Slide 1: Initial July and 2Q20 Numbers
INITIAL JULY AND 2Q20 NUMBERS AUGUST 5, 2020
Slide 2: Disclaimer
DISCLAIMER This presentation (the "Presentation") was prepared by VRG S.A. (the presented in this document. Many of those factors are beyond the "Company") with a due care. Still, it may contain certain inconsistencies or awareness and control of the Company and the Capital Group or the omissions. T
Slide 3: Sales Results
01 SALES RESULTS
Slide 4: Actions Supporting Revenues
ACTIONS SUPPORTING REVENUES Support for on-line … Higher outlays for Streamlining of on-line traffic. on-line logistics. … and off-line stores Promotions to attract Focus on higher customers to stores in conversion in stores May and June. in July. 4 | Initial July and 2Q20 numbers
Slide 5: COVID-19 Impact on Revenues
COVID-19 IMPACT ON REVENUES 169% 102% 82% 59% 1 34% E-stores of our brands operate and 14% 17% record high sales growths, despite 10% -8% 0% E-stores opening of traditional stores. Weaker MoM dynamics due to 9% -35% -42% 9% 10% -65% -4% rebound of sales in the traditional channel. -17% -52% 2 -63% -
Slide 6: Revenues Above Base Case Scenario
REVENUES ABOVE BASE CASE SCEARIO Shopping malls Gradual recovery from closed by 4th May revenue fall 10% 9% 0% -8% -10% -10% -10% -10% -10% -35% -42% Possible loss of more than -65% 20% of retail sales. Previous assumptions -80% -50% -30% -20% I.20 II.20 III.20 IV.20 V.20 VI.20 VII.20 VIII.20 IX.20
Slide 7: Stable Group Revenues
STABLE GROUP REVENUES Group revenues PLN 85.2m JULY 2020 0.2% YoY Group’s gross profit margin: Apparel segment revenues PLN 48.6m 49.6% - 0.6pp. -5.0% YoY Key trends - faster recovery of demand in the jewellery segment than in the apparel Jewellery segment segment, revenues - focus on conversion due
Slide 8: Costs and Liquidity
VISTULA WOLCZANKA BYTOM WKRUK —_DENICLER 02 COSTS AND LIQUIDITY
Slide 9: Stabilising Actions
STABILISING ACTIONS Cost reductions: Working capital Maintaining HR, rentals, improvements liquidity marketing 01 02 03 9 | Initial July and 2Q20 numbers
Slide 10: Actions Towards HR and Rental Costs
ACTIONS TOWARDS HR AND RENTAL COSTS HR COSTS RENTAL COSTS - May and June: holiday use, impact - Successfully renegotiated rents for of subsidies and salary reduction. 90% of the Group's floorspace. - July: extension of 4/5 of working - Negotiations on the remaining time in stores of apparel brands,
Slide 11: Safe Liquidity Position
SAFE LIQUIDITY POSITION WORKING CAPITAL INDEBTEDNESS Secured current financing: - extension of multi-purpose loan - Reduction of Autumn/Winter agreements with PKO BP for 2 orders by 30% in the apparel years, segment and 20% in the jewellery - the total value of financing from segment. PKO BP for all
Slide 12: Preliminary 2Q20 Results
03 PRELIMINARY 2Q20 RESULTS
Slide 13: Preliminary 2Q20 Results
PRELIMINARY 2Q20 RESULTS PLN m, IFRS16 2Q19 2Q20 YoY Revenues 270.2 174.9 -35% Estimated 2Q20 gross profit on sales margin in EBITDA 56.7 18.4 -68% came in at c. 46.9% and was some 6.6 pp. lower than in 2Q19 due to higher YoY promotions EBIT 28.6 -10.4 N/M caused by the COVID-19 pandemic. Net income
Slide 14: Preliminary 1H20 Results
PRELIMINARY 1H20 RESULTS PLN m, IFRS16 1H19 1H20 r/r Revenues 484.6 372.3 -23% Estimated gross profit on sales margin in H120 EBITDA 81.4 35.8 -56% amounted to c. 47.3% and was some 4.2 pp. lower than in 1H19 due to higher YoY EBIT 27.3 -22.3 N/M promotions caused by the COVID-19 pandemic. Net incom
Slide 15: IR Actions
04 IR ACTIONS
Slide 16: Upcoming IR Events
UPCOMING IR EVENTS 26th August before market opens Publication of 2Q20 results along with supplementary materials 26th August during the trading session - Videoconference on 2Q20 results - Similar level of detailed disclosure as in past presentations 1st week of September - Publication of preliminar
Slide 17: Persons to Contact
PERSONS TO CONTACT regarding operational issues (current brands’ functioning) Mr Radosław Jakociuk Vice-President, Management Board Member e-mail: Radoslaw.Jakociuk@vrg.pl regarding financial matters Mr Ernest Podgórski Supervisory Board Member delegated to temporary perform duties of Management Boa
Slide 18: Q&A
05 Q&A
Slide 19: Thank You
THANK YOU VRG S.A. Pilotów 10 St. 31-462 Cracow