Redington Limited · NSE:REDINGTON
Redington — Q1 FY2020 Earnings Presentation
56 slides from Redington's earnings presentation, Aug 13, 2019
Slide 1: Cover letter to National Stock Exchange
Cor crate Office . l Redington [India] Limited Redington House Centre Point, e Ing 0n [5,, Thiru.Vi.Ka Industrial Estate. SEAMLESS PARTNERSHIPS Guindy, Chennai- 600032, India Tel : +91 1.4 4224 3353 Fax :+91 44 2225 3799 CIN : L52599TN196‘I PLC028758 www.redingtongruup.com 13‘h August 2019 The Natio
Slide 2: Q1FY20 Earnings Presentation
REDINGTON (INDIA) LIMITED Q1FY20 Earnings Presentation June 2019
Slide 3: Disclaimer
Disclaimer This presentation contains “forward looking statements” including, but without limitation, statements relating to the implementation of strategic initiatives, and other statements relating to Redington India Limited’s future business developments and economic performance. While these forw
Slide 4: Financial Highlights
Financial Highlights • Q1FY20 – Strong double digit growth across all parameters in both India and Overseas • On a consolidated basis, Revenue grew by 14%, EBITDA grew by 35% and PAT grew by 24% • India – Revenue grew by 14%, EBITDA grew by 46% and PAT grew by 23% • Overseas – Revenue grew by 14%, E
Slide 5: Financial Highlights: India business
Financial Highlights India business • During the quarter, • Inspite of General Elections and SAP implementation in Indian operations, the India business registered strong double digit growth in Revenue, EBITDA and PAT • Growth driven by all three business segments, viz a viz, IT, Mobility and Servic
Slide 6: Financial Highlights: Overseas business
Financial Highlights Overseas business • During the quarter, • Overseas business delivered strong double digit growth, driven by IT and Mobility segment • Overseas business continues to maintain WC efficiently with WC days for Q1FY20 at 36 days Turkey Update • During the quarter, Arena biz had regis
Slide 7: Q1FY20 Highlights
Q4FY18 Highlights Q1FY20 Highlights Connecting The Dots Transformation from ‘Product’ to ‘Utility of Product’ 6
Slide 8: Q1FY20 Consolidated Financials
Q1FY20- Consolidated Financials ₹ in million REVENUE EBIDTA PAT 14% 35% 24% 1,16,866 1,02,288 2,450 1,101 1,811 887 Q1FY19 Q1FY20 Q1FY19 Q1FY20 Q1FY19 Q1FY20 7 7
Slide 9: Q1FY20 Performance by Market
Q1FY20 Performance by Market ₹ in million REVENUE EBIDTA PAT 8 14% 35% 24% 1,101 1,16,866 2,450 1,02,288 887 1,811 25% 14% 27% 697 1,304 75,462 65,992 559 1,025 46% 23% 14% 1,146 404 36,296 41,404 786 328 Q1FY19 Q1FY20 Q1FY19 Q1FY20 Q1FY19 Q1FY20 INDIA OVERSEAS INDIA OVERSEAS INDIA OVERSEAS 8
Slide 10: Q1FY20 Performance by Vertical
Q1FY20 Performance by Vertical INDIA OVERSEAS CONSOLIDATED 7% 7% 2% 2% 4% 4% 18% 20% 36% 38% 30% 32% 75% 73% 62% 60% 66% 64% Q1FY19 Q1FY20 Q1FY19 Q1FY20 Q1FY19 Q1FY20 IT Mobility Services IT Mobility Services IT Mobility Services Note: Upon re-grouping, only smartphones are shown under Mobility 99
Slide 11: Q1FY20 Working Capital Days
Q1FY20 – Working Capital Days INDIA OVERSEAS CONSOLIDATED 57 44 44 52 39 36 5 3 0 Q1FY19 Q1FY20 Q1FY19 Q1FY20 Q1FY19 Q1FY20 10 10
Slide 12: Free Cash Flow Statement
Free Cash Flow Statement ₹ in million Particulars Q1 FY20 Q1FY19 Profit Before Taxation 1,469 1,218 Non-cash items 347 672 Outflow of Finance Cost 577 395 Changes in Working Capital (10,713) 150 Direct Taxes Paid (155) (616) Net Cash Flow from Operations (8,475) 1,819 Capex (328) (211) Dividend paid
Slide 13: Q1FY20 Top Vendors Consolidated
Q1FY20 – Top 5 Vendors Consolidated REVENUE 38% 39% OTHERS LENOVO 6% 5% SAMSUNG 4% 6% 8% DELL EMC 9% HP Inc 15% 12% APPLE 29% 29% Q1FY19 Q1FY20 12 12
Slide 14: Q1FY20 Performance – ProConnect
