Kering Sa · EURONEXT:KER
Kering Sa — PPR — Shareholder Meeting (April 2012)
62 slides from Kering Sa's shareholder meeting presentation, Apr 27, 2012
Slide 1: 2011: An outstanding year
2011 An outstanding year 2012 Annual General Meeting PPR
Slide 2: Annual General Meeting April 27, 2012
Annual General Meeting April 27, 2012 2012 Annual General Meeting PPR
Slide 3: Disclaimer
Disclaimer This presentation does not constitute an offer of securities for sale in the United States of America or any other jurisdiction. Certain information contained in this document may include notably projections and forecasts. They express objectives based on current assessments and estimates
Slide 4: Agenda & regulatory issues
Agenda & regulatory issues Michel Friocourt Group General Counsel 2012 AGM - PPR
Slide 5: Contents
Contents 2011 highlights Analysis of 2011 results Corporate governance Sustainability Strategy & Outlook Statutory Auditors’ reports Questions & Answers Resolutions 2012 AGM PPR
Slide 6: 2011: an outstanding year
2011 an outstanding year François-Henri Pinault Chairman & CEO 2012 AGM - PPR
Slide 7: 2011 highlights
2011 highlights Outstanding operating and financial performances Comparable Group sales up 9.3% Recurring net income, Group share, from continuing operations: +26.4% New brands with huge potential join the Group Sport & Lifestyle Division: Volcom Luxury Division: Girard-Perregaux & JeanR
Slide 8: Share price performance since 2010
Share price performance since 2010 PPR share price compared to the CAC 40 index In € PPR 140 130 120 110 100 90 80 CAC 40 70 60 Apr-10 Jul-10 Oct-10 Apr-11 Jul-11 Oct-11 Apr-12 Jan-12 Jan-10 Jan-11 PPR: +44% CAC 40: - 20% 2012 AGM PPR
Slide 9: Analysis of 2011 annual results
Analysis of 2011 annual results Jean-François Palus Group Managing Director 2012 AGM - PPR
Slide 10: 2011 operating performance
2011 operating performance In €m CONTINUING OPERATIONS 2011 2010 Change Revenue 12,227 11,008 +11.1% Gross profit 6,224 5,369 +15.9% Gross profit margin 50.9% 48.8% +2.1pts Recurring operating income 1,602 1,370 +16.9% Recurring operating income margin 13.1% 12.4% +0.7pt EBITDA* 1,911 1,649 +15.9% E
Slide 11: Breakdown of 2011 revenue
Breakdown of 2011 revenue Revenue breakdown by Revenue breakdown by region - Luxury and segment Sport & Lifestyle Divisions Other* 12% Fnac 34% Western Europe Luxury Asia Pacific 32% Division 40% 24% Sport & Lifestyle Division North 26% Japan America 12% 19% * Eastern Europe, Middle East, Africa and
Slide 12: 2011 recurring operating income
2011 recurring operating income Recurring operating income – from continuing operations In €m Recurring operating income – Redcats (according to IFRS 5 accounting standards*) In €m * Non-current Assets Held for sale and Discontinued Operations 2012 AGM PPR
Slide 13: 2011 financial performance
2011 financial performance In €m 2011 2010 Change Recurring operating income 1,602 1,370 +16.9% Other non-recurring operating income and expenses (58) (141) Financial charges (215) (240) Corporate income tax (317) (264) Income from equity affiliates 47 35 Net income from discontinued operations (13)
Slide 14: Net financial indebtedness
Net financial indebtedness In €m Net indebtedness at December 31, 2010 3,781 Free cash flow from operations (934) Net interest paid and dividend received 198 Dividends paid 454 Purchases of PPR shares 120 Purchases of Puma shares 300 Other disposals & acquisitions (577) Other 54 Net indebtedness at
Slide 15: Debt ratios
Debt ratios In €m 6,121 5,510 4,367 3,781 2.73 3,396 2.57 2.44 2.03 1.78 2007** 2008* 2009* 2010* 2011 Net Financial Indebtedness (NFI) Solvency ratio (NFI/EBITDA) S&P rating upgraded to ‘BBB , with stable outlook ’, on March 23, 2012 * Published, not restated. ** Proforma 2012 AGM PPR
Slide 16: 2011 condensed consolidated balance sheet
