Fnac Darty Sa · EURONEXT:FNAC
Fnac Darty Sa — Investor Presentation (March 2021)
53 slides from Fnac Darty Sa's investor presentation, March 2021
Slide 1: Corporate Presentation March 2021
CORPORATE PRESENTATION 2021 March 2021
Slide 2: Contents
CONTENTS Fnac Darty at a glance 3 FY 2020 Results 4 New Strategic Plan: Everyday 17 Appendices 41 2
Slide 3: Fnac Darty at a glance
FNAC DARTY AT A GLANCE A EUROPEAN OMNICHANNEL LEADER WITH AN EFFICIENT CENTRALISED OPERATIONS PLATFORM 2020 revenue breakdown by category • 7.5bn in revenue – c.25,000 employees Technical products 49,5% • Top 3 European Omnichannel Retailer: Editorial products 15,5% • 30 million references available
Slide 4: Results 2020
RESULTS 2020 FNAC DARTY
Slide 5: Solid 2020 performance despite the crisis
SOLID 2020 PERFORMANCE DESPITE THE CRISIS Post 2nd lockdown Pre-lockdown Reopening of stores November 29 – December 31 January 1 – March 14 From May 11 to end of September Black Friday postponed to Dec 4 1st lockdown From May 11 to From July to end of 2nd lockdown March 15 – May 10 end of June Septe
Slide 6: 2020 Fnac Darty main achievements
2020 FNAC DARTY MAIN ACHIEVEMENTS • Success of the full scale Covid-19 stress test on Fnac Darty’s business model confirming the relevance of the Group’s strategy – Disrupted logistics and digital capacity: switch from offline to online sales and ability to cope with strong peaks in demand with proa
Slide 7: Group revenues & current operating income
GROUP REVENUES & CURRENT OPERATING INCOME • Sales growth of +0.6% on a like-for-like basis1 driven by the €m strong momentum in online sales despite the in-store traffic (IFRS 5 excluding BCC) 2019 2020 % Change impacted by two lockdowns in the context of the Covid-19 crisis • Gross margin rate reac
Slide 8: Performance by geographic region
PERFORMANCE BY GEOGRAPHIC REGION • France & Switzerland €m 2019 2020 Change – Strong sales growth thanks to excellent digital performance which fully offset the drop in in-store traffic related to the crisis France & Switzerland – Current operating income impacted by the decline of the gross margin
Slide 9: Group reported financial results
GROUP REPORTED FINANCIAL RESULTS €m (IFRS 5 excluding BCC) 2019 2020 • Financial expense of €51m in 2020 including the cost of guarantee of the State-guaranteed loan Current operating Income 293 215 and related set-up costs amounting to €2.6m, and the impact of IFRS 16 totaling €22m Non-current oper
Slide 10: Simplified H1 & H2 2020 P&L vs. 2019
SIMPLIFIED H1 & H2 2020 P&L VS. 2019 €m H1 2019 H2 2019 H1 2020 H2 2020 Revenues 3,093 4,256 2,849 4,642 Gross Margin 951 1,285 844 1,342 % Revenues 30.7% 30.2% 29.6% 28.9% Total costs -905 -1,038 -902 -1,069 % Revenues 29.3% 24.4% 31.7% 23.0% Current operating income 46 247 -58 273 Non-current oper
Slide 11: Strong free cash flow generation in 2020
STRONG FREE CASH FLOW GENERATION IN 2020 €m • EBITDA1 down €59m in line with current operating (IFRS 5 excluding BCC) 2019 2020 income evolution EBITDA 626 567 • CAPEX2 of €99m, in line with the indication given by the Group IFRS 16 impact -231 -245 • Solid operating free cash-flow1 of €192m sustain
Slide 12: Solid liquidity position reinforced in 2020
SOLID LIQUIDITY POSITION REINFORCED IN 2020 €m 2019 2020 • Solid liquidity position of €1.9 billion, thanks to the Shareholders’ equity 1,398 1,373 implementation of the Guaranteed Government Net Debt1 18 -114 Loan combined with our strong business recovery and solid financial management Gross debt
Slide 13: Current highlights & outlook
CURRENT HIGHLIGHTS & OUTLOOK • The Covid crisis is still present in all countries in which the Group operates with some stores closed – In France, big shopping malls are closed representing more than 70 Fnac and Darty stores closed – As demonstrated in 2020, the Group has the capacity to continue to
Slide 14: Relaunch of a shareholder return policy
RELAUNCH OF A SHAREHOLDER RETURN POLICY • Resilience of the Group’s business model in a year of unprecedented crisis • Solid cash flow generation and strong liquidity position Proposed distribution1 of an ordinary dividend of €1.00 per share in 2021 for the 2020 financial year, payment in cash 1Su
