Leifheit AG · XETR:LEI
Leifheit — H1 2020 Earnings Presentation
48 slides from Leifheit's earnings presentation, Aug 13, 2020
Slide 1: Investor Presentation H1 2020
Investor Presentation H1 2020 Henner Rinsche (CEO/CFO) Marco Keul (Vice President Finance) 13 August 2020
Slide 2: Disclaimer
Disclaimer This presentation contains forward looking statements which are based on the management’s current estimates with regard to future developments. Such statements are subject to risks and uncertainties which are beyond Leifheit’s ability to control or estimate precisely, such as statements o
Slide 3: Welcome to the conference call: Agenda
Welcome to the conference call Agenda • Executive Summary • Introduction to Leifheit • Key Strategic Initiatives • Financial Figures 6M 2020 Henner Rinsche CEO + CFO • Forecast Financial Year 2020 • Annex Marco Keul Vice President Finance Investor Presentation H1 2020 August 2020 3
Slide 4: Strong Group turnover and earnings growth in first half of 2020 despite COVID-19
Management Summary Strong Group turnover and earnings growth in first half of 2020 despite COVID-19 pandemic • Very positive business development in the first half-year confirms new scaling-up success strategy • Leifheit Group well positioned in times of COVID-19 pandemic - Rising sales in May and J
Slide 5: COVID-19 pandemic strongly affected turnover development in March and April
Management Summary COVID-19 pandemic strongly affected turnover development in March and April Group turnover development by months in % • TV advertising led to a good start the first two months of 2020 40 +33% • COVID-19 pandemic resulted in retail 30 shutdowns in March +18% and April 20 +13% • Ris
Slide 6: Key financial highlights: increased turnover and EBIT despite COVID-19
Management Summary Key financial highlights: increased turnover and EBIT despite COVID-19 1 2 3 Turnover Successful TV-campaigns EPS in the first half of 2020 up by and consumers’ increased almost doubled 7.3% despite COVID-19 need for hygiene and home from 0.32 € in 6M 2019 crisis comfort sped up g
Slide 7: Introduction to Leifheit
Introduction to Leifheit
Slide 8: Solid base to build on
Introduction to Leifheit Solid base to build on Commitment to shareholders Strong products and brands in € 1.50 1,50 Dividend payments 1984 - 2019 1,00 1.00 0,50 0.50 0,00 0.00 Bonus/special dividend Dividend Strong financial structure Strong long-term stock performance in € m in % Assets Liabilitie
Slide 9: Leifheit Group
Introduction to Leifheit Leifheit Group Household Wellbeing Private Label Kitchen Standing Laundry Care Cleaning Kitchen goods Personal scales Kitchen scales goods Dryers Wellbeing 9% Rest of World Kitchen 4% Germany Goods Laundry Care 41% 15% Eastern Turnover by 41% Turnover Europe product by regio
Slide 10: Introduction to Leifheit
Introduction to Leifheit Investor Presentation H1 2020 August 2020 10
Slide 11: Fortunately hypers & discounters stayed open during Covid-19 retail shut-downs
Introduction to Leifheit Fortunately hypers & discounters stayed open during Covid-19 retail shut-downs Blue Chip client base Distribution channels Turnover in % (previous year’s figures) Electro Others 3 (3) 5 (5) Cash & Carry 3 (3) Hypermarkets Discounter 29 (30) 8 (8) Top 10 Customers Turnover 20
Slide 12: Operating in more than 80 countries with 15 own branches
Introduction to Leifheit Operating in more than 80 countries with 15 own branches Paris/F (Leifheit/Birambeau) Nassau/D (Leifheit/Soehnle) • About 80 employees • About 320 employees • Marketing, sales • Marketing, sales, development, quality and administration assurance, central administration • Man
Slide 13: Key Strategic Initiatives
Key Strategic Initiatives
Slide 14: Our purpose? Happy consumers!
