Delta Galil Industries Ltd. · TASE:DELG
Delta Galil Industries — Q3 2014 Earnings Presentation
32 slides from Delta Galil Industries's earnings presentation, 2014
Slide 1: Results Overview Q3 2014
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Slide 2: Forward-looking information disclaimer (Hebrew)
RESULTS OVERVIEW | Q2 2014 האמור במצגת זו כולל גם מידע צופה פני עתיד ,כהגדרתו בחוק ניירות ערך ,של תחזיות ,מטרות ,הערכות ,אומדנים ומידע אחר המתייחסים לאירועים ו/או לעניינים עתידיים ,שהתממשותם אינה ודאית ואינה בשליטת החברה .מידע צופה פני עתיד אינו מהווה עובדה מוכחת והוא מבוסס
Slide 3: Q3 Sales, Net Profit & EPS
RESULTS OVERVIEW | Q3 2014 Q3 SALES, NET PROFIT & EPS 20th Consecutive Quarters of Organic Sales Growth ($ Million) % Change Q3 2014 Q3 2013 vs LY 4% Sales UP 4% to $267.2M Sales 267.2 257.2 4% Operating Profit % from sales 21.7 21.3 2% 8.1% 8.3% 2% Operating Income excluding one-time items Increase
Slide 4: YTD 2014 Sales, Net Profit & EPS
RESULTS OVERVIEW | Q3 2014 YTD 2014 SALES, NET PROFIT & EPS ($ Million) % Change YTD 2014 YTD 2013 vs LY 5% Sales UP 5% to $754.5M Sales 754.5 718.8 5% Operating Profit % from sales 52.0 46.8 11% 11% Operating Income excluding one-time items 6.9% 6.5% Increased 11% to $52.0M comp. to $46.8M EBITDA 6
Slide 5: Strong Balance Sheet
RESULTS OVERVIEW | Q3 2014 STRONG BALANCE SHEET ($ Million) Sep. 30 % Sep. 30 % 2014 from total 2013 from total Cash and cash equivalents 147.7 20% 85.5 13% Restricted cash 0.2 0% 1.4 0% Trade receivables 114.4 15% 114.0 18% $336M Increase in Equity to $336M Inventories Assets held for sale Others 2
Slide 6: Improved Financial Indicators
RESULTS OVERVIEW | Q3 2014 IMPROVED FINANCIAL INDICATORS ($ Million) 30.09.2014 30.09.2013 Current ratio 2.75 2.02 Quick ratio 1.61 1.15 Days of Sales Outstanding 39 40 Days Payable Outstanding 44 41 Inventory Days 98 88 Operating cash flow - Q3 ($ million) 14.8 19.4 Operating cash flow - YTD ($ mil
Slide 7: Results on a Quarterly Basis
RESULTS OVERVIEW | Q3 2014 RESULTS ON A QUARTERLY BASIS Excluding one time items ($ Million) We EXCEED $1 billion sales in the year ending SEPTEMBER 30th 2013 2014 Last 4 Quarters Q1 Q2 Q3 Q4 Q1 Q2 Q3 Net Sales 227,255 234,368 257,199 255,897 238,074 249,152 267,237 1,010,360 EBIT before one time it
Slide 8: Sales Analysis by Geographic Area
RESULTS OVERVIEW | Q3 2014 SALES ANALYSIS BY GEOGRAPHIC AREA ($ Million) Q3 YTD 2014 % of 2013 % of % 2014 % of 2013 % of % sales sales change sales sales change North America 150.1 56% 142.9 56% 5% 416.1 55% 408.5 57% 2% Europe 41.9 16% 40.3 15% 4% 126.1 17% 118.1 16% 7% (excluding Germany) Germany
Slide 9: Improved Gross Margin
RESULTS OVERVIEW | Q3 2014 IMPROVED GROSS MARGIN Growing our branded business % From Sales 30.9% 30.2% 29.5% 25.7% 23.7% YEAR YEAR YEAR YTD YTD 2011 2012 2013 2013 2014 9
Slide 10: Q3 Sales and EBIT by Segment
RESULTS OVERVIEW | Q3 2014 Q3 SALES AND EBIT BY SEGMENT ($ Million) Sales EBIT Q3 2014 Q3 2013 % Chg. Q3 2014 Q3 2013 Delta USA 7,841 6,960 116,680 103,493 13% % from segment sales 6.7% 6.7% Global Upper Market 4,982 7,769* 68,865 73,027 (6%) % from segment sales 7.2% 10.6% Schiesser 8,039 7,127 53,
Slide 11: YTD Sales and EBIT by Segment
RESULTS OVERVIEW | Q3 2014 YTD SALES AND EBIT BY SEGMENT ($ Million) Sales EBIT YTD 2014 YTD 2013 % Chg. YTD 2014 YTD 2013 Delta USA 19,692 19,355 325,934 299,189 9% % from segment sales 6.0% 6.5% Global Upper Market 202,732 212,080 (4%) 16,363 19,188 % from segment sales 8.1% 9.0% Schiesser 148,124
Slide 12: Segmental Results on a Quarterly Basis
RESULTS OVERVIEW | Q3 2014 SEGMENTAL RESULTS ON A QUARTERLY BASIS Excluding one time items ($ Million) 2013 2014 Last 4 Quarters Q3 Q4 Q1 Q2 Q3 EBIT SALES EBIT SALES EBIT SALES EBIT SALES EBIT SALES EBIT SALES Delta USA 6,960 103,493 4,629 103,395 3,906 91,915 7,945 117,339 7,841 116,680 24,321 429,
Slide 13: 2014 Updated Guidance
