Kddl Limited · NSE:KDDL
Kddl — Q1 FY2021 Earnings Presentation
40 slides from Kddl's earnings presentation, Aug 27, 2020
Slide 1: Cover letter to stock exchanges
KDDL Limited Kamla Centre, SCO 88-89, Sector 8-C, Chandigarh - 160 009, INDIA. Tel: +91 172 2548223/24, 2544378/79 Fax: +91 172 2548302, Website:www.kddl.com CIN-L33302HP1981PLC008123 Ref : KDDL/CS/2020-21/42 Date : 27th August, 2020 National Stock Exchange of India Limited BSE Limited, Exchange Pla
Slide 2: KDDL Limited & ETHOS Limited Result Update Presentation
KDDL Limited & ETHOS Limited Result Update Presentation August 2020
Slide 3: Safe Harbor
Safe Harbor This presentation and the accompanying slides (the “Presentation”), which has been prepared by KDDL Ltd and Ethos Limited, a material subsidiary of KDDL Limited, (the “Company”), solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or
Slide 4: Q1FY21 Performance Overview
Q1FY21 Performance Overview
Slide 5: Q1FY21 Performance
Q1FY21 Performance Standalone Performance (Rs. Crs) Revenue Gross Profit 48.2 35.7 21.0 15.2 Q1FY20 Q1FY21 Q1FY20 Q1FY21 Ethos Performance (Consolidated) (Rs. Crs.) Revenue Gross Profit 102.1 30.5 32.8 11.7 Q1FY20 Q1FY21 Q1FY20 Q1FY21 4 Financials are with applicability of IND AS 116
Slide 6: COVID-19 Impact on the Business (1/2)
COVID-19 Impact on the Business (1/2) Business • The outburst of Pandemic COVID-19 has disrupted businesses through out. KDDL was also Operations affected with COVID-19 from March onwards as all factories, retail stores and offices were closed due to strict lockdown and curfew across the country. •
Slide 7: COVID-19 Impact on the Business (2/2)
COVID-19 Impact on the Business (2/2) Optimising Costs • We are taking all necessary actions and available options for reducing costs, overheads and deferring the long-term commitments of expenditures. • In addition, all avenues and efforts are being initiated for enhancing the revenue and income of
Slide 8: Standalone Profit & Loss
Standalone Profit & Loss Profit & Loss (Rs. Crs.) Q1FY21 Q1FY20 Revenue 21.0 48.2 Cost of Goods Sold 5.8 12.5 Gross Profit 15.2 35.7 Employee Expenses 10.8 14.1 Other Expenses 5.7 13.5 EBITDA -1.3 8.2 Margin (%) -6.3% 16.9% Other Income 0.8 0.9 Interest 2.4 2.0 Depreciation 3.0 3.0 PBT -5.9 4.2 Tax
Slide 9: Consolidated Profit & Loss
Consolidated Profit & Loss Profit & Loss (Rs. Crs.) Q1FY21 Q1FY20 Revenue 53.0 152.9 Cost of Goods Sold 28.2 84.9 Gross Profit 24.8 68.0 Employee Expenses 19.5 25.8 Other Expenses 11.6 24.3 EBITDA -6.3 17.9 Margin (%) -11.9% 11.7% Other Income 5.6 0.8 Interest 7.2 6.3 Depreciation 12.3 10.9 Share of
Slide 10: Adjusted Consolidated Profit & Loss
Adjusted Consolidated Profit & Loss As Reported Adjusted for INDAS 116 Profit & Loss (Rs. Crs.) Q1FY21 Q1FY20 Q1FY21 Q1FY20 Revenue 53.0 152.9 53.0 152.9 Cost of Goods Sold 28.2 84.9 28.2 84.9 Gross Profit 24.8 68.0 24.8 68.0 Employee Expenses 19.5 25.8 19.5 25.8 Other Expenses 11.6 24.3 19.8 32.1 N
Slide 11: Ind AS 116: Impact on Financials
Ind AS 116: Impact on Financials • The adoption of Ind AS 116 has resulted in recognizing a Right-of-Use Assets of Rs. 102.2 Crores and equivalent to the lease liability of Rs. 102.2 Crores as on 30th June 2020 • Overall balance sheet will increase by the amount of asset created for Leases. This wil
Slide 12: Standalone Balance Sheet
Standalone Balance Sheet Assets (Rs. Crs.) Mar-20 Mar-19 Liabilities (Rs. Crs.) Mar-20 Mar-19 Non-current assets 216.0 185.2 Equity 169.5 167.1 Property, plant and equipment 93.8 94.1 Equity share capital 11.7 11.7 Capital work-in-progress 2.2 2.4 Other equity 157.8 155.4 Right-of-use asset 12.7 - I
Slide 13: Consolidated Balance Sheet
Consolidated Balance Sheet Assets (Rs. Crs.) Mar-20 Mar-19 Liabilities (Rs. Crs.) Mar-20 Mar-19 Non-current assets 299.2 183.9 Equity 227.4 235.0 Property, plant and equipment 158.6 143.2 Equity share capital 11.7 11.7 Capital work-in-progress 2.9 6.8 Other equity 174.0 179.1 Right-of-use asset 109.
