Shaver Shop Group Limited · ASX:SSG
Shaver Shop — H1 FY2020 Earnings Presentation
29 slides from Shaver Shop's earnings presentation, Feb 21, 2020
Slide 1: 1H FY20 Results Presentation
1H FY20 Results Presentation 21 February 2020 TRANSFORM YOURSELF
Slide 2: Table of contents
03 1H FY20 Highlights 07 Financial Results Summary 15 2H FY20 Key Priorities 18 Trading Update & Outlook 21 Appendices Table of contents
Slide 3: 1H FY20 Highlights
1H FY20 HIGHLIGHTS
Slide 4: Shaver Shop Competitive Advantages
Shaver Shop Competitive Advantages Shaver Shop is a leading, personal care specialty retailer across Australia & New Zealand operating in a growing market Trusted and respected retail brand Unique business model with significant contribution from exclusive product lines Specialist store teams
Slide 5: 1H FY20 Highlights
1H FY20 Highlights Shaver Shop has delivered record sales and EBITDA in 1H FY20 Like for Like Sales Insert Braun Online1 Sales + 9.3% S9 image + 61% Pro forma2 EBITDA Operating Cash (AASB 117) Flow (AASB 117) Insert Dyson $12.9m $23.7m + 16.8% Strong Balance Gross Margin Interim Dividend Sheet down
Slide 6: Record 1H Sales – Up 12.3% to $107.5m
Record 1H Sales – Up 12.3% to $107.5m Like for like (LFL) sales up 9.3% driven by 61% growth in online sales together with bricks and mortar stores LFL sales growth Strong Sales Growth Trend > Total sales up 12.3% to $107.5 million 120.0 - > Digital investments paying dividends with online sales up
Slide 7: Financial Results Summary
Financial Results Summary
Slide 8: Reported Profit & Loss
Reported Profit & Loss Reflects statutory results and adoption of AASB 16 Leases effective 1 July 2019. Prior corresponding period results reflect Reported Reported old AASB 117 lease accounting standard $A 000s 1H FY20 (AASB 16) 1H FY19 Variance Variance (AASB 117) $ % Sales 107,492 95,716 11,776 1
Slide 9: Strong Growth On Comparable Accounting Basis
Strong Growth On Comparable Accounting Basis Strong top line sales growth and operating leverage has combined to drive a 16.8% increase in pro forma (AASB 117) EBITDA (to $12.9 million) and a 16.3% increase in NPAT (to $7.9 million) and Basic EPS (to 6.5 cents per share) > Total Sales up 12.3% Compa
Slide 10: Pro Forma EBITDA
Comparable EBITDA growth of 16.8% Strong LFL sales growth together with incremental contributions from greenfield and buyback stores delivered record EBITDA Pro forma EBITDA Growth ($m) Pro forma EBITDA Growth Drivers ($m) 14.0 16.0 12.9 14.0 0.4 12.0 0.5 1.2 0.3 1.1 12.0 1.8 12.9 11.0 10.0 10.5 Pro
Slide 11: Operating Leverage
Operating Leverage Costs of doing business (CODB) as a % of sales down c.170 bps to 30.5% driven by strong like for like sales growth and ongoing cost management Pro Forma 1H FY20 CODB % vs 1H FY19 Normalised CODB % 16.0% 14.3% 14.3% 14.0% 12.0% 10.0% 8.0% 8.0% 7.5% 6.0% 4.7% 4.9% 4.9% 4.1% 4.0% 2.0
Slide 12: Strong Balance Sheet
Strong Balance Sheet Shaver Shop had net cash of $8.4 million (30 June 19: net debt of $6.4 million) Pro forma AASB 16 AASB 117 AASB 117 > Shaver Shop’s balance sheet remains conservatively geared $m 31-Dec-19 31-Dec-19 30-Jun-19 > Stock levels consistent with prior year despite additional 3 Cash 19
Slide 13: Operating Cashflow Up 33% to $23.7m
Operating Cashflow Up 33% to $23.7m Increase in comparable operating cash flow due to higher earnings and increased timing of supplier payments. Investments continuing in 2H FY20 store refits and technology platforms Pro Forma Reported > Comparable 1H FY20 operating cash flow up $5.9m to 1H FY20 1H
Slide 14: Capital Management
Capital Management Shaver Shop’s strong cash flow and conservative gearing supports a healthy dividend payout ratio > 1H FY20 interim dividend up 5% to 2.1 cps (80% franked) > Interim dividend represents 32.6% of pro forma NPAT (AASB 117) and approximately 30% of cash NPAT > SSG dividend policy rema
Slide 15: 2H FY20 Key Priorities
