Max Stock Ltd. · TASE:MAXO
Max Stock — Q1 2021 Earnings Presentation
22 slides from Max Stock's earnings presentation, 2021
Slide 1: Investors Presentation Q1 2021
Investors Presentation Q1 2021
Slide 2: Disclaimer
Disclaimer: This presentation, which includes oral statements made or videos shown at the presentation hereof, any question and answer session and any written or oral material discussed or distributed during the meeting to present this document or otherwise in connection with it (this “Presentation”
Slide 3: Today's Presenters
Today’s Presenters Evan Neumann Nir Dagan Co-CEO CFO 3
Slide 4: The Value Leader of Israeli Retail
The Value Leader of Israeli Retail Company Overview Broad Selection of Quality Products(3) Toys & Baby A leading extreme value retailer of everyday essential 11% items in Israel. Office / School Housewares Supplies ─ Up to 50% lower prices than conventional retailers. 35 % 4% Broad selection of
Slide 5: Our Secret Sauce
Our Secret Sauce Energetic, Right Product, Superior Preferred Shopping Right Price Customer Service Experience Our Mission is to Help Customers “Dream Big, Pay Small” for Everyday Essentials 5
Slide 6: Israel Covid-19 Update
Israel Covid-19 Update Q1 2021 Situation • During January 2021, some Max stores were closed, and others were operating under restrictions as the government imposed a closure on the Israeli population. • On 21st of February 2021 the Israeli economy began to re-open and the company’s stores returned t
Slide 7: Growth Strategy: new stores
Growth Strategy: new stores 2020 New stores City Owned / Franchisee Sqm Status Talpiot Owned 1,320 Open Q2 2020 Raanana Owned 800 Open Q2 2020 Carmiel Owned 1,700 Open Q4 2020 2021-2022 New Stores City Owned / Franchisee Sqm Status Ramla Owned 3,400 Open Q1 2021 Tel Aviv Franchisee 250 Open Q1 2021
Slide 8: Q1 2021 Delivering High Growth
Q1 2021 Delivering High Growth Q1 2021 Vs Q1 2020 Total revenue growth: 39% (49% excluding onetime bulk operation) Same store sales growth: 38% (17%(1) excluding period the stores were closed in Q1 2020 but including days when in 2021 some stores were closed and restriction were applied) Gross
Slide 9: Q1 2021 Financial Summary
Q1 2021 Financial Summary (NIS / USD Millions) Total revenue growth of 39% in Q1 2021 vs. Q1 2020 driven by same store sales growth and new stores openings. Comparable stores sales increased 38% in Q1 2021 driven by a larger basket size and increase in stores traffic. Adjusted EBITDA (1) and E
Slide 10: Summary P&L Q1 2021
Summary P&L Q1 2021 Q1-2021 vs Q1-2020 Q1-2020 Q1-2021 % Change Revenue from sales 172,266 256,464 49% Revenue from commissions / fees 1,190 2,411 103% Revenue from onetime bulk operation 12,610 - Total revenue 186,066 258,875 39% Gross profit (Excluding onetime bulk operation) 69,750 99,800 43% % o
Slide 11: Revenue Bridge Q1 2021
Revenue Bridge Q1 2021 Multiple drivers of growth (NIS Millions) Q1-2021 Vs Q1-2020 11
Slide 12: Adjusted EBITDA Bridge Q1 2021
Adjusted EBITDA (1) Bridge Q1 2021 Multiple drivers of growth (NIS Millions) Q1-2021 Vs Q1-2020 (1) Adjusted EBITDA defined as Net Income + Income Tax Expenses + Net Interest Expenses + D&A + Other Expenses - the impact of IFRS 16 + Share-based payment; see appendix for a reconciliation. 12
Slide 13: Historical Financial Performance
Historical Financial Performance Number of Stores and SqM Revenue (NIS / USD Millions) ’18 – 21 CAGR: NIS 1,083/$336 50 52 46 47 NIS 1,010 / $293 NIS 112/ $33.6 21% 15 16 NIS 124.8 / $36 13 15 NIS 742/ $208 NIS 618 / $184 16% 33 35 36 NIS 886 / $258 NIS 971 / $291 32 (1) 2018 2019 2020 Q1 2021 Max M
Slide 14: Balance Sheet Update
Balance Sheet Update Key Points Summary Balance Sheet (NIS Thousands) Max has ample liquidity and strong Balance Sheet as of 3/31/2021 3/31/2020 free cash flow generation to support Current Assets 386,269 316,165 future growth. Right of Use Assets 505,816 363,868 Other Non-Current Assets 62,137 48
Slide 15: Bottom line: delivering on our growth strategy
Bottom line: delivering on our growth strategy (NIS Millions) Drive Comparable Store Sales (1) Grow Store Base - SQM +17% +15% 153 47.5K 131 41.4K Q1 2020 1 Q1 2021 2 Q1 2020 Q1 2021 Adj EBITDA Margin(2) +0.8 % pts. 15.6% 16.4% Q1 2020 Q1 2021 (1) Exclude period stores were closed due to government
Slide 16: Summary Cash Flow
Summary Cash Flow (NIS Thousands) Q1 2020 Q1 2021 Cash flows deriving from (used for) current operation 8,261 (19,524) Cash flows deriving from (used for) investment activities (52,106) 1,827 Cash flows deriving from (used for) financing activities 40,473 (6,126) Decrease in cash and cash equivalent
Slide 17: Dividend expected distribution
Dividend expected distribution One time dividend distribution amount: ILS 70 million (ILS 0.49 per share). Distribution of net income by years: Year Profit (NIS Thousands) 2018 12,005 2019 57,995 17
Slide 18: Long-Term Financial Targets
Long-Term Financial Targets Metric Long-Term Target 3 – 5 New Max Stores Annually Unit Growth (Potential to Double Store Count Long-Term) Annual Revenue Growth Low-to-Mid Teens Annual SSS 3% Adjusted EBITDA Margin Expansion ~200bps Annual Net Income Growth 18% - 20% 18
Slide 19: Appendix
Appendix
Slide 20: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation Reconciliation of Net Income to Adjusted EBITDA (NIS Thousands) (2) Q1 2020 Q1 2021 Net Income 18,076 26,965 (+) Interest Expense, Net 5,618 2,862 (+) Income Tax Expense 5,807 9,192 (+) Depreciation and Amortization 10,488 12,362 (1) (+) Other Incomes -18 - (-) IFRS 16
Slide 21: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation Reconciliation of Net Income to Adjusted EBITDA (NIS Thousands) (2) 2018 2019 2020 LTM Q1 2021 Net Income 58,814 70,274 87,629 96,517 (+) Interest Expense, Net 1,676 10,397 32,558 29,804 (+) Income Tax Expense 19,414 20,861 30,542 33,927 (+) Depreciation and Amortizati
Slide 22: Application of IFRS 16
Application of IFRS 16 Impact of IFRS 16 on the Q1-2021 Income Statement (NIS Thousands) Before Application Effect of After Application After Application of Section of IFRS 16 IFRS 16 of IFRS 16 IFRS 16 Excl. PPE Gross Profit 99,426 374 99,800 99,800 EBITDA 38,604 12,777 51,381 51,381 Operating Prof