Future Lifestyle Fashions Ltd. · NSE:FLFL
Future Lifestyle Fashions — Non-Deal Roadshow (May 2017)
55 slides from Future Lifestyle Fashions's roadshow presentation, May 2017
Slide 1: FLF Asia Road Show May 2017
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Slide 2: Disclaimer
Disclaimer This report contains forward-looking statements, which may be identified by their use of words like ‘plans’, ‘expects’, ‘will’, ‘anticipates’, ‘believes’, ‘intends’, ‘projects’, ‘estimates’, or other words of similar meaning. All statements that address expectations or projections about t
Slide 3: Index
Index Future Group overview 4 Investment proposition 7 Company overview 11 Future Lifestyle Fashion Brands 22 Future Lifestyle Fashion Retail 32 Investee Brands 39 Financials 46 Outlook 50 Technological architecture 52 Appendix 53
Slide 4: Future Group in Numbers
Future Group in Numbers Key facts & figures The Foremost Player Catering to the “Consumption Sector” in India Total Revenue `23,000 cr+ Market Cap Increase Retail Footprint 643% (01 Apr 14 to 18 Apr 17) ~ 1,300 Stores Total Area Customer Footfalls Cities Present 20 mn sq ft 350 mn+ 250+ *:Market Cap
Slide 5: Future Group overview
Future Group overview Focussing on Food, Fashion & Home Operates across Focuses on branded fashion hypermarkets, convenience from design to distribution; Pure play integrated Food & stores and home segment with a portfolio of brands in FMCG company with a portfolio fashion space of brands across cat
Slide 6: Mission & Vision
Mission Company overview Be the most preferred fashion Mission & Vision destination of India Create the most preferred Group Core Values portfolio of fashion brands Be as the most innovative, Indianness efficient, and profitable retailer Leadership Be the preferred employer in the fashion space Resp
Slide 7: Investment proposition: Indian fashion industry shifting to branded apparel
Investment proposition Indian Fashion Industry Rapidly Shifting towards Branded Apparel Coupled with Stronger Macroeconomics Branded Apparel Market Growing Indian fashion market is a very large opportunity Faster Than Overall Market # India’s fashion industry was worth ~US$100bn in 2015. FLF’s offer
Slide 8: Fashion Industry is at an Inflection Point
Investment Proposition Fashion Industry is at an Inflection Point Fashion market expected to witness disproportionate growth as per Capita GDP nears US$ 2,000 mark Country China Russia Brazil South Korea Singapore Reached GDP per capita of 2006 2001 1986 1984 1982 $2000 in (Year) Revenues grew 3x fr
Slide 9: Trends in apparel industry
Investment Proposition Trends in apparel industry Buoyancy in branded fashion is expected to continue at an accelerated phase. Indian fashion and lifestyle segment is witnessing a paradigm shift with women’s apparel expected to match men’s apparel – 37 per cent market share each – in 2016. Fas
Slide 10: Integrated Fashion Play is the Way to Go
Investment Proposition Integrated Fashion Play is the Way to Go Brand vs Retail Developed markets saw the Retailers in India have emergence of distinct consolidated now to big business models in fashion players (FLF, SS, Lifestyle) industry (i) Multi Brand Portfolios (ii) Specialty Pure-play b
Slide 11: Company Overview
Company Overview &
Slide 12: Company structure
Company overview Company structure FCL erstwhile FVIL Lifestyle Fashion Fashion Hyper Food Edutainment (Brands) (Central & Market Brand Factory) Carved out in the year 2013 12 Investor Presentation 2017
Slide 13: Milestones
Company overview Milestones Central @ HD- Aerocity Lee Cooper Carved out Focus on Power Brands 2004 2005 2006 2012 2013 2014 2015 2016 2017 13 Investor Presentation 2017
Slide 14: Board of Directors
Board of Directors Shailesh Haribhakti Kishore Biyani Rakesh Biyani Avni Biyani Chairman CEO Future Group Non-Executive Director Non-Executive Director During a career span of four decades, Founder and Group CEO of Future Associated with Future Group for over Closely involved with the launch of succ
Slide 15: Management Team
Management Team Vishnu Prasad Rachna Agarwal Hetal Kotak Suresh Sadhwani Head – Central Head – Brands Head – Lee Cooper & aLL Head – Brand Factory Over 30 years of sales and retail Over 22 years of experience in brand Over 17 years of experience across 20 years of rich retail experience. experience.
