Vaibhav Global Ltd. · NSE:VAIBHAVGBL
Vaibhav Global — Q1 FY2015 Earnings Presentation
32 slides from Vaibhav Global's earnings presentation, July 2014
Slide 1: Vaibhav Global Limited Financial Results Presentation Q1 FY2015
Vaibhav Global Limited Global Retailer of Fashion and Lifestyle Accessories on Home TV and e-Commerce Platforms Financial Results Presentation Q1 FY2015 July 2014
Slide 2: Safe Harbor
Safe Harbor Certain statements in this document may be forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties like regulatory changes, local political or economic developments, and many other factors that could cause our actual results to differ ma
Slide 3: VGL Overview
VGL Overview Vertically-integrated electronic retailer • End-to-end B2C business model in the electronic retail industry • Proprietary TV homeshopping and e-commerce platforms Liquidation Channel and The Jewellery Channel are strong brands • 95 million (FTE) households on TV shopping in the US, UK a
Slide 4: Table of Contents
Table of Contents Q1 FY15 Financial Performance 5 Financial Performance Trends 12 Business Background Details 20 4
Slide 5: Key Highlights for Q1FY15
Key Highlights for Q1FY15 Home TV Network Reaches Over 100 Million Households • 95 million households on full time equivalent (FTE) basis • 25 million households in the UK • 68 million households in the US • 2.3 million households in Canada Retail Volumes increase by 13% to 2.2 Million Units • 3% hi
Slide 6: CMD's Message
CMD’s Message Commenting on Q1FY15 performance, Mr. Sunil Agrawal, Chairman and Managing Director, Vaibhav Global said: “We continue to expand our range of offerings, enhance the transaction experience, and deepen our engagement with our base of 1.4 million TV and web customers. This has resulted in
Slide 7: Financials – Q1 FY15 Performance (Revenues)
Financials – Q1 FY15 Performance (Revenues) Revenues (Rs. crore) 301 251 Q1 FY14 Q1 FY15 Jewelry & Lifestyle Products TV Sales Web Sales B2B Sales 209 188 59 33 30 33 Q1 FY14 Q1 FY15 Q1 FY14 Q1 FY15 Q1 FY14 Q1 FY15 7
Slide 8: Retail Performance Trends
Retail Performance Trends TV Sales Sales Volumes ('000s) Average selling price US$ 24 25 1,422 1,377 • Volume growth in Q1FY15 – 3% in TV and 38% in Web • Web sales now contribute 34% of sales Q1FY14 Q1FY15 Q1FY14 Q1FY15 volume vs 28% in Q1 last year • Increasing contribution from catalog sales Web
Slide 9: Financials – Q1FY15 Performance (Margins)
Financials – Q1FY15 Performance (Margins) Rs. crore Gross Profit Gross margin 200 70% 65% 62% 65% 60% 55% • Gross margins impact from flat TV 150 50% volumes and higher Web contribution to 45% the overall revenue mix 40% 35% 163 187 100 30% Q1 FY14 Q1 FY15 Note: Direct costs for calculation of gross
Slide 10: Financials – Q1FY15 Performance (Profits)
Financials – Q1FY15 Performance (Profits) Rs. crore PAT PAT margin 60 18.0% 16.0% 15.0% • PAT includes exchange gain of Rs. 3.5 crore in Q1FY15 vs Rs. 10.8 crore in 40 12.0% Q1FY1410. Tax rate increased from 2% 9.0% to 14% as both US and India operations 7.0% are tax paying entities this year 20 6.0
Slide 11: Table of Contents
Table of Contents Q1 FY15 Financial Performance 5 Financial Performance Trends 12 Business Background Details 20 11
Slide 12: Financials Performance Trends (Revenues)
Financials Performance Trends (Revenues) Revenues (Rs. crore) 1,298 893 647 526 301 FY11 FY12 FY13 FY14 Q1 FY15 Jewelry & Lifestyle Products TV Sales Web Sales B2B Sales 911 687 483 225 395 162 117 85 91 89 209 46 73 59 33 FY11 FY12 FY13 FY14 Q1 FY11 FY12 FY13 FY14 Q1 FY11 FY12 FY13 FY14 Q1 FY15 FY1
Slide 13: Retail Performance Trends
Retail Performance Trends TV Sales Sales Volumes ('000s) Average selling price US$ 6,420 41 5,239 30 3,268 23 24 25 • Robust volume growth driven by strong 2,039 customer engagement 1,422 • ASP has trended inline with portfolio FY11 FY12 FY13 FY14 Q1 FY11 FY12 FY13 FY14 Q1 transition from fine jewel
Slide 14: Financials Performance Trends (Margins)
Financials Performance Trends (Margins) Rs. crore Gross Profit Gross margin 900 64% 62% 800 62% 61% 700 60% 59% 60% 600 • Gross margins remain robust supported 500 58% by a sourcing matrix that provides 400 55% 56% flexibility to purchase from cost efficient 300 markets 54% 200 100 52% 289 384 533 7
Slide 15: Financials Performance Trends (Profits)
Financials Performance Trends (Profits) Rs. crore PAT PAT margin 180 14% 12% 12% 160 12% 140 10% 120 8% 100 8% 7% 8% 80 6% 60 4% 40 2% 20 42 79 78 153 22 0 0% FY11 FY12 FY13 FY14 Q1 FY15 Rs. per share EPS 48 25 24 13 7 FY11 FY12 FY13 FY14 Q1 FY15 15
Slide 16: Financials Performance Trends (Balance Sheet)