Slide 14: Manufacturing Business Overview
Manufacturing Business Overview 13
Slide 15: Introduction - Watch Dials and Hands Business
Introduction - Watch Dials and Hands Business Watch Dials Watch Hands Value Proposition ▪ Commercial operations began in 1983 ▪ Commercial operations began in 1996 ▪ Deep Understanding of the ▪ Leading Global supplier of Global Watch Industry Watch Dial serving many ▪ Only supplier in India and well
Slide 16: About Estima AG
About “Estima AG” Acquired in 2019 • Estima was established as a maker of watch hands in Switzerland in 1924 • It was a leading supplier to Swiss and other European watch brands in the mid-priced segment and About enjoyed an excellent reputation “Estima AG” • However, over last 10 years, it was unab
Slide 17: Introduction - Precision Engineering Business
Introduction - Precision Engineering Business Value Proposition 01 Eigen offers a full package of services, ranging from design and development to full scale production, providing customers with optimized supply chain solutions Capabilities We address various segments such as Electrical, Electronics
Slide 18: Stable Manufacturing Performance
Stable Manufacturing Performance* Revenue (Rs. Crs.) EBITDA (Rs. Crs.) +10% +13% 181 32 176 29 27 146 125 22 FY17 FY18 FY19 FY20 FY17 FY18 FY19 FY20 17 *Excludes the Financial Performance of Estima AG, Switzerland
Slide 19: Ethos Q1FY21 Snapshot
AS Ethos bag QIFY21 Snapshot THE 50 FINEST WATCHES 18
Slide 20: Renewed Strategy for ETHOS
Renewed Strategy for ETHOS Stores Optimization Uniquely Positioned to Grow In depth assessment of each store's Post Pandemic, Swiss brands may focus more performance across India . Accelerated Closure on developed markets and less on developing of Stores which fails our cost vs. benefits like India.
Slide 21: COVID-19 Impact on the Business
COVID-19 Impact on the Business Revenue Impact ETHOS was severely impacted due to the lockdown imposed by Government to prevent the spread of COVID-19. All the stores were shutdown during the later part of March which adversely impacted the business. Stores started re-opening from April onwards and
Slide 22: Q1FY21 Performance
Q1FY21 Performance Q1FY21 vs Q1FY20 (Consolidated*) Billings (Rs. Crs.) Revenue (Rs. Crs.) Gross Profit (Rs. Crs.) 118.1 102.1 30.5 11.7 32.8 32.2 Q1FY20 Q1FY21 Q1FY20 Q1FY21 Q1FY20 Q1FY21 Since the lockdown was in force for a significant part of Q1, the results for Q1FY21 were adversely affected by
Slide 23: Consolidated Profit & Loss
Consolidated Profit & Loss Particulars (Rs. Crores)* Q1FY21 Q1FY20 Revenue 32.8 102.1 Cost of Goods Sold 21.1 71.6 Gross Profit 11.7 30.5 Employee Expenses 7.1 8.7 Other Expenses 5.4 9.6 Reported EBITDA -0.8 12.1 Margin (%) -2.4% 11.9% Interest 4.6 4.2 Depreciation 8.9 7.8 Profit before share of JV
Slide 24: Adjusted Consolidated Profit & Loss
Adjusted Consolidated Profit & Loss As Reported Adjusted for INDAS 116 & other items Particulars (Rs. Crores)* Q1FY21 Q1FY20 Q1FY21 Q1FY20 Revenue 32.8 102.1 28.1 102.1 Cost of Goods Sold 21.1 71.6 21.1 71.6 Gross Profit 11.7 30.5 7.0 30.5 Employee Expenses 7.1 8.7 7.1 8.7 Other Expenses 5.1 9.3 8.1
Slide 25: Ind AS 116: Impact on Financials
Ind AS 116: Impact on Financials • The adoption of Ind AS 116 has resulted in recognizing a Right-of-Use Assets of Rs. 90.7 Crores and lease liability of Rs. 96.5 Crores, as on 30th June, 2020 • Overall balance sheet will increase by the amount of asset created for Leases. This will have an impact o
Slide 26: Consolidated Balance Sheet
Consolidated Balance Sheet Assets (Rs. Crores)* Mar-20 Mar-19 Equity & Liabilities (Rs. Crores)* Mar-20 Mar-19 Non-current assets 142.7 43.6 Shareholder’s Fund 152.2 133.9 Fixed Assets 32.2 26.6 Share Capital 18.2 16.9 Right of Use 96.9 - Other Equity 134.0 117.0 Financial Assets 9.3 11.2 Other Non
Slide 27: Store Closures
