Ermenegildo Zegna N.v. · NYSE:ZGN
Ermenegildo Zegna — H1 2023 Earnings Presentation
35 slides from Ermenegildo Zegna's earnings presentation, Jul 27, 2023
Slide 1: 1H 2023 & 2Q 2023 Preliminary Revenues
1H 2023 & 2Q 2023 PRELIMINARY REVENUES July 27th, 2023 1H 2023 and 2Q 2023 Revenues are preliminary and unaudited. DATE 1
Slide 2: Disclaimer
DISCLAIMER Non-IFRS Financial Measures Zegna’s management monitors and evaluates operating and financial performance using several non-IFRS financial measures including: adjusted earnings before interest and taxes (“Adjusted EBIT”), Adjusted EBIT Margin, revenues on a constant currency basis and rev
Slide 3: Ermenegildo Zegna Group
Ermenegildo Zegna Group “The second quarter of 2023 has built on the Group’s excellent performance since the beginning of the year. Our brands continue to resonate strongly with customers worldwide, with a positive rebound in China in the first half of the year, our persistent strength in EMEA, and
Slide 4: Group Key Highlights
GROUP KEY HIGHLIGHTS 1H 2023 Revenues1 2Q 2023 Revenues1 €903 million €475 million +23.9% YoY +35.1% YoY +24.7% cFX2 +37.4% cFX2 +21.5% organic3 +24.5% organic3 2-year Stack5 2025 Outlook Zegna branded products: 1H23 @+43.9% (or +20.0% CAGR) Annual revenues expected to exceed €2 billion 2Q23 @ +39.8
Slide 5: 2Q 2023, 1H 2023 Select Highlights and Recent Events
2Q 2023, 1H 2023 SELECT HIGHLIGHTS AND RECENT EVENTS ZEGNA MADE IN ITALY TEXTILE PLATFORM Our Road to Iconicity Our Road to Excellence and Traceability • Zegna One Brand Strategy continues to • Continuing to protect Made in Italy deliver market share gains supply chain capabilities • Store network r
Slide 6: Our Road to Sustainable Growth
OUR ROAD TO SUSTAINABLE GROWTH • Science-Based Targets initiative (SBTi) approved Zegna Group’s greenhouse gas (GHG) emission targets in May. o Targeting net-zero greenhouse gas emissions (GHG) across our value chain by 2050*. o In the near term, Zegna Group has committed to reducing absolute scope
Slide 7: 1H 2023 Group Revenues
1H 2023 GROUP REVENUES • €903 million • +23.9% YoY • +24.7% YoY in cFX • +21.5% organic growth • Continued growth for both Zegna and Thom Browne segments, both up by double digits • Zegna segment +23.8% YoY organic growth/ +18.4% in cFX, with market share gains driven by Zegna One Brand strategy • T
Slide 8: 2Q 2023 Group Revenues
2Q 2023 GROUP REVENUES • €475 million • +35.1% YoY • +37.4% YoY in cFX • +24.5% organic growth • Double-digit growth for both segments • Zegna Segment +28.2% YoY organic growth • Thom Browne Segment +10.8% YoY organic growth • Strong DTC performance for both Zegna and Thom Browne, with U.S. performa
Slide 9: Group Revenues Show Consistent Strength
GROUP REVENUES SHOW CONSISTENT STRENGTH 1H ZEGNA BRANDED PRODUCTS 1H THOM BROWNE REVENUES AND % VARIATION1 REVENUES AND % VARIATION1 1H23 vs 1H21 @ +43.9% 1H23 vs 1H21 @ +45.5% (or +20.0% CAGR2) R e ve n u e s (or +20.6% CAGR2) R e ve n u e s 541 60 0 25 0 207 50 0 425 20 0 185 376 142 40 0 15 0 30
Slide 10: Revenues by Segment
Ermenegildo Zegna Group REVENUES BY SEGMENT 10
Slide 11: 1H 2023 and 2Q 2023 Revenues by Segment
1H 2023 AND 2Q 2023 REVENUES BY SEGMENT ZEGNA THOM BROWNE TOM FORD FASHION 1H 2023: €652 million (+17.9% YoY) 1H 2023: €208 million (+11.9% YoY) 1H 2023: €64 million 2Q 2023: €332million (+23.4% YoY) 2Q 2023: €95 million (+8.1% YoY) • Organic growth of 23.8% and 28.2% YoY in • Organic growth of 13.6
Slide 12: Revenues by Product Line
REVENUES BY PRODUCT LINE Ermenegildo Zegna Group HONUEE LH EHOMOREDE EL A OOHNG EU HOHE 1 bk ek bb heheheh bet hak de Libebatatiie ) otetie hibit diode dea ede
Slide 13: 1H 2023 and 2Q 2023 Revenues by Product Line
1H 2023 AND 2Q 2023 REVENUES BY PRODUCT LINE Zegna-Branded Products: +27.3% YoY in 1H 2023, +33.9% YoY in 2Q 2023 • Sequential acceleration: in 1H, +28.4% in cFX and organic growth, and up +37.0% in cFX and organic growth in 2Q 2023. • Made-to-Measure, together with sneakers and luxury leisurewear,
Slide 14: Revenues by Geography
REVENUES BY GEOGRAPHY Ermenegildo Zegna Group
Slide 15: 1H 2023 and 2Q 2023 Revenues by Geography
1H 2023 AND 2Q 2023 REVENUES BY GEOGRAPHY North America APAC 1H 2023: €174 million (+28.9% YoY, +25.7% cFX and 1H 2023: €389 million (+22.0% YoY, +25.4% cFX +16.3% organic growth) and +24.3% organic growth) 2Q 2023: €109 million (+48.0% YoY, +46.6% cFX and 2Q 2023: €184 million (+27.6% YoY, +33.3% c
Slide 16: Revenues by Channel
REVENUES BY CHANNEL Ermenegildo Zegna Group
Slide 17: 1H 2023 and 2Q 2023 Revenues by Channel
1H 2023 AND 2Q 2023 REVENUES BY CHANNEL DTC: Strong growth for Zegna and Thom Browne Wholesale*: Continued area of growth for Zegna • +36.3% YoY in 1H 2023 (+38.6% in cFX; +30.4% organic) • +6.3% YoY in 1H 2023 (+5.5% in cFX; +7.6% organic) • + 48.1% YoY in 2Q 2023 (+52.8% in cFX; +35.8% organic) •
