Migros Ticaret A.s. · BIST:MGROS
Migros Ticaret A.s — 2Q 2024 Earnings Presentation
37 slides from Migros Ticaret A.s's earnings presentation, 2024
Slide 1: Company Presentation 2Q 2024
Omni-channel retailer, evolving beyond trade Company Presentation 2Q 2024
Slide 2: Disclaimer
Disclaimer In accordance with the decision of the Capital Markets Board (CMB) dated 28.12.2023 and numbered 81/1820, it has been decided that issuers and capital market institutions, which apply Turkish Accounting/Financial Reporting Standards and are subject to the financial reporting regulations o
Slide 3: Contents
Contents Operational & Financial Overview Strategy Update Summary & Guidance Appendix 3
Slide 4: Market Share Evolution
Market Share Evolution Migros FMCG Growth Focus Market Share* (%) Omni channel & Multi format +50 bps 15.9 16.4 Further +30 bps penetration in rural 9.4 9.7 Market districts Share Gain Price Investments 1H 2023 1H 2024 1H 2023 1H 2024 Total FMCG Modern FMCG Source: Nielsen 4 Note: FMCG: Fast Moving
Slide 5: Physical & Online Expansion
Physical & Online Expansion # of Stores Sales Area # of Online Service Stores (k sqm) 390 6.4% 157 1,185 3,490 1,980 3,100 1,860 1,028 185 92 new new stores stores 1H 2023 1H 2024 1H 2023 1H 2024 1H 2023 1H 2024 5
Slide 6: CAPEX (TL million)
CAPEX (TL million) % of Sales CAPEX Breakdown % 3.0% 1H 2024 2.4% 40% 3,644 with IAS 29 inflation 2,609 New Stores New accounting 25% DCs 30% 3% 1H 2023 1H 2024 Subsidiaries 20% 22% 3.0% 142% 3,413 without IAS 29 inflation 2.3% Refurbishment of accounting IT, R&D, Stores & DCs Energy 1,413 6 1H 2023
Slide 7: Expanding Logistics Capacity
Expanding Logistics Capacity 6 new DCs in 7 months reaching a total of 64 DCs 13% DCs space growth in 7 months reaching a total of 448 th sqm İzmir Torbalı DC 2nd automated picking & distribution system after the İstanbul Gebze DC installation in 2024 Multi format (18) Meat (8) E-commerce Fulfillmen
Slide 8: Consolidated Sales (TL million)
Consolidated Sales (TL million) 11% 11% 64,293 58,116 121,104 56,811 109,040 with IAS 29 inflation accounting 2Q 2023 1Q 2024 2Q 2024 1H 2023 1H 2024 ▪ 2023 FY Sales growth: 29% Adjusted for June 2024 inflation 89% without IAS 29 62,150 89% 113,521 inflation accounting 51,371 32,951 60,135 2Q 2023 1
Slide 9: Gross Profit (TL million)
Gross Profit (TL million) 22.9% 21.7% 20.4% 19.9% 20.1% 21% 14,706 26,267 11,665 11,561 21,749 with IAS 29 inflation accounting 2Q 2023 1Q 2024 2Q 2024 1H 2023 1H 2024 Imputed Interest Rate Impact 140 bps 390 bps 550 bps 130 bps 470 bps Inventory inflation adj. Impact -270 bps -610 bps -350 bps -340
Slide 10: Quarterly OPEX Evolution
Quarterly OPEX Evolution 35 bps 13,344 4 bps -21 bps 16 bps -11 bps 5 bps 117 bps 11,216 Margin Margin 20.8% 19.3% 2Q 2023 Personnel Rent & Energy Porterage, Advertising Depreciation & IT 2Q 2024 Opex expenses Common expenses cleaning & expenses Amortisation maintanance Opex area security expenses &
Slide 11: Consolidated EBITDA (TL million)
Consolidated EBITDA (TL million) 5.3% 3.4% 3.1% 22% 4,097 3.9% 3,388 with IAS 29 1.2% 3,370 inflation accounting 2,249 708 2Q 2023 1Q 2024 2Q 2024 1H 2023 1H 2024 Adjusted for June 2024 inflation 8.2% 8.9% 7.3% 5,544 135% 6.6% 6.6% 9,308 without IAS 29 inflation accounting 3,764 2,183 3,959 11 2Q 20
Slide 12: Net Income (TL million)
Net Income (TL million) 4.8% 5.0% -63% 2,798 2.4% One-off impact: 5,410 -40 bps in 1H 2023 with IAS 29 0.9% 1.6% inflation accounting 1,372 610 Inflation Acc. impact: -130 bps 1,982 2Q 2023 1Q 2024 2Q 2024 1H 2023 1H 2024 IAS 29 Monetary gain impact 220 bps 330 bps 130 bps 330 bps 220 bps IAS 29 Dep
Slide 13: Total Equity & Total Financial Debt (TL million)
