY FY21 RESULTS CUSTOMER FIRST PLAN CONCLUSION APPENDICES 15
Slide 19: The first 3 years of Customer First Plan is delivering on its objectives
CUSTOMER FIRST PLAN The first 3 years of Customer First Plan is delivering on its objectives • We have made strong progress against the plan since 2019 despite the challenges of COVID-19 COVID-19 overlay Our Plan Progress Actions taken Delivered strong growth and scale Accelerate Re-sequence Expand
Slide 20: Accelerate online: building on success
CUSTOMER FIRST PLAN Accelerate online: building on success Initiatives Undertaken Results and Benefits Future Growth and Expansion Significantly Scaled Online Group online sales1 • Implementation of Attraqt Fredhopper technology to +158.6% optimise product sequencing and search. Phase one • Driven s
Slide 21: Factory to Customer (F2C): NDC is transformational for Myer
CUSTOMER FIRST PLAN Factory to Customer (F2C): NDC is transformational for Myer • National Distribution Centre (NDC) is the next phase of F2C – Improvements to Online (3PL / Multicarrier) and to international freight arrangements have already delivered cost and customer experience benefits • Phased
Slide 22: Engaging the Consumer through improved loyalty and personalisation
CUSTOMER FIRST PLAN Engaging the Consumer through improved loyalty and personalisation Initiatives Undertaken Results and Benefits Future Growth and Expansion Improved new member acquisition (New members) New Members +860,000 • Continued investment in data sciences, and • Over 860k new members signe
Slide 23: Re-Focus Merchandise: Fundamentals are strong, focus is growth
CUSTOMER FIRST PLAN Re-Focus Merchandise: Fundamentals are strong, focus is growth Initiatives Undertaken Results and Benefits Growth Focus Focus on Profitable sales (OGP %) Make the big bigger +151bps 38.85% 39.71% • Rationalisation of under-performing categories i.e. 38.20% 38.03% • More disciplin
Slide 24: Customer Experience in store has materially improved
CUSTOMER FIRST PLAN Customer Experience in store has materially improved Initiatives Undertaken Results and Benefits IT / Analytics solicit real-time feedback Customer Satisfaction 83% M-Metrics 71% 73% 74% • M-Metrics platform is driving continuous improvement FY18 FY19 FY20 FY21 Technology enabled
Slide 25: Space reductions contribute to optimising profitability
CUSTOMER FIRST PLAN Space reductions contribute to optimising profitability as part of our Omni-channel strategy Initiatives Undertaken Results and Benefits Space Reduction GLA Space Reduction (000’s) • 83,000m2 (8%) of space reduction -14 exited or announced since 1H18; including 42,091m2 in FY21 -
Slide 26: Agenda
AGENDA FY21 SUMMARY FY21 RESULTS CUSTOMER FIRST PLAN CONCLUSION APPENDICES 23
Slide 27: Christmas
LOOKING AHEAD Christmas • We are Australia’ s home of Christmas gifting with a significantly larger Giftorium offering an improved online and in-store shopping experience • We have a strong and distinctive Christmas Brand campaign in follow up to last year’s successful “Bigger than Christmas” campai
Slide 28: Conclusion
CONCLUSION Conclusion • Our Customer First Plan has been, and continues to be, the right plan and showed momentum in FY21 • Delivered for our customer in terms of stronger service and a more engaged MYER one base • Significantly scaled growth in Online with enhanced fulfilment • Strengthened our bal
Slide 29: Agenda
AGENDA FY21 SUMMARY FY21 RESULTS CUSTOMER FIRST PLAN CONCLUSION APPENDICES 26
Slide 30: Appendix 1: Sustainability at Myer in FY21
APPENDIX Appendix 1: Sustainability at Myer in FY21 Continuing our sustainability journey to integrate sustainable, ethical and socially responsible operations into all areas of the business O U R I M PA C T OUR TEAM O U R PA R T N E R S OUR COMMUNITY • 6.7% reduction in energy use and • 54% of lead
Slide 31: Appendix 2: NPAT reconciliation
APPENDIX A p p e n d i x 2 : N PAT r e c o n c i l i a t i o n t o s t a t u t o r y a c c o u n t s $ MILLIONS ebit interest tax npat Statutory reported result 162.9 (96.1) (20.4) 46.4 Add back: Implementation costs and individually significant items Space exit costs/(reversals) and other asset imp
Slide 32: Appendix 3: Income statement – AASB 16 impact
APPENDIX Appendix 3: Income statement – AASB 16 impact FY21 aasb 16 FY21 FY20 CHANGE $ MILLIONS (pre-aasb 16) (statutory) impact (pre-aasb 16) (pre-aasb 16) Total Sales1 2,658.3 - 2,658.3 2,519.4 +5.5% Operating Gross Profit 1,055.7 0.1 1,055.8 957.3 +10.3% Cost of Doing Business2 (665.7) (211.2) (8
Slide 33: Appendix 4: Pre AASB 16 Income statement – 52 week comparison
APPENDIX Appendix 4: Pre AASB 16 Income statement – 52 week comparison FY21 FY21 FY20 CHANGE $ MILLIONS (53 weeks) (52 weeks) (52 weeks) Total Sales1 2,658.3 2,622.1 2,519.4 +4.1% Operating Gross Profit 1,055.8 1,041.8 957.3 +8.8% Cost of Doing Business2 (876.9) (864.2) (863.8) +0.0% EBITDA2 178.9 1