Q1FY20 Performance – ProConnect • Revenue growth over Q1FY19 is 22% • EBITDA growth over Q1FY19 is 57% REVENUE EBIDTA PAT 22% 57% 1% 186 1,150 944 118 61 61 Q1FY19 Q1FY20 Q1FY19 Q1FY20 Q1FY19 Q1FY20 ₹ in million ₹ in million ₹ in million Above figures include Mission Critical Services 13 13
Slide 15: Shareholding Pattern
Shareholding Pattern Others Others 12.2% 9.4% Mutual Funds Mutual Funds 14.1% 13.2% Synnex Mauritius Limited Synnex Mauritius 24.2% Limited 24.2% Standard Standard Chartered Chartered Private Private Equity Equity 15.8% 15.8% Foreign Foreign Institutional Institutional Investors & FPIs Investors & F
Slide 16: Investor Contacts
Investor Contacts M. Muthukumarasamy Compliance Officer Redington (India) Limited SPL Guindy House, 95 Mount Road, Guindy, Chennai 600 032 https://www.redingtongroup.com Sowmiya M Senior Manager – Investor Relations Connecting The Dots sowmiya.manickam@redington.co.in Transformation from ‘Product’ t
Slide 17: Corporate Presentation
Corporate Presentation June 2019
Slide 18: Who Are We? What We Do?
WHO ARE WE? WHAT WE DO? A prominent & leading We are ‘Business Enablers’, “Technology Distributor” Seamlessly partnering with evolving into a Brands and Channel partners “Services & Solutions company” in delivering value No.1 Technology Multi faceted Expanding the reach An Emerging Markets $6.7bn+ c
Slide 19: Industry Overview
SEAMLESS PARTNERSHIPS, Industry Overview
Slide 20: Distribution Food Chain
Distribution Food Chain IT CONSUMER & MOBILITY SUB DISTRIBUTOR RESELLER Earlier VENDOR DISTRIBUTOR RETAILER CUSTOMER RESELLER Present VENDOR DISTRIBUTOR RETAILER CUSTOMER ECOMMERCE PLAYER IT ENTERPRISE Earlier VENDOR DISTRIBUTOR SYSTEM INTEGRATOR CUSTOMER VALUE ADDED RESELLER SYSTEM INTEGRATOR Prese
Slide 21: Distributors: Value Creators
Distributors: Value Creators Market Knowledge & Access One stop shop Demand Generation Inventory Management Partner Recruitment & Enablement Bulk breaking BRANDS CHANNEL Sales & Marketing Expertise PARTNERS Credit financing Supply Fulfilment Logistics Pre & Post Sales Consulting Order consolidation
Slide 22: Product Lifecycle
Product Lifecycle Manufacture/ Distribute Logistics Support Develop Our presence across the product lifecycle 6
Slide 23: Company Overview
SEAMLESS PARTNERSHIPS, Company Overview
Slide 24: Mission Statement
Mission Statement “Our mission is to offer a robust technology-powered platform to enable a seamless flow of products and services” 8
Slide 25: Our Values
Our Values ADAPTABILITY COLLABORATION KNOW-HOW OBJECTIVITY SIMPLICITY TRUST TRANSPARENCY 9
Slide 26: Our Emergence
Our Emergence Present Presence across 37 markets, a leading Emerging Markets player 1993 10
Slide 27: Our Associations
Our Associations Present 1993 Enviable Partnerships with over 220+ brands 11
Slide 28: Our Expansion
Our Expansion CHANNEL SALES SERVICE BRANDS EMPLOYEES MARKETS WAREHOUSES CENTRES PARTNERS OFFICES Present 220+ 39,650+ 4,748 37 80+ 225+ 250+ 1993 1 25 5 1 3 1 1 From a ‘Home Grown Company’ to a ‘Leading Distributor’ 12
Slide 29: Our Board Of Directors
Our Board Of Directors Independent Directors CHAIRMAN Prof. Ramachandran V. S. Hariharan Keith WF Bradley B Ramaratnam Anita P Belani Professor, Corporate Ex. Vice President, Ex.President, Professional Sr Business & Human Policy & Strategy Hewlett-Packard, Ingram Micro, Director Capital Leader, Oper
Slide 30: Our Experienced Executive Team
Our Experienced Executive Team Raj Shankar Managing Director P S Neogi S V Krishnan Ramesh Natarajan J K Senapati, E H Kasturi Rangan Dr. R. Arunachalam S V Rao Chief Development CFO & Whole Time Joint COO & Chief Joint COO, India MD, ProConnect CEO, ProConnect CEO, Ensure & Strategy Officer Directo
