Vaibhav Global Ltd. · NSE:VAIBHAVGBL
Vaibhav Global — H1 FY14 Earnings Presentation
30 slides from Vaibhav Global's earnings presentation, October 2013
Slide 1: Vaibhav Global Limited
Vaibhav Global Limited Global Retailer of Fashion and Lifestyle Accessories on Home TV and e-Commerce Platforms Financial Results Presentation Q2 & H1FY14 October 2013
Slide 2: Safe Harbor
Safe Harbor Certain statements in this document may be forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties like regulatory changes, local political or economic developments, and many other factors that could cause our actual results to differ ma
Slide 3: Business Highlights
Business Highlights Vertically-integrated electronic retailer of discount fashion and lifestyle accessories • Demonstrated profitable growth with direct-to-consumer business model on home shopping and e-commerce platforms with US and UK denominated revenue operations Owns ‘Liquidation Channel’ and ‘
Slide 4: Table of Contents
Table of Contents Q2 & H1 FY14 Financial Performance 5 Financial Performance Trends 12 Business Background Details 20 4
Slide 5: Key Highlights for Q2 FY14
Key Highlights for Q2 FY14 Home TV Network Reaches Over 100 Million Households • 87 million households on full time equivalent (FTE) basis • 20 million households in the UK • 63 million households in the US • 18 million households in Canada Retail Volumes Rise 25% to 2,224 Million Units • 15% higher
Slide 6: Chairman's Message
Chairman’s Message Commenting on Q2 & H1 FY14 performance, Mr. Sunil Agrawal , Chairman, Vaibhav Global said: “We are extremely pleased with our Q2 performance, delivering 46% growth in revenues and expanding profits by almost 5X. Demand for our deep value products remained robust in a traditionally
Slide 7: Financials – Q2 & H1 FY14 Performance (Revenues)
Financials – Q2 & H1 FY14 Performance (Revenues) Revenues (Rs. crore) 568 418 318 218 Q2 FY13 Q2 FY14 H1 FY13 H1 FY14 Jewelry & Lifestyle Products TV Sales Web Sales B2B Sales 88 65 58 415 48 54 314 46 216 29 165 24 Q2 FY13 Q2 FY14 H1 FY13 H1 FY14 Q2 FY13 Q2 FY14 H1 FY13 H1 FY14 Q2 FY13 Q2 FY14 H1 F
Slide 8: Retail Performance Trends
Retail Performance Trends TV Sales Sales Volumes ('000s) Average selling price US$ 2,941 23 23 24 22 2,456 1,564 1,355 • Strong y-o-y volume growth in Q2 FY14 – 15% in TV and 56% in Web • Growth driven by expansion of fashion Q2 Q2 H1 H1 Q2 Q2 H1 FY13 H1 FY14 jewelry and lifestyle accessories lines
Slide 9: Financials – Q2 & H1 FY14 Performance (Margins)
Financials – Q2 & H1 FY14 Performance (Margins) Rs. crore Gross Profit Gross margin 400 70% 350 62% 65% 61% 61% 300 58% 60% • Gross margins have improved owing to 250 55% higher realization on a stable product mix 200 50% 150 45% 100 40% 50 35% 127 192 254 355 0 30% Q2 FY13 Q2 FY14 H1 FY13 H1 FY14 N
Slide 10: Financials – Q2 & H1 FY14 Performance (Profits)
Financials – Q2 & H1 FY14 Performance (Profits) Rs. crore PAT PAT margin 100 18.0% 15.0% 80 15.0% • PAT expansion is in line with improvement 14.0% 12.0% in core business profitability as the company 60 8.0% 9.0% operates on a lean asset profile 40 6.0% 3.0% 20 3.0% 7 44 35 84 0 0.0% Q2 FY13 Q2 FY14
Slide 11: Table of Contents
Table of Contents Q2 & H1 FY14 Financial Performance 5 Financial Performance Trends 12 Business Background Details 20 11
Slide 12: Financials Performance Trends (Revenues)
Financials Performance Trends (Revenues) Revenues (Rs. crore) 893 647 526 568 338 FY10 FY11 FY12 FY13 H1 FY14 Jewelry & Lifestyle Products TV Sales Web Sales B2B Sales 687 117 85 91 89 88 483 73 395 54 65 415 263 46 21 FY10 FY11 FY12 FY13 H1 FY14 FY10 FY11 FY12 FY13 H1 FY14 FY10 FY11 FY12 FY13 H1 FY
Slide 13: Retail Performance Trends
Retail Performance Trends TV Sales Sales Volumes ('000s) Average selling price US$ 5,197 62 • Between FY10 and FY13, ASPs had trended 3,268 with portfolio transition from fine jewelry 2,941 41 30 to fashion jewelry and accessories 2,039 24 24 • Stable volume growth registered on home 698 TV platform
Slide 14: Financials Performance Trends (Margins)
Financials Performance Trends (Margins) Rs. crore Gross Profit Gross margin 600 70% 60% 62% 59% 500 55% 60% 50% 400 • Gross margins have improved as the 36% 40% sourcing matrix provides flexibility to 300 30% purchase from cost efficient markets 200 20% (currently India on account of depreciating 10
