Myer Holdings Limited · ASX:MYR
Myer — FY2024 Earnings Presentation
31 slides from Myer's earnings presentation, Sep 20, 2024
Slide 1: Full Year 2024 Results
20 September 2024 FULL YEAR 2024 RESULTS MYER ONE AND CUSTOMER SATISFACTION DRIVING COMPARABLE SALES GROWTH IN CHALLENGING ENVIRONMENT OVERVIEW • FY24 GROUP COMPARABLE SALES1 GROWTH UP 0.4% ON FY23; improving trajectory despite no discernible improvement in macro conditions; 2H24 comparable sales up
Slide 2: FY24 Results Overview and Strategic Update
• Net Profit After Tax3 (NPAT) of $52.6 million, reflecting impact of store closures, challenging trading conditions, inflationary cost pressures and underperformance of sass & bide, Marcs and David Lawrence. • Statutory NPAT of $43.5 million includes Implementation Costs and Individually Significan
Slide 3: Apparel Brands Combination, Trading Update and Investor Day
Apparel Brands: Discussions with Premier Investments to explore a possible combination with Apparel Brands, which were announced on 24 June 2024, are progressing. Due diligence is underway with a focus on Myer assessing the opportunity to create material value for all shareholders through: • Signifi
Slide 4: Olivia Wirth and Matt Jackman Presenters
TO 27 JULY 2024 OLIVIA WIRTH MATT JACKMAN Executive Chair Chief Financial Officer
Slide 5: Important Information
Important Information The information in this document is Investors and potential investors should make their own assessment Subject to law, Myer assumes no obligation to update, review or and take independent professional advice in relation to the revise any information contained in this document,
Slide 6: Agenda
Agenda FY24 Highlights FY24 Financial Results Strategic Observations Conclusion Appendices MYER HOLDINGS LTD
Slide 7: FY24 Financial Overview
FY24 Financial Overview TOTA L COMP A RABLE GR OU P S A LES 1 S A LES 2 GR OWT H ON LI NE 3 S A LES down 2.9% to up on FY23 up 2.0% to $3,266m + 0.4% $704m FY24 HIGHLIGHTS 21.6% of Total Sales NPAT4 N E T CA S H D I V I D ENDS down 26.0% to down $6m to 3.5c per share FY24 full $52.6m $114m year divi
Slide 8: FY24 Business Overview: Customer Service and Loyalty
FY24 Business Overview Customer Service In-store customer service satisfaction • New Point Of Sale (POS) software rollout completed delivering +210bps improved efficiency and providing real time transaction details for customers and improving transaction speed 85% • Expansion of M-Metrics app to bra
Slide 9: FY24 Business Overview: Omni Channel and Merchandise
FY24 Business Overview Omni Channel Capability Group Online1 Sales mix (% of Total Sales) • Returned to growth, improved margins from changing mix and +103bps improving fulfilment efficiency resulting in online contribution growing faster than sales • Online security bolstered through variety of mea
Slide 10: FY24 Business Overview: Stores and Cost Efficiency
FY24 Business Overview Store Sales Productivity / Space In-store Sales Productivity Weighted Average Lease Expiry (WALE) • Delivering productivity improvements through optimisation of +1.1% space (notable closures Brisbane (FY24) and Frankston (FY23)) • Store refurbishments completed at Chermside, M
Slide 11: sass & bide, Marcs and David Lawrence - reset and refocus
sass & bide, Marcs and David Lawrence - reset and refocus • Strategic review reinforced the importance and potential of growing exclusive and private label brands to improve margin and differentiation • On 24 June 2024 announced decision made to cease the sale process and create strategies that look
Slide 12: Agenda
Agenda FY24 Highlights FY24 Financial Results Strategic Observations Conclusion Appendices MYER HOLDINGS LTD
Slide 13: Income statement
Income statement $ MILLIONS FY24 FY23 CHANGE ▪ Growth in comparable sales3 of 0.4% (with Department stores at 0.6%) despite challenging trading conditions vs pcp Total Sales1 3,266.1 3,362.9 (2.9%) ▪ Total sales1 decline reflects the closure of Brisbane, Frankston, and Operating Gross Profit 1,194.4
Slide 14: Resilient sales performance in a challenging environment
Resilient sales performance in a challenging environment Total Sales1 $m Department Stores Comparable Sales2 growth ▪ Improving comparable sales trajectory in 2H24 (vs 1H24) – no discernible CAGR +4.5% improvement in macro conditions evidenced -2.9% FY24 FINANCIAL RESULTS ▪ Multi-channel offer, and
Slide 15: Operating Gross Profit
Operating Gross Profit OPERATING FY23 – FY24 GROSS PROFIT $M GROSS PROFIT BRIDGE ($M) OGP margin(%) -2.5% FY24 FINANCIAL RESULTS 36.42% 36.57% 37 11 1,225 14 10 1,194 1,225 FY23 Sales Volume Mix shift to Rate impacts Other FY24 Concessions 1,194 ▪ OGP margin increased by 15bps, down 12bps if reclass
Slide 16: Cost of Doing Business
Cost of Doing Business GROUP COST1 FY23 – FY24 STRUCTURE $M COST OF DOING BUSINESS 1 BRIDGE ($M) Operating Wages FY24 FINANCIAL RESULTS Operating Other Costs SSO 3 1.3% 835 22 824 21 9 348 348 824 826 835 FY23 Changes to Support Office Operational Costs FY24 pre reclass Reclass of FY24 219 228 emplo