2011 condensed consolidated balance sheet In €m 2011 2010 Goodwill, brands & other intangible assets - Net 14,546 14,740 Other net non-current assets 115 163 Net current assets 278 1,058 Provisions (364) (529) CAPITAL EMPLOYED 14,575 15,432 Net assets held for sale 570 SHAREHOLDERS’ EQUITY 11,750 11
Slide 17: Dividend
Dividend In € Dividend per share + 6.1% - 4.3% * Subject to April 27, 2012 AGM approval 2012 AGM PPR
Slide 18: Q1 2012 sales summary
Q1 2012 sales summary Reported Comparable (Sales in €m) Q1 2012 change change(1) Luxury 1,458 +29.1% +17.8% Sport & Lifestyle 887 +14.6% +2.8% Sub-total 2,345 +23.2% +11.6% Fnac 916 -0.7% -0.8% Other & inter-company (3) ns ns PPR – Continuing operations 3,258 +15.4% +7.9% (1) Comparable scope and ex
Slide 19: Governance
Governance Patricia Barbizet Vice-Chair of the Board of Directors 2012 AGM PPR
Slide 20: Operation of the Board of Directors
Operation of the Board of Directors 8 meetings held in 2011 and 4 meetings held since the beginning of 2012 Average Directors’ attendance rate in 2011: 81 % Main issues covered: Determine Group strategic priorities Review yearly and half-yearly financial statements Analyze Group activiti
Slide 21: Operation of the Board of Directors
Operation of the Board of Directors 4 committees set up for assisting the Board: Audit Committee Remuneration Committee Appointments Committee Strategy and Development Committee 2012 AGM PPR
Slide 22: Audit Committee
Audit Committee Composition: 3 members, including 2 independent directors, all have recognized financial or accounting skills Mr. Jean-Philippe Thierry (Chairman) Main tasks Monitoring the financial information process of the full-year and half-year financial statements Monitoring the effici
Slide 23: Remuneration Committee
Remuneration Committee Composition: 5 members, including 3 independent directors Mr. Philippe Lagayette (Chairman) Main tasks Assess the remuneration policy for Group executives Make proposals to the Board regarding the remunerations of the Chairman & CEO and the Deputy CEO Make recommenda
Slide 24: Components of the gross remuneration of the Chairman & CEO and Deputy CEO
Components of the gross remuneration of the Chairman & CEO and of the Deputy CEO A fixed salary (no employment contract) A variable portion based on the PPR Group’s financial performance: The amount is established on achieving (or exceeding) two specifically defined financial targets : recurri
Slide 25: Components of the gross remuneration of the Chairman & CEO
Components of the gross remuneration of the Chairman & CEO For the Year 2011 2010 2009 Fixed part (in €’000) 1,100 1,000 1,000 Variable part (in €’000) 1,815 1,663 1,548 Director’s fees (in €’000) 137 158 162 Allocation of performance shares* (in number of shares) 11,682 11,514 12,336 * the full ves
Slide 26: Components of the gross remuneration of the Deputy CEO
Components of the gross remuneration of the Deputy CEO For the year 2011 2010 2009 Fixed part (in €’000) 800 620 613 Variable part (in €’000) 1,100 859 800 Director’s fees (in €’000) 120 128 116 Allocation of performance shares* (in number of shares) 8,416 13,581 14,618 among which, as a specific lu
Slide 27: Implementation of the staggered election of Directors
Implementation of the staggered election of Directors Mr. Denis Mr. di Montezemolo Mr. Lagayette Mrs. Barbizet Mrs. Mittal Mr. Palus Mr. Pinault Mr. Prot Mr. Thierry Mrs. Boone Mrs. Costes Mrs. Puel 2009 2010 2011 2012 2013 2012 AGM PPR
Slide 28: Diversified Board of Directors
Diversified Board of Directors 12 members, including 6 independent directors François-Henri Pinault - Chairman Patricia Barbizet - Vice-Chairwoman Laurence Boone (independent) Luca Cordero di Montezemolo (independent – Italian citizen) Yseulys Costes (independent) Jean-Pierre Denis (in
Slide 29: Sustainable Development
Sustainable Development Jochen Zeitz Chief Sustainability Officer Amy, PPR 2012 AGM PPR
Slide 30: PPR HOME…for the long run
