Tokmanni Group Oyj · OMXHEX:TOKMAN

Tokmanni Group Oyj — H1 2016 Earnings Presentation

19 slides from Tokmanni Group Oyj's earnings presentation, Aug 10, 2016

  1. Slide 1: Half year financial report January-June 2016

    Half year financial report January-June 2016 CEO Heikki Väänänen & CFO Sixten Hjort

  2. Slide 2: Report Highlights – Good growth, profitability and cashflow

    Report Highlights – Good growth, profitability and cashflow Market outperformance continued – revenue grew 5.4% 2nd quarter Good LFL revenue growth LFL revenue • improved brand awareness with increasing grew 2.5% number of customers • investing in improving in-store experience pays off • successful

  3. Slide 3: Retail market remained challenging

    Retail market remained challenging  The total sales of department stores and hypermarket chains + 2.9% Q2/16, +1.1% in January-June 2016  Price competition remained strong, especially in the grocery retail market  The liberalization of opening hours reshuffled market structures slightly  Good we

  4. Slide 4: Store network development

    Store network development  Tokmanni had 157 stores at the end 625,000 map sources of June 2016 with potential to open at screened least 50 more Target areas of existing  So far 1 new store opened, 1 will be stores and white space defined opened in August and plans for 2 Relationship between reloca

  5. Slide 5: Short ramp up time of new stores – a profitable way to grow

    Short ramp up time of new stores – a profitable way to grow Store payback analysis for stores opened and relocated 2012-2013 New stores Relocations • All stores deliver positive EBITDA contribution during the first year of operations Number of store openings 4 10 • Rapid EBITDA ramp-up during the fi

  6. Slide 6: Tokmanni's revenue and profitability are subject to seasonality

    Tokmanni’s revenue and profitability are subject to seasonality 30,0 250,0 26,4 24,4 25,0 200,0 20,0 17,3 17,3 150,0 15,2 15,0 13,5 12,9 100,0 10,0 50,0 5,0 2,0 1,8 2,2 0,0 0,0 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Q2/2016 Revenue Adj. EBITDA 10.8.2016 TOKMANNI - Half Year Review Jan

  7. Slide 7: Market outperformance continued supported by like-for-like revenue growth

    Market outperformance continued supported by like-for-like revenue growth Revenue M€ 400 +4.4% 350.6 Good LFL revenue growth: 350 335.8 • improved brand awareness with increasing number of 300 customers • investing in improving in-store 250 experience pays off +5.4% 192.4 • successful seasonal sales

  8. Slide 8: Adjusted gross profit improved as a result of continuous development of sourcing and category management

    Adjusted gross profit improved as a result of continuous development of sourcing and category management Adj. Gross profit M€ 140 • Q2/ 2015 realized currency hedging impact +0.6 pp (1-6/15 120 +4.0%% +0.4 pp) 119,6 100 114,4 • Adjusted gross profit improved: 80 – Increased share of imports – Improv

  9. Slide 9: Adjusted Operating expenses increased slightly

    Adjusted Operating expenses increased slightly • Tight cost control continues • Increase mainly attributable to – new stores – extended opening hours • Operating expenses were impacted positively by Property, rents, – lower marketing expenses. Opex New stores and Extended Marketing Opex Marketing ex

  10. Slide 10: Profitability development supported by higher sales, improved gross margin and tight cost control

    Profitability development supported by higher sales, improved gross margin and tight cost control Adj. EBITDA M€ 20 Profitability improved due to 18 • revenue growth driven by increased 16 17,4 number of customers 14 15,2 14,7 • efficient new store opening 12 12,9 • increased share of imports 10 8 •

  11. Slide 11: The IPO impacted the company's capital structure

    The IPO impacted the company’s capital structure In connection with the IPO, Tokmanni refinanced its loans with better terms MEUR 30.6.2016 30.6.2015 31.12.2015 30.6.2016 30.6.2015 31.12.2015 EQUITY AND LIABILITIES ASSETS Equity attributable to the equity holders of the parent NON-CURRENT ASSETS com

  12. Slide 12: Strong cash flow from operating activities

    Strong cash flow from operating activities Highly cash generative business model Cash flows from operating activities 1-6/16 1-6/15 Low capex needs Net result for the financial period -2,0 -4,9 Adjustments: Non-cash items 7,3 8,2 Attractive new store Financial income 0,0 -0,2 economics Financial exp

  13. Slide 13: Market outlook

    Market outlook Challenging market conditions expected to Structural changes and deregulation in the continue Finnish retail market provide opportunities • Tokmanni expects the weak market • Liberation of opening hours conditions to continue or to improve (implemented) slightly in 2016 • Alcohol law

  14. Slide 14: Financial targets and dividend policy

    Financial targets and dividend policy Long-term financial targets Historical performance 2013 2014 2015 1. Low single Tokmanni Group’s long-term target is to achieve low single Low single digit like-for-like net sales growth assuming current market Tokmanni 0.0% (0.3%) (0.6%) digit digit conditions

  15. Slide 15: Short-term outlook unchanged despite good first half 2016

    Despite Tokmanni’s good performance during the first half 2016 and due to the market turbulence, Tokmanni has decided to leave its short-term outlook unchanged: Avg. 2013-2014 2015 2016 LFL growth (%) (0.2)% (0.6)% Flat LFL Net new stores ~14.6k sqm ~14.4k sqm c. 5 net new stores/relocations 3-4 net

  16. Slide 16: Appendix

    Appendix 10.8.2016 TOKMANNI - Half Year Review January-June 2016

  17. Slide 17: Adjustments affecting comparability

    Adjustments affecting comparability MEUR 4-6/2016 4-6/2015 1-6/2016 1-6/2015 1-12/2015 Changes in fair value of -0.6 1.5 0.1 1.0 0.6 currency derivatives Changes in fair value of -0.6 0.1 -0.2 0.2 0.3 electricity derivatives Brand harmonization - 0.6 - 2.1 3.5 costs IPO costs`* - - - - 0.2 10.8.2016

  18. Slide 18: Tokmanni has a clear strategic roadmap

    Tokmanni has a clear strategic roadmap Ongoing strategic initiatives provide solid growth and significant margin uplift potential Target Strategic initiative 1. LFL growth Low single • Continuous improvement of category management • Further development of brand image and marketing digit • Continuous

  19. Slide 19: Responsibility is part of the daily work of each member of Tokmanni's personnel

    Responsibility is part of the daily work of each member of Tokmanni’s personnel • Key corporate responsibility focus areas are  business integrity  responsible sourcing and products  fair treatment  efficient use of resources • In order to reach its goals, Tokmanni cooperates with among others B

Tokmanni Group — H1 2016 Earnings Presentation on 6ix