Gome Retail Holdings Limited · HKEX:493
Gome Retail — Q3 2018 Earnings Presentation
38 slides from Gome Retail's earnings presentation, November 2018
Slide 1: Results Announcement 2018 Q1-3
Results Announcement 2018 Q1-3 November 2018
Slide 2: Disclaimer
Disclaimer This presentation and the accompanying slides (the “Presentation”) which have been prepared by GOME Retail Holdings Limited (“GOME” or the “Company”) do not constitute any offer or invitation to purchase or subscribe for any securities, and shall not form the basis for or be relied on in
Slide 3: Content
Content 1. Financial Highlights 2. Shared Retail Powered by “New Business, New Markets, New Technology” • "Home ∙ Living" Strategy Provides New Growth Opportunities • Store Network Penetration Drives Business in New Markets • Technology Stimulates Online Retail System Evolution • Being the First Cho
Slide 4: Q1-3 2018 Financial Highlights
Q1-3 2018 Financial Highlights Shared Retail GMV* RMB 4.3 billion Self-support GMV: GMV from Platform: Total GMV: RMB 32.2 billion RMB 66.7 billion RMB 98.9 billion YoY Growth: 26% YoY Decrease: 3% YoY Growth: 5% Mobile GMV YoY Growth: 13% * Shared Retail GMV： GMV achieved by product sharing and ME
Slide 5: Q1-3 2018 Financial Highlights - Key Operating Indicators
Q1-3 2018 Financial Highlights - Key Operating Indicators Sales revenue: RMB 50.99 billion YoY decrease 11.2% Comparable store sales: RMB 42.84 billion YoY decrease 8.9% Consolidated gross profit margin: 18.1% YoY increase 1.0 percentage point Loss attributable to the owners of the parent company: R
Slide 6: Q1-3 2018 Financial Highlights - Key Operating Indicators
Q1-3 2018 Financial Highlights - Key Operating Indicators Operating Expenses Ratio Sales Revenue Change 18.8% 18.8% 18.4% 7.8% 3.7% 17.2% 16.3% 1H17 9M17 FY17 1H18 9M18 -6.7% -8.8% -11.2% 1H17 9M17 FY17 1H18 9M18 Consolidated Gross Profit Margin Net Profit Margin 18.3% 18.1% 0.38% 17.8% 0.32% 17.3%
Slide 7: Content
Content 1. Financial Highlights 2. Shared Retail Powered by “New Business, New Markets, New Technology” • "Home ∙ Living" Strategy Provides New Growth Opportunities • Store Network Penetration Drives Business in New Markets • Technology Stimulates Online Retail System Evolution • Being the First Cho
Slide 8: New Retail Direction – Shared Retail
New Retail Direction – Shared Retail Technology reshaping the dynamics of consumers, products and stores; transforming GOME to a service provider Big data analytics for Sales with more service Covering the complete life-cycle continuous customization responsibilities of products and services Custo
Slide 9: Content
Content 1. Financial Highlights 2. Shared Retail Powered by “New Business, New Markets, New Technology” • "Home ∙ Living" Strategy Provides New Growth Opportunities • Store Network Penetration Drives Business in New Markets • Technology Stimulates Online Retail System Evolution • Being the First Cho
Slide 10: Open up new business and new markets in the existing market
Open up new business and new markets in the existing market Key development of sizable experience stores in T1-T2 markets; Rapid layout of county-level stores in T3-T6 markets; Construction material/household product stores in specialty markets. T1-T2 markets T3-T6 markets T1-T6 markets • Establish
Slide 11: "Home ∙ Living" Strategy Provides New Growth Opportunities
"Home ∙ Living" Strategy Provides New Growth Opportunities Integration of kitchen cabinets and electrical appliances Create the perfect combination of space, kitchen cabinets, Launched partner brands in 62 stores; Targets to bring in countertops and electrical appliances through meticulous mor
Slide 12: "Home ∙ Living" Strategy Provides New Growth Opportunities
"Home ∙ Living" Strategy Provides New Growth Opportunities Home furnishing business HVAC business Home furnishing business launched in 146 stores; As of Q3 2018, heat and ventilation showcases launched in 51 will be launched in a total of 211 stores for 2018. stores; central air-conditioning s
Slide 13: “Home ∙ Living” Scenario - Trendy Life Experience Store
