Pds Limited · NSE:PDSL
Pds — PDS Multinational Fashions — FY2021 Earnings Presentation
52 slides from Pds's earnings presentation, May 27, 2021
Slide 1: Cover letter to stock exchanges
PDS Multinational Fashions Limited PDS/SE/2021-22/06 May 27, 2021 Listing Department Corporate Relationship Department National Stock Exchange of India Limited BSE Limited Exchange Plaza, C-1 Block G, Phiroze Jeejeebhoy Towers, Bandra Kurla Complex, Bandra (E), Dalal Street, Mumbai -400 051 Mumbai-
Slide 2: PDS Multinational Fashions Ltd Investor Update FY2021
PDS Multinational Fashions Ltd INVESTOR UPDATE –FY2021 1
Slide 3: Safe Harbour
Safe Harbour This presentation has been prepared by PDS Multinational Fashions Ltd (“PDS”, “the Company”) and does not constitute a prospectus or placement memorandum or an offer to acquire any securities. This presentation or any other documentation or information (or any part thereof) delivered or
Slide 4: Our Values
Table of Contents Our Values - Trust, Integrity & Ethics - Transparency, Collaboration & Teamwork - Customer Centricity - Social Responsibility - People First - Entrepreneurial Spirit 3
Slide 5: Table of Contents
Table of Contents Contents 1 PDS - A Global Plug & Play Platform 5-16 2 PDS Platform – Business Overview 17-24 3 Financial Journey of the PDS Platform 25-28 4 Business & Financial Performance Overview – Q4FY21 / FY21 29-40 5 Proposed Employee Incentive Plan 41-42 6 Acquisition of 50% stake in Yellow
Slide 6: PDS - A Global Plug & Play Platform
PDS - A Global Plug & Play Platform 5
Slide 7: Power of the PDS Platform
Power of the PDS Platform Asset light business 6,213cr 230cr 148cr model FY 21 Topline FY 21 EBITDA FY 21 PAT ($837mn) ($31mn) ($20mn) Strong Financials and Risk Management Capabilities 15.75 22.1% 0.26x Design Led Sustainable and Dividend per share 49% pay-out on EPS FY 21 ROCE* Net Debt/EBITDA Res
Slide 8: Key Building Blocks for PDS's Global Platform
Key Building Blocks for PDS’s Global Platform END TO END INVESTING IN GLOBAL SCALE THE FUTURE CAPABILITIES RISK ETHICS & FINANCIAL MANAGEMENT SUSTAINABILITY STRENGTH LEADERSHIP DIGITAL TEAM SOLUTIONS 7
Slide 9: End-to-End Capabilities of the Platform
Key Building Blocks for PDS’s Global Platform End-to-End Capabilities of the Platform Multi Country Sourcing Multi Product Sourcing India / Bangladesh / China / Pakistan All categories of apparel, fashion, / Sri Lanka / Myanmar / Turkey / home Vietnam Market Intelligence Product Development Creative
Slide 10: Global Reach and Scale of the Platform
Key Building Blocks for PDS’s Global Platform Global Reach and Scale of the Platform Canada UK Germany Sales & Design Operations Belgium 1 Million Sourcing/ Manufacturing pcs a day Turkey Pakistan Operations Portugal China production United States of America Jordan Product R&D Centre India Egypt Dub
Slide 11: Investing in the Future
Key Building Blocks for PDS’s Global Platform Investing in the Future Sustainability Investments that fall under the UN Development Goals - 11, 12 & 13 Circular Materials Economy Investments in such core focus areas enhances PDS’s value Sustainable propositions for its stakeholders Communities - Bra
Slide 12: Focus on Ethics, Compliance and Sustainability
Key Building Blocks for PDS’s Global Platform Focus on Ethics, Compliance and Sustainability ETHICS AND COMPLIANCE SUSTAINABILITY GOALS ▪ Industry Experts leading 40 member team to maintain Social, Promoting Sustainable Materials, low impact Technical and Ethical Compliance standards across 200 acti
Slide 13: Rigorous Risk Management Principles
Key Building Blocks for PDS’s Global Platform Rigorous Risk Management Principles CREDIT COMPLIANCE • Secured Credit Payment terms from Customers • Adherence to PDS code of conduct (ZTV policy) and • Insurance cover – Euler Hermes, Atradius, ECIC Hkg, customer compliance requirements ECGC India • ZE
Slide 14: Financial Strength of the Platform
Key Building Blocks for PDS’s Global Platform Financial Strength of the Platform ▪ Consistent topline growth over last 5 year ▪ Focus on financial discipline ▪ Trade Finance Limits of $340 Mn (net utilization of <5%) with Net Debt / EBITDA Ratio of 0.26x and Net Debt / Equity of 0.08x ▪ Working with
Slide 15: Technology Providing Tools for Agility
Key Building Blocks for PDS’s Global Platform Technology Providing Tools for Agility Centralized 3D Design, Sampling Digital Supply Chain & Fit Data Analytics Sourcing Management 3D Design Model PLM – Range Plan Digital Fit & Color 360 Showroom In house team provides cutting edge technological solut
Slide 16: How do Partners Benefit from PDS Platform?
