Sligro Food Group N.v. · EURONEXT:SLIGR
Sligro Food — FY2020 Earnings Presentation
47 slides from Sligro Food's earnings presentation, Jan 28, 2021
Slide 1: 2020 annual figures
2020 annual figures 28 January 2021
Slide 2: Agenda
Agenda • Welcome Koen Slippens • 2020 annual figures Rob van der Sluijs • Developments in the Netherlands Koen Slippens • Developments in Belgium Koen Slippens • Developments in the Group Koen Slippens • Outlook Koen Slippens 2
Slide 3: Abridged statement of profit or loss: Net Sales
Abridged statement of profit or loss 1 Net Sales - Drop in net sales is entirely COVID-19 related. - Major differences between segments: - Catering, events and hospitality were hit hard; - Healthcare and petrol were not hit as hard. - Drop in net sales was € 0.5 billion, not including the acquisitio
Slide 4: COVID-19 impact on net sales in the Netherlands
COVID-19 impact on net sales in the Netherlands 1 Cash-and-carry sites in the Netherlands Weekly development in net sales compared to last year (x € million) 2020 2019 Delivery service sites in the Netherlands Weekly development in net sales compared to last year (x € million) 2020 2019 4
Slide 5: COVID-19 impact on net sales in Belgium
COVID-19 impact on net sales in Belgium 1 Belgium cash-and-carry and delivery service Weekly development in net sales compared to last year (x € million) 2020 2019 5
Slide 6: Gross margin
Gross margin 1 • Mixed effect due to major change to customer mix. • Increase in tobacco sales and lower net sales from services pushed the margin down by approx. 1.3%. • Extra shrinkage due to COVID-19 of approx. € 3 million pushed the margin down by approx. 0.4%. • Different ratio of net sales of
Slide 7: Other operating income
Other operating income 1 • Rental income down €1 million, partly due to the sale of properties. • €5 million EMTÉ service fee (TSA) in the first half of 2019. • Sale of Maison Niels de Veye brought in € 3 million in the first half of 2019. 7
Slide 8: Operating costs
Operating costs 1 Employees: • Reduction of flexible supply of temporary staff; • Vacancies filled only to a limited degree; • Use of NOW scheme2 in the Netherlands: € 22 million; • Use of TWO scheme3 in Belgium € 4 million; • Restructuring provision in relation to the closure of Océan Marée €2 mill
Slide 9: Depreciation, amortisation and impairments
Depreciation, amortisation and impairments 1 • Lease costs were up with € 3 million partly due to sale and leaseback transactions. • Impairment of approx. € 1 million on decommissioned assets and software. • Investments in SO 4.02 software and infrastructure have increased amortisation and depreciat
Slide 10: Financial income and expenses and income taxes
Financial income and expenses and income taxes 1 Financial income and expenses: • Interest and costs increased by € 1 million due to costs for waivers and increased mark-ups for higher leverage ratios during the year; • Financing expenses on lease costs were up € 1 million due to sale and leaseback
Slide 11: Abridged statement of cash flows
Abridged statement of cash flows 1 • Drop in cash flows from operating activities due to lower EBITDA. • Position of postponed tax payments due to COVID-19 € 13 million. • Investments: - CAPEX limited where possible; - Income from sale & leaseback and sale of decommissioned assets; - Change in ‘CAPE
Slide 12: H1 versus H2 2020
H1 versus H2 2020! Sligro Food Group NY. x€ million H1-2020 H2-2020 Year Net sales 943 100.0% 1,003 100.0% 1,946 100.0% Cost of net sales (722) __-76.6% (756) __-75.4% (1,478) _-76.0% Gross margin 221 23.4% 247 24.6% 468 24.0% Other operating inocme 3 0.3% 1 0.1% 4 0.2% Total operating costs excludi
Slide 13: Segment cash flows
Segment cash flows! Sligro Food Group NY. Netherlands Belgium Group x€ million 2020 2019 2020 2019 2020 2019 Net cash flow from business operations 7 163 (2) (28) 95 135 Interest received and paid (5) 7) (0) (5) (7) Dividends received from participations 4 5 4 5 Income tax paid 5 0 (1) 5 (a) Net cas
Slide 14: Segment results
Segment results! Sligro Food Group NY. Netherlands Belgium Group x € million 2020 2019 2020 2019 2020 2019 Net sales 1,777 2,166 169 229 1,946 2,395 Gross margin as % of net sales 24.0 24.6 24.5 22.2 24.0 24.4 Gross operating profit (EBITDA) 78 130 (3) (3) 75 127 Operating profit before amortisation
Slide 15: Financing