Key Strategic Initiatives Our purpose? Happy consumers! Better Value for Money Investor Presentation H1 2020 August 2020 14
Slide 15: Urgent need for change
Key Strategic Initiatives Urgent need for change Gross profit EBIT in € m in € m 109.9 102.1 101.0 18.8 13.1 9.9 -2% -7% -1% 20 -15% -31% -24% 12,00% 120 46.4% 18 43.6% 43.1% 45,0% 10,00% 16 100 8.0% 40,0% 14 8,00% 80 35,0% 12 30,0% 10 5.6% 6,00% 60 8 4.2% 25,0% 4,00% 40 6 20,0% 4 20 2,00% 15,0% 2 0
Slide 16: Can we change it? Yes we can!
Key Strategic Initiatives Can we change it? Yes we can! Gross profit EBIT in € m in € m 109.9 102.1 101.0 52.0 57.5 18.8 13.1 9.9 5.0 8.8 -2% -7% -1% -3% +11% -15% -31% -24% -25.9% +75.7% 20 12,00% 46.4% 43.6% 43.1% 44.1% 18 120 42.8% 45,0% 10,00% 16 100 40,0% 8.0% 14 8,00% 35,0% 12 6.8% 80 5.6% 30,
Slide 17: Scaling up success strategy
Key Strategic Initiatives Scaling up success strategy Focus KPIs Growth Profitability Level of Completion 1 • Invest in pre-tested and scalable high ROI consumer advertising 2019 2020 2020+ Create consumer on profitable best sellers demand • Launch new products only if margin Concept Realisation Imp
Slide 18: Create consumer demand and make brand stronger
Key Strategic Initiatives 1 Create consumer demand and make brand stronger Marketing spend 2019 in % of turnover EBIT margin 25 20 Unilever1 15 Beiersdorf1 Adidas1 10 P&G1 5 Leifheit 0 Marketing spend 0 5 10 15 20 25 30 35 1 Source: Annual reports 2019 Investor Presentation H1 2020 August 2020 18
Slide 19: Successful TV campaigns boost turnover growth in the relevant markets in H1 2020
Key Strategic Initiatives 1 Successful TV campaigns boost turnover growth in the relevant markets in H1 2020 Turnover development selected TV markets Group turnover 6M 2020 in € m +49% +29% +46% +32% +48% Netherlands Belgium Switzerland Poland Romania Investor Presentation H1 2020 August 2020 19
Slide 20: Creating and pre-testing effective ads
Key Strategic Initiatives 1 Creating and pre-testing effective ads • Further TV campaigns in Germany and selected European markets in H2. • Draw consumer attention to top products such as the CLEAN TWIST set or the Pegasus drying rack, which were tested and awarded a “very good” grade. • Major part
Slide 21: Creating and pre-testing effective ads
Key Strategic Initiatives 1 Creating and pre-testing effective ads Large-scale Soehnle print campaign • Campaign focuses on Soehnle Page Profi 300 digital kitchen scales, recently awarded a “very good” test result. • Soehnle Page Profi is the most-popular range of kitchen scales in Germany. • Target
Slide 22: Increase distribution
Key Strategic Initiatives 2 Increase distribution Turnover development Italy Household and Wellbeing in € m 7 -14% -5% +40% 6 5 4 3 2 1 0 2017 2018 2019 Investor Presentation H1 2020 August 2020 22
Slide 23: Improve gross margin
Key Strategic Initiatives 3 Improve gross margin Focus on profitable products Make in Europe Buy in Asia Average contribution margin1 ~42% ~34% Win-win retail negos 23.8 24.6 22.0 23.2 21.8 21.6 20.1 2015 2016 2017 2018 2019 6M 2019 6M 2020 1 Sales deductions + promotional allowances in % of sales 1
Slide 24: Boost profitability rockets
Key Strategic Initiatives 3 Boost profitability rockets Product A Product B Product C Product D… medium medium medium Contribution margin … medium medium medium Level of distribution … Quality and … consumer satisfaction Boost consumer marketing Investor Presentation H1 2020 August 2020 24
Slide 25: High consumer satisfaction with Leifheit top products