Slide 17: Operating Cash Flow
Operating Cash Flow $ MILLIONS FY24 FY23 ▪ Operating cash flow increase of $8.0 million reflects earnings decline, EBITDA 359.7 400.5 offset by disciplined working capital management Add implementation costs and ISIs (12.2) (15.4) ▪ Income tax was higher in FY23 as tax instalments normalised post FY
Slide 18: Balance Sheet
Balance Sheet $ MILLIONS FY24 FY23 % OF INVENTORY1 AGED UNDER 6 MONTHS Inventory 368.5 371.3 Creditors (417.9) (401.7) FY24 FINANCIAL RESULTS Other Assets & Liabilities 96.0 67.9 81% 79% 77% 76% 62% Right-of-Use Assets 1,038.5 1,101.4 FY20 FY21 FY22 FY23 FY24 Lease Liabilities (1,567.1) (1,644.9) Pr
Slide 19: Net Cash / (Debt) Profile
Net Cash / (Debt) Profile NET CASH / (DEBT) $M – FY20 TO FY24 ▪ Strong net cash position maintained at period end FY24 FINANCIAL RESULTS ▪ Current Asset Backed Loan (ABL) facility expires December 2025 186 112 120 114 8 FY20 FY21 FY22 FY23 FY24 NET CASH / (DEBT) PROFILE ($M) – FY24 BY DAY Net Cash 4
Slide 20: Current trade update
Current trade update First seven weeks of 1H25 has delivered comparable sales1,2 of +0.2% on the prior year FY24 FINANCIAL RESULTS 1 s t S E V E N WE E K S C O M P A R A B L E 1 , 2 S A L E S +0.2% FY24 FY25 DEPARTMENT STORES MYER HOLDINGS LTD 1 Department Stores only 17 2 Comparable sales excludes
Slide 21: Agenda
Agenda FY24 Highlights FY24 Financial Results Strategic Observations Conclusion Appendices MYER HOLDINGS LTD
Slide 22: Myer today - stabilised trading and financial performance
Myer today – stabilised trading and financial performance Total sales1 Group Online sales mix Clearance inventory2 Store footprint + instore (% of total) ($m) (% of total sales) sales productivity3 Sales Productivity up 7% STRATEGIC OBSERVATIONS 3,101 3,266 22% 16% 56 62 stores stores 8% 7% FY18 FY2
Slide 23: Myer today - Strong foundations to build upon
Myer today – Strong foundations to build upon • Leading brand - 7th most trusted brand in Australia1 – 124 years of retail heritage Brand strength & • 85% customer satisfaction rating, highest on record customer satisfaction • Comprehensive offering – wide range of price points – broad customer appe
Slide 24: Myer tomorrow: Opportunities for sustainable growth
Myer tomorrow Opportunities for sustainable growth Market and Product MYER one customer and value • Operating in a $70b market with 5%-6% forward Grow Myer Exclusive Brands (MEBs) MYER one program is an important asset driving STRATEGIC OBSERVATIONS CAGR1 • MEB’s deliver highest GP and GP/sqm moment
Slide 25: Myer tomorrow: Digital, Stores, People and Costs
Myer tomorrow Opportunities for sustainable growth People and Profitability Digital Stores community and costs Opportunity to expand digital capabilities Stores space & layout Our people are Myer’s most important Strong Cost control must be maintained STRATEGIC OBSERVATIONS to: • Enhance floor space
Slide 26: Strategic review update
Strategic review update On 24 June 2024 Myer announced that: • It is undertaking a comprehensive and ongoing strategic review of the business • As part of this review Myer is focussing on enhancing and expanding its private label and exclusive brands portfolio STRATEGIC OBSERVATIONS • In line with t
Slide 27: Next steps
Next steps Strategic Process Concludes – repositioning Myer for Future Growth STRATEGIC OBSERVATIONS Complete due diligence on potential combination with Premier Investments’ Apparel Brands Investor Strategy session will be rescheduled to update the market on both future strategic approach and Appar
Slide 28: Agenda
Agenda FY24 Highlights FY24 Financial Results Strategic Observations Conclusion Appendices MYER HOLDINGS LTD
Slide 29: Appendix 1: Income Statement - post AASB
Appendix 1: Income Statement – post AASB 16 $ MILLIONS FY24 FY23 CHANGE Total Sales1 3,266.1 3,362.9 (2.9%) Operating Gross Profit 1,194.4 1,224.6 (2.5%) Cost of Doing Business2 (834.7) (824.1) 1.3% APPENDICES EBITDA2 359.7 400.5 (10.2%) Depreciation2 (197.0) (204.3) (3.6%) EBIT2 162.7 196.2 (17.1%)
Slide 30: Appendix 2: NPAT reconciliation to Statutory Accounts
Appendix 2: NPAT reconciliation to Statutory Accounts $ MILLIONS EBIT INTEREST TAX NPAT Statutory reported result 150.5 (87.3) (19.7) 43.5 Add back: Implementation costs and individually significant items Restructuring, space exit costs, impairments and other significant items 12.2 - (3.1) 9.1 APPEN
Slide 31: Appendix 3: Income Statement - AASB impact
Appendix 3: Income Statement – AASB 16 impact FY24 AASB 16 FY24 FY23 CHANGE $ MILLIONS (STATUTORY) IMPACT (PRE-AASB 16) (PRE-AASB 16) (PRE-AASB 16) Total Sales1 3,266.1 - 3,266.1 3,362.9 (2.9%) Operating Gross Profit 1,194.4 0.4 1,194.8 1,223.9 (2.4%) Cost of Doing Business2 (834.7) (207.6) (1,042.3