Burberry Group plc · LSE:BRBY
Burberry — H1 2016/17 Earnings Presentation
14 slides from Burberry's earnings presentation, November 2016
Slide 1: Interim Results for the Six Months Ended 30 September 2016
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2016 1
Slide 2: Introduction, Financial Review, Five Key Strategies, Questions
CHRISTOPHER BAILEY — CHIEF CREATIVE AND CHIEF EXECUTIVE OFFICER introduction — FINANCIAL REVIEW — Five key strategies — September show and Festive — QUESTIONS 2
Slide 3: Financial Highlights
CAROL FAIRWEATHER — CHIEF financial OFFICER FINANCIAL HIGHLIGHTS CHANGE SIX MONTHS TO 30 SEPTEMBER 2016 2015 UNDERLYING REPORTED £M £M FX REVENUE 1,159 1,105 (4%) 5% ADJUSTED PBT 146.2 152.9 (24%) (4%) ADJUSTED DILUTED EPS 24.4 26.0p (6%) NET CASH 529 459 DIVIDEND PER SHARE 10.5p 10.2p 3% 3
Slide 4: Revenue down 4% underlying; adjusted operating profit down 24%
REVENUE down 4% UNDERLYING £99m £13m (£44m) (£14m) £1,159m £1,105m H1 2015 EXCHANGE RETAIL WHOLESALE LICENSING H1 2016 RATES REVENUE ADJUSTED OPERATING PROFIT down 24% UNDERLYING £29.3m (£24.8m) £151.7m (£11.7m) £144.5m H1 2015 EXCHANGE RETAIL/WHOLESALE LICENSING H1 2016 RATES ADJUSTED OPERATING PRO
Slide 5: Retail/Wholesale
RETAIL/WHOLESALE SIX MONTHS TO 30 SEPTEMBER 2016 2015 £M £M CHANGE RETAIL/WHOLESALE REVENUE 1,145.7 1,078.4 6% GROSS MARGIN 782.2 740.5 AS % OF REVENUE 68.3% 68.7% (40bp) OPERATING EXPENSES (648.7) (610.8) AS % OF REVENUE (56.6%) (56.7%) 10bp ADJUSTED OPERATING PROFIT 133.5 129.7 3% AS % OF REVENUE
Slide 6: Licensing
LICENSING SIX MONTHS TO 30 SEPTEMBER 2016 2015 £M £M REVENUE 12.8 26.1 GROSS MARGIN AT 100% 12.8 26.1 OPERATING EXPENSES (1.8) (4.1) OPERATING PROFIT 11.0 22.0 OPERATING MARGIN 85.9% 84.3% £/YEN RATE 176 175 2016 INCLUDES POSITIVE FX IMPACT OF £0.7M IN REVENUE AND GROSS MARGIN AND NIL IN OPEX licens
Slide 7: Income Statement
INCOME STATEMENT SIX MONTHS TO 30 SEPTEMBER 2016 2015 £M £M ADJUSTED OPERATING PROFIT 144.5 151.7 NET FINANCE CREDIT 1.7 1.2 ADJUSTED PROFIT BEFORE TAX 146.2 152.9 ADJUSTING ITEMS (44.2) 1.8 PROFIT BEFORE TAX 102.0 154.7 TAX (28.9) (33.7) NON-CONTROLLING INTEREST (1.1) (1.5) ATTRIBUTABLE PROFIT 72.0
Slide 8: Cash Inflow from Operations
CASH INFLOW FROM OPERATIONS SIX MONTHS TO 30 SEPTEMBER 2016 2015 £M £M ADJUSTED OPERATING PROFIT 144.5 151.7 RESTRUCTURING SPEND (9.3) - DEPRECIATION AND AMORTISATION 69.4 63.1 EMPLOYEE SHARE SCHEME COSTS 5.3 3.3 (INCREASE) IN INVENTORIES (60.9) (42.9) DECREASE/(INCREASE) IN RECEIVABLES 24.6 (2.1) (
Slide 9: Movement in Net Cash
MOVEMENT IN NET CASH £182m (£65m) (£43m) (£69m) £660m (£119m) (£32m) £15m £529m MAR 2016 OPERATING TAX CAPITAL PAYMENTS FOR DIVIDENDS BUYBACK OTHER SEP 2016 CASHFLOW EXPENDITURE NCI NET CASH MOVEMENT IN NET CASH SIX MONTHS TO 30 SEPTEMBER 2016 2015 £M £M CASH INFLOW FROM OPERATIONS 181.9 167.4 PAYME
Slide 10: FY 2017 Outlook
FY 2017 OUTLOOK RETAIL Low single-digit % growth in retail revenue from net new space WHOLESALE Down mid-teens % at constant FX in H2. Trends in both fashion and Beauty similar to H1 RETAIL/WHOLESALE PROFIT If exchange rates remain at current levels*, c. £125m benefit to reported profit compared to
Slide 11: Five Key Strategies: Progress in the Half
CHRISTOPHER BAILEY — CHIEF CREATIVE AND CHIEF EXECUTIVE OFFICER FIVE KEY STRATEGIES progress in the half PRODUCT PRODUCTIVE E-commerce Operational Inspired FOCUS SPACE Leadership Excellence People • Building a strategic approach • Increasing investment in • Launched redesigned website • Increasing e
Slide 12: Appendix: Disclaimer
APPENDIX DISCLAIMER Certain statements made in this presentation are forward-looking statements. Such statements are based on current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from any expected future results in forward-l
Slide 13: Adjusted Measures
ADJUSTED MEASURES All metrics and commentary in this presentation are at reported FX and exclude adjusting items unless stated otherwise. Adjusting items are: • A £26.1m charge in reported operating expenses relating to the fragrance and beauty licence intangible asset (H1 2015/16: £7.5m) • A £12.8m
Slide 14: Exchange Rates and IR Contacts
Exchange rates FORECAST FULL YEAR AVERAGE RATES FOR FY 2016/17 AVERAGE EXCHANGE RATES 31 October 30 September FY H1 H1 £1= 2016 2016 2015/16 2016/17 2015/16 EURO 1.16 1.19 1.36 1.22 1.39 US DOLLAR 1.29 1.33 1.50 1.37 1.54 CHINESE YUAN RENMINBI 8.54 8.85 9.57 9.08 9.62 HONG KONG DOLLAR 9.98 10.34 11.