Dfi Retail Group Holdings Limited · SGX:D01

Dfi Retail — Dairy Farm International Holdings — H1 2015 Earnings Presentation

21 slides from Dfi Retail's earnings presentation, Jul 31, 2015

  1. Slide 1: 2015 Interim Results Presentation

    2015 Interim Results Presentation 31st July, 2015

  2. Slide 2: Presentation Disclaimer

    1 Presentation Disclaimer This Document (the “Document”) is for information purposes only. This Document is not intended to form the basis of any investment decision nor does it constitute a recommendation or advice as to how the reader should act on any matter. The information in this Document is a

  3. Slide 3: Sales Solid but Margin Pressure Has Hit Profits

    2 Sales Solid but Margin Pressure Has Hit Profits • Sales of continuing businesses up 3%, up 7% in constant currency • Ongoing margin pressures in Food and in Health and Beauty • Underlying profit 14% lower • Key transactions completed: Yonghui, San Miu, Malaysia sell down • IT infrastructure develo

  4. Slide 4: Underlying Net Profit of $193m or 14.25¢ per Share

    3 Underlying Net Profit of $193m or 14.25¢ per Share Constant (US$ m) 1H2015 1H2014 Change Currency % Sales of Continuing Businesses1 6,495 6,312  3%  7 Operating Profit 2 202 245  18%  15 Underlying Net Profit 193 224  14%  12 Underlying EPS (US¢) 14.25 16.56  14%  12 Dividend Per Share (US

  5. Slide 5: Sales Positive across All Business Segments…

    4 Sales Positive across All Business Segments… SALES Constant (US$ m) 1H2015 1H2014 Change % Currency % Food 4,087 4,132  1  4 Supermarkets & Hypermarkets 3,168 3,228  2  4 Convenience Stores 919 904  2  3 Health and Beauty 1,284 1,185  8  11 Home Furnishings 271 226  20  23 Restaurants 85

  6. Slide 6: …but Rising Costs Have Pinched Operating Margins

    5 …but Rising Costs Have Pinched Operating Margins 2 OPERATING PROFIT Margin (US$ m) 1H2015 1H2014 Change Food 112 148  1.1 pts Supermarkets & Hypermarkets 86 117  1.2 pts Convenience stores 26 31  0.5 pts Health and Beauty 89 97  0.9 pts Home Furnishings 26 20  0.9 pts 227 265  0.9 pts Suppor

  7. Slide 7: Supermarkets & Hypermarkets Segment Remains Highly Competitive

    6 Supermarkets & Hypermarkets Segment Remains Highly Competitive  Good LFL growth in Malaysia  Strong LFL in Indonesia  LFL flat in Singapore  Slower sales growth in Hong Kong  Fresh participation up 50 basis points  9 category brands, 308 SKUs; category brand sales up 18%  Margins under pres

  8. Slide 8: Market Leading Private Label Program to Support Growth

    7 Market Leading Private Label Program to Support Growth

  9. Slide 9: Convenience Stores Performance Mixed

    8 Convenience Stores Performance Mixed  Solid sales and profit growth in Hong Kong  Continuing growth momentum in China  Weaker results in Singapore  Ready-To-Eat participation up 40 basis points  Branded coffee now available in all 3 markets  Single store daily sales record of 1,500+ soft ice

  10. Slide 10: Health and Beauty Hit by Weakness in Malaysia

    9 Health and Beauty Hit by Weakness in Malaysia  Hong Kong sales resilient  Good sales growth in Indonesia, Singapore and China  Malaysia sales disappointing  Integration of Rose Pharmacy underway  8 category brands available with 206 SKUs, up by 41% in 1H2015  Margin erosion most acute in Mal

  11. Slide 11: Building Private Label Presence in Health and Beauty Too

    10 Building Private Label Presence in Health and Beauty Too 8 brands 206 SKUs

  12. Slide 12: Home Furnishings Results Very Encouraging

    11 Home Furnishings Results Very Encouraging  Solid sales growth in Hong Kong  Strong growth in Taiwan  Indonesia ahead of target  New kitchen range launched in June  Strong performance in Market Hall and Food  Margin benefits from supply chain  Planning second site in Indonesia  Additional

  13. Slide 13: Maxim’s Performance Again Solid

    12 Maxim’s Performance Again Solid  Further growth in Hong Kong  Strong performance and continued growth in China  Starbucks in Vietnam now at 15 stores  No. 1 Mooncake company in Hong Kong for 17 consecutive years  The Cheesecake Factory to open in Shanghai by first half of 2016  New food pro

  14. Slide 14: A Shared Vision with Yonghui

    13 A Shared Vision with Yonghui  Completion of investment in April  Business performance solid in a challenging market  Strong shared commitment to business partnership − Fresh into Singapore, Philippines, Malaysia − Sharing of international suppliers − Potential on Private Label and GMS − Mannin

  15. Slide 15: San Miu Strengthens Macau

    14 San Miu Strengthens Macau  Dairy Farm acquired 100% of San Miu in March  Market leader in Macau with 15 stores  Integration progressing well − Corporate brands launched in San Miu in May − Introduced more than 50 SKUs from Hong Kong − Expanded fresh offerings to more stores

  16. Slide 16: Making Good Progress on Strategic Priorities

    15 Making Good Progress on Strategic Priorities Strategic Priority Recent Developments • H&B: Offer launched in Singapore E-commerce • Food: Enhancing current offers • SAP system implementation completed in China IT Infrastructure • Stock ordering system implemented • Increased focus on direct sourc

  17. Slide 17: Profit & Loss Account

    16 Profit & Loss Account (US$ m) 1H2015 1H2014 Change % Sales - Including Associates & JVs 8,011 6,312  27% - Subsidiaries 5,593 5,299  6% Operating Profit1 202 245  18% Non-trading items (1) 11 Share of Results of Associates and JVs 32 22  47% Net Finance (Charge) / Income (6) 1 Profit Before T

  18. Slide 18: Balance Sheet

    17 Balance Sheet 30/06/2015 31/12/2014 (US$ m) Intangible Assets 743 566 Property 518 520 Other Fixed Assets 644 701 Associates and Joint Ventures 1,323 388 Net Working Capital (1,077) (1,027) Net (Debt) / Cash (589) 475 Others (108) (100) Total Equity 1,454 1,523 Trade Creditors to Stock Ratio 1.6x

  19. Slide 19: DF Group Cash Flow

    18 DF Group Cash Flow (US$ m) (71) 315 (147) 800 (1,009) 600 400 200 475 0 (200) (223) (589) (400) (600) (800) 2014 Operating CF Normal capex Net Investment Dividends 1H2015 Net Cash Net Debt

  20. Slide 20: Normal Capex

    19 Normal Capex US$147m (1H2014: US$184m) Group IT / Admin 7% Supply chain / others 11% Home Furnishings 4% H&B 13% IT 12% Store Refurbishment 22% Food 76% New Stores 55% By Format By Type

  21. Slide 21: Outlook

    20 Outlook • Expect new investments to make important contribution • Clear commitment to customer centric business model • Increased focus on exploiting benefits of scale • Continuing headwinds but building a strong platform to compete for the long-term

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