Myer Holdings Limited · ASX:MYR
Myer — FY2009 Earnings Presentation
27 slides from Myer's earnings presentation, Sep 11, 2009
Slide 1: Myer FY09 Full Year Results
9/10/2009 Myer FY09 Full Year Results to 25 JJuly l 2009 After 39 months of Myer’s 50 month Turnaround Phase 11 September 2009 Agenda Turnaround Phase 1. Overview 2. Financial review 3. Operating update Growth Phase 4. Building for the future 5. Outlook Myer’s Future An international class retail bu
Slide 2: Financial highlights
9/10/2009 Myer FY09 Agenda Turnaround Phase 1. Overview 2. Financial review 3. Operating update Growth Phase 4. Building for the future 5. Outlook Myer’s Future An international class retail business providing inspiration to everyone Financial highlights Broad customer offer underpins solid financia
Slide 3: Turnaround Phase on track
9/10/2009 Myer FY09 Turnaround Phase Good progress after 39 months Achieved In progress 9 101 projects to significantly reduce CODB and 9 New point-of-sale system (POS) improve the way we do business 9 Closed Closed-circuit circuit television system (CCTV) Considerable 9 World class supply chain ful
Slide 4: Trading
9/10/2009 Myer FY09 Agenda Turnaround Phase 1. Overview 2. Financial review 3. Operating update Growth Phase 4. Building for the future 5. Outlook Myer’s Future An international class retail business providing inspiration to everyone Trading Strong performance in tough retail market Sales ($m) H1 H2
Slide 5: Earnings and Financial Summary
9/10/2009 Myer FY09 Earnings Up 10% before interest and tax in difficult trading environment — Over 7 cents in the dollar EBIT delivered 11 months early % % change IInternational t ti l FY07 FY08 FY09 like-for- change like class EBIT/Sales margin achieved Sales including concessions $3,289m $3,320m
Slide 6: Strong balance sheet; sustained working capital improvement
9/10/2009 Myer FY09 Strong balance sheet FY09 $m FY08 $m Inventory 356 345 Other Assets Less Creditors 137 ((468)) 151 ((437)) Net debt / Less Other Liabilities Net Trading Investment (260) (235) (250) (190) EBITDA Property Fixed Assets 29 372 29 295 2.3 times; Tangible Funds Employed 165 134 Intang
Slide 7: Strong improvement in all key financial metrics
9/10/2009 Myer FY09 Strong improvement in all key financial metrics EBIT and margin improved ROFE improved 7.2% $250m 8% 25% 22.4% 6.4% 18.8% $200m 5.1% 6% 20% 13.6% $150m 15% 4% $100m 10% $50m 2% 5% 167 213 236 $m 0% 0% FY07 FY08 FY09 FY07 FY08 FY09 EBIT EBIT margin EBITDA and margin improved Cash
Slide 8: Brand positioning; most reputable retail brand in Australia
9/10/2009 Myer FY09 Brand positioning Welcoming, inspiring, trusted, stylish and fun Vision Brand position Suppliers Customers Our vision is to be an To excite, inspire and Real brands Brand logic International Class reward our customers New Products Broader choice Retail Business providing Inspirat
Slide 9: Myer's offering has broad customer appeal
9/10/2009 Myer FY09 Myer’s offering has broad customer appeal — Myer caters for a large number of Australian households g , approximately — Customer offer with 10 core categories, pp y 600,000 , SKUs and 800 suppliers pp globally g y Target customer audience Cumulative disposable Most valuable and e
Slide 10: Extensive brand offering at all key price points
9/10/2009 Myer FY09 Extensive brand offering at all key price points — Depth of overall range and store specific ranging capability E cl si e Exclusive Designers @ Myer M er International and National Designers NF by Nicola Charlie Maticevski Women’s fashion Basque Finetti Brown $948 $179 $199 $329
Slide 11: Marketing
9/10/2009 Myer FY09 21 Marketing More relevant, effective and targeted marketing Events marketing Innovative advertising marketing Brand ambassadors — Concentration on ‘owning’ g — Industryy leader in Australia,, — Increased direct marketing g — Jennifer Hawkins renewed events e.g. won ‘Catalogue of
Slide 12: Significantly enhanced in-store customer experience
9/10/2009 Myer FY09 23 Significantly enhanced in-store customer experience Reinvigorated store ‘Store within store’ In-store fashion events Dynamic in-store theatre environment concepts — Innovative in-store events — Cosmetic Department and B Basement t events t — Eg Project Batman (visual — WeightW
Slide 13: MYER one: powerful marketing and promotional tool
9/10/2009 Myer FY09 A powerful marketing and promotional tool 25 provides detailed customer insights — Every time one of our members shops at Myer they tell us something about themselves, giving g g us substantial knowledge g about our customers and how theyy shopp Buying habits Demographics Predict
Slide 14: MYER one now driving 63% of sales
9/10/2009 Myer FY09 : a powerful marketing and promotional tool now driving 63% sales 63% — Over the last 5 years: 61% 58% 56% — $8 billion in transaction value run through program 47% 43% 43% — 14 billion shopping credits issued to members — $150 million in gift cards awarded 1.1m 1.4m 1.7m 2.2m 2.