PPR HOME…for the long run In 2011 we took our efforts to a new level with the creation of a new sustainability initiative PPR HOME’s drive towards best practices is value-creating A team of international experts have been assembled to support our brands A comprehensive service offering is bein
Slide 31: PPR HOME…for the long run
PPR HOME…for the long run The PPR Foundation for Women’s Dignity & Rights, which is part of PPR HOME, benefited over 55,000 women 2012 AGM PPR
Slide 32: PPR HOME…for the long run
PPR HOME…for the long run Creation of first-ever Environmental Profit & Loss Account (E P&L) PPR HOME and PUMA announced a pioneering solution to: Visualize & measure impacts across the entire supply chain Quantify & monetize impacts Identify new opportunities & implement solutions to reduce
Slide 33: PPR HOME…for the long run
PPR HOME…for the long run Determined set of core targets to reach by 2016 alongside implementing Group E P&L Key areas of focus over five years: Reduction of C02, waste & water use Sourcing of raw materials Hazardous chemicals & materials Paper & packaging Supply chain 2012 AGM PPR
Slide 34: PPR HOME…for the long run
PPR HOME…for the long run Partnership with Wildlife Works Offset of 2011 C02 emissions from Luxury division, Sport & Lifestyle division, and PPR’s HQ Acquisition of 5 % of Wildlife Works Investment in for-profit business resulting in net positive social & environmental impacts Potential for
Slide 35: PPR HOME…for the long run
PPR HOME…for the long run At PPR the next 5 years will be pivotal in our sustainable development. For us sustainability IS quality…. for the long run 2012 AGM PPR
Slide 36: Strategy & Outlook
Strategy & Outlook François-Henri Pinault Chairman & CEO 2012 AGM - PPR
Slide 37: Our mission
Our mission Inspire our clients Enable our clients to express themselves, fulfil their dreams and to enjoy themselves Empower our brands to reach their full global potential in a sustainable and responsible way Two coherent product areas: apparel and accessories Two fast-growing market seg
Slide 38: Our strengths
Our strengths Unique ensemble of premium consumer brands: Strong equity, leading positions, huge consumer appeal, significant pricing power Considerable organic growth potential Strong human values at the core of our success and transformation Mastering the entire value chain of our brands
Slide 39: Our management principles
Our management principles We give our brands freedom within a framework Empower the development of our key assets – the brands – and help them reach beyond their limits Well-defined management principles We are a group and act as a group, in a coherent manner A single worldwide corporate t
Slide 40: Luxury Division – Drivers of future growth and profitability
Luxury Division – Drivers of future growth and profitability A coherent collection of world-leading brands Consistency of the portfolio: markets, products categories, styles Designs, manufactures and markets leather goods, shoes, ready-to-wear, jewelry & watches A Group characterized by: Q
Slide 41: Sport & Lifestyle Division – Drivers of future growth and profitability
Sport & Lifestyle Division – Drivers of future growth and profitability A global segment, underpinned by strong demographic trends Sports increasingly becoming key drivers of self-fulfillment, notably in emerging countries Support from strong demographic and social trends Puma The referenc
Slide 42: Tomorrow's PPR – Our 2020 ambitions
Tomorrow’s PPR– Our 2020 ambitions €24 billion 1 PPR talent mobility Revenue platform 40% Revenue generated by Sport & Lifestyle Divison €10 billion Revenue in Asia 1 Group Environmental Profit & Loss Account 54% Revenue generated in directly-operated stores Gender parity Over €1 billion In the Grou
Slide 43: Conclusion & Outlook
Conclusion & Outlook Unique combination of global luxury and premium sport & lifestyle brands with considerable organic growth potential Broad consumer appeal as self-fulfiment and indulgence increasingly drive buying decisions Favorable geographic balance Increasingly flexible cost structur