Key Strategic Initiatives 3 High consumer satisfaction with Leifheit top products Profi Floor Wiper Clean Twist Pegasus 150 Linomatic 500 Deluxe 4.7 stars 4.6 stars 4.6 stars 4.5 stars Investor Presentation H1 2020 August 2020 25
Slide 26: Reduce all cost except consumer advertising
Key Strategic Initiatives 4 Reduce all cost except consumer advertising % of Group FY 2018 FY 2019 H1 2019 H1 2020 Change turnover ✓ Consumer 0.7% 1.7% 1.3% 3.8% +2.5pp marketing Other marketing 5.4% 4.6% 4.7% 3,5% -1.2pp ✓ R&D 2.3% 2.4% 2.4% 2.0% -0.4pp ✓ Logistics 1 11.0% 11.5% 11.1% 10.0% -1.1pp
Slide 27: Continuously working on an Excellence Programme
Key Strategic Initiatives 4 Reduce all cost except consumer advertising Continuously working on an Excellence Programme to reduce complexity and costs: • Operational excellence - Projects to reduce Logistic costs - Streamlining portfolio and substantial SKU reduction - Lean manufacturing initiatives
Slide 28: Financial Figures 6M 2020
Financial Figures 6M 2020
Slide 29: Strong growth in Household and Wellbeing segments
Financial Figures 6M 2020 Strong growth in Household and Wellbeing segments Group turnover by segment Group turnover by segment 6M 2019 vs 6M 2020 in € m 6M 2020 10.1% 130.4 81.1% Household 140 Private Label 8.8% 121.5 Wellbeing 13.2 120 Wellbeing Private Label 14.1 11.4 100 9.4 Household 80 • Turno
Slide 30: Successful TV-advertising campaigns result in increased demand
Financial Figures 6M 2020 Successful TV-advertising campaigns result in increased demand Group turnover by region Group turnover by region 6M 2019 vs 6M 2020 in € m 6M 2020 60 3.9% 54.3 53.6 55.3 12.6% 41.1% Germany 6M 2019 50 47.6 6M 2020 Central Europe Eastern Europe 40 Rest of the world 42.4% 30
Slide 31: Increased turnover and EBIT despite COVID-19
Financial figures 6M 2020 Increased turnover and EBIT despite COVID-19 6M 2019 6M 2020 ∆ Group turnover €m 121.5 130.4 7.3 % Gross margin % 42.8 44.1 1.3 pps EBIT adjusted for foreign currency result €m 4.8 8.9 85.6 % Foreign currency result €m 0.2 -0.1 >- 100 % EBIT €m 5.0 8.8 75.7 % EBIT margin %
Slide 32: Negative cash flow mainly due to turnover-related increase in receivables
Financial figures 6M 2020 Negative cash flow mainly due to turnover- related increase in receivables in € m 6M 2019 6M 2020 ∆ Cash flow from operating activities 6.0 -0.2 -6.2 Cash flow from investment activities -2.7 -2.4 0.3 Cash flow from financing activities -10.3 -0.4 9.9 Change in cash and cas
Slide 33: Group liquidity affected by growth-related increase in receivables and inventories
Financial figures 6M 2020 Group liquidity affected by growth-related increase in receivables and inventories Group liquidity 31.12.2019 vs 30.06.2020 in € m • Increase in trade receivables as a result of turnover growth (H1 2019: decrease 3.8 € 0.7 m) 6.0 50,3 47.4 • No noteworthy effects 5.1 6.0 fr
Slide 34: Forecast Financial Year 2020
Forecast Financial Year 2020
Slide 35: Economic recovery after shutdown: optimistic outlook for the remainder of 2020
Forecast Financial Year 2020 Economic recovery after shutdown: optimistic outlook for the remainder of 2020 Economic • IMF: Global economy faces worst economic downturn since environment 1930s depression with more gradual recovery than previously anticipated. 2020 • European commission: EU economy w
Slide 36: Your questions please
YOUR QUESTIONS PLEASE. 13 August 2020
Slide 37: Annex
Annex
Slide 38: Long-term financial overview
Annex Long-term financial overview 2015 2016 2017 2018 2019 Group turnover €m 231.8 237.1 236.8 234.2 234.0 Profitability ▪ Gross margin % 46.7 47.5 46.4 43.6 43.1 ▪ Cash flow from operating activities €m 20.8 21.8 7.2 10.2 15.9 ▪ Free cash flow €m 14.1 14.3 1.5 3.7 10.1 ▪ EBIT €m 21.7 22.1 18.8 13.