Slide 15: Consumer insights from MYER one offer opportunity to drive sales
9/10/2009 Myer FY09 Consumer insights from offer significant opportunity to drive sales — 3.1 million members — Provides detailed understanding of customer spending habits — Facilitates targeted high-return marketing and dial up / dial down capability Builds Higher spend Strong Highlights Assists wi
Slide 16: Myer in the community; supply chain
9/10/2009 Myer FY09 Myer in the community contributing over $4m last year 31 Supply chain Delivering world class operational efficiency —Supply chain operating at cost of less than 1% of sales; flow on from operational improvements still to come Active supplier Improved store Better visibility of En
Slide 17: Significant investment in IT and customer focused IT
9/10/2009 Myer FY09 Significant investment in IT and customer focused IT Initiative Achievements Benefits IT consolidation and — Separation from Coles completed — Streamlined system with significantly reduced complexity modernisation — Commenced ‘Store of The Future’ back office model — Alignment of
Slide 18: Investment in team; performance-based culture
9/10/2009 Myer FY09 Investment in team delivering better skills, motivation and retention levels Development Incentives Benefits — Skills training (>90% of — Equity incentive plan — Travel and discount web staff t ff completed l t d covering i c.400 400 members b offers ff ‘Awesome Service’ training
Slide 19: Driving outstanding in-store execution
9/10/2009 Myer FY09 Driving outstanding in-store execution Numerous initiatives to improve the shopping experience drive repeat custom and sales growth Service Productivity Communication Product availability IT platform — Staff service — Productivity — My TV — In-stock positions — PoS training lanya
Slide 20: Superior sustainable earnings growth beyond FY10
9/10/2009 Myer FY09 Superior sustainable earnings growth beyond FY10 — Comparable store growth driving returns across a lower cost structure — Supplemented by new stores, margin and CODB improvements CODB reductions Gross margin improvement Superior New stores and returns Myer Melbourne Comparable C
Slide 21: Highly attractive new store economics
9/10/2009 Myer FY09 Highly attractive new store economics — Strong returns from new stores will be a significant driver of earnings growth beyond FY10 Metropolitan infill Growth corridor Regional city Number of stores in current plan 5 5 5 Population catchment (‘000) 150-350 150-250 150-200 Populati
Slide 22: Visual Merchandising Revitalisation - Project Batman
9/10/2009 Myer FY09 Visual Merchandising Revitalisation - Project Batman — Lower cost base and shorter implementation time y — Payback in yyear 1 — Aims to deliver substantial uplift to in-store appearance — Creates freshness, excitement and an easier shopping environment for customers — Key element
Slide 23: Delivery of flagship Myer Melbourne store
9/10/2009 Myer FY09 Delivery of flagship Myer Melbourne store — Myer is the heart of the Melbourne CBD retail precinct — Store will be progressively delivered during 2010 calendar year — State of the art store inspired by London, New York, Milan and Paris best practice — Highly efficient and product
Slide 24: Future focus
9/10/2009 Myer FY09 Agenda Turnaround Phase 1. Overview 2. Financial review 3. Operating update Growth Phase 4. Building for the future 5. Outlook Myer’s Future An international class retail business providing inspiration to everyone Future focus Transition from Turnaround to Growth Phase Turnaround
Slide 25: FY10 outlook
9/10/2009 Myer FY09 FY10 outlook — Optimistic outlook for FY10 and beyond — Signs g of consumer confidence slowlyy improving p g — Forecasting sales increase of around 3% and EBIT growth of around 10% for FY10, based on a 52 week year and assuming current trends continue — Sales in first 6 weeks tra
Slide 26: Transformed iconic Australian retailer; proposed IPO pre-registration
9/10/2009 Myer FY09 Transformed iconic Australian retailer Competitive advantage Transformed platform Growth strategy — Iconic retailer — Unrelenting focus on — Comp store growth execution — Unrivalled offering — New store growth — World class — National store footprint in — Gross margin expansion D
Slide 27: Indicative timetable
9/10/2009 Myer FY09 Indicative timetable FY09 financial results 11 September 2009 Pre-registration Pre registration expected to be 14 – 28 September 2009 Prospectus currently expected to be lodged 28 September 2009 53 Full Year Results to 25 JJuly l 2009 After 39 months of Myer’s 50 month Turnaround