Safilo Group S.p.a. · MIL:SFL
Safilo — Q3 2023 Earnings Presentation
19 slides from Safilo's earnings presentation, Nov 3, 2023
Slide 1: Q3/9M 2023 Trading Update
Q3/9M 2023 Trading Update November 3, 2023
Slide 2: Disclaimer
// 2 DISCLAIMER This presentation may contain forward looking statements based on current expectations and projects of the Group in relation to future events. Due to their specific nature, these statements are subject to inherent risks and uncertainties, as they depend on certain circumstances and f
Slide 3: CEO comment on the first nine months
// 3 “In the 9 months, our sales performance reflected soft trends in North America, particularly in the contemporary segment. Underlying growth in Europe offset most of the sales decline in the former GrandVision chains and emerging markets delivered good progress . We saw a significant strengtheni
Slide 4: Q3 sales still soft, but improving from Q2
// 4 Q3 SALES STILL SOFT, BUT IMPROVING FROM Q2 Q3/9M 2023 TRADING UPDATE Q3 2023 9M 2023 235.0 €M 785.1 €M -3.9% @cFX -3.6% @cFX -2.3% organic 1 Sales decline in the former GV chains accounting for ̴3% of Q3’s and ̴ 4% of 9M’s Underlying growth in Europe slowing in Q3 North America better than in Q
Slide 5: Net sales in North America
// 5 NET SALES in NORTH AMERICA Q3/9M 2023 TRADING UPDATE Q3 2023 9M 2023 109.6 €M 341.1 €M -4.9% @cFX -9.2% @cFX -5.7% organic 1 Smith up double-digits in Q3, on easier comps and improved retail environment. Sport business growing in physical stores and online Still difficult eyewear market in cont
Slide 6: Net sales in Europe
// 6 NET SALES in EUROPE Q3/9M 2023 TRADING UPDATE Q3 2023 9M 2023 85.4 €M 321.1 €M -6.1% @cFX -1.5% @cFX -2.3% organic 1 Positive underlying growth, net of the former GV’s business ~ +7% in 9M. BTB clients outperforming ~ +1% in Q3. Softening performance in Italy, France and Spain vs strong H1and l
Slide 7: Net sales in Asia & Pacific
// 7 NET SALES in ASIA & PACIFIC Q3/9M 2023 TRADING UPDATE Q3 2023 9M 2023 15.2 €M 43.8 €M +2.3% @cFX +11.2% @cFX Continued good progress in China and other key markets of the area Ports, Smith and Polaroid leading the quarterly improvement
Slide 8: Net sales in Rest of World
// 8 NET SALES in REST of WORLD Q3/9M 2023 TRADING UPDATE Q3 2023 9M 2023 24.8 €M 79.2 €M +5.9% @cFX +7.1% @cFX Continued strong progress of Carrera in India and the Middle East Latin America flattish in Q3, with Mexico growing, while Brazil softening. Up mid-single digits in 9M
Slide 9: Adj. gross margin
// 9 ADJ. GROSS MARGIN 2 Q3/9M 2023 TRADING UPDATE Q3 2023 9M 2023 135.5 €M 459.1 €M -3.2% +0.2% 5 7 .7% 58.5% +390 bps +340 bps Continued gross margin improvement thanks to lower inbound transport costs, efficiencies in procurement and positive price/mix effect
Slide 10: Adj. EBITDA margin
// 10 ADJ. EBITDA MARGIN 2 Q3/9M 2023 TRADING UPDATE Q3 2023 9M 2023 18.1 €M 75.4 €M -20.0% -11.5% 7. 7 % 9.6 % -100 bps -70 bps Operating deleverage, coupled with continued IT and marketing investments, weighing on the operating performance
Slide 11: Cash generation and lower net debt
// 11 CASH GENERATION AND LOWER NET DEBT Q3/9M 2023 TRADING UPDATE FREE CASH FLOW* Q3 2023 9M 2023 11.9 €M 21.7 €M *Before €5.9M payment to exercise the first option on an additional 10% of Blenders non-controlling interests GROUP NET DEBT Dec.31,2022 Sept. 30, 2023 113.4 €M 96.0 €M 69.6 €M pre-IFRS
Slide 12: Q3 business updates
// 12 Q3 BUSINESS UPDATES Q3/9M 2023 TRADING UPDATE A new five-year agreement for the eyewear of Stuart Weitzman, an excellent addition to our portfolio in the women’s luxury eyewear segment New Carrera Smart Glasses with Alexa, blending our Italian design with Alexa technology into two iconic frame
Slide 13: Q&A
Q&A
Slide 14: Appendices
Appendices
Slide 15: Notes to the presentation
// 15 NOTES TO THE PRESENTATION 1 Organic sales performance is provided at constant exchange rates and includes only the home brands and not terminated licenses, present in both of the compared periods, excluding the business attributable to the supply contract with Kering Eyewear. 2 In the 9 months
Slide 16: Net sales by geographical area
// 16 NET SALES BY GEOGRAPHICAL AREA Change at Change at current forex constant forex (Euro million) 9M 2023 % 9M 2022 % Reported Reported Organic1 North America 341.1 43.4 383.5 46.1 -11.0% -9.2% -5.7% Europe 321.1 40.9 332.7 40.0 -3.5% -1.5% -2.3% Asia Pacific 43.8 5.6 41.3 5.0 +6.0% +11.2% +11.7%
Slide 17: Key economic highlights
// 17 Q3/9M 2023 TRADING UPDATE % on % on Key Economic highlights - in Euro million 9M 2023 net sales 9M 2022 net sales % Change Net sales 785.1 831.3 -5.6% Reported at cFX -3.6% Gross Profit 451.0 57.4% 458.4 55.1% -1.6% Adjusted 2 Gross Profit 459.1 58.5% 458.4 55.1% +0.2% EBITDA 58.0 7.4% 83.6 10
Slide 18: Exchange rates
// 18 EXCHANGE RATES (Appreciation) (Appreciation) As of Average for /Depreciation /Depreciation September 30, December 31, Currency Code % 9M 2023 9M 2022 % 2023 2022 US Dollar USD 1.0594 1.0666 -0.7% 1.0833 1.0638 1.8% Hong-Kong Dollar HKD 8.2959 8.3163 -0.2% 8.4860 8.3326 1.8% Swiss Franc CHF 0.9
Slide 19: Strong brand portfolio
// 19 STRONG BRAND PORTFOLIO TO REACH A BROAD AUDIENCE OF TARGET CONSUMERS • The right offer for all distribution channels, for all customer types • Centered on contemporary segment where the highest (starting from 2024) demand of eyewear is • Broad based offer across genders, ages, categories & pri