Douglas Ag · XETR:DOU

Douglas — Debt Investor Presentation (February 2024)

36 slides from Douglas's debt investor presentation, Feb 22, 2024

  1. Slide 1: Operational & Financial Results Q1 FY 2023/24

    OPERATIONAL & FINANCIAL RESULTS Q1 | FY 2023/24 Düsseldorf, 22 February2024

  2. Slide 2: Today's Speakers

    TODAY‘S SPEAKERS SANDER VAN DER LAAN MARK LANGER CEO DOUGLAS GROUP CFO DOUGLAS GROUP 2

  3. Slide 3: Agenda

    AGENDA 01 BUSINESS HIGHLIGHTS 4 02 Q1 FINANCIALS 8 03 STRATEGY UPDATE 19 04 WRAP UP & Q&A 26 3

  4. Slide 4: Business Highlights

    CHAPTER – 01 BUSINESS HIGHLIGHTS

  5. Slide 5: Q1 Success

    Q1 SUCCESS OMNICHANNEL INCREASED STRATEGY SUCCESS PROFITABILITY „LET IT BLOOM“ WELL ON TRACK E-Com sales (net): Adjusted EBITDA: +10.7% +12.6% to €348.3m Strategic initiatives with Store sales (net): Adj. EBITDA margin: significant progress +6.7% +0.9ppt to 22.4% in all four pillars 5

  6. Slide 6: Strong Christmas Sales Period

    STRONG CHRISTMAS SALES PERIOD Omnichannel success with customer events − First quarter included Singles‘ Day, Beauty (Black) Friday & Christmas − Final shopping days of 2023: highest number of customers in stores, demand for personal advice − High demand in E-Com: Peak times during Black Friday: DOU

  7. Slide 7: Further Increase in Sales and Profitability

    FURTHER INCREASE IN SALES AND PROFITABILITY Strong net sales, faster growth in adjusted EBITDA & margin NET SALES ADJUSTED EBITDA2 in m€ 1,556 in m€ 1,441 1 +8.0% 348 309 +12.6% +7.5% lfl 21.5% 22.4% MARGINS Q1 2022/23 Q1 2023/24 Q1 2022/23 Q1 2023/24 − Ongoing strong sales momentum as customers con

  8. Slide 8: Q1 Financials

    CHAPTER – 02 Q1 FINANCIALS

  9. Slide 9: DACHNL Q1 2023/24

    DACHNL Q1 2023/24 Solid net sales development in both channels NET SALES ADJUSTED EBITDA1 − Net sales increase driven by +5.2% (+4.3% lfl) growth in Store in m€ in m€ business and +11.6% E-Com 688 sales 638 +7.8% − Net sales increase in Stores due to significantly higher footfall as well as higher b

  10. Slide 10: France Q1 2023/24

    FRANCE Q1 2023/24 Net sales growth with slightly lower EBITDA margin NET SALES ADJUSTED EBITDA1 − Net sales increase driven by +2.8% (+2.3% lfl) growth in Store in m€ in m€ business, E-Com grew by +4.2% 325 335 +3.1% − Higher footfall although lower conversion rate, larger basket sizes with higher n

  11. Slide 11: Southern Europe Q1 2023/24

    SOUTHERN EUROPE Q1 2023/24 Ongoing net sales in stores growth translated into higher adj. EBITDA NET SALES ADJUSTED EBITDA1 − Net sales increase driven by +7.7% (+7.6% lfl) growth in in m€ in m€ Stores and -7.5% in E-Com 234 222 +5.4% business − Net sales increase in Stores due to significantly high

  12. Slide 12: Central Eastern Europe Q1 2023/24

    CENTRAL EASTERN EUROPE Q1 2023/24 Very strong net sales growth and ongoing margin uplift NET SALES ADJUSTED EBITDA1 − Net sales increase driven by +17.7% (+14.4% lfl) growth in in m€ in m€ Stores and +20.2% in E-Com 226 +18.3% − Net sales increase from 191 significantly higher footfall in higher num

  13. Slide 13: Parfumdreams/Niche Beauty Q1 2023/24

    PARFUMDREAMS/NICHE BEAUTY Q1 2023/24 Highest net sales growth for the online beauty businesses NET SALES ADJUSTED EBITDA1 − Strong growth in active customers, both driven by new in m€ in m€ customers and through higher 63 retention rates due to the +26.0% improvement in the customer experience 50 −

