Burberry Group Plc · LSE:BRBY
Burberry — H1 FY2021 Earnings Presentation
31 slides from Burberry's earnings presentation, November 2020
Slide 1: Burberry Interim Results 2020
BURBERRY LONDON ENGLAND INTERIM RESULTS 2020 MARCO GOBBETTI CHIEF EXECUTIVE OFFICER
Slide 2: Agenda
AGENDA INTRODUCTION PROGRESS TO DATE FINANCIAL RESULTS STRATEGY AND OUTLOOK Q&A HALF YEAR RESULTS Total revenue £878m Adjusted operating profit £51m
Slide 3: Momentum disrupted by COVID, but rapidly recovering
MOMENTUM DISRUPTED BY COVID, BUT RAPIDLY RECOVERING TOTAL COMP SALES GROWTH — BY QUARTER % 1% -6% 45% FY19 FY20 FY20 FY21 FY20 FY21 Dec 29 - Jan 25 Qi Q2 RECOVERY ACCELERATING IN THE LAST TWO MONTHS TOTAL COMP SALES GROWTH — BY MONTH % June July August September October FY21 FY21 FY21 FY21 FY21
Slide 4: Strategic progress
STRATEGIC PROGRESS Momentum disrupted by COVID, but good strategic progress driving recovery Outperformance of full-price channels Traction in leather goods High double-digit digital growth High share of new and younger customers COLLECTION PERFORMANCE
Slide 5: Traction in leather goods
TRACTION IN LEATHER GOODS % YOY sales growth LEATHER GOODS - MAINLINE AND DIGITAL COMP SALES. £ FY20 FY21 Q2 Q2 Note: Graph not to scale FULL PRICE CHANNEL MIX >) Increase vs LY (p.p.) SHARE OF FULL PRICE CHANNELS! WITHIN TOTAL COMP. SALES % Q2 FY20 Q2FY21 Includes full price and markdown sales from
Slide 6: Brand activations
BRAND ACTIVATIONS NATIVE & CREATIVE. COLLABORATIONS INNOVATIVE CLIENT FORMATS FASHION SHOW UNEXPECTED VISIBILITY | b BURBERRY a1 Auuaaung a | t ey NEW COLLECTIONS BURBERRY COMMUNITY POP-UPS AND VM CAPSULES B SERIES STRONG RECOVERY IN ASIA AND AMERICAS TOTAL COMP SALES - ASIA TOTAL COMP SALES - AMERI
Slide 7: Mainland China
MAINLAND CHINA \ Rann LOCAL CAMPAIGNS AND CONTENT NEW ACTIVATIONS. DIGITAL NATIVE CONTENT COLLABORATIONS POP-UPS AND IN-STORE INNOVATIVE CLIENT INSTALLATIONS FORMATS
Slide 8: Image for virtual event to come
IMAGE FOR VIRTUAL EVENT TO COME 8
Slide 9: Immersive worlds on .com
IMMERSIVE WORLDS ON .COM DIGITAL ACTIVATIONS BURBERRY DIGITAL POP-UPS ACTIVATIONS ON THIRD PARTY PLATFORMS
Slide 10: Adapting in-store experiences
ADAPTING IN-STORE EXPERIENCES % YoY sales growth MAINLINE REVENUE GENERATED FROM APPOINTMENTS. £M FY20 Q2 FY21Q2 BALANCE SHEET AND LIQUIDITY CASH AND LIQUIDITY COST MANAGEMENT 10
Slide 11: People and responsibility
PEOPLE AND RESPONSIBILITY OUR PEOPLE AND COMMUNITES RESPONSIBILITY AGENDA INTRODUCTION PROGRESS TO DATE FINANCIAL RESULTS STRATEGY AND OUTLOOK Q&A 11
Slide 12: H1 2021 summary financials
JULIE BROWN CHIEF OPERATING & FINANCIAL OFFICER H1 2021 SUMMARY FINANCIALS = CHANGE -- H1 2021 H1 2020 Reported CER £m £m FX > | Revenue 878 1,281 (31%) (30%) oO 8 Adjusted operating profit 51 203 (75%) (71%) =) <t Adjusted operating margin 5.8% 15.9% (10.1% pts) (9.3% pts) Adjusted diluted EPS 4.6p
Slide 13: Retail comp growth
RETAIL COMP GROWTH IMPROVING QUARTERLY PERFORMANCE Group APAC EMEIA Americas H1-25% H1 flat H1-56% H1-28% 21% -39% 45% -74% GROUP REVENUE -30% (CER) £1,281m 25% LJ 4% £892m £878m as -38% 24% -30% 41% -31% Revenue Retail Comp RetailSpace | Wholesale Licensing Revenue H1 FX Revenue H1 H1 FY2021 FY2021
Slide 14: Retail & wholesale revenue by product
RETAIL & WHOLESALE REVENUE BY PRODUCT Q2 FY2021 H1 FY2021 H1 FY2020 H1FY2021 H1FY2021 CER Reported CER Growth* Growth Growth (5%) £860m £1,257m (32%) (31%) (38%) (37%) (16%) Women's 8 3 (26%) (25%) z 2% y sg fo Men's 8 (10%) (8%) zt 27% Children’s & Other! 9 : s £457m (34%) (33%) (5%) Accessories 3
Slide 15: £112m total opex reduction
£112m total opex reduction YoY -17% 15
Slide 16: Sustainability bond
SUSTAINABILITY BOND • • • • • • • • • 16
Slide 17: Brexit
BREXIT • • • • • • • • • • • * Based on FX rates at 30 October 17
Slide 18: H1 FY2021 impacted by store closures