Slide 16: Awards & Recognition
Awards & Recognition FLF was awarded the Most Admired Fashion Company of the year 2017. Central @ HD was awarded the Design Concept of the Year – Theme Store. FLF CFO was recognized as top 100 CFOs in India by CFO India Institute Indigo Nation was awarded the Most Admired Fashion Brand of the Ye
Slide 17: FY17 a year of transformation for FLF
FY 17 a year of transformation for FLF Revenue `3,877 Cr Business Effectiveness 16.4% SSG at FLF Highest SSG% Converted Central @ Brand Factory Focus on against Demonetization HD Revamp Power Brands competition Cover Story as Opportunity Global and FLF Coverage Marquee Credit Rating Debt & Market Ca
Slide 18: Financial Performance at a Glance
Financial Performance at a Glance SSG Revenue EBITDA PBT 16.4 % 17.5 % 10.2 % 33.7 % Industry leading SSG% ` 3,877 Cr in FY17 ` 365 Cr in FY17 ` 60 Cr in FY17 (8.6% in FY16) (`3,300 Cr in FY16) (`331 Cr in FY16) (`45 Cr in FY16) EPS Debt Free Cash Flow Dividend Reduction 54.7 % ~50 % 72.8 % 100.0 %
Slide 19: Business Overview
Company overview Business Overview FLF Brands FY17 Revenue Third Party Brands (FY17 Revenue: `1,454 cr) `3,877 cr (FY17 Revenue: `2,423 cr) Portfolio includes ~30 brands, catering Third party brands are distributed to men, women and kids to a wide distribution network of An integrated fashion comp
Slide 20: Snapshot – FY17
Investment Proposition Snapshot – FY17 Total Income (Operations) EBITDA Margin Total Debt Reduction Free Cash Flow `3,877 cr ~9% `650 cr `146 cr FLF Brands Retail SSGs Contributed ~40% to Total Income from Operations in FY17 Distributed across 372 Stores in 90 Delivered consistent same odd cit
Slide 21: Company store network
Company overview Company store network Central Ahmedabad | Bengaluru | Bhubaneswar | Delhi | Gurgaon | Hyderabad | Indore | Jaipur | Kochin | Koregaon | Lucknow | Mangalore | Mohali | Mumbai | Nagpur | Nashik | Navi Mumbai | Noida | Patna | Pune | Raipur | Surat | Vadodara | Visakhapatnam Brand Fact
Slide 22: Brands
Brands
Slide 23: FLF Brands
FLF Brands FLF Present Across All Key Categories And Well Diversified (Not Overly Dependent on Any Category For Growth) Branded Market Indicative Revenues Opportunity F L F – Key Brands Investee – Key Brands Split Men’s wear Size: $ 7bn ~26% Growth: 10% CAGR Unisex Brands ~53% Women’s wear Size: $ 5
Slide 24: Focusing on Power Brands
FLF Brands Focusing on Power Brands Focus on building Power Brands to deliver next stage of growth Identified 6 brands which can drive higher growth & profitability Focused on high growth categories in the fashion space Dedicated teams focusing to drive these brands Resources & Capital to
Slide 25: Lee Cooper – Global Denim Brand
Aspires to be a `1,000 cr brand FLF Brands Global Denim Brand Category Denim and Casual wear – one of the fastest growing segment Target Customer Young Men and Women who are relaxed, easy going yet strong and level headed Competitors Levi’s, Pepe Jeans, Wrangler, Lee, Killer Distribution Sold throug
Slide 26: John Miller
FLF Brands Men’s Fashion Category Shirts, trousers, business suits and accessories. Also introduced a range of relaxed office wear - John Miller Hangout in line with the more relaxed work culture Growing faster than formal men’s wear Target Customer Successful mid level executive who is inspired and
Slide 27: Scullers
FLF Brands Brand inspired by Harvard Yale Category An all-inclusive range of casual and sportswear for men, women and kids. Renowned for its Chinos with more than 14 types Target Customer Crafted for those who believe that life is meant to be lived and that age doesn’t matter generations do. The ele
Slide 28: aLL
FLF Brands Plus size unisex brand Category Dedicated plus-size clothing category for men and women including everything from western to ethnic wear and accessories that make you look sexy, cool and confident Target Customer Population of overweight crowd that feels judged by modern culture and peopl
Slide 29: Indigo Nation
FLF Brands Brands Appealing to The New Generation Category Work, Street, Club and Casual wear for young men Target Customer Young urban Indian male aged 21-30 years Competitors Wrangler, Parx Distribution Sold through the Central and Brand Factory network. Also available at EBOs and MBOs including P
Slide 30: BARE
FLF Brands Casual Unisex Brand Category Casual and denim wear brand for Kids and unisex Target Customer A comprehensive brand catering to all demographics. Bare offers multiple ranges catering to specific segments Competitors Lee, Pepe Jeans, Colour Plus, Indian Terrain, Allen Solly. Distribution So
Slide 31: Jealous 21
FLF Brands Women’s Fashion Category Casual and denim wear brand for women Target Customer Chic and vibrant kind of girl in groove when it comes to fashion and lifestyle, settling for nothing less than what she wants. Upper to middle income group Positioning Women who express herself & shows her atti
Slide 32: Retail
Retail
Slide 33: Retail Formats
Retail Formats Own Brands – non EBOs & Others FLF Channels Department store chain Outlet model positioned Includes Planet Sports, Includes third party stores such Converse and other sports as Shoppers Stop, Lifestyle etc. that offers a complete as a stopover hub for formats and franchisee stores a
Slide 34: Central
Retail Formats Central Overview Then Stores Launched in 2004, a seamless mall and a department store chain offering a ‘complete shopping experience’ 17 Revenue/ sq.ft. Positioned for the premium lifestyle segment, Central appeals to the fashion shopper with its spread of leading brands ~`6k Fo
Slide 35: Central – Hi Definition Fashion Experience
Retail Formats Central – Hi Definition Fashion Experience Assisted Shopping Valet Parking Fashion attendants Golf cart pickup & drop service Whatsapp shopping Central buddies & Ushers Lux Billing Product reserved service Complimentary wifi Fashion stylists by appointment Ambience and Store facilitie
Slide 36: Central – Hi Definition
Retail Formats Central – Hi Definition 36 Investor Presentation 2017
Slide 37: Brand Factory – India's Leading Fashion Discount Chain
Retail Formats Brand Factory – India’s Leading Fashion Discount Chain Overview Our Customers Then Stores Family shopping destination offering much Value seeking better customer experience than Factory suburban families 13 Outlets Revenue/ sq.ft. Fashion following ~`4.5k Typically offers 20%
Slide 38: Brand Factory
Retail Formats Brand Factory 38 Investor Presentation 2017
Slide 39: Investee Brands
Investee Brands &
Slide 40: Investee Key Brands
Investee Key Brands A Portfolio of over 12 Brands Generating ~`600cr Invested in businesses backed by Typical investment size is smaller, talented designers / entrepreneurs at however, offers a significant value early stage unlocking potential over the years Benefits to Future Lifestyle Fashions A
Slide 41: Cover Story – A Fast Fashion Brand for Women
Investee - Key Brands Cover Story – A Fast Fashion Brand for Women Category Fast Fashion for women, which is one of the fastest growing fashion segment, recently attracted international players such as Zara Target Customer 23 to 40 years, Independent woman with a rising disposable income, She thrive
Slide 42: Cover Story – Digital Foot Print
Investee - Key Brands Cover Story – Digital Foot Print ~170K Fan Base on Increasing base by Social Network 1.5 X Monthly Highest Reach on Engaged Audience Instagram: Metro Female ~100K per Month Age 18-24 Re-Directing On Twitter we ~30K per Month receive 142 to Myntra & Jabong impression per day Out