How do Partners Benefit from PDS Platform? Entrepreneurial Spirit | Value Driven Performance Rewards | Profit Sharing | Knowledge Sharing Culture Global Presence | Economies of Scale | Collaboration Across Scalability Businesses| Cost Optimization via Shared Resources Integrated Model | Best Practic
Slide 17: Translating into a Resilient Platform
Translating into a Resilient Platform Customer Dependency Net Working Capital ROCE* Net Debt/EBITDA <6% 0.26x Avg Customer Contribution 5 days 22.1% to Total sales In FY21 in FY21 FY21 (Based on top 10) Top 10 customers An asset light model contributing 56% of A stringent Risk enables higher Busines
Slide 18: PDS Platform – Business Overview
PDS Platform – Business Overview Sourcing Manufacturing PDS Venture Tech Investments 17
Slide 19: Design Led Sourcing Capabilities of the Platform
Sourcing Manufacturing PDS Venture Tech Investments Design Led Sourcing Capabilities of the Platform ~42% of Capital Employed Managing the entire supply chain execution of end-customers Design Excellence Provides in-house expertise and market know-how in managing global trade Market Intelligence In-
Slide 20: A Well Diversified Base Of Marquee Customers
Sourcing Manufacturing PDS Venture Tech Investments A Well Diversified Base Of Marquee Customers Catering to both offline & online channels On an average basis, each of top 10 customers contribute < 6% of topline 19
Slide 21: World Class PDS Manufacturing Facilities
Sourcing Manufacturing PDS Venture Tech Investments World Class PDS Manufacturing Facilities 42% of Capital Employed c.6,000 Machine Capacity with 130 production lines spread across Bangladesh, India and Sri Lanka Annual in-house production of 36 Million pieces NOR LANKA, SRI LANKA PARC DESIGN, INDI
Slide 22: Further Linkages With Over 540 Facilities Globally
Sourcing Manufacturing PDS Venture Tech Investments Further Linkages With Over 540 Facilities Globally Pakistan # of facilities: 10 Bangladesh # of facilities: 240 Turkey | Jordan | Egypt Turkey Pakistan # of facilities: 90 China China |Myanmar | Cambodia # of facilities: 103 Jordan India Egypt Bang
Slide 23: Rationale for PDS Venture Tech Investments
Sourcing Manufacturing PDS Venture Tech Investments Rationale for PDS Venture Tech Investments PDS is continually exploring opportunities for developing new partnerships and investing in businesses that fit with PDS’s vision 1. Investment opportunities enable PDS to strengthen its focus areas : a. S
Slide 24: PDS Venture Tech Investments & Others
Sourcing Manufacturing PDS Venture Tech Investments PDS Venture Tech Investments & Others* 16% of Capital Employed True PDS Fund Apex Black VC Fund PDS Impact Fund Direct Investments Major focus on sustainable & Focused investments in Focus on Fashion, Key Focus Area- Sustainable tech-oriented fashi
Slide 25: PDS Venture Tech Investments & Others
Sourcing Manufacturing PDS Venture Tech Investments PDS Venture Tech Investments & Others Developing new partnerships and investing in businesses that fit with our vision MATERIALS FASHION TECH CIRCULAR ECONOMY CONSUMER TECH Sustainability Technology OTHER TECH SUSTAINABLE COMMUNITIES Consumer Brand
Slide 26: Financial Journey of the PDS Platform
Financial Journey of the PDS Platform 25
Slide 27: Historical Financial Performance
Historical Financial Performance Sales (₹cr) Gross Margin (₹cr) Employee & Other Expenses (% of Sales) 7.0% 7.2% 6,213 1,028 6.7% 6.4% 6.7% 4,616 612 6.6% 6.2% 6.2% 5.9% 5.6% 13.3% 16.5% FY17 FY18 FY19 FY20 FY21 FY17 FY21 FY17 FY21 Employee benefits expense Other expenses EBITDA (₹cr) PAT (₹cr) Free
Slide 28: Deep Dive into Sourcing & Manufacturing Business
Deep Dive into Sourcing & Manufacturing Business Sales (₹cr) EBITDA Margin % Gross Capital Employed (₹cr) ROCE %* 6,073 5.3% 4,766 ₹509cr 60% Sourcing 1.8% (US$ 70 mn) 42% of Total Capital FY17 FY21 FY17 FY21 Employed ~100% 96% % of overall PDS sales 285 Manufacturing -26.9% FY21 EBITDA margins: Gre