Slide 15: New financing strategy as of March 2021
NEW FINANCING STRATEGY AS OF 16 MARCH 2021 • Placement of its first OCEANE bond for €200 million maturing in 2027 • Extension of its RCF line of credit to €500 million maturing maximum in 2028 and repayment of the Senior Term Loan Facility of €200 million maturing in April 2023 • Full repayment of i
Slide 16: Success of the OCEANE
SUCCESS OF THE OCEANE • 1st OCEANE bond for €200 million maturing in 2027 • Use of proceeds: repayment of its Senior Term Loan Facility in the amount of €200 million maturing in April 2023 • 2,468,221 bonds with a par value of €81.03 per bond • The bonds will bear interest at an annual rate of 0.25%
Slide 17: New Strategic Plan: Everyday
Y YW NEW STRATEGIC PLAN EVERYDAY Ju FNAC DARTY
Slide 18: Two iconic brands with a unique positioning and model
TWO ICONIC BRANDS WITH A UNIQUE POSITIONING AND MODEL, WHICH STRENGTH WAS PROVEN BY THE COVID CRISIS ICONIC AND POWERFUL BRANDS ATTRACTIVE CATEGORY MIX LEADERSHIP ON HIGH-VALUE3 DARE Self-fulfillment, CARE Serenity, c.75% ofin our growth categories mix Fnac Darty 2019 market share Fnac Darty 2019 pr
Slide 19: Our next transformation will be driven by our powerful group mission
OUR NEXT TRANSFORMATION WILL BE DRIVEN BY OUR POWERFUL GROUP MISSION Commit to an educated choice and a sustainable consumption S’engager pour un choix éclairé et une consommation durable 19
Slide 20: Our model is evolving towards a responsible digitized retailer
OUR MODEL IS EVOLVING TOWARDS A RESPONSIBLE DIGITIZED RETAILER DELIVERING HIGH-VALUE AND DURABLE SERVICES 2016 - 2018 2018 - 2020 > 2021 everyday au service de nos clients everyday companion of our customers RESPONSIBLE DIGITIZED RETAILER POWERFUL BEST-IN-CLASS DELIVERING HIGH-VALUE AND LEADER OMNIC
Slide 21: How do we commit to an educated choice and sustainable consumption
HOW DO WE COMMIT TO AN EDUCATED CHOICE AND A SUSTAINABLE CONSUMPTION, EVERYDAY? Build a digitized omnichannel retail Lead durable behaviors Scale the next in-home subscription-based assistance service 21
Slide 22: Build a digitized omnichannel retail
BUILD A DIGITIZED OMNICHANNEL RETAIL, THANKS TO… Digitized omnichannel best-in-class online capacities a profitable and digitized store network a high-value offer #convenience >30% 50% 100% #experience online revenue of online revenue of stores #uniqueness penetration by 2025 from Click & Collect pr
Slide 23: Best-in-class online capacities
BEST-IN-CLASS ONLINE CAPACITIES Digitized omnichannel > 50% of total Capex invested by 2025 to offer the best experience, bearing Fnac Darty’s distinctive signature Best-in-class Distinctive signature Enhanced logistics user experience through expert advice to increase capacity Immersive experience
Slide 24: A profitable and digitized stores network
A PROFITABLE AND DIGITIZED STORES NETWORK Digitized omnichannel A stronger and more digitized network, fostering the expertise of salespeople and digital footprint The cornerstone of Optimized current Expertise our digital footprint store network and experience Immediacy of 100% profitability of our
Slide 25: A high-value and lasting offer
A HIGH-VALUE AND LASTING OFFER Digitized omnichannel An uncompromised acceleration to offer high-value products to all Conquest of Dynamic and spot-on Enhanced access legitimate territories diversification Focus on white goods Focus on urban mobility Financing services A full-stack action plan A hol
Slide 26: New standards of human-to-human omnichannel excellence
WE SET THE NEW STANDARDS OF HUMAN-TO-HUMAN OMNICHANNEL Digitized omnichannel EXCELLENCE BY CLOSING THE LOOP OF WEB AND STORES SYNERGIES From bringing the web into our stores… ... to bringing our stores online, with the strength of our 12,000 in-store salespeople Expertise and customer In-store sales
Slide 27: A high-value and lasting offer: durability
A HIGH-VALUE AND LASTING OFFER durability a more durable offer, combined with customers’ orientation towards durable products the promotion of responsible behaviors, notably through eased access to repair #durability 135 c.2,5M #repair “durability score” products repaired #use by 20251 in 20252 #tra