Total Equity & Total Financial Debt (TL million) Total Equity Total Financial Debt* 18% 45,806 -69% 4,911 38,969 with IAS 29 inflation accounting 1,536 1H 2023 1H 2024 1H 2023 1H 2024 *w/o IFRS 16 107% 12,322 2,862 -46% without IAS 29 5,963 1,536 inflation accounting 1H 2023 1H 2024 1H 2023 1H 2024
Slide 14: Net Cash & Free Cash Flow (TL million)
Net Cash & Free Cash Flow (TL million) Net Cash* Free Cash Flow Cash Conversion Cycle in Days -8% -26% 16,333 8,132 -41.1 15,032 -37.0 with IAS 29 6,024 inflation accounting 1H 2023 1H 2024 1H 2023 1H 2024 1H 2023 1H 2024 *w/o IFRS 16 21% 58% 15,032 6,021 -47.9 4,964 -44.2 without IAS 29 9,518 infla
Slide 15: Strategy Update
Online Operations & Strategy Update Strategy Update
Slide 16: Migros One
Online Business Share Migros One in Sales in 1Q 2024 (w/o tobacco & alcohol) without IAS 29 inflation accounting 19.5% Leader in the Turkish e-grocery market Gross Merchandise Value (TL billion) 119% 19.7 Fastest growing player in meal verticals Scheduled delivery: Targeting to match the Group avera
Slide 17: Migros One
Online Business Share Migros One in Sales in 1Q 2024 (w/o tobacco & alcohol) without IAS 29 inflation accounting 19.5% Online business share GMV growth # of orders growth 18.6% +119% +43% exc. tobacco & alcohol y-o-y y-o-y (1H’23: 16.8%) Quarterly active customers LTM active customers Online service
Slide 18: MoneyPay
MoneyPay without IAS 29 inflation accounting Consumer (B2C) Total Payment Volume Pay with e-wallet, (TL billion) Pay with QR & Card at all Migros online & stores 224% 6.8 Money Loyalty Program Integrated Payment Solutions in one App Buy Now Pay Later 2.1 Pay with integrated Bank Credit Value Added S
Slide 19: KPIs of Migros Digital Ecosystem
KPIs of Migros Digital Ecosystem without IAS 29 inflation accounting # of active users # of orders Gross Merchandise # of registered users # of transactions Total Payment (million) (million) Value (million) (million) Volume (TL billion) (TL billion) 21.0 21.0 10.3 3.0 3.0 9.3 2.7 2.7 18.8 2.4 17.1 2
Slide 20: Summary & Guidance
Online Operations & Summary & Guidance Strategy Update
Slide 21: 1H 2024 Underlying Performance
1H 2024 Underlying Performance with IAS 29 inflation accounting without IAS 29 inflation accounting Net Sales Sales Growth Net Sales Sales Growth EBITDA EBITDA Margin Net Profit Margin Net Profit 21
Slide 22: 2024 Guidance Updated
2024 Guidance Updated Sales Growth EBITDA Margin 2024E 2024E with IAS 29 Expansion Target inflation accounting 2024E ~10% 4.5-5.0% New CAPEX stores from from high single-digit margin improvement (2023: 1.8%) ~350 TL ~8.0 billion without IAS 29 inflation accounting 250+ new stores from+250 from TL ~8
Slide 23: Appendix
Online Operations & Appendix Strategy Update
Slide 24: Migros at a Glance
Migros at a Glance TL 121.1 bn Sales 1H 2024 55,182 employees 3,490 stores as of 1H 2024 +2,000 suppliers In BIST Sustainability Index for 10 years in a row 49.18% free float Included in BIST Corporate Governance Index since 2015 Subsidiaries Money Card 11.8 mn households 19.8 mn active cards 24
Slide 25: Migros' Subsidiaries
Migros’ Subsidiaries Online grocery Last-mile Fintech Packed Migros’ offline Charging & meal delivery financial ready-to-eat & online retail services for business solution solutions meal production media assets electric vehicles ▪ Active in 81 cities with ▪ 6,200+ riders ▪ E-wallet, BNPL, B2C, ▪ Rea
Slide 26: Store Portfolio: Physical & Online Network – 1H 2024
Store Portfolio: Physical & Online Network – 1H 2024 Supermarkets Hypermarkets Macrocenter Wholesale Online 3,211 54 172 30 1,185 40 sqm - 3,500 sqm 3,500 sqm – 8,500 sqm 250 sqm – 2,000 sqm 200 sqm – 1,600 sqm 2,000 SKU – 40,000 SKU # of Sales area (th sqm) stores Migros 1,975 1,382 (M, MM, MMM) Mi