Slide 29: Enhanced Key Leverage and Return Ratios
Enhanced Key Leverage and Return Ratios Net Debt/EBITDA(x) ROCE (Net) %* ROE %* 3.8 22% 22% 6% 7% 0.3 FY17 FY21 FY17 FY21 FY17 FY21 Consistent expansion in EBITDA and Attributable to increase in EBIT with Topline growth, margin expansion reduction in Net Debt translated into the business model conti
Slide 30: Business & Financial Performance Overview Q4 FY2021 and FY2021
Business & Financial Performance Overview Q4 FY2021 AND FY2021 29
Slide 31: Focus On Expanding Into More Value Accretive Business Models
Focus On Expanding Into More Value Accretive Business Models Retail format & Geographic market Brands India, Australia & Others Channel expansion expansion D2C / Online United States Discount / value UK/Europe Key Drivers Trading Apparel Agency Kids wear, Home Full service, Outsourcing Active, Leisu
Slide 32: Launched Brands for B2B and B2C Segments
Launched Brands for B2B and B2C Segments Brands are currently clocking around ₹70cr in sales (c.$9.5mn) Men’s wear Kids wear Scrubs Masks 31
Slide 33: Focus on Expanding into New Geographies
Focus on Expanding into New Geographies Front end: 1. Increasing share with current customers across Europe 2. Building presence in United States, Australia, Scandinavia, South Africa among others Back end 1. Building network of manufacturing partners in Egypt and Jordan a) In Egypt ~70% of apparel
Slide 34: Revenue Break up (FY21)
Revenue Break up (FY21)* Australia PPE & 0.2% Others 4% Essentials Others 9% Asia & 4% Middle Ladies East 4% Wear 33% North America 8% Children Wear 18% Category wise Geography wise UK & Men's Europe Wear 36% 84% *Broad Estimates 33
Slide 35: Key Business Highlights
Key Business Highlights 1. COVID significantly disrupted business globally with large part of UK being under lockdown for majority of the year 2. In spite of all the disruptions and what happened to the fashion and apparel industry, the topline witnessed 9% q-o-q growth in Q4 FY21; Order Book in han
Slide 36: Key Financial Highlights FY21
Key Financial Highlights FY21 Reported consolidated Opex Reduction of FY21 EBITDA of FY21 topline FY21 Reported PAT of ₹ 6,213cr 13% ₹ 230cr ₹ 148cr from ₹913cr in FY20 to 3.7% 2.4% (US$837mn) ₹798cr in FY21 2.8% 1.2% FY20 FY21 FY20 FY21 FY21 ROCE* of FY21 ROE* of Net Working Capital Gross Debt Redu
Slide 37: Consolidated Profit & Loss Statement
Consolidated Profit & Loss Statement ₹ in cr, unless mentioned otherwise Growth Growth Particulars Q4 FY21 Q3 FY21 Q4 FY20 FY21 FY20 (Q-o-Q) (Y-o-Y) Income from Operations 1,765 1,626 2,004 9% 6,213 6,648 -7% Q4 FY21 COGS 1,440 1,329 1,669 8% 5,185 5,549 -7% 1. Income from Operations Gross Profit 32
Slide 38: Consolidated Balance Sheet
Consolidated Balance Sheet ₹ in cr, unless mentioned otherwise As on As on Particulars Particulars 31-Mar-21 31-Mar-20 31-Mar-21 31-Mar-20 Non-Current Assets 594 571 Inventory Days 14 12 Current Assets 1,752 1,773 Debtor Days 53 46 Inventories 197 183 Payables Days 63 48 Trade Receivables 910 832 NW
Slide 39: Segment wise Business Performance
Segment wise Business Performance Revenue break up (₹cr, % of total) Capital Employed break up (₹cr, % of total) Investment & Other, 191 , 16% Sourcing, 509 , 42% Manufacturing, Sourcing, 6,073 , 285 , 4% 96% Investment & Other, -2 , 0% Manufacturing, 505 , 42% Gross Capital Employed: ₹1,205cr • Sou
Slide 40: Consolidated Cash Flow Statement
Consolidated Cash Flow Statement ₹ in cr, unless mentioned otherwise Particulars For the period ended Particulars For the period ended 31-Mar-21 31-Mar-20 31-Mar-21 31-Mar-20 A. Cash Flow from Operating Activities C. Cash Flow from Financing Activities Profit before tax 170 91 Proceeds from borrowin
Slide 41: What PDS has achieved?
