Piquadro S.p.a · MIL:PQ
Piquadro — Investor Presentation (2009)
29 slides from Piquadro's investor presentation, 2009
Slide 1: Presentation 1st Half 2009 as at September 30
PRESENTATION Milan - 1st Half 2 0 0 9 as at September 30 1
Slide 2: Important Information
IMPORTANT INFORMATION • The information provided in this presentation is being furnished to you solely for your information on a confidential basis. Neither this document nor any copy thereof may be reproduced, redistributed or passed on, in whole or in part, to any other person. Neither this presen
Slide 3: A Rapid Path to Success
A RAPID PATH TO SUCCESS €52m 1998-2003 CAGR: +26.1% (1) 2004/05-2008/09 CAGR: +28.1% (2) €46m €36m Launch of Piquadro brand €25m €19m €16m 30,00% 29,50% 27,8% €13m 25,10% €10m €6m €8m €5m 1998 1999 2000 2001 2002 2003 2004 2004/05 2005/06 2006/07 2007/08 2008/09 SALES EBITDA Margin • Strong top line
Slide 4: Unique and Distinctive Brand Identity
UNIQUE AND DISTINCTIVE BRAND IDENTITY • Distinctive brand for “moving” people in leather goods industry • Aspirational brand: high quality, technological mood, innovation, design and ergonomic performance • Premium/performance positioning 4
Slide 5: Distinctive and Effective Marketing & Communication
DISTINCTIVE AND EFFECTIVE MARKETING & COMMUNICATION • Communication centralized at Group level and focused on Piquadro’s philosophy and strengths (innovation, technological mood, high quality, design and ergonomic performance) • Mainly through innovative advertising on magazines, newspapers and web
Slide 6: Price Positioning: Premium/Performance Positioning
PREMIUM/PERFORMANCE POSITIONING VALUE PROPOSITION Performance Fashion Lifestyle • Clear distinction from competitors at comparable price level through commitment to innovation, design, high Luxury - quality and ergonomic performance PRICE POSITIONING • Customer “community” recognized in brand values
Slide 7: Brand Awareness
B R A N D A W A R E N E S S (Elite research 2009 – Eurisko- GFK Group ) BAGS’ BRANDS KNOWN, OWNED AND WISHED (Italian market ) 7 Basis: total sample =1000 (%) KNOWN OWNED WISHED LOUIS VUITTON 64 SAMSONITE 24 LOUIS VUITTON 30 SAMSONITE 53 LOUIS VUITTON 23 GUCCI 16 GUCCI 48 GUCCI 13 SAMSONITE 15 PRADA
Slide 8: Brand Awareness: Brands Trend
B R A N D A W A R E N E S S (Elite research 2009 – Eurisko- GFK Group) BAGS’ ,BRANDS TREND (Italian market) 8 Basis: total sample =1000 (%) LOUIS VUITTON PRADA GUCCI 60 60 60 40 40 40 28 30 DESIDERATA 21 22 17 16 16 16 17 17 18 15 17 16 20 27 23 POSSEDUTA 20 14 20 13 10 10 15 12 14 16 13 16 13 11 12
Slide 9: Brand Awareness: Top 15
B R A N D A W A R E N E S S (Elite research 2009 – Eurisko- GFK Group) BAGS’ ,BRANDS TOP 15 (Italian market) 9 Basis: total sample =1000 (%) OTHERS REFERENCES 65 CHANEL COCCINELLE DOLCE E GABBANA LOUIS VUITTON FENDI ARMANI FURLA TOD'S HOGAN 55 MANDARINA GUCCI PRADA DUCK RATIONALITY HERMES HEDONISM S
Slide 10: Wide, Complementary Mono-Brand Product Mix
