Samsonite Group S.a. · HKEX:1910
Samsonite — Samsonite International — Q1 2022 Earnings Presentation
29 slides from Samsonite's earnings presentation, May 12, 2022
Slide 1: First Quarter Results
2022 FIRST QUARTER RESULTS MAY 12, 2022 Samsonite International S.A. Stock Code: 1910
Slide 2: Disclosure Statement
Disclosure Statement This presentation and the accompanying slides (the “Presentation”), which have been prepared by Samsonite International S.A. (“Samsonite” or the “Company”), do not constitute any offer or invitation to purchase or subscribe for any securities, and shall not form the basis for, o
Slide 3: Agenda
Agenda Business Update Financial Highlights Outlook Q&A Page 3
Slide 4: Our sales recovery and strong profitability continued in Q1 2022
Our sales recovery and strong profitability continued in Q1 2022 Q1 2022 sales growth continued to improve to (25.2%)(1)(2) vs. Q1 2019 up from (28.0%)(1)(2) in Q4 2021 despite a rise in COVID-19 cases and the resulting reinstatement of travel restrictions and social distancing measures in certain m
Slide 5: Net sales increased 75% compared to prior year, and Adjusted EBITDA margin improved
Net sales increased 75%(1)(2) compared to prior year, and Adjusted EBITDA margin improved to 12.8% in Q1 2022 from -8% a year ago Consolidated Quarterly Net Sales and Adjusted EBITDA Q1 2022 Adjusted EBITDA margin was approximately 260 basis points better than Q1 2019. Additionally, Q1 2022 Adjusted
Slide 6: The sales recovery is in various stages across regions
The sales recovery is in various stages across regions, but overall trends continue to improve By region constant currency sales growth vs. 2019 (2) (2) (2) North America continued to see a The recovery in Asia has lagged Europe continued to see sequential quarterly Latin America continued strong re
Slide 7: International travel has continued to recover, and is poised for an even stronger recovery
International travel has continued to recover, and is poised for an even stronger recovery over the rest of 2022 Domestic Revenue Passenger-kilometers (RPKs) vs. International RPKs Domestic travel was negatively impacted by the Delta variant. Source: IATA Monthly Statistics+ Domestic travel recovere
Slide 8: The travel recovery has varied across regions
The travel recovery has varied across regions, with the quickest recoveries in North America, LATAM, and Europe Total Market – Revenue Passenger-Kilometers (RPKs) – comparison to same month in 2019 All markets showed strong improvement in Q1 with a temporary dip in January due to a rise in COVID-19
Slide 9: Travel has slowly been improving in Asia as countries ease travel restrictions
Travel has slowly been improving in Asia as countries ease travel restrictions Many countries within Asia have been lifting or easing their travel restrictions, which has helped improve the travel recovery within the region. Key markets such as South Korea, Hong Kong, Australia, Singapore and Thaila
Slide 10: Gross margin increased to 54.7% in Q1 2022 vs. 48.7% in Q1 2021
Gross margin increased to 54.7% in Q1 2022 vs. 48.7% in Q1 2021 Q1 2022 gross margin approached pre-pandemic levels Quarterly Gross Margin Comparison despite significant headwinds on costs and inflationary pressures. Q1 2022 gross margin increased by approximately 600 basis points to 54.7% from 48.7
Slide 11: In our 6th annual ESG Report we share 2021 accomplishments and 2022 priorities
In our 6th annual ESG Report we share 2021 accomplishments and 2022 priorities In 2021, we: Launched Magnum Eco, our most sustainable Samsonite product to date. Doubled our share of products with recycled materials since 2019. Generated 1.7 GWh of renewable energy from on-site solar panels (>4% of o
Slide 12: Agenda
Agenda Business Update Financial Highlights Outlook Q&A Page 12
Slide 13: Q1 2022 Results Highlights
Q1 2022 Results Highlights Net sales increased 74.9%(1)(2) Gross margin increased by 600bp from Q1 Adjusted EBITDA increased by Adjusted Net Income compared to prior year. 2021, driven by increased sales, lower US$102 million from Q1 2021 increased by US$91 million promotional activity due to strong
Slide 14: Financial Highlights
Financial Highlights Net sales in Q1 2022 increased from prior year by 74.9%(1)(2) to US$574 million. Net sales performance in Q1 2022 continued its sequential quarterly improvement compared to 2019, with Q1 2022 net sales down by 25.2%(1)(2), reflecting improvement from Q4 2021, which was down by 2
Slide 15: Financial Highlights (cont'd)
Financial Highlights (cont’d) Fixed SG&A expenses for Q1 2022 were US$88 million lower than Q1 2019 driven by the comprehensive cost reduction program that began in 2020, the impact from the sale of Speck, and continued tight cost discipline as net sales continue to recover. Advertising spend increa