  14. Slide 14: Omnichannel Growth Fueled by Both Channels

    OMNICHANNEL GROWTH FUELED BY BOTH CHANNELS Net sales Q1 2023/24 GROUP STORES E-COM in m€ in m€ in m€ − Significantly increased footfall and number of − E-Com continues to grow for the 6th consecutive 1,556 1 customers as well as expanded store network quarter 1,441 +8.0% by 17 net new stores − More

  15. Slide 15: P&L – KPIs Significantly Improved

    P&L – KPIS SIGNIFICANTLY IMPROVED Q1 2023/24 in m€ Q1 2022/23 Q1 2023/24 ∆% Net sales 1,440.6 1,555.5 8.0% Cost of raw materials, consumables and -807.1 -861.9 -6.8% supplies and merchandise Main reasons: Store expansion, Gross profit 633.5 693.6 9.5% increased bonus accruals, higher wages, higher m

  16. Slide 16: DIO Stable; Focus on Store Capex

    DIO STABLE; FOCUS ON STORE CAPEX As of 31 December 2023 AVERAGE NET WORKING CAPITAL CAPEX in m€ 230 in m€ 173 +33.2% 19 +25.9% 15 Average NWC as % of 4.5% 5.5% net sales 1 31.12.2022 31.12.2023 Q1 2022/23 Q1 2023/24 − Higher inventory to avoid out of stocks in the peak season − Most capital expendit

  17. Slide 17: Free Cash Flow Improved

    FREE CASH FLOW IMPROVED Q1 2023/24 Especially from VAT, severance payment in m€ provisions and bonus accruals 474 459 -15 100 348 -12 -26 64 Adj EBITDA CAPEX 1 Working Capital ² TAX Others ³ Adj FCF 5 EBITDA Adjustments Free Cash Flow 5 (Cash effect) 4 Q1 2022/23 309 -28 65 -9 78 415 -13 402 1 Excl.

  18. Slide 18: Significant Reduction in Leverage Ratio

    SIGNIFICANT REDUCTION IN LEVERAGE RATIO As of 31 December 2023 AVAILABLE LIQUIDITY in m€ +5.6% 714 676 161 €9.0m used or 160 (RCF) reserved for rental (RCF) guarantees (PY: TOTAL NET LEVERAGE1 ADJUSTED EBITDA LTM2 €10.4m) in m€ 4.8 765 4.0 647 517 553 (cash) (cash) Dec-22 Dec-23 Dec-22 Dec-23 Dec-22

  19. Slide 19: Strategy Update

    CHAPTER – 03 STRATEGY UPDATE

  20. Slide 20: Implementation of Strategy Well on Track

    IMPLEMENTATION OF STRATEGY WELL ON TRACK Several landmark decisions and milestones reached Deliver most Be the #1 BEAUTY Offer most relevant Build focused customer friendly DESTINATION and distinctive and efficient OMNICHANNEL in all our markets RANGE OF BRANDS OPERATING MODEL experience Brand Commu

  21. Slide 21: Store Network Expansion Program

    STORE NETWORK EXPANSION PROGRAM Extensive opening and refurbishment plan − Program launched to develop and expand store network; crucial element of the „Let it Bloom“ strategy − Decisive adjustments to store network until 2025/26: + 200 store + 400 store openings*, focus refurbishments* CEE (~40%) −

  22. Slide 22: Sustainability Report FY 2022/23

    SUSTAINABILITY REPORT FY 2022/23 Updated strategy & goals − New Sustainability Report for the FY 2022/23 published in early February, including an updated and more ambitious sustainability strategy in line with „Let it Bloom“ − Ambitious goals in three key focus areas: − People: Create a workplace c

  23. Slide 23: Corporate Branding

    CORPORATE BRANDING

  24. Slide 24: We Are a Leading Beauty Retail Group

    WE ARE A LEADING BEAUTY RETAIL GROUP Uniting four extraordinary beauty retail brands 24

  25. Slide 25: Decision for New Corporate Branding

    DECISION FOR NEW CORPORATE BRANDING DOUGLAS Group brand reflects positioning as leading international premium beauty retail group 25