“Home ∙ Living” Scenario - Trendy Life Experience Store Esports+Net Café Baking Studio Anime, Comics and Book Store and Café Experience Stores Experience Stores Games Experience Stores Experience Stores 小美网咖 VR影院 国美竞 Esports stores partner closely with RNG, MISS Kitchen experience stores offer p
Slide 14: Supply Chain – Uncover New User Demands
Supply Chain – Uncover New User Demands Drive new product categories to tap into more business opportunities Dryers Smart door locks Dyson hairdryers Dishwashers Enhance Product Robotic vacuum cleaners Selection Smart speakers Smart mattresses Smart toilet seats 14
Slide 15: Content
Content 1. Financial Highlights 2. Shared Retail Powered by “New Business, New Markets, New Technology” • "Home ∙ Living" Strategy Provides New Growth Opportunities • Store Network Penetration Drives Business in New Markets • Technology Stimulates Online Retail System Evolution • Being the First Cho
Slide 16: Continue to Expand Store Network in T3-T5 markets
Continue to Expand Store Network in T3-T5 markets Almost 400 county-level stores opened as of Q3 2018. Introduced core brands to stores to Professional sales complete product offering Staff + LCD screen + Renowned brands + video shopping guide differentiated house brand zone High-quality deliv
Slide 17: Internal Growth and External Growth under “Shared Retail”
Internal Growth and External Growth under“Shared Retail” Internal Growth: Social sharing drives traffic and enhances shared benefits External Growth: Competitive supplychain complements external high traffic platforms 2018 Q3 Shared Retail GMV recorded “Group Purchase” is a new way of growth of over
Slide 18: Multi-industry Partners
Multi-industry Partners Proactively explore partnerships. Establish coopeartion partners' commnunity 18
Slide 19: Content
Content 1. Financial Highlights 2. Shared Retail Powered by “New Business, New Markets, New Technology” • "Home ∙ Living" Strategy Provides New Growth Opportunities • Store Network Penetration Drives Business in New Markets • Technology Stimulates Online Retail System Evolution • Being the First Cho
Slide 20: Technology Drives Synergy in O2O Traffic
Technology Drives Synergy in O2O Traffic 20 Technology drives B2C+O2O+group purchase development, creating synergy Activity driven Drive traffic to More rights to lead Me shop Mini Program code Check Promotion purchase order Reverse order / Membership on “Finish Order” Sales activities ( store, onli
Slide 21: Standardization, Visualization and Feedback Services Driven by Technology
Standardization, Visualization and Feedback Services Driven by Technology 21 Logistics service Feedback-enabled System Aftersales service Orders In-store service Aftersales 03 Installation service Cards and wallets Visualized System Logistics service CS system 02 Asset Supporting Service Upgrade Sta
Slide 22: Content
Content 1. Financial Highlights 2. Shared Retail Powered by “New Business, New Markets, New Technology” • "Home ∙ Living" Strategy Provides New Growth Opportunities • Store Network Penetration Drives Business in New Markets • Technology Stimulates Online Retail System Evolution • Being the First Cho
Slide 23: Transform into a “Home∙Living” provider
Reputable logistics Service Provide one-stop logistics service with a focus on large-scale goods including home appliances, home decoration, home furnishing product 01 Strengthen delivery service of large scale home appliances Transform into a “Home∙Living” provider 01 Strengthen installation upon d
Slide 24: Logistics Services Development – Efficiency and Accuracy
logistics Services Development Efficiency and Accuracy “Efficiency”is the basis for service capability “Accuracy”is the requirement for service quality Next-day delivery On-time delivery Compensation for delays Service ratings for county-level cities Change in Monthly Number of Feedback Next-day d
Slide 25: Further Develop Self-operating Logistics System
Further Develop Self-operating Logistics System Expediting self-operating warehouses construction, penetrating into county level logistics network logistics Base To be in operation：Xi’an Under construction: Shenyang, Ningbo, Tianjin (Wuqing), Shanghai (Jiading) Under project development stag
