Slide 1: 2020 Results
2020 Results 10 March 2021 INDITEX 2020 RESULTS 1
Slide 2: Disclaimer
Disclaimer This document and the information herein does not constitute an offer to sell, to buy or to exchange, nor an invitation to make an offer to buy, to sell or to exchange, nor a recommendation or advice, regarding any security issued by the Inditex Group. This document contains forward-looki
Slide 3: 2020: A year marked by the pandemic and key in Inditex's strategic transformation
2020: A year marked by the pandemic and key in Inditex’s strategic transformation INDITEX 2020 RESULTS 3
Slide 4: A year marked by the pandemic and key in Inditex's strategic transformation
A year marked by the pandemic and key in Inditex’s strategic transformation We express our solidarity with the people affected People first. Top priority health and safety of local communities, customers, suppliers and employees Operations seriously disrupted by lockdowns and restrictions We
Slide 5: Strong operating performance
Strong operating performance Remarkable execution in a challenging operational environment Store performance marked by lockdowns and restrictions Outstanding growth in online sales continues Disciplined management of operating expenses Strong cash flow and financial condition Fully confi
Slide 6: Strong operating performance
Strong operating performance Total integration of Stores & Online 100% implementation of RFID and SINT. Inditex Open Platform 80% developed Online sales grew +77% in constant currencies Strong customer engagement (5.3 billion online visits, +50%) Gross space growth +2%. Store optimisation
Slide 7: A year marked by the pandemic: stores open
A year marked by the pandemic: stores open INDITEX 2020 RESULTS 7
Slide 8: A year marked by the pandemic: store & online sales
A year marked by the pandemic: store & online sales INDITEX 2020 RESULTS 8
Slide 9: FY2020: Healthy sales productivity
FY2020: Healthy sales productivity 2020 2H2020 4Q2020 Trading hours (25.5%) (15%) (23.5%) Total store & online sales growth (24.5%) (15%) (19.5%) On 31 January 2021 30% of stores were in full lockdown (versus 8% on 31 October 2020) and 52% had restrictions INDITEX 2020 RESULTS 9
Slide 10: Online continues to be a major growth driver
Online continues to be a major growth driver €6.6bn Confirms strength of business model and fashion proposition Sector leading growth and profitability Non-dilutive to margins and lower capital intensity INDITEX 2020 RESULTS 10
Slide 11: Online sales €6.6 billion
Online sales €6.6 billion 7 bn +77% increase in online sales in constant 6 bn currency Online sales € 5 bn 95% of online growth organic SINT €1.2 billion 4 bn 5.3 billion online visits, a +50% increase 3 bn Strong growth continues into 2021 2 bn 1 bn bn 2017 2018 2019 2020 INDITEX 2020 RES
Slide 12: Online €6.6 billion with leading growth rates and profitability
Online €6.6 billion with leading growth rates and profitability Company data / Bloomberg estimates INDITEX 2020 RESULTS 12
Slide 13: A key year in Inditex's strategic transformation
A key year in Inditex’s strategic transformation INDITEX 2020 RESULTS 13
Slide 14: 2020: A key year in Inditex's strategic transformation
2020: A key year in Inditex’s strategic transformation Further strengthen our competitive advantage: Integrated store and online reinforce one another Stronger customer experience: Improved management of stores, inventory, supply chain, sales conversion Strong growth of online sales and reinfo
Slide 15: Continuous investment in digitalisation
Continuous investment in digitalisation Digital capex €1bn over 2020-22 Zara online studio (67,000 m²) 2020 Inditex Open Platform 2019-2021 INDITEX 2020 RESULTS 15
Slide 16: New Online studios for Zara
New Online studios for Zara Veldstraat, Ghent INDITEX 2020 RESULTS 16
Slide 17: Single Inventory Integration (SINT)
Single Inventory Integration (SINT) 2020 marked the completion of SINT rollout to all concepts and geographies SINT contribution to 2020 online sales €1.2 billion INDITEX 2020 RESULTS 17
Slide 18: Investment in digital integration: the store in-your-pocket 24/7
Investment in digital integration: the store in-your-pocket 24/7 Acquisition / Discovery Geolocation 18 Fitting 1 8 INDITEX 2020 RESULTS Customer service
Slide 19: Sustainability a key part of the strategy
Sustainability a key part of the strategy Sustainability in supply chain Renewable energies Sustainable fabrics Eco-efficient stores Zero-waste / recycling INDITEX 2020 RESULTS 19
Slide 20: Sustainability 2020 targets
Sustainability 2020 targets Objective 2020 100% eco-efficient stores 100% stores w. containers for used garments More than 25% of Join Life garments 35% 100% certified forest friendly fibres Removal of plastic bags in all concepts Zero discharge commitment 65% renewable energy in own facil
Slide 21: Sustainability 2023 targets
Sustainability 2023 targets Objective Zero waste from our facilities 100% sustainable cellulosic fibres 100% free of single-use plastic 100% of all packaging materials collected for reuse/recycle in our supply chain INDITEX 2020 RESULTS 21
Slide 22: Financial Summary
Financial Summary INDITEX 2020 RESULTS 22
Slide 23: 2020: A year marked by the pandemic