What PDS has achieved? PDS Generating Return Higher than Cost of Capital 22% • Cost of Debt: 4.2% • Cost of Equity: 9.8% Value Creation Given PDS has largely 7% LIBOR driven debt and revenues are in US$, PDS largely has a natural hedge WACC ROCE PDS has a Positive Economic Value Added generating ret
Slide 42: Proposed Employee Incentive Plan
Proposed Employee Incentive Plan 41
Slide 43: Highlights
Highlights 1. PDS Multinational has a unique business model which is driven through entrepreneurship -------------------- 2. Businesses are led by various Business Heads, Financial Controllers and Business Enabling Team (BET) Proposal - ESOP: 0.95mn 3. With an aim to incentivize the key employees an
Slide 44: Acquisition of 50% stake in Yellow Octopus
Acquisition of 50% stake in Yellow Octopus FURTHER STRENGTHENING PDS VALUE PROPOSITION 43
Slide 45: Investing in Yellow Octopus – A Strategic Fit
Investing in Yellow Octopus – A Strategic Fit Yellow Octopus is a world leader in providing commercial sustainability solutions in the Fashion Industry. Aims to Transform Fashion Industry From Linear To Circular Economy Model • Yellow Octopus is currently based out of Poland, UK and UAE • Yellow Oct
Slide 46: Annexure
Annexure 45
Slide 47: Standalone Profit & Loss Statement
Standalone Profit & Loss Statement ₹ in cr, unless mentioned otherwise Growth Growth Particulars Q4 FY21 Q3 FY21 Q4 FY20 FY21 FY20 (Q-o-Q) (Y-o-Y) Income from Operations 14.7 16.2 11.5 -9% 46.1 41.1 12% COGS 4.0 7.7 0.0 -48% 15.4 0.0 Gross Profit 10.8 8.5 11.5 27% 30.7 41.1 -25% Gross Margin (%) 73.
Slide 48: Standalone Balance Sheet
Standalone Balance Sheet ₹ in cr, unless mentioned otherwise As on Particulars 31-Mar-21 31-Mar-20 Non-Current Assets 138 137 Current Assets 55 9 Trade Receivables 5 1 Cash and cash equivalents 45 2 Other Bank Balances 0 0 Other Current Assets 5 6 Total Assets 193 146 Total Equity 156 111 Non-Curren
Slide 49: Standalone Cash Flow Statement
Standalone Cash Flow Statement ₹ in cr, unless mentioned otherwise Particulars For the period ended Particulars For the period ended 31-Mar-21 31-Mar-20 31-Mar-21 31-Mar-20 A. Cash Flow from Operating Activities C. Cash Flow from Financing Activities Profit before tax 46 4 Proceeds from borrowings (
Slide 50: Consolidated Profit & Loss (US$mn)
Consolidated Profit & Loss (US$mn) US$ in mn, unless mentioned otherwise Growth Growth Particulars Q4 FY21 Q3 FY21 Q4 FY20 FY21 FY20 (Q-o-Q) (Y-o-Y) Income from Operations 238 218 283 9% 837 938 -11% COGS 194 178 235 9% 699 783 -11% Gross Profit 44 40 47 10% 138 155 -11% Gross Margin (%) 18.4% 18.2%
Slide 51: Consolidated Balance Sheet (US$mn)
Consolidated Balance Sheet (US$mn) US$ in mn, unless mentioned otherwise As on As on Particulars Particulars 31-Mar-21 31-Mar-20 31-Mar-21 31-Mar-20 Non-Current Assets 81 76 Inventory Days 14 11 Current Assets 240 235 Debtor Days 54 43 Inventories 27 24 Payables Days 64 45 Trade Receivables 124 110
Slide 52: Together we're building a better, more sustainable supply chain
Together we’re building a better, more sustainable supply chain Abhishekh Kanoi PDS Multinational Fashions Limited For Further Head of Legal & Company Secretary No. 758 & 759, 2nd Floor, Information, abhishekh.k@pdsmultinational.com 19th Main, Sector-2, HSR Layout, please contact Bangalore-560102, K
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