Largest Pan India retailer of Luxury Watches Stores as of June-20 50 Multi Brand Mumbai, Maharashtra Store 452 Sq. Ft. Closures Multi Brand Hyderabad, Andhra Pradesh Store 1,141 Sq.Ft. Multi Brand Navi Mumbai, Maharashtra Store 782 Sq.Ft. Total Stores 47 In line with our strategy, non-performing sto
Slide 28: New Initiatives
New Initiatives Repair and Service Pre-Owned Watches Pre-Owned Watches has the potential to Repair and services over 60 expand the volume and customer base of the World’s top Luxury watch Ethos has the expertise to check the authenticity Brands and to ensure that each time piece is in great conditio
Slide 29: Operational Snapshot
Operational Snapshot 28
Slide 30: Ethos - Performance Trend
Ethos - Performance Trend Front-end Rent & Manpower Cost as % of Revenue (Rs. Crs.) Revenue 27.2% 99.1 100.8 102.1 71.1 13.5% 11.3% 11.8% 32.8 9.4% Q1FY17 Q1FY18 Q1FY19 Q1FY20 Q1FY21 Q1FY17 Q1FY18 Q1FY19 Q1FY20 Q1FY21 EBITDA (Rs. Crs.) EBITDA Margins 12.1 11.9% 5.4 5.3% 0.2% 0.2 -0.8 -1.6% -1.1 -2.4
Slide 31: Ethos - Online Sales Trend
Ethos - Online Sales Trend Online Billings (Rs. Crs.) Online Billing as % of Total Billing 39.5 52.8% 34.6 32.7 26.3 32.9% 33.8% 31.2% 27.7% 17.0 Q1FY17 Q1FY18 Q1FY19 Q1FY20 Q1FY21 Q1FY17 Q1FY18 Q1FY19 Q1FY20 Q1FY21 Visitors (‘000) 3,873 3,424 3,316 2,894 2,181 Q1FY17 Q1FY18 Q1FY19 Q1FY20 Q1FY21 Sin
Slide 32: Ethos - Repeat Sales Trend
Ethos - Repeat Sales Trend Club ECHO Member Base Repeat Billings (Rs. Cr.) 2,47,648 2,49,443 39.6 39.3 2,16,704 1,84,891 29.9 11.8 Mar’18 Mar’19 Mar’20 Jun’20 Q1FY18 Q1FY19 Q1FY20 Q1FY21 Since the lockdown was in force for a significant part of Q1, the results for Q1FY21 were adversely affected by t
Slide 33: Ethos is India's Largest Luxury Watch Retailer
Ethos is India’s Largest Luxury Watch Retailer 32
Slide 34: Pan-India Presence with Offline Store Network
Pan-India Presence with Offline Store Network India’s Largest retail chain of Luxury Watches with 47 stores Ludhiana Presence across Metros, Tier I, Tier Chandigarh II cities New Delhi Gurugram Noida Jaipur Guwahati Lucknow 1 Duty Paid Retail Outlet at Domestic Terminals Ahmedabad Indore Kolkata Pun
Slide 35: Pan-India Presence with Offline Store Network
Pan-India Presence with Offline Store Network Exclusive Stores Digital Right Mix Brands Strategy ▪ Leverage on our ▪ Targeting to ▪ To go slower on Digital platform have a right mix new stores in to drive sales of Brands at all ▪ Higher share of price points near term. and customers Business from Fo
Slide 36: Ethos is India's Preferred Destination for Luxury Watches
Ethos is India’s Preferred Destination for Luxury Watches… Knowledge One-stop shop Mind Share Ethos has well trained Ethos’ access to Swiss Watch Ethos to be synonymous with Knowledgeable staff to ensure Brands will make it a ‘1 Stop Luxury watches retailing in highest customer satisfaction Shop’ fo
Slide 37: With an Asset Light Model
With an Asset Light Model… Improve Return On Capital Employed Operating Leverage Playing Out Reduce Front-End Cost like Manpower and Rental expenses Maximize Reach Expand catchment area of offline store, leading to higher revenue Minimize Investment Focus on Online Presence & Rationalize Store Prese
Slide 38: Continued Investments in Advertising
and Continued Investments in Advertising… Print Ads in leading news media… … with ETHOS co-branding 37
Slide 39: Offering the best Watch Brands under one roof
Offering the best Watch Brands under one roof 38 The Brand Names mentioned are the property of their respective owners and are used here for identification purposes only
Slide 40: For further information, please contact
For further information, please contact: Company : Investor Relations Advisors : Ethos Ltd. CIN : U52300HP2007PLC030800 CIN : U74140MH2010PTC204285 Mr. C. Raja Sekhar Mr. Shogun Jain/ Mr. Shrenik Shah +91 7738377756 / +91 9664764465 rajasekhar@ethoswatches.com shogun.jain@sgapl.net / Shrenik.shah@sg