Kmd Brands Limited · NZX:KMD
Kmd Brands — Kathmandu Holdings — Macquarie Securities Australian Emerging Leaders Conference 2010
26 slides from Kmd Brands's conference presentation, May 5, 2010
Slide 1: Market Release: Investor Presentation Material
KATHMANDU LIVE THE DREAM? KATHMANDU HOLDINGS Ltd 11 Mary Muller Drive, Heathcote 8022 P.0. Box 1234, Christchurch 8140 5 May 2010 New Zealand Phone +64 3 373 6110 Fax +64 3373 6111 www.kathmandu.co.nz Market Release Investor Presentation Material Please find attached presentation material to be used
Slide 2: Presentation to Macquarie Securities Australian Emerging Leaders Conference
For personal use only Presentation to Macquarie Securities Australian Emerging Leaders Conference - 5 May 2010 5 May 2010 Peter Halkett – Kathmandu Managing Director
Slide 3: Agenda
Agenda For personal use only • Business and Market Overview • Key Growth Strategies • Summary and Outlook • Q&A 5 May 2010
Slide 4: Business Overview
For personal use only BUSINESS OVERVIEW 5 May 2010
Slide 5: Overview of Kathmandu
Overview of Kathmandu For personal use only Kathmandu is a leading retailer of clothing and equipment for travel and adventure in Australia and New Zealand • Vertically integrated business from in- house design team to company-owned retail chain • Total sales are split approximately 60% clothing and
Slide 6: Addressable Market
Addressable Market For personal use only Kathmandu’s wide appeal and technical credibility increases the size of its addressable market • Kathmandu divides the clothing and equipment for travel and adventure market into three categories: – Specialist - highly technical products – Mainstream/lifestyl
Slide 7: Specific Market Participants
Specific Market Participants For personal use only The Kathmandu brand has the largest number of stores across New Zealand and Australia Australian stores New Zealand stores 31 5 6 11 45 60 36 39 39 30 18 7 13 10 9 7 2 BCF Mountain Ray's Aussie Snowgum Anaconda Macpac Paddy Palin Bivouac R&R Sports
Slide 8: Financial Summary
Financial Summary For personal use only Historical and forecast sales (NZ$m) Pro forma historical and forecast EBIT (NZ$m) $240.0 $215.6 $192.8 $50.6 $44.1 $151.4 $33.1 $32.9 FY2007 – FY2010 FY2007 FY2008 FY2009 FY2010 forecast FY2007 FY2008 FY2009 FY2010 forecast 1st Half FY10 5 May 2010
Slide 9: Business Highlights
Business Highlights For personal use only • Amongst outdoor enthusiasts, Kathmandu is the #1 recognised outdoor clothing brand in New Zealand and Brand recognition Australia, with 99% recognition in New Zealand and 88% recognition in Australia, according to the latest GORE- TEX® brand survey* A mark
Slide 10: Key Growth Strategies
For personal use only KEY GROWTH STRATEGIES 5 May 2010
Slide 11: ANZ Growth Strategy
ANZ Growth Strategy For personal use only New store rollout Upgrade existing store network Expand product offer Grow and maximise customer database Operational efficiencies 5 May 2010
Slide 12: New Store Rollout: 15-20 stores p.a
New Store Rollout: 15-20 stores p.a For personal use only We have identified 150 potential Stores in ANZ, at least 60 further opportunities • Profitability of current network • Penetration of NZ versus AU • Regional and infill opportunities • Formats and size • Destination, strip and mall locations
Slide 13: New Store Results
New Store Results For personal use only • Over 40 new stores in past 4 years New Zealand stores 12 9 • Set up costs vary significantly – Regional, CBD, 7 large or small 3 • Rapid profitability ramp up with average payback period better in NZ than Australia High footfall Destination Regional / Cleara
Slide 14: New Christchurch Store
New Christchurch Store For personal use only 5 May 2010
Slide 15: Upgrade Existing Store Network: 5-8 stores p.a
Upgrade Existing Store Network: 5-8 stores p.a For personal use only Significant opportunity to enhance brand profile, grow floor space and lift same store sales • Target stores: • Smaller stores • Secondary locations • Older, inefficient fit outs • Enlarge, relocate and renovate • Recent upgrades:
Slide 16: Expand the Product Offer: 5-7% p.a.
Expand the Product Offer: 5-7% p.a. For personal use only Product Design is a core competency, we have identified opportunities to grow our range by at least 20% • Growth over last 3 years in ranges such as Active, Kids, thermals • Many gaps in our product range – clothing and equipment • Keep away
Slide 17: Expand the Product Offer: Just released Winter 2010 Range
Expand the Product Offer: Just released Winter 2010 Range For personal use only • Example of new products for winter 2010 • Ultra core, Gore-Tex, merino, packs and bags etc • Innovation and points of difference 5 May 2010
Slide 18: Grow and Maximise the Customer Database
Grow and Maximise the Customer Database: At least double in 3 years For personal use only • Summit Club members attributes and opportunity: – Loyal customers, frequent purchasers and lower marketing costs to service • Current membership 340,000+ across all 3 countries, increased 20% + in last year •
Slide 19: Understanding our Customers
Grow and Maximise Customer Database – Understanding our Customers For personal use only Kathmandu’s core customer base can be classified into three categories, providing the company with access to a broad range of customers Young Go-Getters Adventurous Families Older Outdoor Enthusiasts Emerging p
Slide 20: Deliver Operational Efficiencies
Deliver Operational Efficiencies – Target - reduce CoDB by 1% by FY13 For personal use only Lower cost of doing business in percent terms / Gain operating leverage. • Internal systems and processes – Core systems upgrade to enable new efficiencies – Improved reporting and mgmt information • Reduced
Slide 21: Deliver Operational Efficiencies – Supply Chain Example
Deliver Operational Efficiencies – Supply Chain Example For personal use only • 95%+ of stock currently passes through Melbourne and Christchurch warehouses • Bulk deliveries currently received from suppliers in numerous categories where effective demand forecasting will reduce order sizes and stock
Slide 22: ANZ Growth Strategy as Destination 2013
We present our “ANZ Growth Strategy” as “Destination 2013” For personal use only The power the Kathmandu Brand is both internal and external • We have identified 31 key workstreams – To deliver the 5 growth strategies – Supported by Brand, People, Systems & Processes • “Destination 2013” – Clear foc
Slide 23: Summary & Outlook
For personal use only SUMMARY & OUTLOOK 5 May 2010
Slide 24: Summary and Outlook
Summary and Outlook For personal use only • Summary – Proven business model with a track record of success – Significant (proven/low risk) growth opportunities – A business far from maturity – Brand versus retailer • Outlook – Much uncertainty exists in the short term: • 2009 Stimulus impact • Risin
Slide 25: Q&A
For personal use only 5 May 2010 Q&A
Slide 26: Thank You
For personal use only THANK YOU 5 May 2010 I WELCOME YOU TO ENJOY OUR NEW WINTER RANGE!
Kathmandu Holdings — Macquarie Securities Australian Emerging Leaders Conference 2010 on 6ix