WIDE, COMPLEMENTARY MONO–BRAND PRODUCT MIX • Complementary and extensive product offering, including professional bags, travel items, women’s bags, small leather goods and other accessories • Product strategy: Basic Collections and Seasonal Collections • Basic Collections (80% of turnover): long lif
Slide 11: Flexible and Efficient Business Model
FLEXIBLE AND EFFICIENT BUSINESS MODEL THE MANAGMENT • Internal product development and centralized procurement system. • Partly-outsourced production (70%) guaranteed by select, controlled third-party Efficient manufacturers (China, Taiwan, Hong Kong). Procurement • From 30% to 40% in-house producti
Slide 12: Manufacturing: The Factory
MANUFACTURING:THE FACTORY • Partly-outsourced production (from 60% to 70%) guaranteed by select, controlled third-party manufacturers (Far East). 12
Slide 13: Testing & Quality Control
TESTING & QUALITY CONTROL • Tumble Test • Adhesion of Coating Tensile • Veslik Test on Leather Seam Breaking • Handle Jerk • Mileage Test • A unique Quality and Testing department in Europe Leather Industry. • More than twenty control both on raw material (leather and metal accessories) and finished
Slide 14: International Multi-Channel Distribution Network
INTERNATIONAL MULTI–CHANNEL DISTRIBUTION NETWORK International Presence • Presence in approx. 50 countries with strategic mix of DOS and Wholesale channel (282 Piquadro stations and 32 shop-in-shops in leading department stores and multi-brand stores) • Growing mono-brand network of 73 Stores (32 DO
Slide 15: International Multi-Channel Distribution Network: Store List
INTERNATIONAL MULTI–CHANNEL DISTRIBUTION NETWORK As at 19 November 2009 FRANCHISING Opening Year 1 ) Roma Via Frattina 125 2002 Opening 2 ) Mosca, Russia MEGA Shopping Mall 2004 DOS Year 3 ) Padova Via Dante 19 2006 1 ) Milano Via Della Spiga 33 2000 4 ) Sofia, Bulgaria A. Stamboliiski Blvd 2006 2 )
Slide 16: Summary Income Statement
SUMMARY INCOME STATEMENT IAS-IFRS 1st Half (€m) FY Ending March 31st , (ending Sept 30th) 2007 A 2008 A 2009 A 2009 A 2010 A Net sales 35.7 45.9 51.7 23.1 23.0 % growth 51.6% +28.6% +12,4% +20,4% -0,5% Other revenues 0,9 0,7 0,9 0.4 0.4 Material costs (7.8) (7.9) (9.8) (3.7) (3.0) Service costs (14.
Slide 17: Strong Top Line Growth
STRONG TOP LINE GROWTH Net Sales: up 28,1% p.a. * 51,7 46.0 • Net sales growth of 28% (€m) p.a. over the 2004/05- 35.7 2008/09 period, mainly driven by 1st Half Net Sales 25.0 • Continuously improved 23,1 23,0 19.2 19,2 product mix 15,0 • Increase of average prices (up 3.0%(3)) and volumes (up 8.0%)
Slide 18: Sustainable High Profitability
SUSTAINABLE HIGH PROFITABILITY EBITDA: up 34.6% pa * • EBITDA growth (up 6% in € 14.4m 1st Half EBITDA 2008/09 vs 2007/08; € 13.6m € 10.7m € 5.9 m EBITDA margin down 170 € 5.9m € 6.4 m bps), driven by 2005/06 2006/07 2007/08 2008/09 2008/09H 2009/10H • Significant top-line (1) growth Margin: 25.1% 3
Slide 19: Group Net Income and Income Taxes
GROUP NET INCOME AND INCOME TAXES Net Income: up 19% pa * (€m) 1st Half Net Profit € 6.4m € 7.5m € 5.3m € 2.8 m € 3.3 m 2006/07 2007/08 2008/09 2008/09H 2009/10H • Significantly improving bottom line. % of sales: 14.9% 14.0% 14.5% • Net income impacted positively by Piquadro’s operating efficiency.