Financials Performance Trends (Balance Sheet) Rs. crore Shareholders’ Equity Rs. crore Fixed Assets 265 205 203 254 233 205 159 58 66 69 FY11 FY12 FY13 FY14 Q1 FY15 FY11 FY12 FY13 FY14 Q1 FY15 * During FY13, Shareholders’ Equity was adjusted lower by Rs. 163.7 crore due * During FY13 fixed assets we
Slide 17: Financials Performance Trends (Cash Flow)
Financials Performance Trends (Cash Flow) Rs. crore Free Cash Flow * Rs. crore Operating Cash flow 178 160 77 63 54 52 48 44 27 22 FY11 FY12 FY13 FY14 Q1 FY15 FY11 FY12 FY13 FY14 Q1 FY15 *Includes Foreign Currency Transaction Reserve *Includes Foreign Currency Transaction Reserve Key usage areas for
Slide 18: Financials Performance Trends (Key Ratios)
Financials Performance Trends (Key Ratios) ROE ROCE 68% 60% 65% 52% 53% 37% 34% 36% 23% 15% FY11 FY12 FY13 FY14 Q1 FY15 FY11 FY12 FY13 FY14 Q1 FY15 18
Slide 19: Table of Contents
Table of Contents Q1 FY15 Financial Performance 5 Financial Performance Trends 12 Business Background Details 20 19
Slide 20: Market Opportunity
Market Opportunity US market size (US$ Bn) UK market size (US$ Bn) Fashion Fashion Accessories Accessories 17 6 Fine and Fine and Fashion Fashion Jewelry 67 Jewelry 8 Market share gains through expanded distribution network and introduction of collections/designs mapping market trends 20
Slide 21: Product Profile
Product Profile Watches, handbags, scarves, phone protective shells etc. Bracelets, bangles, earrings, studded jewelry etc. Office and home décor, etc. Continuously expanding product range – portfolio of 65,000 designs augmented with launch of lifestyle accessories 21
Slide 22: US Market Access on Liquidation Channel
US Market Access on Liquidation Channel Channel #274 Channel #399 & 1399 Channel #159 Channel #75 & 226 * * * https://www.liquidationchannel.com * * * Different channel # across various locations Access to 70 million (FTE) of the 116 million households in the US 22
Slide 23: UK Market Access on The Jewellery Channel
UK Market Access on The Jewellery Channel Channel #49 Channel #650 Channel #815 Channel #757 www.thejewellerychannel.tv Access to 25 out of the total 25 million households 23
Slide 24: Sourcing Markets
Sourcing Markets Manufacturing facility in Jaipur, India Production capacity – 4 million pieces p.a. ISO 9001:2008 manufacturing facilities Over 2,200 people in India across corporate, manufacturing, design, sales & marketing, customer service, logistics etc Sourcing operations from fashion centric
Slide 25: Consumption Markets
Consumption Markets Access to over 95 million (FTE) households on TV homeshopping in the US, UK and Canada • Affiliate agreements with major cable, satellite providers • Improved product presentation by investing into studio facilities The Jewellery Channel Liquidation Channel UK USA • The Jewellery
Slide 26: Sourcing Methodology
Sourcing Methodology Assessing value perception – design / fashion trend / price in target Competitive markets Pricing Mapping latest fashions Vendor Core evaluation competency process of vendor Rapid turnaround Sourcing from appropriate micro-markets in China/Asia Delivery/ Low Focus on best qualit
Slide 27: Aligned with Demand Patterns
Aligned with Demand Patterns Process Buyer discussions Evaluation/ feedback of last year’s hits/misses Product Valentine Day & Mothers’ Summer Product development strategies – by Spring Product Line Day Line category Process begins – September Process begins – December Process begins – Decembe
Slide 28: Recent Additions to the Board
Recent Additions to the Board Pulak Prasad Vikram Kaushik Director Director 40 years of experience with the companies like Unilever, Britannia, Colgate-Palmolive and Tata Sky Founder of private equity fund Nalanda Capital Pte Ltd Management consultant / advisor to groups like Voltas, Serves
Slide 29: Management Team
Management Team Sunil Agrawal Chairman and Managing Director Established Vaibhav in 1980 as a first generation entrepreneur and has led the company’s transition into a leading brand for fashion jewelry and lifestyle accessories Travels extensively across the world, overseeing operations, sourcin
Slide 30: Management Team
Management Team Hemant Sultania Gaurav Vishal Soni Group Chief Financial Officer Chief Operating Officer, VGL India 17 years of rich experience in strategic financial planning, budgeting, project evaluation, commercial and legal affairs, taxation, fund management, finalization of 17 years of ext
Slide 31: Contact Information
Contact Information For more information on Vaibhav Global Limited, please contact: Hemant Sultania Vaibhav Global Ltd. Tel: +91-141-2770648 Email: Hemant@vglgroup.com Shiv Muttoo / Karl Kolah CDR India Tel: +91 22 6645 1207 / 1220 Email: shiv@cdr-india.com karl@cdr-india.com 31
Slide 32: Thank You
Thank You 32