Slide 18: Mono-brand Store Network
MONO-BRAND1 STORE NETWORK 633 Group mono-brand stores as of June 30, 2023 Zegna • 7 net DTC, 1 net wholesale opening at end 1H-2023 compared to end-2022 Thom Browne • 4 net store openings in 1H 2023 compared to end-2022, of which 3 are DTC, all located in APAC TOM FORD FASHION • Adds 121 mono-brand
Slide 19: Update on Accounting and Financial Metrics Presentation
UPDATE ON ACCOUNTING AND FINANCIAL METRICS PRESENTATION • Revenues • Introduction of organic growth • P&L Format to change as of 1H 2023 • A Statement of Profit and Loss presenting costs by functions (Cost of Sales, SG&A, Marketing) consistent with Zegna management’s view and international practice,
Slide 20: Outlook
OUTLOOK* Medium-term Financial Ambitions (announced on May 17, 2022) • Revenues to exceed €2 billion • Adjusted EBIT Margin to reach at least 15% of revenues • Excluding the Tom Ford Fashion segment Since then • Mid-term defined as 2025 • TOM FORD FASHION business deal announced on November 15, 2022
Slide 21: g E} = ‘Ob zs E ca
3 g E} 3 = ‘Ob zs E ca
Slide 22: Appendix
APPENDIX 22
Slide 23: Group Revenues by Segment (Preliminary and Unaudited)
GROUP REVENUES BY SEGMENT (PRELIMINARY AND UNAUDITED) Note: “n.m.” means not meaningful 23
Slide 24: Group Revenues by Segment: Reconciliation Tables
GROUP REVENUES BY SEGMENT (PRELIMINARY AND UNAUDITED) Reconciliation Tables The tables above show a reconciliation of revenue growth for the six months ended June 30, 2023 and for the three months ended June 30 and March 31, 2023 to organic 24 growth for the same periods by segment and at the Group
Slide 25: Group Revenues by Product Line (Preliminary and Unaudited)
GROUP REVENUES BY PRODUCT LINE (PRELIMINARY AND UNAUDITED) Note: “n.m.” means not meaningful 25
Slide 26: Group Revenues by Product Line: Reconciliation Tables
GROUP REVENUES BY PRODUCT LINE (PRELIMINARY AND UNAUDITED) Reconciliation Tables Note: “n.m.” means not meaningful The tables above show a reconciliation of revenue growth for the six months ended June 30, 2023 and for the three months ended June 30, 2023 to organic growth for the 26 same periods by
Slide 27: Group Revenues by Sales Channel (Preliminary and Unaudited)
GROUP REVENUES BY SALES CHANNEL (PRELIMINARY AND UNAUDITED) 27
Slide 28: Group Revenues by Sales Channel: Reconciliation Tables /1
GROUP REVENUES BY SALES CHANNEL (PRELIMINARY AND UNAUDITED) Reconciliation Tables /1 The table above shows a reconciliation of revenue growth for the six months ended June 30, 2023 to organic growth for the same period by sales channel and at the Group level. 28
Slide 29: Group Revenues by Sales Channel: Reconciliation Tables /2
GROUP REVENUES BY SALES CHANNEL (PRELIMINARY AND UNAUDITED) Reconciliation Tables /2 The table above shows a reconciliation of revenue growth for the three months ended June 30 and March 31, 2023 to organic growth for the same period by sales channel and at the Group level. 29
Slide 30: Group Revenues by Geographical Area (Preliminary and Unaudited)
GROUP REVENUES BY GEOGRAPHICAL AREA (PRELIMINARY AND UNAUDITED) 30
Slide 31: Group Revenues by Geographical Area: Reconciliation Tables
GROUP REVENUES BY GEOGRAPHICAL AREA (PRELIMINARY AND UNAUDITED) Reconciliation Tables The tables above show a reconciliation of revenue growth for the six months ended June 30, 2023 and for the three months ended June 30, 2023 to organic growth for the same periods by geographical area and at the Gr
Slide 32: Non-IFRS Financial Measures
Non-IFRS Financial Measures Zegna’s management monitors and evaluates operating and financial performance using several non-IFRS financial measures including: adjusted earnings before interest and taxes (“Adjusted EBIT”), Adjusted EBIT Margin, revenues on a constant currency basis and revenues on an
Slide 33: Non-IFRS Financial Measures
Non-IFRS Financial Measures Constant Currency Revenues. In addition to presenting our revenues on a current currency basis, we also present certain revenue information on a constant currency basis (Constant Currency), which excludes the effects of foreign currency translation from our subsidiaries w
Slide 34: Glossary and Definitions
Glossary and Definitions (1) y o y: used to refer to year on year growth rate. All growth rates are at actual currency (2) Growth rates in this presentation are year on year unless specified differently (3) cFX growth: means growth at constant currency. For the description of constant currency calcu
Slide 35: Investor Relations Contacts
INVESTOR RELATIONS CONTACTS Investor Relations / Group Communications / Media Francesca Di Pasquantonio / Clementina Tito ir@zegna.com / corporatepress@zegna.com 35