RESULTS OVERVIEW | Q3 2014 2014 UPDATED GUIDANCE Excluding one time items ($ Million) % Increase 2014 % Increase 2014 2014 2014 2011 2012 2013 Updated Guidance Previous Guidance Updated Previuos Actual Actual Actual compared to compared to Guidance Guidance 2013 Actual 2013 Actual Sales 678.8 817.8
Slide 14: Capital Expenditures
RESULTS OVERVIEW | Q3 2014 CAPITAL EXPENDITURES Investing in our future growth ($ Million) 22.5 Other investments Joint Ventures - investment of 5.0 18.7 $5.0M in 3 new factories 18.0 17.5 EGYPT– New dye house 1.5 FIX – Acquisition of the Brand FIX 2.1 Capex Manufacturing 5.1 Schiesser (Mainly in St
Slide 15: Diversified Portfolio
RESULTS OVERVIEW | Q3 2014 DIVERSIFIED PORTFOLIO % FROM SALES (first 9 months of 2014) Business Segments DELTA USA GLOBAL UPPER SCHIESSER DELTA MARKET ISRAEL 43% 25% 20% 12% Product Categories LADIES MENS SOCKS KIDS 45% 24% 17% 14% Geographic Area NORTH AMERICA EUROPE ISRAEL 56% 32% 12% Branded / Pr
Slide 16: Strengthening Our Platform for Continuing Long-Term Growth
Strengthening Our PLATFORM FOR CONTINUING LONG-TERM GROWTH
Slide 17: Our goal in the next 5 years: Strategic Initiatives
RESULTS OVERVIEW | Q3 2014 Our goal in the next 5 years is to build on Delta Galil’s position in the global apparel market– significantly increasing our sales and delivering the benefits of profitable growth to our shareholders. Strategic Initiatives: Strengthen our management team with world-class
Slide 18: Adding World-Class Management Talent
RESULTS OVERVIEW | Q3 2014 ADDING WORLD-CLASS MANAGEMENT TALENT Key additions to management, along with our existing strong team, will provide leadership for critical functions that will drive growth. Maurice Reznik, PRESIDENT OF DGUSA, INCHARGE OF OUR US & uk Intimates business, will join on Januar
Slide 19: Growing the Activewear Business
RESULTS OVERVIEW | Q3 2014 GROWING THE ACTIVEWEAR BUSINESS Activewear BUSINESS will become +20% of Delta Galil’s business, with solid margins and outstanding growth potential. We are building this business across multiple fronts, through product innovation and expanded distribution. 19
Slide 20: Avia – Expanding distribution into Walmart
RESULTS OVERVIEW | Q3 2014 Avia – Expanding distribution by moving product lines into Walmart 20
Slide 21: Center Fold BTS Roto 2013
RESULTS OVERVIEW | Q3 2014 CENTER FOLD BTS ROTO 2013 21
Slide 22: BTS 2014 Centerfold
RESULTS OVERVIEW | Q3 2014 BTS 2014 CENTERFOD 22
Slide 23: Front Page - BTS Roto 2014 Avia Apparel Launch
RESULTS OVERVIEW | Q3 2014 FRONT PAGE - BTS ROTO 2014 AVIA APPAREL LAUNCH 23
Slide 24: BTS 2014 Inside Front Left Cover
RESULTS OVERVIEW | Q3 2014 BTS 2014 INSIDE FRONT LEFT COVER 24
Slide 25: National TV - 4 Weeks August 2014
RESULTS OVERVIEW | Q3 2014 NATIONAL TV - 4 WEEKS AUGUST 2014 25
Slide 26: Asics – New agreement to design, manufacture and sell in U.S.
RESULTS OVERVIEW | Q3 2014 Asics – New agreement to design, manufacture and sell in U.S. 26
Slide 27: Nike – Joint research center and Vietnam facility
RESULTS OVERVIEW | Q3 2014 Nike – Joint research center for seamless innovation in Portland, and investING manufacturing facility in Vietnam 27
Slide 28: Launching Lacoste Spring 2015
RESULTS OVERVIEW | Q3 2014 Launching Lacoste Spring 2015 28
Slide 29: Results Overview | Q3 2014
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Slide 30: Driving Organizational Efficiency
RESULTS OVERVIEW | Q3 2014 DRIVING ORGANIZATIONAL EFFICIENCY CONSOLIDATING OFFICES AND DIVISIONS WILL CREATE A MORE UNIFIED, COLLABORATION AND AGILE ORGANIZATION AND WILL SPEED DECISION-MAKING. U.S - RELOCATING 3 SEPARATE LOCATIONS IN NYC TO A SINGLE FLOOR AT 2 PARK AVENUE TO ACCOMMODATE GROWTH AND
Slide 31: Consistent Long Term Growth
RESULTS OVERVIEW | Q2 2014 CONSISTENT LONG TERM GROWTH SALES ($ Million) 1,040- Continue to Grow Organically CAGR 1,050 12.8% 975 and through Acquisitions 818 679 620 573 Continue to grow our Branded and Retail Businesses 2009 2010 2011 2012 2013 2014 Updated Growth in Activewear Guidance EBIT* 77-
Slide 32: Thank You
THANK YOU
Delta Galil Industries — Q3 2014 Earnings Presentation on 6ix