Slide 27: IAS 29 Consolidated Income Statement Summary – 1H 2024
IAS 29 Consolidated Income Statement Summary – 1H 2024 (TL million) 1H 2024 1H 2023 Net Sales 121,104 109,040 Cost of Sales -94,836 -87,291 Gross Profit 26,267 21,749 Operating Expenses -26,185 -21,847 Other Operating Expense -5,814 -1,651 Operating Loss -5,732 -1,749 Income / Expense from Investmen
Slide 28: IAS 29 Consolidated Balance Sheet Summary – 1H 2024
IAS 29 Consolidated Balance Sheet Summary – 1H 2024 (TL million) 1H 2024 2023 Current Assets 45,813 47,244 Non-current Assets 72,664 67,673 Total Assets 118,478 114,918 Current Liabilities 57,569 56,000 Non-current Liabilities 15,103 13,696 Total Liabilities 72,671 69,696 Equity 45,806 45,222 Total
Slide 29: IAS 29 Cash Flow - 1H 2024
IAS 29 Cash Flow- 1H 2024 (TL million) 1H 2024 1H 2023 Net profit 1,982 5,410 Adjustments related to reconciliation of net profit for the period 10,058 6,068 Changes in net working capital 5,447 3,269 Cash flows from operating activities 17,488 14,746 Net cash provided by operating activities 10,260
Slide 30: IAS 29 Impact on Financials
IAS 29 Impact on Financials with IAS 29 without IAS 29 inflation accounting inflation accounting (TL million) 1H 2024 1H 2023 1H 2024 1H 2023 Selected Balance Sheet Items Total Assets 118,478 111,296 81,710 40,344 Total Liabilities 72,671 72,326 69,408 35,602 Total Equity 45,806 38,969 12,302 4,742
Slide 31: Inflation-accounting impact on EBITDA & Net Income in 2Q
Inflation-accounting impact on EBITDA & Net Income in 2Q 5,544 103 -2,258 1,062 -3,528 -351 bps 165 bps -2,026 2,258 3,388 -549 bps Margin 8.9% -315 bps 351 bps Margin 5.3% -551 -86 bps 7 610 0.9% Inventory 2Q 2024 Depreciation Inventory Asset & Due date Financial 2Q 2024 2Q 2024 P&L Tax inflation a
Slide 32: Ownership Structure
Ownership Structure Direct Shareholding Structure Indirect Shareholding Structure AG Anadolu Grubu AG Anadolu Grubu Free Float Holding A.Ş. Holding A.Ş. 50.00% 100.00% 50.00% MH Perakendecilik ve Free Float Migros Ticaret A.Ş.* Migros Ticaret A.Ş. Ticaret A.Ş. 49.18% 1.64% 49.18% Migros Ticaret A.Ş.
Slide 33: Sustainability
Online Operations & Sustainability Strategy Update
Slide 34: Sustainability Targets
Sustainability Targets Reducing Greenhouse Gas Emission 42% 50% Reducing Food Waste by 2030 year-end (base year 2020) by 2030 year-end (base year 2018) by 2026 year-end (base year 2018) Increasing 27-33% 10% Reducing Women Participation in Management Water Consumption by 2030 year-end (base year 202
Slide 35: Energy Sustainability Investments
Energy Sustainability Investments Rooftop solar panels installations y Sustainability Hedging volatile rg I e nv En energy cost in Opex est via greenfield ments investments 1/3 of total energy consumption is expected to be from Migros’ Izmir MİGET meat production facility owned solar plants by 2026
Slide 36: Migros Better Future Plan
Migros Better Future Plan ECOSYSTEM SUSTAINABILITY THROUGH TRANSPARENT, RESPONSIBLE, ETHICAL GOVERNANCE To adopt the governance practices that are rightful for all stakeholders through our value-focused business model and integrated thinking system. To create shared value for all by integrating our
Slide 37: Waste Management & Biodiversity Conservation
Waste Management & Biodiversity Conservation Preventing Food Waste* Reducing Plastic Waste* Prevented food loss with Expiry Date discounts: 8,565 tons of food Business Plastic Initiative (IPG) 512 tons less plastic Food Donation: 11 million meals Good Agricultural Practices (GAP) GAP certified F&V: