Bang & Olufsen A/s · OMXCOP:BO
Bang & Olufsen A/s — Q2 2024 Earnings Presentation
24 slides from Bang & Olufsen A/s's earnings presentation, Jan 10, 2024
Slide 1: Q2 2023/24 Webcast presentation
January 2024 Q2 2023/24 Webcast presentation
Slide 2: Disclaimer
Disclaimer This presentation does not constitute or form part of and should not be construed as an offer to sell or issue or the solicitation of an offer to buy or acquire securities issued by Bang & Olufsen a/s in any jurisdiction, including the United States of America, Canada, Australia, Japan or
Slide 3: Agenda
Agenda # Key Highlights and Strategy Update # Financial Performance in Q2 # Outlook # Q&A 3|
Slide 4: Key Highlights and Strategy Update
Key Highlights and Strategy Update
Slide 5: Margins significantly improved, generating positive earnings despite lower revenue level
Margins significantly improved, generating positive earnings despite lower revenue level Q2 2023/24 H1 2023/24 • Regional product revenue declined by 17.0% (-15% LC). Due to the Revenue DKK 700m DKK 1,319m successful launch of Beosound Theatre in Q2 of last year and the planned change in the channel
Slide 6: Sell-out confirms continued stable customer demand
Sell-out confirms continued stable customer demand Regions Product Categories Regions -1% -2% • EMEA: Company-owned stores grew double- EMEA Staged digit. 2% • Americas: All channels declined except for e- commerce. Company-owned stores impacted by store closure for a month. > -6% 6% • APAC: Growth
Slide 7: Our five strategic shifts – highlights from the quarter
Our five strategic shifts – highlights from the quarter # 1 # 2 # 3 # 4 # 5 Culturally Seamlessly connected Magical moments Winning in key Exploring and relevant luxury product portfolio in key touch cities commercialising new love brand bridging our past, points and existing business present and fu
Slide 8: Our new flagship store in London, features our new store concept
Our new flagship store in London, features our new store concept, and redefines our brand and shopping experience Luxury apartment style setting and A sensorium for ultimate, Designated Bespoke and private decompression zones for customers to immersive sound experiences in a event area for personali
Slide 9: Financial Performance in Q2
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Slide 10: Revenue decline of 16% in local currencies, negative growth expected
Revenue decline of 16% in local currencies, negative growth expected Group revenue Regional product revenue Brand partnering & other activities DKKm DKKm DKKm -17.0% -28.8% -15% in LC -26% in LC -18.5% -16% in LC 105 754 > 564 625 84 82 77 75 551 542 859 700 635 646 619 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2
Slide 11: Development driven by planned change in channel network, high comparables and lower sales from China
Development driven by planned change in channel network, high comparables and lower-than-expected sales from China EMEA Americas APAC DKKm DKKm DKKm EMEA: Down 15% in local currencies -14.5% -31.3% -15.0% • Company-owned stores grew double- digit, e-commerce grew while 400 106 Monobrand declined as
Slide 12: Margins significantly improved mainly due to normalisation of component and logistics costs
Margins significantly improved mainly due to normalisation of component and logistics costs, price increases and better channel mix towards branded channels % Gross margin % EBIT margin bsi* 8.7pp 1.4pp 3.0% 53.1% 2.6% 51.4% 52.6% 1.6% 1.4% 44.4% 43.6% -6.8% Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 2022/23 202
Slide 13: Improved gross margin across product categories
Improved gross margin across product categories Gross margin, product categories Brand Partnering and Other % % Staged Flexible Living On-the-go 9.0pp 1.1pp 13.6pp 5.3pp 53.4 52.3 34.9 87.9 87.8 87.9 58.4 33.0 33.6 52.8 54.0 49.9 49.4 47.9 48.1 84.8 45.6 82.6 20.0 18.0 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2
Slide 14: Capacity costs 4% lower than Q2 of last year
Capacity costs 4% lower than Q2 of last year Capacity costs Development costs Distribution & marketing costs Administrative costs DKKm DKKm DKKm DKKm -3.8% -9% -3.5% 15% 38 369 86 255 33 33 355 81 246 31 234 335 326 216 215 71 27 309 65 63 > 9.4% 13.5% 10.1% 10.2% 10.1% 29.7% 34.0% 36.2% 34.7% 35.1%
Slide 15: Focus on working capital - Inventory reduced since Q2 22/23
Focus on working capital - Inventory reduced since Q2 22/23 Net working capital Inventory Trade receivables Trade payables DKKm DKKm DKKm DKKm 445 648 335 568 311 365 565 286 499 499 341 478 327 327 506 269 460 451 222 403 11.4% 9.6% 8.1% 11.3% 11.0% 19% 18% 18% 17% 18% 15% 12% 12% 12% 14% 22% 18% 2
Slide 16: Free cash flow improved DKK 23m year-on-year
Free cash flow improved DKK 23m year-on-year Free cash Flow CAPEX Capital resources DKKm DKKm DKKm Intangible Tangible 33 384 27 24 328 323 69 307 310 1 14 57 53 43 42 19 17 11 10 55 36 32 32 38 -61 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 22/23 23/24 22/23 23/24 22/23 23/24 • Q2 free cash flow
Slide 17: Outlook
Outlook
Slide 18: Outlook 2023/24 maintained
Outlook 2023/24 maintained. Revenue growth and free cash flow in the lower end of the range – EBIT margin before special items is unchanged Outlook H1 FY 2023/24 2023/24 Main assumptions Outlook for 2023/24 maintained. However, revenue growth and free cash flow expected to be at the lower end of the
Slide 19: Summary
Summary • Margins significantly improved, generating positive earnings despite lower revenue level • Significantly improved gross margin. • Normalisation of component and logistics costs has lifted the margin level. • Margin improved across regions and product categories, supported by product mix an
Slide 20: Q&A
Q&A
Slide 21: Appendix
APPENDIX
Slide 22: Improved gross margin across regions
Improved gross margin across regions Gross margin, regions Brand Partnering and other % % EMEA Americas APAC 11.7pp 9.3pp 6.6pp 5.1pp 44.2 45.5 42.9 51.6 87.9 87.8 87.9 46.7 47.3 48.5 48.9 45.0 46.6 42.5 84.8 33.6 36.8 36.8 31.0 82.8 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 22/23
Slide 23: Q2 development since 20/21
Q2 development since 20/21 EMEA Americas APAC DKKm DKKm DKKm 400 284 106 248 367 91 352 216 211 342 Regions 72 45 20/21 21/22 22/23 23/24 20/21 21/22 22/23 23/24 20/21 21/22 22/23 23/24 Q2 Q2 Q2 Staged Flexible Living On-the-go 327 332 279 Product 254 278 193 225 222 212 categories 143 134 135 20/21
Slide 24: Investor Relations Contact
INVESTOR RELATIONS CONTACT Cristina Rønde Hefting +45 41 53 73 03 crrh@bang-olufsen.dk