Endeavour Group Ltd · ASX:EDV
Endeavour — Investor Presentation (October 2023)
22 slides from Endeavour's investor presentation, Oct 10, 2023
Slide 1: Endeavour Group Investor presentation October 2023
Endeavour Group Investor presentation October 2023
Slide 2: Disclaimers
Disclaimers This presentation is dated 10 October 2023 and unless stated otherwise is current as at that date. This presentation contains summary and general information about Endeavour Group Limited and its controlled entities (together, Endeavour, the Group, or Endeavour Group), and Endeavour Grou
Slide 3: Responses to Bruce Mathieson Group (BMG) statements
1 Responses to Bruce Mathieson Group (BMG) statements Where data is available, we view the period between F19 and F23 as most The Bruce Mathieson Group has relied on selective and incomplete comparable: COVID-19 significantly impacted trading in both our divisions, information to present a negative
Slide 4: Responses to Bruce Mathieson Group (BMG) statements (cont'd)
Responses to Bruce Mathieson Group (BMG) statements (cont’d) BMG statements Endeavour Group performance and context ● From F19 to F23, EBIT has grown at a compound average annual growth rate of 5.3%, ahead of Revenue with a compound average annual growth rate of 4.2% – i.e. EBIT has grown ahead of s
Slide 5: Key investment highlights
Key investment highlights ✔ We have a portfolio of leading brands and businesses with a proven track record of growth and profitability ✔ We operate leading Retail businesses underpinned by our strength in eCommerce ✔ We are investing in our Hotels to position them for growth and long-term value cre
Slide 6: Our business has a history of strong and sustained growth
Our business has a history of strong and sustained growth F05 F06 F09–F11 F12–F13 F15 F20 F21 F22–F23 Takeover ALH Group Acquisition of Multiple Launch of My Acquisition of Established Acquisition of of established Langton’s, acquisitions Dan’s loyalty Chapel Hill and Endeavour Josef Chromy Australi
Slide 7: We are delivering results in each of our core businesses
We are delivering results in each of our core businesses Strong growth demonstrated between the F19-F23 period1, with profit growing ahead of sales Retail Revenue Hotel Revenue (F19–23, $m) (F19–23, $m) +4.0% CAGR +4.8% CAGR Retail EBIT and margin Hotel EBIT and margin (F19–23, $m, %) (F19–23, $m, %
Slide 8: Retail business is sustainably growing trading margin
Retail business is sustainably growing trading margin Gross profit margin growth accelerated F19-23, driven by product innovation, better buying and premiumisation. This was underpinned by a step up in investment in digital, data and analytics. Retail Gross Profit Margin (%)1 +300 bps Retail CODB %1
Slide 9: Dan Murphy's is more competitive
Dan Murphy’s lowest liquor price guarantee supports real price leadership, driving market leading value perception Dan Murphy’s actual price index (weighted relative price of product basket 1) Value perception (%)2 61% Dan Murphy’s is more competitive 32% Brand 1 33% Brand 2 42% Brand 3 Notes: (1) S
Slide 10: Our Retail business has grown sales meaningfully since F19
Our Retail business has grown sales meaningfully since F19 We materially outperformed during COVID, driven by Dan Murphy's category destination status and an extreme acceleration in eCommerce Retail Revenue (F19–23, $bn) Incremental COVID-19 impacted Revenue We remain focused on F19-F23 profitable g
Slide 11: Our Retail store network has continued to grow profitably
Our Retail store network has continued to grow profitably Revenue and EBIT per store has outpaced store growth across our network Retail revenue / store ($‘000)1 +2.1% CAGR We operate an efficient network EBIT per store has 1 Retail EBIT / store ($‘000) +3.2% CAGR grown faster than revenue per store
Slide 12: Our Retail businesses are eCommerce leaders in the category
Our Retail businesses are eCommerce leaders in the category Market leading eCommerce platform, powered by 5.2m active MyDan’s members Retail eCommerce sales (A$m) and eCommerce penetration (%) eCommerce business overview1 +14.5% CAGR ~36% of Dan Murphy’s and BWS sales digitally influenced Dan Murphy
Slide 13: We have invested in our Hotels network to position it for growth
We have invested in our Hotels network to position it for growth Hotels, including managed clubs (#) Revenue ($bn) +26 hotels (1) hotels COVID-19 impact Source: Certain information obtained from Woolworths Company filings 13
Slide 14: Our Hotels network has continued to grow profitably
Our Hotels network has continued to grow profitably Revenue and EBIT per store has outpaced growth of number of hotels in the network Hotel revenue / hotels ($‘000)1 +2.8% CAGR Hotel EBIT / hotels ($‘000)1 +3.1% CAGR Net # of hotels1 +1.9% CAGR Source: Certain information obtained from Woolworths Co
Slide 15: Growing Group earnings through margin management and cost control
Growing Group earnings through margin management and cost control Group EBIT margin (F19-23, %) ● We grow Group EBIT through a balance of sales +35 bps growth, gross profit margin management and cost control to mitigate impacts of cost inflation ● We invest in capability that drives growth and margi
Slide 16: We have an optimisation program in place that is delivering sustainable operating efficiency
We have an optimisation program in place that is delivering sustainable operating efficiency F24–F26 F23 F22 $200m+ Target ofsavings target $200m+savings $60m savings delivered $30m savings delivered Technology enabled Group wide program, targeting efficiencies across the end-to-end Evolved into end
Slide 17: Disciplined capital allocation framework in place
Disciplined capital allocation framework in place Operating cash flow (high cash realisation) ● Annual cash realisation expected to be Targeting investment grade credit metrics ~90-110% (COVID / one off impacts have driven fluctuation) Sustaining CAPEX ● Sustain the core Dividends Stay-in-business 7
Slide 18: Capital allocation between segments
Capital allocation between segments In a rising cost of capital environment, we are actively exploring opportunities to continually optimise capital across the group Average funds employed by segment1 F23 EBIT F23 ROFE $m % $m 39% 50% 50% 61% Retail Hotels We are focused on enhancing the performance
Slide 19: Working capital management
Working capital management Working capital levels have normalised following COVID-19 supply chain disruptions Trade working capital days1 Inventory days2 COVID-19 impacted COVID-19 impacted We are targeting further working capital days reduction from F24 Notes: (1) Trade working capital days calcula
Slide 20: Net debt remains within target levels supportive of future growth and returns
Net debt remains within target levels supportive of future growth and returns Significant free cashflow generation supports shareholder distributions and investment Net debt ($m) Significant operating cash flow to support investment and dividends to shareholders Vic Gaming4 237 Dividends 1161 COVID-
Slide 21: Since demerger we have been investing in our sustainability agenda
Since demerger we have been investing in our sustainability agenda with an emphasis on responsibility & community Player Protect is our commitment to leading the way in responsible gaming ● Evolution of the Group’s holistic approach to responsible gaming in ALH ● Whole-of-business framework ● Coveri
Slide 22: Strong performance through our first two years as a listed company, but there is more to do
Strong performance through our first two years as a listed company, but there is more to do We have focused on delivering stability and value since demerger …with more to do to unlock the next phase of growth Strong, sustained and profitable growth across our core Drive earnings growth through a bal
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