Michael Hill International Ltd. · ASX:MHJ
Michael Hill International — Shareholder Meeting (October 2021)
41 slides from Michael Hill International's shareholder meeting presentation, Oct 27, 2021
Slide 1: Annual General Meeting presentations
27 October 2021 To: Company Announcements Office Company Announcements Office ASX Limited NZX Limited Annual General Meeting presentations In accordance with the Listing Rules, enclosed are the presentations of the Chair, Managing Director & Chief Executive Officer and Chief Financial Officer, which
Slide 2: Chair's Address
Michael Hill International Limited 2020 Annual General Meeting CHAIR’S ADDRESS Today I’d like to give you an overview of how we view the year that’s closed. Following that Daniel and Andrew will give more detail on our 2021 results, our current and future focus and a trading update for the recent qu
Slide 3: Chair's Address continued and Managing Director & CEO's Address
In June this year, Emma Hill decided to retire as Chair and remain as a non-executive director. As an admirer of the Michael Hill brand for many decades, I was honoured to be selected to succeed Emma as Chair and I now look forward to building on the heritage that Sir Michael, Emma and the entire Hi
Slide 4: CEO address: FY21 results and supply chain
Focused management of our key Indian supply chain meant that the pandemic impacts in India did not significantly disrupt inventory flow. Other sourcing regions across Europe and China were also relatively unimpacted. Of course throughout the year, always at the forefront of our minds, was prioritisi
Slide 5: CEO address: digital transformation
Digital is at the forefront of our transformation with an emphasis on customer experience, product offering, and fulfilment. Following another year of exceptional growth, investment in our highest profit margin channel continues to focus on incremental traffic, higher conversion rates, and increased
Slide 6: Chief Financial Officer's Address
Our early insights already provide confidence that the program is resonating with our customers, delivering increased frequency, larger baskets, and higher margins. Predicative analytics and increased personalisation are being enabled by investment in data analytics capability and artificial intelli
Slide 7: CFO address: revenue and balance sheet
growth in all markets. Total revenue was up by 13.1% to $556.5m, as the Company continues to elevate and modernise the brand, and transform the customer journey. The Company strengthened its balance sheet, with a year-end net cash position of $72.4m (prior year $0.5m) and nil debt. During the year,
Slide 8: CEO address: FY22 Q1 update
total sales. Website traffic increased by 35.3% against prior year, with an increased volume of customers continuing to utilise our enhanced online platform. The Company continues to prioritise product evolution and create uniquely Michael Hill jewellery. Branded collections represented 42.1% of tot
Slide 9: AGM presentation
AGM presentation 27 October 2021
Slide 10: Important notice and disclaimer
Important notice and disclaimer Certain statements in this announcement constitute forward-looking statements. Forward-looking statements are statements (other than statements of historical fact) relating to future events and the anticipated or planned financial and operational performance of Michae
Slide 11: Board of Directors
Gary Smith Independent NED Rob Fyfe Chair, Audit & Independent NED Sir Michael Hill Risk Management Chair Founder Committee Emma Hill Daniel Chair, People Jacquie Naylor Development & Bracken Remuneration Managing Independent NED Committee Director & CEO 3
Slide 12: CFO, Company Secretary and Auditor
Andrew Lowe Kellie McKenzie CFO & Company Secretary Ernst & Young 4
Slide 13: Questions – audio
Questions – audio Three stone diamond rings from the 5 Sir Michael Hill Designer Bridal Collection
Slide 14: Questions – written
Questions – written Three stone diamond rings from the 6 Sir Michael Hill Designer Bridal Collection
Slide 15: Voting
Voting When open, the vote will be accessible by selecting the voting ft Home x. NG Bi vorine tab at the top of the screen B Poll Open Resolution 1 To vote simply select the direction in which you ” would like to cast your vote. The selected option will change colour For O Against O Abstain re) For
Slide 16: Chair's address
Chair’s address Rob Fyfe From left: Grand Arpeggio and Grand Aria from our Sir Michael Hill Designer Bridal Collection, and a three stone ring from our Evermore Collection
Slide 17: Managing Director & CEO presentation
Managing Director & CEO presentation FY21 performance overview Rings from our Southern Star Collection
Slide 18: FY21 performance overview
FY21 performance overview Outstanding year - all metrics up • Significant disruption from the global pandemic • Transformative agenda delivering both strong sales growth and margin expansion • Digital sales +53% • Retail fundamentals (ATV , IPS and conversion ) • Loyalty – now over 900,000 members •
Slide 19: Strategy update – Growth and Margin
Strategy update – Growth and Margin 11
Slide 20: Strategy update – Brand
Strategy update – Brand A modern, differentiated, omni-channel jewellery brand Elevated brand messaging Reducing discount-led campaigns “Made in Australia” Increasing Average Transaction Value Customer segmentation and personalisation 12
Slide 21: Strategy update – Digital
