Prada S.p.a. · HKEX:1913
Prada — Prada Spa Ord — H1 2023 Earnings Presentation
28 slides from Prada's earnings presentation, Jul 27, 2023
Slide 1: H1-23 Results Presentation
H1-23 Results Presentation Milan, July 27th 2023 1 July 27th 2023
Slide 2: Disclaimer
Disclaimer The information contained in this document is for information purposes only and does not constitute an offer, solicitation, invitation or recommendation to subscribe for or purchase any securities, or other products or to provide any investment advice or service of any kind. This document
Slide 3: Agenda
Agenda Patrizio Bertelli - Chairman and Executive Director Highlights Lorenzo Bertelli - Marketing Director and Head of CSR Key Marketing Initiatives and ESG Update Andrea Guerra - Group CEO Business Update Andrea Bonini - Group CFO H1-23 Financial Review Andrea Guerra - Group CEO Closing Remarks Q&
Slide 4: Strong brand identity, creativity and disciplined execution drive positive results
Strong brand identity, creativity and disciplined execution drive positive results High quality Profitability increase Acceleration of capex Positive Q2 Retail Sales growth coupled with higher plan for the growth of on top of solid Q1 driven by full price, investments tomorrow like-for-like sales Ne
Slide 5: Agenda
Agenda Patrizio Bertelli - Chairman and Executive Director Highlights Lorenzo Bertelli - Marketing Director and Head of CSR Key Marketing Initiatives and ESG Update Andrea Guerra - Group CEO Business Update Andrea Bonini - Group CFO H1-23 Financial Review Andrea Guerra - Group CEO Closing Remarks Q&
Slide 6: Prada brand continues to resonate
Prada brand continues to resonate With a solid and above-market search trend on the web Continued success Exceptional personalities Brand exclusive New and consolidated formats of fashion shows drive campaigns allurement collaborations elevate the brand experience • Prada Menswear FW23 and SS24 • Th
Slide 7: Miu Miu's increasing visibility
Miu Miu’s increasing visibility Outstanding performance reflected in the web search growth Sustained brand Exceptional personalities Brand exclusive collaborations New and consolidated formats building investments drive campaigns allurement and special capsules elevate the brand experience • Miu Miu
Slide 8: ESG focus on key areas of supply chain and water challenges
ESG focus on key areas of supply chain and water challenges Driving continued progress against environmental commitment Building a Responsible Supply Chain Widening of Water Conservation Framework Launched ambitious Water Conservation Programme to monitor water availability, usage and quality in our
Slide 9: Agenda
Agenda Patrizio Bertelli - Chairman and Executive Director Highlights Lorenzo Bertelli - Marketing Director and Head of CSR Key Marketing Initiatives and ESG Update Andrea Guerra - Group CEO Business Update Andrea Bonini - Group CFO H1-23 Financial Review Andrea Guerra - Group CEO Closing Remarks Q&
Slide 10: Prada
Prada Positive semester, continuing to capitalise on strong identity, creativity and uniquely polyhedric brand equity Strategic decision to increase marketing and communication investments to foster brand desirability and visibility Methodical introduction of newness, wisely balanced with the streng
Slide 11: Miu Miu
Miu Miu Excellent brand momentum globally, underpinned by a clearer and stronger identity, growing awareness and desirability Accelerated investment continued to amplify brand visibility and relevance to growing client base Reinforcement of brand codes and constant flow of collections reflecting nee
Slide 12: Agenda
Agenda Patrizio Bertelli - Chairman and Executive Director Highlights Lorenzo Bertelli - Marketing Director and Head of CSR Key Marketing Initiatives and ESG Update Andrea Guerra - Group CEO Business Update Andrea Bonini - Group CFO H1-23 Financial Review Andrea Guerra - Group CEO Closing Remarks Q&
Slide 13: Key Financials
Key Financials Solid growth and improved profitability H1-23 Net Revenues H1-23 EBIT H1-23 Cash Flow from Operations (3) €2,232 mln (+17% vs. H1-22 / +20% at constant fx) €491 mln €509 mln Retail Revenues (€ mln) and Growth (%) (1) EBIT (2) (€ mln) and Margin (%) Net Financial Position (€ mln) (4) +
Slide 14: Net Revenues by Channel