Slide 31: Business Overview
SEAMLESS PARTNERSHIPS, Business Overview
Slide 32: Distribution Business
Distribution Business BUSINESS INDIA MIDDLE EAST AFRICA TURKEY SINGAPORE SOUTH ASIA DISTRIBUTION IT CONSUMER IT ENTERPRISE MOBILITY EMERGING PCs Laptops Networking Software Health & Medical Smartphones Equipment Print Supplies 3D Printers & Scanners Servers & Storage Security Printers Solar Consumer
Slide 33: Services Business
Services Business BUSINESS INDIA MIDDLE EAST AFRICA TURKEY SINGAPORE SOUTH ASIA SERVICES Supply Chain SERVICES & SOLUTIONS Transformative initiatives for Trader Distributor Consolidator COMPANY Seamless Success Logistics services Support services Cloud services Digital print services 3D Print Servic
Slide 34: ProConnect India
ProConnect India Wholly Owned Subsidiary of Redington Revenue Contribution from Services 17% Integrated Third Party Logistics partner Warehousing 50% Transportation 33% PAN India presence Others FY19 figures 180+ Warehouses Revenue Contribution from Industries IT 6.6 mn Sq.ft. in operation 18% Consu
Slide 35: ProConnect India: Growth Story
ProConnect India : Growth Story 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 CUSTOMERS 33 53 74 124 166 205 WAREHOUSES 74 74 80 150 173 181 WAREHOUSING SPACE (in sq. ft.) 0.9 mn 1.2 mn 2.5 mn 4.8 mn 6.3 mn 6.8 mn Revenue EBITDA PAT Revenue Mix Redington Outside Biz 4,035 581 295 24% 29% 49% 65% 7
Slide 36: Ensure India
Ensure India Wholly Owned Subsidiary of Redington Warranty Support Services PAN India presence with 35+ Owned Infrastructure Post Warranty Management service centres across India Services Services Preferred Service partner with 170+ service partners across India Managed Print Spare Parts Services Ma
Slide 37: Redington Cloud Solutions
Redington Cloud Solutions Our Cloud Practice Our business Digital Platform Partner Enablement Program Distribution Element Services Element Managed Our Cloud Business Practice Down-selling of Redington team Services Development Cloud products provides Managed Services, focussing on SME/Mid Market Cl
Slide 38: Printing Solutions
Printing Solutions DIGITAL PRINT SERVICES 3D PRINT SERVICES Exclusive Distributor of HP Indigo’s “Digital Set up 3D Printing Printing Press” in India Facility in Chennai REVENUE MODEL Ranked Grade “A” by HP Indigo (Second highest in the world) Distribution of Printing Press Annuity revenues from cli
Slide 39: Fueling Growth In a Challenging Business
Fueling Growth In a Challenging Business IT CONSUMER • Enabling better product mix with higher ASP • Market share gains PC Shipments decline • Establishing presence in Cloud IT ENTERPRISE • Increased value added services • Systematic approach devised to participate in Government Gradual pickup in Co
Slide 40: Financial Performance
SEAMLESS PARTNERSHIPS, Financial Performance
Slide 41: Performance Since Listing
86,672 1,03,699 1,19,186 1,31,622 CAGR 15% 1,63,734 2,07,799 2,34,462 2,72,441 REVENUE 3,07,361 3,44,198 3,97,362 4,16,417 4,65,994 1,985 Performance Since Listing 2,590 3,296 3,657 4,717 CAGR 14% 6,334 6,842 7,196 EBITDA 7,619 8,176 8,662 8,555 *Post acquisition of Easyaccess Financial Services in
Slide 42: Performance By Market
Performance By Market ₹ in million REVENUE EBIDTA PAT 1,101 14% 1,16,866 35% 24% 1,02,288 2,450 887 1,811 27% 25% 14% 697 1,304 75,462 65,992 559 1,025 14% 46% 23% 1,146 404 36,296 41,404 786 328 Q1FY19 Q1FY20 Q1FY19 Q1FY20 Q1FY19 Q1FY20 India Overseas India Overseas India Overseas 26
Slide 43: Performance By Vertical
Performance By Vertical INDIA OVERSEAS CONSOLIDATED 7% 7% 2% 2% 4% 4% 18% 20% 36% 38% 30% 32% 75% 73% 62% 60% 66% 64% Q1FY19 Q1FY20 Q1FY19 Q1FY20 Q1FY19 Q1FY20 IT Mobility Services IT Mobility Services IT Mobility Services 27
