Avolta Ag · SIX:AVOL
Avolta — Dufry — 9M 2017 Earnings Presentation
34 slides from Avolta's earnings presentation, Oct 31, 2017
Slide 1: 9M 2017 Results
9M 2017 Results Ongoing strong growth and acceleration of cash flow generation October 31, 2017
Slide 2: Legal Disclaimer
Legal Disclaimer Information in this presentation may involve guidance, expectations, beliefs, plans, intentions or strategies regarding the future. These forward-looking statements involve risks and uncertainties. All forward-looking statements included in this release are based on information avai
Slide 3: Agenda
AGENDA 1. Nine Months 2017 Results 2. Financials 9M 2017 3. Considering IPO of North American Business 4. Conclusion 3_ 9M 2017 Results Presentation
Slide 4: Nine Months Results 2017
1 Nine Months Results 2017 4_ 9M 2017 Results Presentation
Slide 5: Strong organic growth and cash flow in 9M 2017
Strong organic growth of 7.9% in the 9M ‘17 Gross profit margin expands by 100 bps to 59.4% in the 9M ‘17 EBITDA grows to CHF 743.6 million in the 9M ’17; 9.3% growth in Q3 ‘17 Robust free cash flow of CHF 464.6 million in the 9M ‘17 (CHF 337.1 million in Q3) 5_ 9M 2017 Results Presentation
Slide 6: Highlights 9M 2017
Highlights 9M 2017 • Organic growth reaches +7.9% in the 9M 2017 Strong organic • Turnover increased by 6.7% and reached CHF 6,270.5 million in the first nine months of growth in the 2017 9M 2017: 7.9% • Organic growth in Q3 2017 of +7.6% • Gross profit margin expands by 100 bps to 59.4% from 58.4%
Slide 7: Turnover analysis
Turnover analysis • Strong organic growth in 9M 2017 at Turnover evolution Turnover +7.9% growths by 6.7% 6,400 +6.7% 6,270.5 6,200 • Good performance in all locations 6,000 5,877.2 • Strong summer in the Mediterranean (CHF million) 5,800 • UK confirms good performance post Brexit 5,600 All division
Slide 8: Dufry has opened close to 20,500 m2 of gross retail space in 9M 2017
Dufry has opened close to 20,500 m2 of gross retail space in 9M 2017 Openings - 9M 2017 Over 20,500 m2 of North America gross retail space 26% Southern Europe and • Over 20,500 m2 of gross retail space opened in the Africa opened, including new shops and 19% 9M 2017 expansions UK, Central and Easter
Slide 9: 18,000 m2 additional retail space signed for 17/18
18,000 m2 additional retail space signed for 17/18 18,000 m2 signed space • Contract renewals and pursue of new 18,000 m2 concession is an important part of our additional retail activities Southern Europe and Africa 4,700 space signed for 17/18 UK, Central and Eastern Europe 200 • 18,000 m2 of new
Slide 10: Organic growth: Positive forecasts for ongoing passenger growth
Organic growth: Positive forecasts for ongoing passenger growth International PAX growth - 2017* International PAX growth forecast Healthy 2017 2018 2019 international 12% 10.8% PAX growth 10% Europe 8.6% 8.0% 5.2% 7.8% 8.9% 8% 6.6% 7.3% 7.2% Africa 2.8% 3.4% 2.3% 6.5% 6% Asia/Pacific 9.5% 8.2% 7.4%
Slide 11: Dufry's Segmentation
Dufry’s Segmentation Dufry by Division 9M 2017 Dufry by Channel 9M 2017 Balanced Southern North America concession 21% Europe and Airports Africa portfolio across 23% 92% divisions Border, downtown and Latin America hotels shops 20% UK, Central and Eastern 3% Airport is the Europe Railway most impor
Slide 12: Priorities going forward
Priorities going forward • Drive organic growth Ongoing focus • Increase spend per passenger on driving • Accelerate commercial initiatives organic growth • Shop Development Plan: 70,000 m2 to be opened or refurbished in 2017 • Digitalization (New Generation Store, Digitalization of Employees, RED b
Slide 13: 13_ 9M 2017 Results Presentation
13_ 9M 2017 Results Presentation
Slide 14: 14_ 9M 2017 Results Presentation
14_ 9M 2017 Results Presentation
Slide 15: 15_ 9M 2017 Results Presentation
15_ 9M 2017 Results Presentation
Slide 16: 16_ 9M 2017 Results Presentation
16_ 9M 2017 Results Presentation
Slide 17: 17_ 9M 2017 Results Presentation
17_ 9M 2017 Results Presentation
Slide 18: Financials 9M 2017
2 FINANCIALS 9M 2017 18_ HY 2017 Results Presentation
Slide 19: Growth performance by division
Growth performance by division Reported growth components Strong organic growth in Q3 Q1 '16 Q2 '16 Q3 '16 Q4 '16 Q1 '17 Q2 '17 Q3 '17 Like for Like -6.2% -7.7% -0.6% 5.0% 7.2% 8.7% 6.4% 2017, despite New concessions, net 1.0% 0.4% 0.9% 0.6% 0.0% 0.2% 1.2% higher Organic growth -5.2% -7.3% 0.3% 5.6%