Slide 20: Summary Balance Sheet
SUMMARY BALANCE SHEET IAS-IFRS As of March 31st , 1st Half (€m) (as of Sept. 30th) 2007A 2008A 2009A 2009 A 2010 A Net Working Capital 8.0 12.8 14.5 13.5 14.6 Net Tangible Assets 10.3 10.2 11.5 10.8 11.4 Net Intangible Assets 1.0 1.2 1.2 1.4 0.8 Net Financial Assets 0.6 0.9 1.3 0.9 1.4 Severance Sta
Slide 21: Lean Capital Structure
LEAN CAPITAL STRUCTURE Total Capitalization Net Debt/ 2.3 1.4 0.9 0.6 IAS-IFRS Equity (€m) St As of March 31 2006A 2007A 2008A 2009A 27.4 24.1 Short-term Net Debt 1.8 2.1 1.6 2.8 29 (€m) Long-term Net Debt 13.3 13.1 12.4 14.5 28 0.2 27 26 Cash & Cash Equivalents (3.7) (4.1) (2.3) (6.8) 25 19.0 0.3 2
Slide 22: Summary Cash Flow Statement
SUMMARY CASH FLOW STATEMENT IAS-IFRS st (€m) FY Ending March 31 , 2007A 2008A 2009A PBT 8.9 10.9 11.8 Depreciation & Amortisation 1.1 1.4 1.9 Provisions & Impairments 0.2 0.1 0.5 Taxes (3.5) (5.4) (5.2) Net Interest (0.0) 0.3 (0.1) Change in net working capital (2.6) (3.9) (0.8) Operating Cash Flow
Slide 23: Cash Generative Business Model
CASH GENERATIVE BUSINESS MODEL Cash Conversion(1) 0,1% • The Company has high 7,6% 14,1% conversion of EBITDA into 24.2% 37.1% 22,0% operating cash flow : 15.1% 10.2% • Limited Capex 85,8% requirement Total 70,4% 60.8% EBITDA 52.7% • Efficient working capital management 2006/07A 2007/08A 2008/09A 20
Slide 24: Cash Generative Business Model: 12 Months Rolling
CASH GENERATIVE BUSINESS MODEL: 1 2 M O N T H S R O L L I N G A S A T 3 0 S E P T. 2 0 0 9 NET DEBT -364 1.581 €/000 12.758 -380 4.681 5.286 10.144 10.454 14.000 12.000 +310 +4.858 10.000 8.000 +605 6.000 +3.100 4.000 +1.945 2.000 +16 0 -13.138 -2.000 Net Debt as Operating NWC Capex Dividends Other
Slide 25: The Path Ahead
THE PATH AHEAD Focus on aspirational content and brand awareness: profitability and cash generation International Focus on Logistic/Manufacturing internationalization /Financial platform in Asia Development of Exploiting target Brand Extension: positioning inTravel new licensing Items and agreement
Slide 26: Focus on Internationalization
FOCUS ON INTERNATIONALIZATION • New franchised stores in Italy and Europe • Expansion of presence in international markets adapting collection to local customers • Focus on “high potential markets” (mainly Far East) but very careful in investing money CHINA - BEIJING JIMBAO PLACE HONG KONG – TIME SQ
Slide 27: Development of Brand Extension
DEVELOPMENT OF BRAND EXTENSION • Leveraging on existing distribution network • Brand extension (from helmets to gloves from golf-staff-bags to mobile phone and etc..) to increase brand awareness and find some rooms of expansion in Mobile phone Helmets Voyager golf bag lifestyle. Cufflinks Gloves Wat
Slide 28: Apparel Project: Exploration
A P P A R E L P R O J E C T: EXPLORATION Introducing some “contamination” of Piquadro values with more marketable apparel values Exploration in new business areas which could drive new growth to core business Limited Investment by applying the same Piquadro business model (Far East manufacturing) Ma
Slide 29: Continuously Translating and Creating Sustainable Cash Generation
CONTINUOUSLY TRANSLATING AND CREATING, SUSTAINABLE CASH GENERATION Top line growth/stability in relation to the Maintaining high profitability more than market conditions average Industry Efficient working capital management Low capital intensive business model HIGH CASH FLOW GENERATION 29