  26. Slide 26: Wrap-Up + Q&A

    CHAPTER – 04 WRAP-UP + Q&A

  27. Slide 27: Summary

    SUMMARY − DOUGLAS Group continues growth trajectory and enters the FY 2023/24 with very good results for the first quarter − Very successful peak season (October – December) − Tenth consecutive quarter with Group sales (net) growth: +8.0% to €1.56bn, driven by all segments and channels − Continued o

  28. Slide 28: DOUGLAS Group

    DOUGLAS GROUP

  29. Slide 29: Appendix

    APPENDIX

  30. Slide 30: Adjustments to EBITDA

    ADJUSTMENTS TO EBITDA Q1 2023/24 in m€ Q1 2022/23 Q1 2023/24 Reported EBITDA 296.3 318.4 Consulting fees1 1.2 7.8 Strategic projects Restructuring costs2 2.2 -0.6 PPA -0.1 -0.1 COVID-19 -0 -0 Release of unused provisions SOP3 1.0 -2.7 Other 8.9 25.6 Mainly litigation risk provision Adjusted EBITDA 3

  31. Slide 31: Selected Segmental KPIs

    SELECTED SEGMENTAL KPIS Q1 2023/24 REPORTED EBITDA CAPEX In m€ Q1 2022/23 Q1 2023/24 In m€ Q1 2022/23 Q1 2023/24 DACHNL 145.0 153.7 DACHNL 3.0 6.8 France 82.8 83.4 France 2.3 2.8 Southern Europe 56.3 67.8 Southern Europe 1.1 1.9 Central Eastern Europe 57.8 69.7 Central Eastern Europe 1.5 3.5 NB/PD 4

  32. Slide 32: Deep Dive into LFL Net Sales Development

    DEEP DIVE INTO LFL NET SALES DEVELOPMENT Quarterly Overview Q1 2022/23 Q2 2022/23 Q3 2022/23 Q4 2022/23 Q1 2023/24 DACHNL 15.8% 24.8% 10.9% 9.3% 7.2% France 2.1% 9.8% 4.8% 6.4% 2.8% Southern Europe 17.2% 19.9% 14.3% 4.7% 5.1% Central Eastern Europe 25.5% 31.5% 15.1% 17.0% 15.8% NB/PD 10.0% 4.4% 23.0

  33. Slide 33: Development of Net Working Capital

    DEVELOPMENT OF NET WORKING CAPITAL As of 31 December 2023 257 251 205 in m€ 149 66 NWC as % of X% LTM net sales 1.7% 6.5% 6.2% 5.0% 3.5% Q1 2022/23 Q2 2022/23 Q3 2022/23 Q4 2022/23 Q1 2023/24 Inventory 734.3 774.4 737.9 762.6 794.7 Trade accounts receivable 91.5 68.6 71.3 61.0 116.6 Trade accounts p

  34. Slide 34: Cash Flow Statement

    CASH FLOW STATEMENT Q1 2023/24 In m€ Q1 2022/23 Q1 2023/24 Deviation to bond report as we Net cash flow from operating activities 430.4 485.0 regard money market funds as cash equivalent (€210.2m as of 31 Dec 22) Net cash flow from investing activities -28.1 -25.6 Free cash flow 402.3 459.4 Net cash

  35. Slide 35: Cash and Financial Debt Structure

    CASH AND FINANCIAL DEBT STRUCTURE As of 31 December 2023 in m€ m€ x Adj. EBITDA2 Maturity Pricing Cash and cash equivalents 553 RCF (€170m Volume) 0 Jan 26 E+4.50% €9.0m used or reserved for rental guarantees (PY: €10.4m) E+5.25% Term Loan B (B3/B-/B) 669 Apr 26 (99% OID) Senior Secured Notes (B3/B-

  36. Slide 36: Store Network Across Europe

    STORE NETWORK ACROSS EUROPE As of 31 December 2023 NUMBER OF STORES DEVELOPMENT 1,850 1,867 30 September 2023 – Franchise 132 131 31 December 2023 Store openings 19 Store closures -2 Total 17 own 1,718 1,736 Store openings: 4 stores in DACHNL (A, CH), 1 in France, 4 in South Europe (IT, SI) and 10 C

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