Slide 20: Aggregated FX development
Aggregated FX development Translational FX impact Translational FX 4.0% impact turned 2.5% 2.2% negative in Q3 2.0% 2016 due to GBP 0.5% 0.0% -2.0% -1.4% -1.9% -1.6% Appreciation of -4.0% -3.3% Q1 '16 Q2 '16 Q3 '16 Q4 '16 Q1 '17 Q2 '17 Q3 '17 EUR benefits FY impact Main currencies development Turnov
Slide 21: Income statement 9M 2017
Income statement 9M 2017 Income statement 9M 2017 Strong turnover (CHF million) 9M 2017 % 9M 2016 % growth driven by Turnover 6,270.5 100.0% 5,877.2 100.0% organic growth Gross profit 3,726.4 59.4% 3,434.7 58.4% Concession fees (1,741.2) -27.8% (1,601.2) -27.2% Personnel expenses (844.7) -13.5% (792
Slide 22: Cash earnings – strong growth in 9M 2017
Cash earnings – strong growth in 9M 2017 Cash EPS by quarter Cash EPS analysis Cash EPS 4.00 9M 2017 9M 2016 improves from 3.47 CHF 4.55 in 9M 3.00 2.86 Cash EPS 5.81 4.55 2016 to CHF 5.81 2.05 2.00 1.74 Deffered taxes on acquisition- in 9M 2017 -0.79 -1.06 (CHF) 1.46 related amortization 1.00 0.29
Slide 23: Cash flow statement
Cash flow statement Cash flow statement Strong cash (CHF million) 9M 2017 9M 2016 generation in the EBITDA before other operational result 743.6 685.4 9M 2017 Changes in net working capital (6.5) 143.2 Taxes paid (69.4) (65.2) Other operational items (10.0) (53.3) Dividends from associates 4.9 4.9 N
Slide 24: Capex & Net Working Capital
Capex & Net Working Capital Core Net Working Capital (1) • Core net working capital within Core Net 900 7.0% expected levels 6.3% Working Capital 800 5.9% 5.5% 5.4% 5.6% 5.3% 6.0% NWC (as % of Turnover) continues at NWC (CHF million) 700 4.2% 4.7% 5.0% • 600 reduced levels 500 4.0% Expectation for F
Slide 25: Seasonality of cash generation
Seasonality of cash generation Seasonality of cash generation – Free cash flow Strong seasonality in 400 335 337 350 cash generation 300 250 205 206 (CHF million) 200 150 122 102 100 79 Q3 typically 50 19 12 strongest quarter 0 -50 -100 -52 -77 Q1 Q2 Q3 Q4 2015 2016 2017 Positive trends point to hig
Slide 26: Balance sheet
Balance sheet Summary balance sheet as per 30.09.2017 No significant (CHF million) 30.09.2017 31.12.2016 Variation changes in the Concession right finite life 3,584 3,780 -196 balance sheet Goodwill, Brands, Conc. rights indef. life 2,960 2,923 37 9M 2017 Other intangible assets 102 84 18 Other non
Slide 27: Financing & Covenants
Financing & Covenants Net Debt Evolution Covenants evolution No debt maturity 4,000 5.00 3,838 until 2019 3,750 (Net Debt/Adj. EBITDA) 4.50 4.50 4.50 3,750 3,628 4.50 4.25 4.25 4.25 3,476 3,500 4.00 4.00 (CHF million) 4.00 3.75 3,250 3.92 3.94 3.91 3.79 3.50 3.72 3.69 3.68 3,000 3.45 2,750 3.00 … De
Slide 28: New Senior Notes in place and bank financing under review
New EUR 800 million Senior Notes in place and bank financing under review • New EUR 800 million Senior Notes Debt maturity profile New Senior 4,000 launched in October 2017 Notes with 3,500 coupon of 2.5% • Maturity in 2024 3,000 900 (CHF million) 2,500 • Coupon of 2.5% 2,000 572 • Proceeds used to
Slide 29: Dufry Considering IPO of North American Business
3 Dufry Considering IPO of North American Business 29_ HY 2017 Results Presentation
Slide 30: Potential listing of North American business
Potential listing of North American business • IPO of the North American business of Dufry remains under consideration Dufry considering an IPO of its • IPO considerations: North American • Dufry would keep a majority ownership stake in the business business • Dufry would continue to consolidate the
Slide 31: Retain control to continue to harvest global synergies
Retain control to continue to harvest global synergies Dufry Group Dufry North America Global leader in travel retail Leader in North America with operating in 64 countries in 947 shops in 86 locations 380 locations • Keep majority stake in the North American division and continue to consolidate it
Slide 32: Conclusion
4 CONCLUSION 32_ HY 2017 Results Presentation
Slide 33: Conclusion
Conclusion • Strong organic growth : 7.9% in 9M 2017 Continue • Pursue initiatives to further drive spend per passenger organic growth • Accelerating commercial initiatives acceleration • Digitalization of business • Refurbishing existing operations • New concessions and expansions Drive cash • Impl
Slide 34: Thank you
Thank you © DUFRY