Financing 1 • In December 2020, USPP from 2010 repaid ($ 75 million) and repayment to Rabo (€ 10 million). • Free cash flow used to reduce interest-bearing debts. • Stayed within original financing frameworks thanks to interventions in expenses and investments as at 31/12/2020: Net interest-bearing
Slide 16: Net profits and earnings per share
Net profits and earnings per share 1 • No final dividend for 2019. • No dividend for 2020. • The priority is to restore the financial position in light of the uncertainty of the coming period. 16
Slide 17: Developments in the Netherlands
Developments in the Netherlands
Slide 18: General economic developments in the Netherlands
General economic developments in the Netherlands • Due to the COVID-19 pandemic, consumer confidence has fallen sharply and unemployment has risen. • ‘Hidden’ unemployment is the uncertain factor. 18
Slide 19: Food Service market development in the Netherlands
Food Service market development in the Netherlands • Sligro’s market share grew considerably by 2.4%. • Food Service market contracted sharply due to government measures taken to stem the COVID-19 pandemic. • After the first lockdown, markets recovered rapidly. • Wholesale value -33.0%; consumer spe
Slide 20: Food market development in the Netherlands
Food market development in the Netherlands Decline in total food market, shift from food service to food retail (in millions of €) -6.2% (3,689) Total food market -38.8% (7,690) Total food service Total food retail 4,001 +10.0% (10,000) (8,000) (6,000) (4,000) (2,000) 0 2,000 4,000 6,000 Source: Foo
Slide 21: Developments in the Netherlands
Developments in the Netherlands • Market share gained thanks to: - Combination of cash-and-carry and delivery service; - A broad and diverse customer base; - Strength of the format including the first results of the Next-Gen Cash-and-Carry programme. • Short-term focus on offsetting the drop in net
Slide 22: Delivery service customer satisfaction
Delivery service customer satisfaction • Major focus on flexibly and decisively scaling down and back up, and scaling down again in times of COVID-19. Due to disruptions across the supply chain, operating Our Solutions performance was below our desired level. • Focus on: inventory levels, staffing l
Slide 23: Delivery service customer satisfaction: final situation for customers
Delivery service customer satisfaction One portal, one drop, one invoice live! Final situation for customers Product range Sales & Service Ordering Delivery Invoice Complete food & drink Heineken for Beer & One order for the whole One complete delivery One invoice from range. Cider and Sligro for al
Slide 24: Cash-and-carry customer satisfaction
Cash-and-carry customer satisfaction • Nice net sales growth and rising Net Promoter Score at our cash-and-carry Offline and online reinforce each other business. ‘offline’ ‘online’ • During the first lockdown and the second one up to mid-December, our cash-and- carry stores were also open to non-ca
Slide 25: Network of cash-and-carry sites
Network of cash-and-carry sites Achieved in 2020 • Final adjustments and lessons learned for Deventer cash-and-carry store (type 3 type 1). • Plans postponed due to investment freeze on account of the COVID-19 pandemic. Scheduled for 2021 • Remodelling and downsizing of Heerlen and Arnhem cash-and
Slide 26: Returns in the delivery segment
Returns in the delivery segment • Heineken integration completed, on schedule within 3 years. Contract for at least 12 years to reap the benefits for customers, the environment, Heineken and Sligro Food Group. • Drop in net sales (-75% in some weeks) largely absorbed by flexibility and decisiveness
Slide 27: Network of delivery service sites
Network of delivery service sites New sites opened in 2020 • Maastricht delivery service (Q1). • Breda delivery service (Q2). • Vianen delivery service (Q3). Refurbishments in 2020 • Venray delivery service (Q3). Maastricht delivery service • Nieuwegein X-dock delivery service (Q4). Heineken integra
Slide 28: Plan for 2021 (1/2): High Five!
Plan for 2021 (1/2): High Five! • Excel in customer satisfaction in the delivery segment: - Further development of the new online platform: Sligro’s largest (digital) outlet; - Scale up and further develop Sligro Solutions; - Valorise the partnership with Heineken for customers, environment, Heineke
Slide 29: Plan for 2021 (2/2): High Five!