2H FY20 Key Priorities
Slide 16: Key Priorities for 2H FY20
Key Priorities for 2H FY20 > Omni channel marketing (“always on approach”) to continue LFL sales growth trends – Continued growth in customer database . Now at 340,000 (up > c200% in 18 months) – targeting 500,000 in near term – See subsequent slide for further details > Continue growth trajectory i
Slide 17: Omni Retail Growth
Omni Retail Growth Shaver Shop has quickly transitioned from a bricks and mortar retailer to the leading omni channel specialty retailer in our category Network Online Sales Growth 61% > Online sales up to 17.6% of total sales 25.0 20.3 > Online sales growth has helped SSG deliver 13 months of 20.0
Slide 18: Trading Update & Outlook
Trading Update & Outlook
Slide 19: Trading Update & Outlook
Trading Update & Outlook Trading Update > Like for like sales growth from 1 Jan 20 through 14 Feb 20 up 7.6% – Online sales growth remains a key driver > Gross margins relatively consistent with 1H FY20 > Karrinyup, WA store reopening in March following significant centre renovation over last 24 mon
Slide 20: Summary
Summary Shaver Shop has delivered a strong 1H FY20 result underpinned by both online and bricks and mortar sales growth > Shaver Shop is a specialty retailer that has a leading position in a growing market > Investments in digital marketing capability and technology have driven online sales growth o
Slide 21: Appendices
Appendices
Slide 22: Key metrics
Key metrics Pro Forma Normalised AASB 117 AASB 117 Comparable Accounting 1H FY20 1H FY19 Number of corporate stores 116 113 Number of franchise stores 6 8 Total stores 122 121 Corporate store sales ($'000) 107,492 95,716 Franchise store sales ($'000) 8,417 10,271 Total network sales ($'000) 115,909
Slide 23: Store numbers
Corporate Store Network Growth Corporate Store Profile 140 116* 120 113* 1 106* 2 6 1 95 8 100 4 80 8 Store numbers 7 80 16 56 60 8 113 8 106 95 30 40 18 80 4 56 20 10 30 16 16 0 FY13 FY14 FY15 FY16 FY17 FY18 FY19 1H FY20 Opening Buybacks Greenfields • Karrinyup, WA store was temporarily closed duri
Slide 24: Reconciliation of AASB 16 and Normalisation Impacts – P&L
Reconciliation of AASB 16 and Normalisation* Impacts – P&L 1H FY20 pro forma adjustments are to represent results on a comparable basis with 1H FY19 normalised results. Normalisation in 1H FY19 related due diligence costs incurred in unsuccessful acquisition. Reversal of Recognition of Reported AASB
Slide 25: Reconciliation AASB16 Impact – Balance Sheet
Reconciliation AASB16 Impact – Balance Sheet Removal of Recognition of AASB 16 Lease AASB 117 Lease Pro forma AASB 16 Assets & Liabilities Liaibilties AASB 117 AASB 117 AASB 117 $m 31-Dec-19 31-Dec-19 31-Dec-19 31-Dec-19 30-Jun-19 31-Dec-18 Cash 19.4 19.4 3.9 14.0 Trade & other receivables 5.1 5.1 2
Slide 26: Reconciliation AASB16 Impact – Cash Flow
Reconciliation AASB16 Impact – Cash Flow No impact on net cash flow Reported Reclass of Pro Forma Reported 1H FY20 operating lease 1H FY20 1H FY19 AASB 117 $'000 (AASB 16) payments (AASB 117) (AASB 117) Variance EBITDA 19,239 (6,381) 12,858 10,037 2,821 Change in working capital and other 12,509 (10
Slide 27: Franchise Buy-Back Tax Benefit
Franchise Buy-Back Tax Benefit $2.9 million reduction in income tax payable over next 5 years. ATO Private Ruling enables tax deduction for cost of terminating franchise license Franchise buy-back tax benefit ($m) 1.4 1.2 1.0 0.8 0.6 1.2 0.9 0.4 0.2 0.4 0.2 0.2 0.0 FY20 FY21 FY22 FY23 FY24 27
Slide 28: Important Notice and Disclaimer
Important Notice and Disclaimer This management presentation (“Presentation”) has been prepared by Shaver Shop Group Limited ACN 150 747 649 (“Shaver Shop”) and contains general background information about Shaver Shop, its subsidiaries and their activities which is current at the date of this Prese
Slide 29: 1H FY20 Results Presentation
1H FY20 Results Presentation 21 February 2020 TRANSFORM YOURSELF