Harvey Norman Holdings Ltd · ASX:HVN
Harvey Norman — H1 FY2012 Earnings Presentation
22 slides from Harvey Norman's earnings presentation, Feb 29, 2012
Slide 1: Presentation of Results for Half-Year Ended 31 December 2011
For personal use only H O L D I N G S L I M I T E D Presentation of Results for Half-Year Ended 31 December 2011 Harvey Norman Holdings Limited ABN 54 003 237 545
Slide 2: Agenda
H O L D I N G S L I M I T E D Agenda For personal use only 1. Strategic Overview 2. Franchisee Sales Revenue 3. Franchisee Trading Performance 4. Net Assets 5. Key Financial Highlights 6. Review of the Income Statement for the HY ended 31/12/11 7. Review of the Balance Sheet as at 31/12/11 8. Review
Slide 3: Strategic Overview: The Future of Retail – Our Omni Channel Strategy
Strategic Overview The Future of Retail – Our Omni Channel Strategy For personal use only The Omni Channel Strategy: The CUSTOMER IS FIRST and ever We seamlessly integrate the customer experience across all channels. We interact and transact with our customers through our website, changing. As a
Slide 4: Strategic Overview – The Omni Channel Strategy
H O L D I N G S L I M I T E D Strategic Overview – The Omni Channel Strategy For personal use only Physical Stores Distribution Web Centres Home Kiosks Services Mobile Marketing Devices Smart TV’s, Social Networked Media Appliances & Gaming Devices 4 Harvey Norman Holdings Limited | Appendix 4D | Ha
Slide 5: Strategic Overview – Our Channels
H O L D I N G S L I M I T E D Strategic Overview – The Omni Channel Strategy Our Channels For personal use only Social Media Physical Stores Active since 2009. Marketing 247 sites covering country, city Australia & New Zealand. Across all brands and services. In-house agency integrating traditional
Slide 6: Franchisee Sales Revenue
H O L D I N G S L I M I T E D Franchisee Sales Revenue For personal use only Global Sales $AUD Global Sales Increase / (Decrease) % Sales from the franchised Sales Growth (%) “Harvey Norman” complexes, Total (%) Like-for-Like (%) commercial divisions & other sales outlets in Australia, New HY Dec-
Slide 7: Franchisee Trading Performance
H O L D I N G S L I M I T E D Franchisee Trading Performance For personal use only The Australian sales data for the second quarter FY12 has been negatively impacted by the closure of the 7 Clive Peeters and Rick Hart stores, coupled with the transition of rebranding the remaining 18 stores to Harve
Slide 8: Franchisee Trading Performance
H O L D I N G S L I M I T E D Franchisee Trading Performance For personal use only The decrease in franchisee turnover resulted in a reduction to franchise fees received and an increase in tactical support, ultimately reducing the franchising operations margin & cash flows from operating activities.
Slide 9: Net Assets (5 Years)
H O L D I N G S L I M I T E D Net Assets (5 Years) For personal use only Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Net Assets* $1.87bn $1.96bn $2.10bn $2.14bn $2.23bn Rate of increase from PCP 24.8% 4.7% 7.4% 1.9% 4.2% Real Property Assets $1.56bn $1.77bn $1.83bn $1.98bn $2.12bn Rate of increase from PCP 1
Slide 10: Key Financial Highlights
H O L D I N G S L I M I T E D Key Financial Highlights For personal use only HY Dec 11 HY Dec 10 Mvmt on PCP EBIT $188.12m $219.96m down 14.5% EBIT Margin %1 13.5% 15.7% -220 bps PBT $163.47m $198.61m down 17.7% NPAT 2 $128.95m $131.67m down 2.1% NPAT Margin %1 9.2% 9.4% -20 bps Net Assets 3 $2.23bn
Slide 11: Review of the Income Statement – Revenue Items
H O L D I N G S L I M I T E D Review of the Income Statement For personal use only Revenue Items HY Dec 11 HY Dec 10 Mvmt on PCP Sales Revenue $806.88m $804.13m up 0.3% Gross Profit $205.00m $215.39m down 4.8% Revenues & Other Income $584.11m $590.38m down 1.1% Sales Revenue increase in CP & RH sa
