Migros Ticaret A.s. · BIST:MGROS
Migros Ticaret A.s — H1 2022 Earnings Presentation
33 slides from Migros Ticaret A.s's earnings presentation, 2022
Slide 1: Company Presentation: 1H 2022 Financial Results
Company Presentation 1H 2022 Financial Results
Slide 2: Contents
Contents Sales Expansion Market Share Evolution Financial Overview Online Operations & Strategy Update Summary & Guidance Operations & Financials Details
Slide 3: Sales – 1H 2022 (TL million)
Sales – 1H 2022 (TL million) Sales Sales 90% 75% 28,235 15,963 Competitive pricing strategies pay off in trading-down environment 16,104 8,415 Inflationary environment in 2Q 2Q 2021 2Q 2022 1H 2021 1H 2022 3
Slide 4: Offline & Online Expansion
Offline & Online Expansion Number of Stores Online Service Stores (Total) (Total) +276 2,681 Sales Area +129 (K sqm) 955 2,405 7% 826 1,605 1,713 1H 2021 1H 2022 1H 2021 1H 2022 1H 2021 1H 2022 4
Slide 5: CAPEX (TL million)
CAPEX (TL million) % of Sales % of Sales 1.9% 2.7% 1.9% 1.7% ~1,650 474 969 303 539 2020 2021 2022E 1H 2021 1H 2022 Bolt on Acquisitions: • 25 stores in Trabzon & Giresun • 6 stores in İstanbul • Will be operational in 4Q22 5
Slide 6: Market Share Evolution
Market Share Evolution Migros FMCG Market Share Evolution (%) 14.8 15.1 14.8 Flat market share 8.2 8.5 8.5 Migros’ strong sales growth especially in 2Q despite trading-down 1H 1H 1H 1H 1H 1H 2020 2021 2022 2020 2021 2022 Total FMCG Modern FMCG Source: Nielsen 6 Note : FMCG: Fast Moving Consumer Good
Slide 7: Financial Overview
Financial Overview
Slide 8: Consolidated Gross Profit (TL million)
Consolidated Gross Profit (TL million) Gross Profit Gross Profit 83% 7,182 100% 4,048 3,924 2,025 2Q 2021 2Q 2022 1H 2021 1H 2022 Margin 24.1% 25.4% Margin 24.4% 25.4% 8
Slide 9: Consolidated EBITDA after ETB & unused vacation provisions (TL million)
Consolidated EBITDA after ETB & unused vacation provisions (TL million) • Our guidance EBITDA is now after employee termination benefits & unused vacation provisions. 123% 92% 1,416 2,380 1,241 636 (w/o IFRS 16) (w/o IFRS 16) 178% 130% 1,143 1,852 1H 2021 1H 2022 2Q 2021 2Q 2022 412 804 Margin 7.6%
Slide 10: Net Cash Position
Net Cash Position Total Financial Debt* Net Cash / EBITDA* (TL million) (TL million) 2-years average maturity with 18% average interest cost 2,847 2,899 1,903 0.6x Improved net cash position 1H 2021 -0.2x 1H 2022 1H 2021 1H 2022 -379 *w/o IFRS 16 *w/o IFRS 16 10
Slide 11: Online Operations & Strategy Update
Online Operations & Strategy Update
Slide 12: Migros’ Geographical Coverage in Online
Migros’ Geographical Coverage in Online Migros Sanal Migros Hemen Market # of Service Stores # of Service Stores +100 +147 731 341 631 194 1H 2021 1H 2022 1H 2021 1H 2022 81 cities +35,000 SKU Macroonline # of Service Stores 70 ~2,500 SKU +12 cities Delivery within minutes 82 70 10 +15,000 SKU citie
Slide 13: Sales Contribution of Online Operations
Sales Contribution of Online Operations Online Sales (TL billion) Online Share in Total Sales 60% 2.0 1H 2022 (w/o tobacco & alcohol) 1.3 16.0% Online Sales (TL billion) 2Q 2021 2Q 2022 66% 3.8 • High base impact of May’21 2.3 due to Covid-19 lockdowns • Online sales growth will accelerate in 2H 202
Slide 14: Migros Yemek
Migros Yemek Online Meal Delivery Platform Launched in June 2022 73% Wide restaurant network, affordable prices, healthy & wide range of meal options Currently operating 7/24 in 6 districts in İstanbul, reaching 15 districts by September Service network to reach 30 districts in 6 cities by September
Slide 15: Summary & Guidance
Summary & Guidance
Slide 16: 1H 2022 Underlying Performance
1H 2022 Underlying Performance Net Sales Sales Growth EBITDA Net Profit Margin 8.4%* TL 28,235 75% after ETB & in million unused vacation provisions TL 603 in million 2Q 2022: 90% 9.4%** 2Q 2022: TL 444 mn * EBITDA after ETB & unused vacation provisions = Operating Profit + Amortization - Other Inco
Slide 17: 2022 Guidance (Consolidated)
2022 Guidance (Consolidated) Sales Growth EBITDA Margin Expansion Target CAPEX ~ 8%* ~350*** after ETB & unused 80-85% vacation provisions ~TL 1,650 new stores mn ~8.5%** from 55-60% new guidance from 250+ from ~TL 1,500 mn * EBITDA after ETB & unused vacation provisions = Operating Profit + Amortiz
Slide 18: Key Takeaways
Key Takeaways Operational Performance Stronger Balance Sheet • Growth momentum accelerated • Improvement in net cash position • Operational profitability improved thanks to • Improvement in net income personnel & rent cost efficiencies: • Stronger shareholders’ equity: • Increase in employee cost: 7