Slide 43: Clarks
Investee - Key Brands Clarks – Footwear brand for Men and Women Category Premium boots, sandals and shoes Target Customer Men and women in the age group of 25 – 45 yrs, Upwardly mobile Competitors Hush Puppies, Aldo, Charles & Keith, Geox & Woodland Distribution Sold through the Central network. Als
Slide 44: Turtle
Investee - Key Brands Turtle – Focused on Men’sWear Category Shirts, Trousers, T-Shirts, Denims, Suits, Gilets, Jackets, Windcheaters, Pullovers and Accessories for men Target Customer Men in the age group 20-40 Competitors Arrow, Zodiac, Van Heusen Distribution Sold through Central, Brand Factory,
Slide 45: 4 Pillars Driving Growth
4 Pillars Driving Growth Power Brands Distribution Networks Loyalty Programs Supply Chain Transformation Fast Fashion vs Core Hi-definition retail Loyalty program Operating Merchandise and Data analytics efficiencies in cost Right stores at the at core of driving and reduce net Focus on power brands
Slide 46: Financials
Finewcialle &
Slide 47: Financial Performance vs Peers
Financial Performance vs Peers SSG (YoY%) Revenue Growth (YoY%) 22 19 22 23 18 17 16 17 17 16 15 8 10 10 11 7 6 6 6 9 2 7 0 -1 5 6 2 Q2FY16 Q3FY16 Q4FY16 Q1FY17 Q2FY17 Q3FY17 Q4FY17 -2 Q2FY16 Q3FY16 Q4FY16 Q1FY17 Q2FY17 Q3FY17 Q4FY17 Central Competitor 1 FLF Competitor 1 Gross Margin (%) EBITDA Marg
Slide 48: Typical Fashion Season
Typical Fashion Season Concept to Consumption Design to Consumer– 12 to 14 months cycle Indicative Inventory Overview Inventory = ~`1,400 cr Design / Merchandising Selection / Finalization Own Brands Third Party - SoR Backed by equivalent T T + 1 Months ~(44%) ~(56%) Payables End of Season Core Full
Slide 49: Financial Overview (Standalone)
Financial Overview (Standalone) Income Statement (` cr.) Twelve Months ended Cash Flow (` cr.) FY16 FY17 Net Cash from Operating Particulars FY16 FY17 358 512 Activities Net Sales 3,229 3,800 Less:- Other Operating Income 71 77 Net Capex 138 248 Interest paid 135 117 Total Income from Operations 3,3
Slide 50: Focus Going Forward
Focus Going Forward Top line Growth / Margin Expansion Expected to Drive Returns Targeted Revenue Trajectory EBITDA Margin Expansion Resultant ROCE Improvement Potential 3,877 8% 9.4% FY17 FY20 FY17 FY20 FY17 FY20 Growth of 17%-19% FY20 Potential EBITDA margin expansion Potential for ROCE expansion
Slide 51: Operates an Integrated Fashion Ecosystem
Operates an Integrated Fashion Ecosystem Leveraging the Vertical Integration and Omnipresence in the value chain Target revenue growth of 17-19% over FY17 to FY20 Power brands to drive the top line growth and profitability Expanding presence in 3rd party chains Offer industry leading retai
Slide 52: Technological Architecture
Technological Architecture Sanchayan Shoppers Sampradan TP Linux Anushasan Purti POS System Operations PRIDE Dunnhumby Book MI TXT training People Assortment Planning Information Technology SAP Infra Payback WMS Infor- warehouse Warehouse Loyalty/CFS/CRM Management SAP Manthan Vistex Dunnhumby Finan
Slide 53: Appendix
Appendix 53 Investor Presentation 2017
Slide 54: Share Information
Share Information Stock Data (as on 31st March, 2017) Top Institutional Holders Market Capitalization `52,966.3mn Institutions OS % Premji Invest 8.1 Shares Outstanding 190.0mn Timf Holdings 2.7 Free Float (%) 59.2 L&T Mutual Fund Trustee Ltd-L&T Tax Advantage Fund 2.4 Symbol (NSE/BSE) FLFL/536507 I
Slide 55: Thank You
Thank You Registered and Corporate Office: Contact Detail: Future Lifestyle Fashions Ltd Kaleeswaran Arunachalam Knowledge House, Shyam Nagar, Off Jogeshwari - Chief Financial Officer Vikhroli Link Road, Jogeshwari (East), Mumbai 400 060 Kaleeswaran.Arunachalam@futuregroup.in +91 22 30842336 www.fut
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