Slide 12: Review of the Income Statement – Expenses & Profit
H O L D I N G S L I M I T E D Review of the Income Statement For personal use only Expenses & Profit HY Dec 11 HY Dec 10 Mvmt on PCP Total Expenses ($628.03m) ($618.45m) up 1.5% Share of JV investments $2.39m $11.30m down 78.8% Profit Before Tax $163.47m $198.61m down 17.7% Income Tax Expense ($32.6
Slide 13: Review of the Balance Sheet (5 Years)
H O L D I N G S L I M I T E D Review of the Balance Sheet (5 Years) For personal use only Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Total Assets $3.46bn $3.78bn $3.82bn $4.06bn $4.23bn Return on Total Assets % 6.65% 2.63% 4.15% 3.25% 3.05% Total Liabilities $1.54bn $1.76bn $1.67bn $1.87bn $1.96bn Net Asset
Slide 14: Review of the Balance Sheet – Net Debt to Equity Ratio
H O L D I N G S L I M I T E D Review of the Balance Sheet – Net Debt to Equity Ratio (%) For personal use only Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 TOTAL DEBT $515.14m $655.24m $579.57m $682.77m $799.40m Less: CASH RESERVES ($67.03m) ($159.67m) ($166.35m) ($132.92m) ($122.47m) NET DEBT $448.11m $495.5
Slide 15: Review of the Statement of Cash Flows
H O L D I N G S L I M I T E D Review of the Statement of Cash Flows For personal use only HY Dec 11 HY Dec 10 Mvmt on PCP Operating Cash Flows $19.88m $93.52m down 78.7% Operating cash 1) Reduction in net receipts from franchisees by $77.78m due to the following: flows ↓ by lower revenue received
Slide 16: Review of the Statement of Cash Flows
H O L D I N G S L I M I T E D Review of the Statement of Cash Flows For personal use only HY Dec 11 HY Dec 10 Mvmt on PCP Investing Cash Flows ($128.40m) ($226.44m) down 43.3% Financing Cash Flows $77.52m $115.53m down 32.9% Net Decrease in Cash Flows ($31.00m) ($17.39m) down 78.3% Cash & Cash Equiv
Slide 17: Segment Analysis – Franchising Operations Segment
H O L D I N G S L I M I T E D Segment Analysis – Franchising Operations Segment For personal use only Franchising Operations HY Dec 11 HY Dec 10 Mvmt on PCP Segment Revenue $466.26m $498.99m down 6.6% Segment EBITDA $134.88m $189.14m down 28.7% Segment Result Before Tax $95.51m $150.36m down 36.5% F
Slide 18: Segment Analysis – Total Property Segments
H O L D I N G S L I M I T E D Segment Analysis – Total Property Segments For personal use only Total Property HY Dec 11 HY Dec 10 Mvmt on PCP Segment Revenue $116.61m $91.58m up 27.3% Segment EBITDA $83.37m $60.78m up 37.2% Segment Result Before Tax $68.77m $47.18m up 45.8% Property segment rent r
Slide 19: Segment Analysis – Company-Operated Retail Operations
H O L D I N G S L I M I T E D Segment Analysis – Company-Operated Retail Operations For personal use only Total Retail Operations HY Dec 11 HY Dec 10 Mvmt on PCP Segment Revenue $822.53m $818.96m up 0.4% Segment EBITDA $9.94m $5.54m up 79.5% Segment Result Before Tax ($1.14m) ($6.89m) up 83.5% Retai
Slide 20: Outlook
H O L D I N G S L I M I T E D Outlook continued investment in strengthening our Omni channel strategy For personal use only improved inventory efficiency program & enhanced supply chain controls to reduce the working capital requirements of franchisees strategy continues to be underpinned by a
Slide 21: Outlook
H O L D I N G S L I M I T E D Outlook For personal use only positioned for growth in Slovenia and Croatia in the year ahead with the opening of our Maribor and Zagreb stores. property portfolio continues to be a key asset base of the company construction of a 32,600 sqm homemaker centre at Mar
Slide 22: Questions
H O L D I N G S L I M I T E D Questions (limited to 30 minutes) For personal use only 22 Harvey Norman Holdings Limited | Appendix 4D | Half-Year Report | 31 December 2011
Harvey Norman Holdings — H1 FY2012 Earnings Presentation on 6ix