Slide 15: Financials Performance Trends (Profits)
Financials Performance Trends (Profits) Rs. crore PAT PAT margin 100 20% 15% 80 12% 15% 60 8% 8% 10% 40 5% • Limited fixed cost along with expanding 20 0% profits will assist debt reduction and funding 42 79 78 84 0 -5% ‘technology efficiency’ driven capital -20 -47 -10% investments from internal ac
Slide 16: Financials Performance Trends (Balance Sheet)
Financials Performance Trends (Balance Sheet) Rs. crore Shareholders’ Equity Rs. crore Fixed Assets 265 207 205 203 205 209 186 159* 58* 62 FY10 FY11 FY12 FY13 H1 FY14 FY10 FY11 FY12 FY13 H1 FY14 * During FY13, Shareholders’ Equity was adjusted lower by Rs. 163.7 crore due to * During FY13 fixed ass
Slide 17: Financials Performance Trends (Cash Flow)
Financials Performance Trends (Cash Flow) Operating Cash flow Rs. crore Free Cash Flow Rs. crore 69 63 77 77 48 44 54 52 FY10 FY11 FY12 FY13 H1 FY14 FY10 FY11 FY12 FY13 H1 FY14 -36 -27 17
Slide 18: Financials Performance Trends (Key Ratios)
Financials Performance Trends (Key Ratios) ROE ROCE 77% 48% 68% 34% 37% 36% 23% 15% FY10 FY11 FY12 FY13 H1 FY14 FY10 FY11 FY12 FY13 H1 FY14 -9% -41% 18
Slide 19: Table of Contents
Table of Contents H1 Financial Performance 5 Financial Performance Trends 12 Business Background Details 20 19
Slide 20: Market Opportunity
Market Opportunity US market size (US$ Bn) UK market size (US$ Bn) Fashion Fashion Accessories Accessories 17 6 Fine and Fine and Fashion Fashion Jewelry 67 Jewelry 8 Market share gains through expanded distribution network and introduction of collections/designs mapping market trends 20
Slide 21: Product Profile
Product Profile JEWELLERY FASHION Product catalogue includes FINE & bracelets, bangles, earrings, studded jewelry etc. ACCESSORIES FASHION Product catalogue includes watches, bags, phone protective shells etc. PRODUCTS LIFESTYLE OTHER Product catalogue includes office and home décor, etc. Continuous
Slide 22: US Market Access on Liquidation TV Channel
US Market Access on Liquidation TV Channel https://www.liquidationchannel.com Access to 63 million of the 116 million households in the US 22
Slide 23: UK Market Access on the Jewellery Channel
UK Market Access on the Jewellery Channel www.thejewellerychannel.tv Access to 20 out of the total 20 million households 23
Slide 24: Integrated Global Operations
Integrated Global Operations SOURCING MARKETS India Asia • Corporate HQ – Jaipur, Rajasthan • China is the hub for sourcing • ISO 9001:2008 manufacturing fashion and lifestyle accessories, facilities accessed from multiple locations • Production capacity - ~3 million • Sourcing capacity from China -
Slide 25: Sourcing Methodology
Sourcing Methodology Assessing value perception – design / fashion trend / price in target markets Competitive Pricing Mapping latest fashions Vendor Core evaluation competency process of vendor Rapid turnaround Sourcing from appropriate micro-markets in China/Asia Delivery/ Low Focus on best qualit
Slide 26: Aligned with Demand Patterns
Process Aligned with Demand Patterns Buyer discussions Evaluation/ feedback of last year’s hits/misses Product Valentine Day & Spring Mothers’ Summer Product development strategies – by Product Line Day Line category Process begins – September Process begins – December Process begins – Decembe
Slide 27: Management Team
Management Team Sunil Agrawal Rahimullah Chairman Managing Director, VGL India Established Vaibhav in 1980 as a first generation Beginning his career in emerald trading and exports, he has entrepreneur and has led the company’s transition gained considerable experience and knowledge in this fiel
Slide 28: Management Team
Management Team Michael Raisbeck Praveen Tiwari Senior Vice President , Group Human Resources Vice President , STS China Responsible for HR strategy and systems Extensive cross-industry HR leadership and management Over 15 years at VGL, currently heads the group’s China experience of over 25 y
Slide 29: Contact Information
Contact Information For more information on Vaibhav Global Limited, please contact: Anshuman Khandelwal Vaibhav Global Ltd Tel: +91-141-2770648 Email: anshuman.khandelwal@vaibhavglobal.com Shiv Muttoo / Dipti Yadava CDR-India Tel: +91 22 6645 1207 / 1218 Email: shiv@cdr-india.com dipti@cdr-india.com
Slide 30: Thank You
Thank You 30