Slide 44: Statutory Auditors' reports
Statutory Auditors’ reports Assemblée Générale PPR 2012
Slide 45: Report on the Company financial statements
Report on the Company financial statements (1st resolution) PPR company financial statements: certification without comments or qualifications Pages 291 and 292 of the Reference Document. In our opinion the financial statements give a true and fair view of the assets and liabilities and of the
Slide 46: Report on the consolidated financial statements
Report on the consolidated financial statements (2nd resolution) PPR Group consolidated financial statements: certification without comments or qualifications Page 271 of the Reference Document. In our opinion, the consolidated financial statements give a true and fair view of the assets and l
Slide 47: Other reports issued by the Statutory Auditors (1/2)
Other reports issued by the Statutory Auditors (1/2) Statutory Auditors’ report on internal control and risk management procedures Page 136 of the Reference Document We have nothing to report on the information in respect of the Company’s internal control and risk management procedures relatin
Slide 48: Other reports issued by the Statutory Auditors (2/2)
Other reports issued by the Statutory Auditors (2/2) Statutory Auditors’ special reports on capital transactions: delegation of authority / authorisation to be granted to the Board of Directors. Issue of redeemable share subscription and/or purchase warrants to Group employees and corporate office
Slide 49: Questions & Answers
Questions & Answers 2012 AGM - PPR
Slide 50: Resolutions
Resolutions 2012 AGM - PPR
Slide 51: First resolution
First resolution (acting as an Ordinary Meeting) Approval of the Parent Company financial statements for FY 2011 2012 AGM PPR
Slide 52: Second resolution
Second resolution (acting as an Ordinary Meeting) Approval of the consolidated financial statements for FY 2011 2012 AGM PPR
Slide 53: Third resolution
Third resolution (acting as an Ordinary Meeting) Appropriation of FY 2011 net income and distribution of a €3.50 dividend per share 2012 AGM PPR
Slide 54: Fourth resolution
Fourth resolution (acting as an Ordinary Meeting) Renewal of the term of the Director Luca Cordero Di Montezemolo 2012 AGM PPR
Slide 55: Fifth resolution
Fifth resolution (acting as an Ordinary Meeting) Renewal of the term of the Director Jean-Pierre Denis 2012 AGM PPR
Slide 56: Sixth resolution
Sixth resolution (acting as an Ordinary Meeting) Renewal of the term of the Director Philippe Lagayette 2012 AGM PPR
Slide 57: Seventh resolution
Seventh resolution (acting as an Ordinary Meeting) Election of Mr. Jochen Zeitz as a Director 2012 AGM PPR
Slide 58: Eighth resolution
Eighth resolution (acting as an Ordinary Meeting) Resolution Term of Authorization Conditions number authorization 18 months Outstanding Maximum purchase price: €160 (November (May 2011) Cap : 10 % of the share capital 2012) Share buy-back 8th resolution 18 months Maxium purchase price: €180 as of A
Slide 59: Ninth resolution
Ninth resolution (acting as an Extraordinary Meeting)-BSAAR Resolution Term of the Authorization Maximum par value issue number authorization 18 months Outstanding (November 0.5 % of the capital at the time of the allocation (May 2011) Issue of redeemable 2012) equity warrants (BSAAR) to employees a
Slide 60: Tenth resolution
Tenth resolution (acting as an Extraordinary Meeting) Resolution Term of the Authorization Maximum par value issue number authorization Capital increase reserved 10th to the Company resolution 26 months € 5.04 million Employee Saving as of April 27, (June 2014) schemes employees 2012 2012 AGM PPR
Slide 61: Eleventh resolution
Eleventh resolution (acting as an Ordinary and Extraordinary Meeting) Powers for formalities 2012 AGM PPR
Slide 62: Annual General Meeting April 27, 2012
Annual General Meeting April 27, 2012 2012 Annual General Meeting PPR