Net Revenues by Channel High-quality Retail growth driven by like-for-like, full price sales Royalties € mln H1-23 Q2-23 2% % at constant fx Wholesale H1-23 vs. vs. 9% H1-22 Q2-22 Retail 1,975 +21% +19% Wholesale 210 +9% +8% Royalties 47 +66% +80% Retail Total 2,232 +20% +19% 89% • Retail - Solid gr
Slide 15: Retail Sales by Brand
Retail Sales by Brand Solid growth at Prada; further acceleration at Miu Miu € mln H1-23 Q2-23 Church's Other % at constant fx vs. vs. 1% 0% H1-23 H1-22 Q2-22 Miu Miu Prada 1,668 +18% +15% 14% Miu Miu 285 +50% +57% Church’s 13 -21% -20% Prada Other (1) 9 +14% +6% 85% Total 1,975 +21% +19% • Prada •
Slide 16: Retail Sales by Geography
Retail Sales by Geography Strong double-digit growth across all regions excl. Americas Middle € mln H1-23 Q2-23 East 5% % at constant fx vs. vs. H1-23 H1-22 Q2-22 Japan Asia Pacific 716 +25% +28% 11% Europe 582 +24% +22% APAC 36% Americas Americas 361 -1% -6% 18% Japan 224 +49% +44% Europe Middle Ea
Slide 17: Retail Sales by Product
Retail Sales by Product Continued double-digit growth across all categories Other € mln H1-23 Q2-23 3% % at constant fx vs. vs. H1-23 H1-22 Q2-22 Leather Goods 925 +12% +10% Footwear 19% Ready to Wear 609 +36% +34% Leather Goods Footwear 374 +20% +20% 47% Other 66 +50% +43% RTW 31% Total 1,975 +21%
Slide 18: Gross Margin
Gross Margin 260 bps increase driven by average price, channel, scale 79.8% H2-22 2.6% 80.3% 77.7% H1-22 Avg. Price H1-23 Channel Mix Scale Logistics Raw Materials and Others FX / Hedging Note: Positive impact Negative impact 18 July 27th 2023
Slide 19: EBIT and Net Income
EBIT and Net Income EBIT Margin of 22% and Net Income growth of 62% € mln H1-22 % on Net H1-23 % on Net H1-23 Revenues Revenues vs. H1-22 Selling 796 41.8% 895 40.1% +12% Advertising & Promotion 155 8.2% 187 8.4% +21% Design and Product Dev. 69 3.6% 72 3.2% +6% G&A 127 6.7% 148 6.6% +16% Total Opera
Slide 20: Capex
Capex Acceleration of Retail, IT and Industrial investments 151 € mln Corporate, IT & Industrial 56 Retail 97 35 95 62 H1 -2 2 H1 -2 3 • ~ 70 renovation and relocation projects in H1-23 • 9 net closures vs. FY-22 (14 openings and 23 closures) / 603 DOS end of June 2023 • €22 mln Industrial Capex and
Slide 21: Net Operating Working Capital
Net Operating Working Capital Good control of inventory with limited increase 691 723 € mln Trade Receivables 332 325 Inventory Trade Payables 760 785 -402 -387 FY-2 2 H1 -2 3 17% 16% % of Net Sales (1) (1) Net Revenues excluding Royalties 21 July 27th 2023
Slide 22: Net Financial Position
Net Financial Position Solid balance sheet with Net Cash of €283 mln € mln Opening Net Financial Position Surplus / (Deficit) - 31/12/2022 535 Consolidated Profit / (Loss) before taxation 445 Depreciation and Amortisation 111 Net Working Capital -66 Tax paid -305 Capital Expenditures and Investments
Slide 23: Agenda
Agenda Patrizio Bertelli - Chairman and Executive Director Highlights Lorenzo Bertelli - Marketing Director and Head of CSR Key Marketing Initiatives and ESG Update Andrea Guerra - Group CEO Business Update Andrea Bonini - Group CFO H1-23 Financial Review Andrea Guerra - Group CEO Closing Remarks Q&
Slide 24: Closing Remarks
Closing Remarks Another positive semester with significant and well balanced growth Focused effort to progress fundamental Group projects of strategic, organisational and digital evolution Continued to strengthen desirability of our brands and their roots in the respective cultural heritage In store
Slide 25: Agenda
Agenda Patrizio Bertelli - Chairman and Executive Director Highlights Lorenzo Bertelli - Marketing Director and Head of CSR Key Marketing Initiatives and ESG Update Andrea Guerra - Group CEO Business Update Andrea Bonini - Group CFO H1-23 Financial Review Andrea Guerra - Group CEO Closing Remarks Q&
Slide 26: Appendix
APPENDIX PRADA Group 26 July 27% 2023
Slide 27: Condensed P&L
Condensed P&L €m H1-21 H1 22 H1 23 Net Revenues 1,501 100% 1,901 100% 2,232 100% COGS -386 -25.7% -423 -22.3% -439 -19.7% Gross Profit 1,115 74.3% 1,477 77.7% 1,793 80.3% Selling -651 -43.4% -796 -41.8% -895 -40.1% Advertising & Promotion -127 -8.5% -155 -8.2% -187 -8.4% Design and Product Developme
Slide 28: Condensed Balance Sheet
Condensed Balance Sheet € mln 31 Dec 2022 30 June 2023 Right of use 2,011 2,082 Non current assets (excl deferred tax assets) 2,517 2,545 Net operating working capital 691 723 Other current assets / (liabilities), net -293 -94 Other non current assets / (liabilities), net 148 172 Net invested capita