Slide 19: Appendix
Appendix
Slide 20: Migros at a Glance
Migros at a Glance TL 36.3 billion 40,470 1,500+ 49.18% sales in 2021 employees suppliers free float The only food retailer listed in BIST Sustainability Index for 8 years in a row Included BIST Corporate Governance Index since 2015 Business Option th 2,681 stores in all 81 cities 68 year 9.5 millio
Slide 21: Transforming our Ecosystem with New Subsidiaries
Transforming our Ecosystem with New Subsidiaries Online Business Focusing on gearing up the Focused on online grocery development of Migros’ business and ready-made meals online channels Migros shareholding: 100% Fintech company E-wallet, money transfer, Financial solutions utility payment and BNPL
Slide 22: Offline & Online – 1H 2022
Offline & Online – 1H 2022 40 sqm - 3,500 sqm 3,500 sqm – 8,500 sqm 250 sqm – 2,000 sqm 200 sqm – 1,600 sqm 2,000 SKU – 40,000 SKU Supermarkets Hypermarkets Macrocenter Wholesale Online 2,475 56 125 25 955 22
Slide 23: Store Portfolio
Store Portfolio 2,475 30 June 2021 30 June 2022 Supermarkets Sales area Sales area # of stores # of stores (th sqm) (th sqm) 56 Migros 1,353 1,089.7 1,504 1,174.4 (M, MM,MMM) Hypermarkets Migros Jet 900 187.6 971 204.4 5M 56 268.5 56 261.0 125 Macrocenter Wholesale 23 13.4 25 14.3 Macrocenter 73 46.
Slide 24: IFRS Consolidated Income Statement Summary – 1H 2022
IFRS Consolidated Income Statement Summary – 1H 2022 (TL million) 1H 2022 1H 2021 Net Sales 28,235 16,104 Cost of sales -21,052 -12,180 Gross Profit 7,182 3,924 Operating Expenses -5,335 -3,116 Other Operating Income / (Expense) -557 -306 Operating Profit 1,281 502 Income / (Expense) from Investment
Slide 25: IFRS Consolidated Balance Sheet Summary – 1H 2022
IFRS Consolidated Balance Sheet Summary – 1H 2022 (TL million) 1H 2022 2021 Current Assets 13,583 8,704 Non-current Assets 10,381 9,397 Total Assets 23,965 18,100 Current Liabilities 17,970 13,109 Non-current Liabilities 4,773 4,455 Total Liabilities 22,742 17,564 Equity 1,223 536 Total Liabilities
Slide 26: Cash Position & Leverage
Cash Position & Leverage Without IFRS 16 With IFRS 16 (Total TL mn) 1H 2021 1H 2022 1H 2021 1H 2022 Cash & Cash Equivalents 2,468 4,803 2,468 4,803 TL 2,285 4,657 2,285 4,657 EUR 18 2 18 2 Financial Debt 2,847 2,899 5,7951 6,5741 TL 2,799 2,899 5,747 6,571 EUR 5* 0* 5* 0* Net Cash (Net Debt) (379) 1
Slide 27: Ownership Structure
Ownership Structure Direct Shareholding Structure Indirect Shareholding Structure AG Anadolu Grubu Holding A.Ş. 100.00% AG Anadolu Grubu Free Float Holding A.Ş. 50.00% 50.00% MH Perakendecilik Free Float Migros Ticaret A.Ş.* ve Ticaret A.Ş. 49.18% 1.64% 49.18% Migros Ticaret A.Ş. Migros Ticaret A.Ş.
Slide 28: Sustainability
Sustainability
Slide 29: Migros Sustainability Targets
Migros Sustainability Targets By 2030 42% Science Based Target (SBT) Reducing Scope 1 & Scope 2 Greenhouse Gas Emission Base Year: 2020 Progress 2020- 2021: 4.58% By 2030 By 2030 By 2026 10% 50% 27-33% Reducing Water Reducing Food Women Participation in Consumption per sqm Waste (tones) Top Manageme
Slide 30: Migros Better Future Plan
Migros Better Future Plan TRANSPARENT, RESPONSIBLE AND ETHICAL GOVERNANCE FOR A SUSTAINABLE ECOSYSTEM To adopt the governance approach that suits best to our value-oriented business model and integrated mindset, for all our stakeholders. To create a joint value with our stakeholders integrated into
Slide 31: Waste Management & Biodiversity Conservation
Waste Management & Biodiversity Conservation Combating Food Waste* Combating Plastic Waste* Day-end clearance on perishables: Plastic bags: 59% 3,967 tons of food Plastic Initiative from the Business World 247 tons less plastic in 1 year Food Donation: 5.9 million meals Good Agricultural Practices G
Slide 32: Social Responsibility Efforts
Social Responsibility Efforts Family Clubs Aegean Forest Foundation Growing Healthy with Migros P&G - Turkey Special Olympics 167,000 members / 128 different 554,148 sapling donation F2f conscious shopping trainings to Committee Collaboration trainings in 33 locations in 14 years 176,000 children. 2
Slide 33: Disclaimer Statement
Disclaimer Statement Migros Ticaret A.Ş. (the “Company”) has prepared this presentation for the sole purpose of providing information about its business, operations and financial results. The informaation in this presentation is subject to updating, revision and amendment. The information in this pr