Plan for 2021 (2/2): High Five! • A happy, committed and professionally strong team: - After a lot of hard work behind the scenes in 2020 our people strategy was implemented and anchored; - Launch of the Ideas Lab, Pion (personnel management and time recording), and the People Management Programme
Slide 30: Developments in Belgium
Developments in Belgium
Slide 31: General economic developments in Belgium
General economic developments in Belgium • Developments in Belgium are comparable to those in the Netherlands. 31
Slide 32: Food Service market development in Belgium
Food Service market development in Belgium • Market trend similar to Dutch figures. In Belgium, too, the Food Service market contracted sharply due to government measures taken to stem the COVID-19 pandemic. • Differences per segment are also considerable in Belgium with the same emphases. • From th
Slide 33: Developments in Belgium (1/2)
Developments in Belgium (1/2) • Market development is similar to that in the Netherlands, with spending down over 50%. • The impact differs per business unit: - Delivery service net sales down to nil at Sligro-ISPC during lockdown periods, but a sharp rise in net sales at cash-and-carry stores; - Th
Slide 34: Developments in Belgium (2/2)
Developments in Belgium (2/2) • Short-term focus was to offset the drop in net sales and adjust costs, inventories and investments. • Strong focus on ‘decency in business’, also in times of crisis, towards all stakeholders. • Conscious choice to still go ahead with, or even step up, strategically im
Slide 35: Network of sites
Network of sites Achieved in 2020 • New signing of Sligro-ISPC in Ghent and Liège (Q1). • Head office in Rotselaar refurbished (Q2). • Land in Bruges sold (Q2). • Antwerp site layout adapted to cash-and-carry/delivery service ratio (Q2) open delivery service set-up. Scheduled for 2021 • Optimisati
Slide 36: Plan for 2021 (1/2): High Five!
Plan for 2021 (1/2): High Five! • Excel in customer satisfaction in the delivery segment: - Next steps in setting up account management and relationship management; - New concept launches; - Roll out programmes being developed in the Netherlands with an international perspective both at Sligro-ISPC
Slide 37: Plan for 2021 (2/2): High Five!
Plan for 2021 (2/2): High Five! • Operational excellence and returns in the supply chain: - Further product range harmonisation and supply chain optimisation; - Preparations for Ghent delivery service site; - After the first successes in 2020 all sites in Belgium will be connected to the Veghel CD
Slide 38: Developments in the Group
Developments in the Group
Slide 39: SAP launch
SAP launch • The migration to the new online platform for customers was successful and went as planned. • The first version of new ERP and data landscape did not go live in Belgium in 2020: - Teams were unable to meet in person; - Complexity of integral upgrading of IT structure. • Construction fini
Slide 40: A happy, committed and professionally strong team
A happy, committed and professionally strong team • Lots of changes across the organisation in recent years. • Organisational governance model changed. • Over the past year, a lot of hard work behind the scenes has gone into the design and implementation of the People strategy: - Being an attractive
Slide 41: Outlook
Outlook
Slide 42: Outlook
Outlook Market conditions • The consequences of COVID-19 will also dominate a major part of 2021. • If the vaccination strategy is successful, we expect recovery to set in from the second quarter onwards. • Experiences from 2020 have taught us that recovery can happen quickly and that consumers will
Slide 43: Slide 43
Slide 44: Abridged statement of financial position
Abridged statement of financial position 1 44
Slide 45: Goodwill and intangible fixed assets
Goodwill and intangible fixed assets 1 3 1 D e ce m b e r 2 8 D e ce m b e r x € million 2020 2019 Impairments Belgium as at mid-2020 • Non-cash impairment investments JAVA and ISPC: 125 168 - Goodwill € 43 million. - Customer relationships € 17 million. 75 102 14 9 15 11 • Full confidence in Belgiu
Slide 46: EBITDA for ratio calculation
EBITDA for ratio calculation 1 • EBITDA reported from 2019 including IFRS 16. • Financing based on Net Debt / EBITDA ratio not including IFRS 16. • Not including IFRS 16 paints a better picture of the cash position. +7 75 58 46
Slide 47: Jumbo Coop Claim
Jumbo Coop Claim • On 13 March 2020, Sligro learnt of a writ of summons issued by the Jumbo & Coop consortium, resulting from the transaction concerning the sale of EMTÉ in 2018. • The consortium alleges that in the context of this transaction, an incorrect picture had been painted of EMTÉ’s histori