Slide 44: Geographical Contribution
Geographical Contribution REVENUE PAT 47% 49% 51% 57% 59% 62% 61% 54% 64% 63% 65% 60% 63% 68% 53% 51% 49% 43% 41% 38% 39% 46% 36% 37% 35% 40% 37% 32% FY 14 FY 15 FY 16 FY 17 FY 18 FY 19 Q1FY20 FY 14 FY 15 FY 16 FY 17 FY18 FY19 Q1FY20 India Overseas India Overseas 28
Slide 45: Top Vendors
Top 5 Vendors 41% 40% 39% 48% 46% 46% 51% 4% 5% 5% 4% 5% 6% 9% 7% 7% 8% 8% 8% 4% 9% 9% 7% 6% 5% 4% 5% 4% 16% 15% 12% 15% 21% 20% 17% 27% 27% 29% 22% 11% 13% 15% FY 14 FY 15 FY 16 FY 17 FY 18 FY 19 Q1FY20 APPLE HP Inc DELL EMC SAMSUNG LENOVO OTHERS Note: Effect of Dell EMC merger is shown partly in F
Slide 46: Key Operating Metrics
Key Operating Metrics Inventory Days Debtor Days Creditor Days Working Capital Days 58 55 54 44 37 43 39 41 48 44 49 44 Working Capital Days 43 61 59 63 53 59 54 39 at sustainable levels 49 33 36 43 33 29 32 34 FY 14 FY 15 FY 16 FY 17 FY 18 FY 19 Q1FY20 Rs in FY14 FY15 FY16 FY17 FY18 FY19 Q1FY20 mn
Slide 47: Consolidated Financials
Consolidated Financials Particulars Q1FY20 FY19 FY18 FY17 FY16 FY15 FY14 Total Revenue 1,168,66 4,65,994 4,16,417 3,93,762 3,44,198 3,07,361 2,72,441 EBITDA 2,450 9,619 8,555 8,662 8,176 7,619 7,196 PAT 1,101 5,078 4,816 4,642 4,235 3,865 3,367 Networth 40,029 39,060 35,306 31,479 29,494 23,742 20,2
Slide 48: Dividend Distribution
Dividend Distribution 215% Dividend Payout : 20% on profits earned 165% 120% 105% 115% 95% Buyback of shares 45% Issue size Rs.139 crs 20% % Equity 2.78% FY13 FY14 FY15 FY16 FY17 FY18 FY19 Dividend % on Face Value of shares Final dividend plus Special Interim Dividend declared 32
Slide 49: Shareholding Pattern (June 2019)
Shareholding Pattern (June 2019) HDFC Mutual Fund Others, 9.4% Fidelity Management & Research (FMR) Synnex Mauritius Ltd, 24.2% Franklin Templeton Investments Mutual Funds, 13.2% ICICIPru Life Insurance Standard Fidelity International Chartered Foreign Private Equity, Institutional 15.8% Dimensional
Slide 50: Our Growth Drivers
SEAMLESS PARTNERSHIPS, Our Growth Drivers
Slide 51: Revenue Growth Vectors
Revenue Growth Vectors Tapping incremental Continuous addition BRAND MARKET revenue from of brands across SHARE ACQUISITIONS available product categories opportunities GAINS TARGET 3 year Revenue CAGR of 10% yoy Acquiring MARKET NEW BUSINESS Foraying into newer distribution rights in product categor
Slide 52: Margin Growth Vectors
Margin Growth Vectors Enabling higher Product mix of Improved Mix HIGH MARGIN Margin Focus on products Trajectory INDIA Geography as a growth Mix TARGET market ROCE of Business Foray into 16-18% by Improved Mix SERVICES WC turns FY21 Optimization Driving of OPERATING Efficiency EXPENSES Improvement
Slide 53: Capital Allocation Priorities
Capital Allocation Priorities NO FPO Dividend payout @ 1 Returns to Shareholders 20% of Profits MADE Investments of Debt ~Rs.1,500 mn spread until FY21 Investments into the business Investments into business 2 Equity Ratio at 0.4 Investments of 3 Strategic M&As for ProConnect ~Rs.1,500 mn spread unt
Slide 54: Redington Foundation
Redington Foundation Foundation for CSR @ Redington (Redington Foundation), a trust formed by Redington (India) Limited to implement various CSR activities towards the betterment of the society 38
Slide 55: Contact Us
CONTACT US Compliance Officer M. Muthukumarasamy Redington (India) Limited SPL Guindy House, 95 Mount Road, Guindy, Chennai 600 032 https://www.redingtongroup.com CIN - L52599TN1961PLC028758 Investor Contact Sowmiya M Senior Manager – Investor Relations sowmiya.manickam@redington.co.in IR Materials
Slide 56: Thank You
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