Slide 28: Lead the transition towards more sustainable consumption
LEAD THE TRANSITION TOWARDS MORE SUSTAINABLE durability CONSUMPTION AND BEHAVIORS From a sustainable choice to a sustainable ecosystem of products and services The right solutions A more durable A well-established and advice to offer reputation consume better Durability criteria applied to Solutions
Slide 29: Leadership on durability with a holistic ecosystem
THIS AMBITION WILL STRENGTHEN OUR LEADERSHIP ON durability DURABILITY WITH A HOLISTIC ECOSYSTEM ASSISTANCE & REPAIR DURABLE OFFER RECYCLING SECOND LIFE USED PRODUCTS COLLECTION 29
Slide 30: Scale the next in-home subscription-based assistance services
SCALE THE NEXT IN-HOME SUBSCRIPTION-BASED services ASSISTANCE SERVICES BY… unlocking the full potential of our exclusive unlimited repairs subscription program >2M #subscription #margin subscribers to our unlimited repairs subscription program by 2025 #use #derisked retail 30
Slide 31: Become the undisputed leader of in-home assistance solutions
BECOME THE INDISPUTED LEADER OF IN-HOME ASSISTANCE SOLUTIONS services LEVERAGING OUR UNIQUE SUBSCRIPTION BASED SERVICE : DARTY MAX Tremendous potential to unlock to become the leader of in-home assistance solutions Whole home, A subscription- A valuable bond available based model with customers ever
Slide 32: Whole home, available everywhere
WHOLE HOME, AVAILABLE EVERYWHERE services From our products… From our stores… to the entire home to everywhere … From ... to all ... to the entire From our … to every customer ... to B2B partners MDA… our products home stores… touchpoint c.1Bn touchpoints today1 The path to become the undisputed lea
Slide 33: A subscription-based model
A SUBSCRIPTION-BASED MODEL services <10€1 Eased access Recurring x2,5 to high-value margin generated a month to protect cash flows over a 5 year-period one’s every appliance services vs. warranty extension 50%2 Maximum Loyalty and >50%1 of French households MDA additional declare they would convenie
Slide 34: Proven ability to launch, sell and operate subscriptions and repair
WE LEVERAGE OUR PROVEN ABILITY TO LAUNCH, SELL services AND OPERATE SUBSCRIPTIONS, AND TO REPAIR Design the service No one else than Customers Non customers Fnac Darty Recruit customers Stores B2C Other B2B2C can offer such contact points a complete expertise to run this exclusive service and become
Slide 35: All of Everyday is in each of its ambitions
ALL OF EVERYDAY IS IN EACH OF ITS AMBITIONS Build a digitized omnichannel retail Scale the next in-home Lead durable subscription-based behaviors assistance service 35
Slide 36: Key financial drivers
KEY FINANCIAL DRIVERS… Revenue growth mainly driven by increased online activity >30% online revenue penetration by 2025 o/w 50% is click & collect Significant contribution in gross margin of the subscription-driven service offering >2M subscribers to our unlimited repairs subscription program by 20
Slide 37: To generate recurring cash flows
… TO GENERATE RECURRING CASH FLOWS Revenue growth mainly driven by increased online activity Significant contribution in gross margin of the subscription-driven service offering Cost-cutting program to offset more than the expected inflation Controlled capex level focused on strategic initiatives Cu
Slide 38: Capital allocation ensuring sustainable shareholder returns
A STEP FURTHER IN CAPITAL ALLOCATION ENSURING SUSTAINABLE SHAREHOLDER RETURNS Fund profitable growth Increased Reinvest in the business Opportunity-driven decision Free Cash Flow Tactical bolt-on M&A Incremental + + shareholder return Leverage1 of max 2.0x Controlled net debt Shareholder retur
Slide 39: Outlook for 2021-2023
OUTLOOK FOR 2021-2023 Slight increase in revenues vs 2020 2021 Slight increase in current operating income vs 2020 Proposal for a dividend of €1/share for 20201 2021-2023 c.€500m of cumulative Free Cash Flow2 Target dividend of ≥ €1.5/share3 From 2021 Additional opportunistic shareholder return Leve