Slide 16: Financial Highlights (cont'd)
Financial Highlights (cont’d) Significant liquidity of approximately US$1.4 billion as of March 31, 2022, which includes US$330 million available on the RCF. Q1 2022 cash burn(2) of US$(58) million compared to significant cash generation(2) in 2H 2021 as we invested more into our working capital, pr
Slide 17: Sales were higher in all regions in Q1 2022 compared to the prior year
Sales were higher in all regions in Q1 2022 compared to the prior year as the recovery in travel continued Constant Currency Q1 Q1 Q1 Q1 Growth 91.6%(1) 22.2% 169.7% 151.9% Constant Currency Q1 Q1 Q1 Q1 vs. 2019 -21.6%(1) -38.6% -21.5% 28.7% Page 17 (1) Prior years sales are adjusted to exclude Spec
Slide 18: Net sales increased 75% compared to prior year, and Adjusted EBITDA margin improved
Net sales increased 75%(1)(2) compared to prior year, and Adjusted EBITDA margin improved to 12.8% in Q1 2022 from -8% a year ago Consolidated Quarterly Net Sales and Adjusted EBITDA Q1 2022 Adjusted EBITDA margin was approximately 260 basis points better than Q1 2019. Additionally, Q1 2022 Adjusted
Slide 19: Stronger growth in our wholesale and retail channels and travel category
Stronger growth in our wholesale and retail channels, and an acceleration in our travel category sales compared to prior year as travel recovers Comparison of sales by channel Comparison of Travel vs. Non-travel sales 40.7% (1)(2) (9.3% of Net Sales) 40.1% (1)(2) 99.4% (1)(2) (38.9% of Net Sales) US
Slide 20: The Company has continued to maintain fixed SG&A savings
The Company has continued to maintain fixed SG&A savings from our cost reduction initiatives SG&A within Adjusted EBITDA(1) Q1 2022 fixed SG&A expenses were US$13 million higher than prior year as temporary cost savings rolled off, but still US$88 million lower than 2019. We continue to tightly cont
Slide 21: Significant ongoing SG&A savings are offsetting the lower sales compared to 2019
Significant ongoing SG&A savings are offsetting the lower sales compared to 2019 leading to higher Adjusted EBITDA margin Adjusted EBITDA Bridge Q1 2019 – Q1 2022 10.2% 12.8% of sales of sales US$106.1 million (1)(2) (1) (1)(2) (1) (1)(2) (1) Stated on a constant currency basis. (2) SG&A within Adju
Slide 22: Q1 2022 cash burn of US$(58) million driven by working capital investment
Q1 2022 cash burn(1) of US$(58) million was largely driven by increased investment into our working capital, primarily inventory Quarterly cash burn(1) US$m Page 22 (1) Cash burn is calculated as the total increase (decrease) in cash and cash equivalents per the consolidated statements of cash flows
Slide 23: Balance Sheet
Balance Sheet US$m March 31, December 31, March 31, $ Chg Mar-22 % Chg Mar- Net debt of US$1,525 million 2021 2021 2022 vs. Mar-21 22 vs. Mar-21 at March 31, 2022, which Cash and cash equivalents 1,417.9 1,324.8 1,057.0 (360.9) -25.5% decreased by approximately Trade and other receivables, net 127.9
Slide 24: Working Capital
Working Capital US$m March 31, December 31, March 31, $ Chg Mar-22 % Chg Mar- Net working capital at March 31, 2022 2021 2021 2022 vs. Mar-21 22 vs. Mar-21 was US$80 million lower than at March Working Capital Items 31, 2021 driven mainly by higher trade Inventories $ 434.9 $ 348.4 $ 406.2 $ (28.6)
Slide 25: Continued to tightly manage our capex and software additions in Q1 2022
Continued to tightly manage our capex and software additions in Q1 2022 Capital Expenditure by project type The majority of capex in Q1 2022 US$m Q1 2021 Q1 2022 was related to retail remodels Retail 1.4 2.2 and investment in machinery and Product Development / R&D / Supply 0.5 1.9 equipment for pro
Slide 26: Agenda
Agenda Business Update Financial Highlights Outlook Q&A Page 26
Slide 27: Outlook
Outlook Our strong momentum and financial results at the end of 2021 have continued into 2022, and we are well positioned to grow market share at a fundamentally higher operating margin as shown in our Q1 2022 results. We remain focused on improving and maintaining our gross margins through reduced
Slide 28: Outlook (cont'd)
Outlook (cont’d) We intend to increase our investment in marketing spend in 2022 to drive growth and capitalize on the continued recovery in travel. We will maintain disciplined expense management on our fixed SG&A expenses, but will look to make selective investments in core strategic functions goi
Slide 29: Agenda
Agenda Business Update Financial Highlights Outlook Q&A Page 29
Samsonite International — Q1 2022 Earnings Presentation on 6ix