H1 FY2021 IMPACTED BY STORE CLOSURES H1 PERCENTAGE OF STORES CLOSED H1-25% AND MONTHLY COMPARABLE SALES GROWTH "60% +LSD -HSD- -HsD (>) -20% 615% 645% MSD MSD isp LSD 60% End Mid End End End End End Current Apr May Jun July Aug Sept Oct Mar. May June = July = Aug Sep Oct Summary * Good recovery from
Slide 19: Where we are in our journey
MARCO GOBBETTI CHIEF EXECUTIVE OFFICER WHERE WE ARE IN OUR JOURNEY * Accelerate growth + Adapt business to the COVID environment + Ignite brand heat with influencers + Continue to strengthen and key opinion leaders brand and product + Manage product transition and invest in image-driving channels 19
Slide 20: Clear plans in place to drive performance
CLEAR PLANS IN PLACE TO DRIVE PERFORMANCE 1 SHARPEN,OUR ‘ LUXURY BRAND the: \TE/> 3. FOCUS /ON 4. GROWLEATHER 5. ADAPT THE, & LUXURY STORE _EXPERIENCE 6. SUPERGHARGE MESSAGE P "Ss LOCAL AND OUTERWEAR DIGITAL - | = FLEXIBILITY AND AGILITY SUPPORT OUR PEOPLE AND COMMUNITIES BALANCE SHEET AND LIQUIDITY
Slide 21: Accelerate Mainland China
ACCELERATE MAINLAND CHINA DRIVE LOCAL RELEVANCE HERO NEW PRODUCT CONNECT WITH REPATRIATED CUSTOMERS
Slide 22: Focus on local consumer
-—— | it. | ome) Ge ——— ae = ~ | oo i ee ) Mm Lt 7 ‘e.™ FOCUS ON LOCAL CONSUMER % 4 = | PROGRAMME OF LOCALLY NEW FORMATS TO ENGAGE RELEVANT EVENTS LOCAL CONSUMERS 22
Slide 23: Grow leather and outerwear
GROW LEATHER AND OUTERWEAR REINFORCE LEATHER CONTINUE BUILDING DESIRE SUPPORT WITH BAGS AND GOODS ARCHITECTURE FOR OUTERWEAR OUTERWEAR-DEDICATED CALENDAR MOMENTS. ADAPT LUXURY STORE EXPERIENCE ry Detachable Sleeve Hooded Puffer Jacket “ Jame memusras age eee ofan SIZE: Size guide Women's Children's
Slide 24: Supercharge digital
SUPERCHARGE DIGITAL SHOP DISCOVER STEP-CHANGE INSPIRATION CURATED PRODUCT 24
Slide 25: Strong business foundation
STRONG BUSINESS FOUNDATION LOCAL EXECUTION CASH AND COST MANAGEMENT AGILITY AND OPERATIONAL EFFICIENCY DRIVING POSITIVE CHANGE KEY MESSAGES Strong strategic progress despite COVID Still a challenging period ahead, but clear plans in place to drive performance in the next 12-18 months 25
Slide 26: Disclaimer
DISCLAIMER The financial information contained in this presentation is unaudited. Certain statements made in this announcement are forward-looking statements. Such statements are based on current expectations and are subject to a number of risks and uncertainties that could cause actual results to d
Slide 27: FY2021 outlook
FY2021 OUTLOOK Lockdown impact Trading Retail space Non strategic store rationalisation PROFIT Cumulative cost savings Restructuring charges Cash cost of restructuring FX on adjusted operating profit No interim — FY2021 reviewed in May 7 LF * Spot rates at 30 October 2020, taking into account the cu
Slide 28: Alternative performance measures
ALTERNATIVE PERFORMANCE MEASURES APM. Description and purpose GAAP measure reconciled to Free Cash Flow Free cash flow is defined as net cash generated from operating activities less Net cash generated from operating activities: capital expenditure plus cash inflows from disposal of fixed assets and
Slide 29: Retail & wholesale revenue by region
RETAIL & WHOLESALE REVENUE BY REGION H1 FY2021 H1FY2020 YOY Growth YOY Growth Reported CER £860m £1,257m (32%) (31%) pecs (12%) (11%) APAC £439m (49%) (48%) EMEIA AMERICAS (37%) (35%) FOREIGN EXCHANGE RATES Euro 1.11 1.11 112 112 1.14 US Dollar 1.27 1.24 1.26 1.26 1.27 Chinese Renminbi 8.76 8.79 8.8
Slide 30: Adjusting items
ADJUSTING ITEMS Inventory impairments (recognised in COGS) 7 - Rent concessions 26 - Store impairments 23 - Receivable impairments 2 - COVID-19 related adjusting items 58 - Restructuring costs (22) (a) Revaluation of deferred consideration liability 1 - Adjusting operating items 37 (1) Adjusting fin
Slide 31: IR contacts
IR CONTACTS Julian Easthope VP, Investor Relations julian.easthope@burberry.com Stephanie Crinnegan Director, Investor Relations stephanie.crinnegan@burberry.com Sophie Parker Investor Relations Coordinator sophie.parker@burberry.com 31