Slide 40: Fnac Darty profile in 2025
FNAC DARTY PROFILE IN 2025 >30% >2M 100% Online revenue penetration Subscribers to our unlimited repairs Stores profitable by 20251 by 2025 subscription program by 2025 c.€120m ≥ €240m Shareholder return Total annual normative capex budget Run rate Free Cash Flow3 in 2025 >30% mid-term payout ratio
Slide 41: Appendices
li APPENDICES FNAC DARTY “ff y
Slide 42: Definitions
DEFINITIONS • Definition of Like-for-like sales growth – This indicator measures changes in revenue excluding exchange rate fluctuations, the impact of variations in scope and the impact of the opening and closing of directly owned stores since January 1, N-1. • Definition of Current operating incom
Slide 43: Definitions
DEFINITIONS EBITDA EBITDA excluding IFRS 16 + Rents within the scope Current operating income before depreciation, EBITDA including rental expenses within the scope of amortization and provisions on fixed operational assets of IFRS 16 = IFRS 16 Free cash flow from operations Free cash flow from oper
Slide 44: Fnac Darty, a responsible company
FNAC DARTY, A RESPONSIBLE COMPANY 2019 OUTPERFORMER AVERAGE PERFORMER 2020 • Top 20% worldwide (rank 44 48 38 2019 13 7.7 7.9 68 in Universe: 529/4,846) 2020 100 100 • Rank in Sector: 9/73 (vs. 11/76 in 2019) 61 out of 136 out of AA out of 10 AA out • Information rate: 91% 126 of 10 Information rate
Slide 45: Fnac Darty, a responsible company
FNAC DARTY, A RESPONSIBLE COMPANY FOCUS ON A STRONG COMMITMENT TOWARD A MORE CIRCULAR ECONOMY A strong commitment to the circular economy with a clear engagement in extending product durability through a unique service proposal Customer information from independent experts An activity dedicated to t
Slide 46: Q4 and FY 2020 revenue vs. 2019
Q4 AND FY 2020 REVENUE VS. 2019 Change vs. Q4 2019 Change vs. 2019 €m At constant FX Q4 2020 At constant FX 2020 (IFRS 5 excluding BCC) and and comparable Reported Like-for-like Reported comparable Like-for-like scope of scope of consolidation consolidation France and Switzerland 2,348 11.3% 12.1% 1
Slide 47: Q1-Q2-Q3 2020 revenue vs. 2019
Q1-Q2-Q3 2020 REVENUE VS. 2019 Change vs. Q1 2019 Change vs. Q2 2019 Change vs. Q3 2019 €m (IFRS 5 At constant FX At constant At constant Q1 2020 and Q2 2020 FX and Q3 2020 FX and excluding BCC) Reported comparable Like-for-like Reported comparable Like-for-like Reported comparable Like-for-like sco
Slide 48: Cash flow statement
CASH FLOW STATEMENT €m (IFRS 5, excluding BCC) 2019 2020 Net cash as of January 1 7 -18 Operating free cash Flow 173 192 Interest paid net of interest and dividends received -46 -25 Acquisition/disposal of subsidiaries net of cash transferred -107 -9 Acquisition/disposal of other financial assets (n
Slide 49: Simplified P&L
SIMPLIFIED P&L €m Reported (IFRS 5, excluding BCC) 2019 2020 Revenues 7,349 7,491 Current operating income 293 215 Non-current operating income and expenses -29 -16 Operating income 265 199 Financial expense -79 -51 Tax -72 -60 Consolidated net income from continuing operations, Group share 115 96 N
Slide 50: Balance sheet
BALANCE SHEET Assets in €m FY 2019 FY 2020 Equity and Liabilities in €m FY 2019 FY 2020 Goodwill 1,654 1,654 Share capital 27 27 Intangible assets 511 506 Reserves related to equity 971 971 Conversion reserves -6 -5 Tangible assets 615 594 Other reserves 396 375 Rights of use relating to lease agree
Slide 51: Store network
STORE NETWORK December 31, 2019 December 31, 2020 (IFRS 5, excluding BCC) Owned Franchised Total Owned Franchised Total France and Switzerland(1) 411 315 726 412 339 751 Iberian Peninsula 65 5 70 67 5 72 Belgium and Luxembourg 84 0 84 85 0 85 Group 560 320 880 564 344 908 1 Including 13 stores outsi
Slide 52: Disclaimer
DISCLAIMER IMPORTANT NOTICE: By reading this presentation, you agree to be bound by the following limitations and qualifications: certain information included in this release is not based on historical facts but on forward-looking statements. Such forward looking statements speak only as of the date
Slide 53: CORPORATE PRESENTATION
CORPORATE PRESENTATION 2021