Strategy update – Digital Digital-first Over $34.8m in sales (+53%) Highest profit margin channel Traffic conversion Refreshed navigation and website Website users increased by 35.3% FY21 traffic over 18.5m users Launch of Medley Continual growth underpinned by omni-channel Conversion
Slide 22: Strategy update – Retail fundamentals
Strategy update – Retail fundamentals Elevated productivity and customer experience Nine quarters of same store sales growth since FY19Q4 Roster optimisation Visual excellence and increased training Store refurbishments with improved layout and design Increased focus on retail metrics Retail G
Slide 23: Strategy update – Omni-channel
Strategy update – Omni-channel Customer-led and channel agnostic Ship from store improved inventory utilisation reduced costs more efficient better customer experience Click and reserve Virtual selling In-store appointments (made via website) Click and collect Marketplace strategy 15
Slide 24: Strategy update – Loyalty
Strategy update – Loyalty Your love for jewellery rewarded Significantly more profitable customer more sales, more often higher margin, higher Average Transaction Value Now over 900,000 members Predictive analytics, powered by artificial intelligence Targeted communication, bias for action 1
Slide 25: Strategy update – Product evolution
Strategy update – Product evolution Uniquely Michael Hill Regular product newness Growth in branded collections Lower inventory holdings Focus on craftsmanship Sustainability emphasis 17
Slide 26: Strategy update – Cost conscious culture
Strategy update – Cost conscious culture Unwavering focus on costs Controlled working capital Strong net cash position Reduced supply chain costs Optimised inventory holdings 3rd party logistics: Canadian distribution facility 18
Slide 27: CFO presentation
CFO presentation FY21 results Rings from the Fenix Created Diamonds for Michael Hill Collection
Slide 28: FY21 Group results
Pendants from the Spirits Bay, Endless and Knots Collections FY21 Group results • Revenue growth in all markets • Gross profit up $50.7m • Delivered significant increase to net profit after tax (NPAT) and earnings before interest and tax (EBIT) • Strong balance sheet with a healthy net cash position
Slide 29: FY21 Key Performance Results
FY21 Key Performance Results +35.3% $56.6m +8.6% GROUP WEBSITE TRAFFIC COMPARABLE EBIT SAME STORE 18.6m USERS FY20: loss $5.2m SALES GROWTH 6.3% 62.7% 42.1% 6 1 $34.8m GROUP BRANDED STORES STORE DIGITAL SALES GROSS MARGIN COLLECTION SALES CLOSED OPENED + 53.4% FY20: 3 7.3 % FY20: 60.6% +13.0% +7.1%
Slide 30: Managing Director & CEO presentation: FY22Q1 update
Managing Director & CEO presentation FY22Q1 update Rings from our Southern Star Collection
Slide 31: FY22Q1 update
FY22Q1 update • Continued strong performance despite impact of ongoing lockdowns • A combination of increased margins, focused cost control, digital growth and strong same store sales, has lessened the negative impact on earnings from • Earnings impact of COVID-related the lockdowns closures well ma
Slide 32: FY22Q1 update
FY22Q1 update • Same store sales for the quarter were up an impressive 15.5%, against FY21Q1 • The quarter saw 7,396 lost store trading days vs 2,158 in FY21Q1 (a net loss of 20% of Q1 trading days against prior year) • All store sales were only down 10% for the quarter against FY21Q2 • Earnings imp
Slide 33: FY22Q1 update
FY22Q1 update • Strategic initiatives underpinned margin growth of 100 to 200 basis points in all markets and channels against FY21Q1 • For the quarter, digital sales were up 58.2% against FY21Q1, representing 9.4% of sales (FY21Q1: 5.3%) • Earnings impact of COVID-related closures well managed • St
Slide 34: Questions
Questions
Slide 35: Business of the Annual General Meeting
Business of the Annual General Meeting Ring from our Solitaire by Michael Hill Collection
Slide 36: Financial statements and reports
Financial statements and reports • Audited financial statements • Directors’ report • Auditor’s report. Pendant and ring from our Knots Collection 28
Slide 37: Resolution 1: Remuneration report
Resolution 1: Remuneration report To consider and if thought fit, pass the following advisory resolution: “That the Remuneration Report for the year ended 27 June 2021 (as set out in the Directors’ Report) is adopted.” FOR AGAINST OPEN ABSTAIN EXCLUDED NO. OF 77,921,120 508,975 390,037 242,631 181,1
Slide 38: Resolution 2: Re-election of Sir Michael Hill as a director
Resolution 2: Re-election of Sir Michael Hill as a director To consider and if thought fit, pass the following resolution as an ordinary resolution: “That Sir Michael Hill who retires by rotation in accordance with ASX Listing Rule 14.4 and Rule 38.6 of the Company’s Constitution and, being eligible
Slide 39: Resolution 3: Re-election of Emma Hill as a director
Resolution 3: Re-election of Emma Hill as a director To consider and if thought fit, pass the following resolution as an ordinary resolution: “That Ms Emma Hill who retires by rotation in accordance with ASX Listing Rule 14.4 and Rule 38.6 of the Company’s Constitution and, being eligible, offers he
Slide 40: Resolution 4: Grant of share rights to Mr Daniel Bracken
Resolution 4: Grant of share rights to Mr Daniel Bracken To consider and if thought fit, pass the following resolution as a special resolution: “That for the purposes of ASX Listing Rule 10.14 and for all other purposes, approval be given to grant 634,081 share rights to the Managing Director & Chie
Slide 41: Thank you
Thank you michael hill. INTERNATIONAL LIMITED
Michael Hill International — Shareholder Meeting (October 2021) on 6ix