2020: A year marked by the pandemic Remarkable execution of store, online and supply chain Store sales recovering progressively Online sales continue growing at an outstanding pace New temporary restrictions in some markets from 19 October 2020 Healthy sales productivity INDITEX 2020 RESUL
Slide 24: 2020: A year marked by the pandemic
2020: A year marked by the pandemic € million 2020 20/19 Active management of supply chain Net sales 20,402 (28%) Healthy gross margin evolution Gross profit 11,390 (28%) Strong reduction in operating expenses EBITDA 4,552 (40%) Net income 1,106 (70%) INDITEX 2020 RESULTS 24
Slide 25: 2020: Second half recovery
2020: Second half recovery € million 2H2020 20/19 Strong recovery in challenging environment Net sales 12,369 (20%) Active management of supply chain Gross profit 6,878 (19%) Healthy gross margin evolution EBITDA 3,066 (26%) Strong reduction in operating expenses Net income 1,300 (38%) Exc
Slide 26: 2020: Sales
2020: Sales Second half recovery in sales € million 2020 2019 Online sales +77% CC in 2020 Net sales 20,402 28,286 2020 sales trends improve as stores reopen and online sustains outstanding progress INDITEX 2020 RESULTS 26
Slide 27: Global Store & Online sales in 2020
Global Store & Online sales in 2020 48% Europe ex-Spain 15% Spain 23% Asia & 14% RoW Americas INDITEX 2020 RESULTS 27
Slide 28: Gross margin
Gross margin 2020 2019 Flexibility of supply chain key to gross margin performance Gross margin 55.83% 55.88% CC gross margin +170 bps to 57.58% (+257 bps in 2H2020) INDITEX 2020 RESULTS 28
Slide 29: Operating efficiencies
Operating efficiencies € million 2020 2019 20/19 Very efficient cost management across all departments and business areas Op. expenses 6,807 8,176 (17%) Demonstrates our ability to react and adapt continuously to the changing trading environment The main components of operating expenses have s
Slide 30: Depreciation
Depreciation € million 2020 2019 20/19 Depreciation & Amortisation includes completion of space optimisation 2020- Depreciation (3,045) (2,826) 8% 2021 booked in 1Q2020 INDITEX 2020 RESULTS 30
Slide 31: Financial results
Financial results € million 2020 2019 20/19 Interest on lease liability amounted to €120m Financial results (139) (152) (8%) INDITEX 2020 RESULTS 31
Slide 32: Efficiencies in operations
Efficiencies in operations Efficiencies from single inventory position Technology enabled by RFID & SINT fully rolled out in 2020 In-store inventory to fulfill online orders Store optimisation improves inventory allocation Higher product availability and full price sales Strong cash gene
Slide 33: Flexible business model
Flexible business model € million FY2020 20/19 Inventory 2,321 (9%)* Receivables 715 (8%) Payables (4,747) (15%) Operating working capital (1,711) (24%)* Net Cash & Equivalents 7,560 (6%) Robust cash generation in a disrupted trading environment *Excluding 4Q2019 inventory provision INDITEX 2020 R
Slide 34: Cash flow summary
Cash flow summary € million FY2020 Funds from operations 3,864 Lease payments (1,673) Funds from operations* 2,191 Change in working capital (847) Cash from Operations 1,344 Capital expenditure (713) Free cash flow 631 Dividends 1,090 *FFO including lease payments INDITEX 2020 RESULTS 34
Slide 35: Concepts
Concepts INDITEX 2020 RESULTS 35
Slide 36: Store & Online sales by concept
Store & Online sales by concept Sales Pull&Bear Massimo Dutti Bershka Stradivarius Zara & Oysho Zara Home Uterqüe INDITEX 2020 RESULTS 36
Slide 37: Performance per concept
Performance per concept Oysho Uterqüe Stradivarius Pull&Bear Bershka Group average Massimo Dutti INDITEX 2020 RESULTS 37
Slide 38: Concepts
Concepts Remarkable online growth across all concepts Strong performance of Oysho and Zara Home Optimisation activity in all concepts INDITEX 2020 RESULTS 38
Slide 39: Outlook
Outlook INDITEX 2020 RESULTS 39
Slide 40: FY2022 outlook
FY2022 outlook Global fully integrated Store & Online Strong organic growth. Increased differentiation of the model Strong online sales growth to continue Capital expenditure c€900m annually (2020-22). Digital capex €1 billion for 2020-2022 Sustainability is central to the strategy Incre
Slide 41: Online key to Growing Markets
Online key to Growing Markets Full integration between store & online key to best customer experience Online access in all markets Strong acceleration in online to date 5.3 billion online visits in 2020, +50% 200 million followers on social media 132 million active apps in 2020 Leading
Slide 42: Unique business model: Global fully integrated Store & Online
Unique business model: Global fully integrated Store & Online INDITEX 2020 RESULTS 42
Slide 43: FY2021 outlook
FY2021 outlook Spring/Summer collections have been very well received by our customers In February an average of 21% of stores were temporarily closed. At 8 March 15% of stores remained temporarily closed Store and online sales 1-7 March were -4% vs -4% in same period last year. Excluding the
Slide 44: Dividend
Dividend Inditex’s Dividend Policy of 60% ordinary payout and bonus dividends remains in place Inditex’s Board of Directors will propose to the Annual General Meeting a dividend of 70 cents per share for fiscal 2020. This will be composed of an ordinary dividend of 22 cents and a bonus dividend
Slide 45: 2020 Results
2020 Results 10 March 2021 INDITEX 2020 RESULTS 45