Slide 39: Long-term financial overview
Annex Long-term financial overview 2015 2016 2017 2018 2019 Per share1 Net result for the period2 € 1.51 1.53 1.35 0.88 0.61 Free cash flow € 1.48 1.51 0.16 0.39 1.06 Dividend3 € 1.00 1.05 1.05 1.05 0.55 Special dividend € 0.38 0.40 -- -- -- Investments €m 7.1 7.8 7.8 6.6 6.0 Depreciation €m 5.8 6.2
Slide 40: Experienced Management
Annex Experienced Management Henner Rinsche Igor Iraeta Munduate Marco Keul CEO + CFO COO Vice President Finance Previous experience Previous experience Previous experience • President Europe at • Many years of experience • Responsible for Finance, SodaStream as CTO at Igus GmbH and Controlling, IT/
Slide 41: Committed to shareholder returns
Annex Committed to shareholder returns Long-term dividend development Dividend yield 1 Dividend per share / in € 2019: 2.3% 2015: 5.6% 2018: 5.9% 2014: 3.9% 2017: 3.8% 2013: 5.3% 2016: 5.1% 2012: 5.2% 1,50 Proposal to the Annual General Meeting for 2019: 0.55 € 1,00 0,50 0,00 1984 1985 1986 1987 198
Slide 42: Leifheit awards (selection)
Annex Leifheit awards (selection) Rotary dryer Rotary dryers Laundry dryers LinoProtect 400 Linomatic Pegasus Floor wiper CLEAN TWIST Window vaccum Profi micro duo System cleaners Isolating jug Isolating mug Cordless vaccum Steam Mop Columbus Flip 600 ml Regulus Aqua PowerVac 2in1 CleanTenso Investo
Slide 43: Soehnle awards (selection)
Annex Soehnle awards (selection) Kitchen Scales Personal Scales Luftbefeuchter Page Profi + Page Profi 300 Style Sense Compact 300 + Safe 300 Airfresh Hygro 500 Body analysis scales Blood pressure monitors Luftreiniger Shape Sense Connect 100 + 200 Systo Monitor 200 + 300 AirFresh Clean 300 and Clea
Slide 44: Leifheit – more than 60 years of passion for housework
Annex Leifheit – more than 60 years of passion for housework 2010 1984 • Sale of the business unit • IPO of Leifheit AG ‘bathroom’ including the brands Spirella, Kleine Wolke and Meusch 1988 2008 • License agreement for • Takeover of 60% of Dr Oetker Bakeware Herby/F • Acquisition of Spirella and Kl
Slide 45: European competitors by category
Annex European competitors by category Cleaning Laundry care Spontex Brabantia Vileda Artweger Rival Tonkita Swiffer Juwel Wenko Gimi Stewi Vileda Metaltex Kärcher Rörets Blome Kitchen goods Wellbeing Tescoma WMF Laica Gefu Bosch Rösle Tanita Zyliss Lurch ADE Homedics Oxo Fackelmann Sanitas Beurer E
Slide 46: Significant free float and international investors
Annex Significant free float and international investors Shareholder structure August 2020 • Joachim Loh, Haiger (GER), 10.31% 10.31% • MKV Verwaltungs GmbH, Grünwald (GER), 10.03% 10.03% • Leifheit AG Nassau (GER), treasury shares 43.37% Aktien, 4.91% 4.91% • Alantra EQMC Asset Management, SGIIC, S
Slide 47: Financial calendar and contact
Annex Financial calendar and contact Dates 2020 Contact 30 Sep 2020 Corporate Communications / Investor Relations Virtual Annual General Meeting in accordance with the regulations of the C19 AuswBekG. Phone: +49 2604 977-218 11 Nov 2020 Quarterly statement for the period Email: ir@leifheit.com endin
Slide 48: Aktiengesellschaft Postfach 11 65 D-56377 Nassau
Aktiengesellschaft Postfach 11 65 D-56377 Nassau