Bang & Olufsen A/s · OMXCOP:BO
Bang & Olufsen A/s — Q1 2023 Earnings Presentation
22 slides from Bang & Olufsen A/s's earnings presentation, Oct 10, 2022
Slide 1: Q1 2022/23 Webcast presentation
October 2022 Q1 2022/23 Webcast presentation
Slide 2: Disclaimer
Disclaimer This presentation does not constitute or form part of and should not be construed as an offer to sell or issue or the solicitation of an offer to buy or acquire securities issued by Bang & Olufsen a/s in any jurisdiction, including the United States of America, Canada, Australia, Japan or
Slide 3: Agenda
Agenda # Key Highlights and Strategy Update # Financial Performance in Q1 # Outlook # Q&A
Slide 4: Key Highlights and Strategy Update
Key Highlights and Strategy Update
Slide 5: Challenging macroeconomic environment continued in Q1 22/23. Outlook maintained but uncertainty remains high
Challenging macroeconomic environment continued in Q1 22/23. Outlook maintained but uncertainty remains high Q1 Outlook 2022/23 FY 2022/23 • Robust demand driven by travel and outdoor-related On-the-go products. Like-for-like sell-out adversely Revenue -10% -4% to 5% impacted by regional lockdowns i
Slide 6: Robust demand reflecting return to normal seasonality except for China
Robust demand reflecting return to normal seasonality except for China, which was still impacted by regional lockdowns Regions Product Categories • EMEA: Sell-out driven by company -2% -3% EMEA Staged owned stores, multibrand and etail with sales moving to travel and outdoor -9% related On-the-go pr
Slide 7: Expanding customer base and brand awareness with Balenciaga collaboration
Expanding customer base and brand awareness with Balenciaga collaboration as a key driver 6% Customer Successful product collaborations • Limited edition of Beosound Explore with Supreme Growth* • Limited edition Speaker Bag unveiled at Balenciaga 51st Couture show in Paris and Bang & Olufsen reache
Slide 8: Beosound Theatre redefining the soundbar category
Beosound Theatre redefining the soundbar category • Most powerful soundbar in the market, bring the home cinema into the living room in one product • Based on our Mozart product platform that enables connectivity with products from the past, present and futures • Most modular product ever built with
Slide 9: Adjusting to the macroeconomic headwinds
Adjusting to the macroeconomic headwinds Hiring Freeze Phasing investments Production forecast lowered to ensure an efficient inventory development Prioritising activities towards key segments 9|
Slide 10: Prioritising our activities towards core segments
Prioritising our activities towards core segments City strategy US as a core market Enterprise HNWI and Gen Z - Building on Win London - Several US cities are ranking - New products - Target marketing high on the segmentation - Adding New York and Paris - Teams and Zoom - Expanding digital and servi
Slide 11: Financial Performance in Q1
Financial Performance in Q1
Slide 12: Revenue in Q1 declined due to lower product sales, partly offset by brand partnering
Revenue in Q1 declined due to lower product sales, partly offset by strong performance from brand partnering Regional product revenue DKKm -16%* DKKm -10%* 606 666 520 Regional product sales declined 16%* 612 406 362 • Lockdowns in China, impacting sales and consumer confidence • Retail partners red
Slide 13: Regional product sales impacted by lockdowns and inventory reductions
Regional product sales impacted by lockdowns and inventory reductions EMEA Americas Asia DKKm DKKm DKKm -22%* -6%* 302 63 -12%* EMEA: 239 60 244 • Decline across all channels 204 218 179 • Staged and Flexible Living declined Regions 35 most, impacted by normalisation of 33 169 148 seasonality and in
Slide 14: Margins impacted by component costs and a large On-the-go deal
Margins impacted by component costs and a large On-the-go deal % Gross margin % EBIT margin bsi* -15.5pp -8.2pp 1.4% 44.8% 42.8% 36.7% 36.6% -8.5% -14.1% -30.8% 19/20 20/21 21/22 22/23 19/20 20/21 21/22 22/23 Q1 Q1 14 | *Before special items
Slide 15: Gross margin decline mainly driven by component costs and one On-the-go deal
Gross margin decline mainly driven by component costs and one On-the-go deal 15 |
Slide 16: Capacity costs increase mainly driven by marketing activities
Capacity costs increase mainly driven by marketing activities Capacity costs Development costs Distribution & marketing costs Administrative costs DKKm DKKm DKKm DKKm -12% 12% 13% 6% 231 236 37 225 35 78 34 34 205 340 70 69 31 332 67 183 326 64 309 292 > 11.7% 8.3% 9.0% 9.2% 11.3% 27.5% 28.6% 30.5%
Slide 17: Free cash flow impacted by the decline in sales and a return to normal seasonality
Free cash flow impacted by the decline in sales and a return to normal seasonality Free cash Flow Net working capital CAPEX Capital resources DKKm DKKm % of LTM revenue DKKm DKKm 21 Intangible 335 325 Tangible 688 93 614 591 76 19 217 -62 433 191 187 27 58 -81 > 54 12 337 18 74 26 11.4% 11.2% 4 49 4
Slide 18: Outlook
Outlook
Slide 19: Outlook 2022/23 maintained, subject to unusually high uncertainty
Outlook 2022/23 maintained Subject to unusually high uncertainty Outlook Main assumptions ▪ China expected to see gradual normalisation in Q2 ▪ Launching more than five product innovations, including re-launch of Revenue growth Beosound Emerge in the remainder for the year -4% to 5% in local currenc
Slide 20: Summary, robust demand but challenging macroeconomics
Summary, robust demand but challenging macroeconomics • Robust demand in Q1, except for China, which was impacted by lockdowns • We continue to see growth in our customer base and in repeat purchases • Financial performance impacted by lockdowns, lower inventories with partners and higher costs • We
Slide 21: Q&A
Q&A
Slide 22: Investor Relations Contact
INVESTOR RELATIONS CONTACT Martin Egenhardt +45 53707439 mare@bang-olufsen.dk 22 |