Mr Price Group Limited · JSE:MRP
Mr Price — Investor Day (September 2024)
13 slides from Mr Price's investor day presentation, September 2024
Slide 1: Strategic positioning
By Mark Blair Strategic positioning Approach to the next phase of growth Part 8
Slide 2: Desired strategic outcomes
Desired strategic outcomes STRATEGIC OUTCOMES Surprise and delight our customers People | Operations | Sustainability 1 3 5 Profitable • Growing comp sales Diversified • Omni-channel Operational • Digital & tech leadership FRO NTLINE E NA BLE RS market • Space growth offering • Differentiated fashio
Slide 3: Existing business growth framework
Existing business growth framework CO MP GRO WTH N O N CO M P G RO WT H Sustainable comp growth is key This will build off a strong to achieving our long term vision existing base, introducing innovation and accessing Key part of divisional strategies new/under-served customer segments DI V I S IO N
Slide 4: Sales drivers: Geography
Sales drivers Geography RSA REST OF AFRICA % of sales % of sales 92.2 % 7.8 % • Primary operations in South Africa • Focus on extracting growth from • Group focus is concentrated on currently invested markets extracting value from this market • Blend of franchise and corporate • Established infrastr
Slide 5: Credit sales and number of active accounts
Sales drivers Tender type CREDIT SALES AND NUMBER OF ACTIVE ACCOUNTS CASH CREDIT 100.0 1 600 % of sales % of sales 88.9 % 11.1 % 90.0 1 400 80.0 1 200 70.0 No. of active accounts (000’s) 1 000 60.0 • Lowers group exposure to negative • Cautious credit risk appetite credit cycles • Opportunity for gr
Slide 6: Sales drivers: Channel
Sales drivers Channel NUMBER OF STORES AND TRADING AREA BRICKS ONLINE 1 050 000 +9.9 % +23.6 % 2 800 1 010 000 970 000 5-year CAGR 5-year CAGR 930 000 2 300 890 000 % of sales 97.9 % % of sales 2.1 % 850 000 No. of stores 1 800 • Growth acceleration since 2021: • Online channel doubled since 2020 81
Slide 7: Managing store profitability
Sales drivers Managing store profitability NON COMP NEW STORES | MAY 2024 FEASIBILITY FRAMEWORK ROOA% var to feasibility & threshold • Stringent investment process - 5-year feasibility outlook - Store selection - Performance tracking considers total capital employed • Key metrics 60 - Cannabilisatio
Slide 8: Future store growth
Sales drivers Future store growth STORE FOOTPRINT: CURRENT VS FUTURE NEW STORE OPENINGS Space opportunities still exist across the group’s portfolio • In FY2024: ~3 700 2 900 - 75% of stores were opened in malls smaller than 30 000m2 - Opportunities across all trading chains o No single chain exceed
Slide 9: Omni-channel state of play
Omni-channel State of play e-Commerce in South Africa • Contribution to total retail has increased from 2.9% to 4.7% since 2020 • e-Commerce contribution lagged EM peers, remaining in the low single-digits: - Delivery challenges to informal markets - Consumers continued preference for in-store shopp
Slide 10: Future of omni-channel consumer behaviour
Future of omni-channel Consumer behaviour South Africans still value physical shopping experiences, enjoying visits to shopping malls and browsing in stores. Many South Africans compare prices online regularaly but prefer shopping in-store for the immediacy of purchase. Euromonitor 2023 Group respon
Slide 11: Growth: capital allocation framework and concept considerations
Growth COMMITTED TO CAPITAL ALLOCATION FRAMEWORK: • Allocate cash to highest returning opportunities - Invest for the long-term in the most attractive opportunities based on returns and scalability • Ongoing assessment of dividend policy and share buybacks Concept considerations: Research to inform
Slide 12: Delivering growth
Delivering growth STRONG SALES GROWTH OPPORTUNITIES ACROSS THREE KEY AREAS: Medium-term • Growth in core business driven by: - Market share gains/recovery o Gained R1bn in market share in FY24 o Gain or maintain in over-indexed categories and grow top 10 under-indexed categories per segment - New st
Slide 13: Summary
Summary • A more favourable economic environment will provide consumer tailwinds for the sector • We remain growth focused and invested through the cycle underpinned by: - Growing and regaining market share - Investing further in existing stores and customer experience - Opening new stores - Expandi