Slide 26: Focus on Commercialization of GOME Manager
Focus on Commercialization of GOME Manager Focus on the commercialization of services, providing “VIP Service Package” for multiple product categories to build reputation VIP cleaning service package Appliances cleaning RMB688 for VIP Cleaning Service Package vouchers Cleaning vouchers represent ser
Slide 27: High-quality and Comprehensive Supply Chain Services for GOME House Manager
High-quality and Comprehensive Supply Chain Services for GOME House Manager Ecosystem of comprehensive supply chain of pre-sale, sale and after-sale to provide standardized and high-quality services supply chain Services Cap Product Sales Installation Recycling service & Repair Maintenance Tool bag
Slide 28: Service Goals of the “GOME House Manager”
Service Goals of the “GOME House Manager” Using GOME’s IoT technology to offer customers with one-stop solutions for smart homes, including delivery and installation, maintenance, appliances recycling, smart home IoT and smart customer servicing under the “Home∙Living” Concept Central air-conditioni
Slide 29: Content
Content 1. Financial Highlights 2. Shared Retail Powered by “New Business, New Markets, New Technology” • "Home ∙ Living" Strategy Provides New Growth Opportunities • Store Network Penetration Drives Business in New Markets • Technology Stimulates Online Retail System Evolution • Being the First Cho
Slide 30: Income Statement Summary
Income Statement Summary （RMB million） 9M2017 9M2018 YoY change Revenue 57,429 50,992 (11.2)% Consolidated gross profit 9,790 9,207 (6.0)% Consolidated gross profit margin 17.0% 18.1% 1.1 percentage points Profit/(loss) before finance cost/income 434 (461) (206.2)% and tax Profit margin 0.8% (0.9)%
Slide 31: Financial Position
Financial Position （RMB million） As of 31 December 2017 As of 30 September 2018 Change Financial Position Cash and cash equivalents 9,244 9,780 5.8% Pledged deposits 6,735 8,693 29.1% Pledged deposits ratio 0.5 (excl. outbound guarantee and 30.2% 30.7% interest reserve) percentage point Inventories
Slide 32: Consolidated Gross Profit Margin
Consolidated Gross Profit Margin （RMB million） 9M2017 9M2018 RMB million Revenue 57,429 50,992 18.1% Consolidated gross profit 9,790 9,207 17.0% 2.8% Consolidated gross profit margin 17.0% 18.1% 2.1% 0.6% 0.5% Gross profit margin from suppliers 14.3% 14.8% Others income and gains 2.7% 3.3% 9,790 9,2
Slide 33: Store Indicator Analysis
Store Indicator Analysis Period End Sales Area Average Quarterly Sales per Store „000 sq. m. RMB million 9.9 10.9 9.9 5,430 9.2 8.1 5,208 5,100 5,195 5,225 3Q17 4Q17 1Q18 2Q18 3Q18 3Q17 4Q17 1Q18 2Q18 3Q18 Quarterly Sales per sq. m. Same Store Sales Growth with Comparable Number of Stores RMB 3,435
Slide 34: T1 & 2 Markets Revenue Breakdown
T1 & 2 Markets* Revenue Breakdown In 9M 2018, Sales Revenue in T1 Market Decreased by 12.7% YoY， Sales Revenue in T2 Market Decreased by 12.6% YoY RMB million Sales Ratio of T1 & 2 Markets* Sales Revenue of T1 & 2 Markets* 43,176 75.2% 74.0% 37,708 14,253 24.8% 24.4% 12,451 1.6% 833 Tier 1-2 Cities
Slide 35: Revenue and Gross Profit Margin by Category
Revenue and Gross Profit Margin by Category Revenue by Category 18% 17% 19% 20% 20% 20% 18% 19% 14% 15% 8% 6% 3% 3% AV Air-con Fridge & washing machine Telcom Small appliances Computer Digital & others Gross Profit Margin by Category 19.7% 18.6% 14.8% 15.0% 15.8% 16.0% 16.2% 17.2% 10.5% 9.6% 10.2% 8
Slide 36: Nationwide Store Network
Nationwide Store Network China As at 30 Sep 2018 Group Total GOME Dazhong CellStar Paradise Flagship stores 286 235 28 22 1 Standard stores 428 381 32 14 1 Specialized stores 902 773 69 8 52 County-level stores 392 368 18 5 1 Total 2,008 1,757 147 49 55 Among them：T1 Market (Tier 1-2 cities) 877 707
Slide 37: Top Suppliers
Top 5 Suppliers 9M 2018 GOME Top 5 Suppliers 46.2% 9.8% 9.4% 9.3% 9.2% 8.5% Haier Apple Midea Huawei Gree Top 5 Suppliers in Total 9M 2017 GOME Top 5 Suppliers 44.3% 9.9% 9.5% 9.2% 8.2% 7.5% Haier Midea Apple Gree Huawei Top 5 Suppliers in Total Remarks：Discrepancies are caused by rounding off the f
Slide 38: Thank you!
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