Myer Holdings Limited · ASX:MYR
Myer — H1 2023 Earnings Presentation
31 slides from Myer's earnings presentation, Mar 9, 2023
Slide 1: Half Year 2023 Results: Momentum Sustained in 1H23
9 March 2023 HALF YEAR 2023 RESULTS MOMENTUM SUSTAINED IN 1H23 – PROFITABLE SALES GROWTH WITH NPAT INCREASING 101% For personal use only • RECORD1 1H SALES OF $1,884.9 MILLION, GROWTH 24.2% YOY; 17.2% HIGHER THAN 1H20 (PRE-COVID) • NPAT OF $65.0 MILLION, HIGHEST SINCE 1H14 • NET CASH UP $50 MILLION
Slide 2: Customer First Plan Update
CUSTOMER FIRST PLAN UPDATE Strength of the omni-channel offer is driving earnings momentum • Strong total sales2 growth of 24.2% led by a return to physical retail, with the prior corresponding period impacted by lockdowns in Q1, and Omicron in Q2 • CBD stores were the strongest channel increasing 5
Slide 3: Investor and Analyst briefing
Investor and Analyst briefing Myer’s CEO and Managing Director John King and CFO Nigel Chadwick will host a teleconference for investors and analysts today at 9.30am (Melbourne time). Participants can register for the conference by clicking here. Attendees will need to have the attached slides avail
Slide 4: Half Year 2023 Results to January 2023
For personal use only MYER HOLDINGS LTD HALF YEAR 2023 RESULTS TO 28 JANUARY 2023 JOHN KING NIGEL CHADWICK Chief Executive Officer Chief Financial Officer
Slide 5: Important Information
Important Information For personal use only The information in this document is Investors and potential investors should make their own Subject to law, Myer assumes no obligation to update, assessment and take independent professional advice review or revise any information contained in this general
Slide 6: Agenda
For personal use only Agenda 1H23 Highlights 1H23 Financial Results Customer First Plan Conclusion Appendices MYER HOLDINGS LTD
Slide 7: Financial Highlights
Financial Highlights For personal use only STRO N G RO B U ST S I GN I F IC ANTLY ST RO N GER R E WA RDING SA L ES GROW TH O M N I -C HA NNEL I M PROV ED N PAT BA L A N CE S H E E T S H A R E H OLDERS 1H23 HIGHLIGHTS 24.2% 20.3% $65.0m $267m 8.0c net cash per share Total sales1 Group online3 sales m
Slide 8: Record 1H sales with in-store sales returning
Record 1H sales with in-store sales returning, including strong CBD For personal use only store growth and robust omni-channel offer 1 H T O TA L S A L E S 1 G R O W T H T O TA L S A L E S 1 G R O W T H B Y C H A N N E L C O M PA R A B L E S A L E S 3 In-store 37.3% In-store 10.6% +5.4% CAGR +24.2%
Slide 9: Strong online presence underpins omni-channel capabilities
Our strong online presence continues to underpin our omni- For personal use only channel capabilities and point of difference in market GROUP ONLINE1 SALES GROWTH ($M) MYER ONLINE2 PERFORMANCE METRICS 1H19-23 +31.5% 1H19 1H20 1H21 1H22 1H23 Change CAGR -9.8% 424 Visitor Traffic 52.3m 69.3m 85.9m 104
Slide 10: MYER one continues to drive our growth story
MYER one continues to drive our growth story delivering a leading For personal use only retail customer loyalty proposition 7.0m The program is one of Australia’s 402k Acquisition continues to increase Digitally contactable largest retail loyalty programs New Members dramatically, particularly a
Slide 11: Profitable sales growth leads to best 1st half NPAT since 1H14
Profitable sales growth under the Customer First Plan has led to For personal use only the best 1 st half NPAT 1 result since 1H14 N PAT 1 $ M DPS $c Pre AASB 16 Post AASB16 1H23 HIGHLIGHTS 65 8.0 41 40 43 5.0 5.0 32 4.0 1H19 1H20 1H21 1H22 1H23 FY16 FY17 FY18-FY21 FY22 1H23 Strong sales momentum
Slide 12: Building a more resilient and balanced business
Building a more resilient and balanced business For personal use only Building stronger customer value Less reliance on Christmas and loyalty through MYER one, peak, improving spread partnerships and points plus pay across the calendar through greater frequency of These assets drive acquisitio
Slide 13: Myer has emerged from the pandemic stronger on all key metrics
Myer has emerged from the pandemic stronger on all key metrics, For personal use only underpinned by our Customer First Plan GROUP ONLINE1 SALES ($M); % OF CLEARANCE INVENTORY3 IN-STORE SALES PRODUCTIVITY2 P E N E T R AT I O N ( % ) O F T O TA L 20% +16% -490bps 1H23 HIGHLIGHTS 11% 382 13% 8% 168 1H
Slide 14: Agenda
For personal use only Agenda 1H23 Highlights 1H23 Financial Results Customer First Plan Conclusion Appendices MYER HOLDINGS LTD
Slide 15: NPAT increased 101.4% over 1H22
NPAT increased 101.4% over 1H22 For personal use only $ MILLIONS 1H23 1H22 C H A N GE D E PA R T M E N T S T O R E S Total Sales1 1,884.9 1,517.4 24.2% Operating Gross Profit 683.2 582.2 17.4% 1H23 FINANCIAL RESULTS 23.7% Cost of Doing Business (442.5) (375.4) (17.9%) $439m EBITDA 240.7 206.8 16.4%
Slide 16: Operating Gross Profit
Operating Gross Profit For personal use only O P E R AT I N G G R O S S P R O F I T $ M a n d % t o S A L E S OGP Margin % OGP $m var LY 39.16 +101m 800 38.61 38.37 40 36.25 Sales Volume +143 • Increased sales volume 1H23 FINANCIAL RESULTS 750 35 700 650 30 600 Mix -6 • Increase in Concession sales
Slide 17: Cost of Doing Business Margin improved by 126bps
Cost of Doing Business Margin improved by 126bps For personal use only COST OF DOING BUSINESS $M and % to SALES CODB Margin % CODB $m var LY 650 25.58 26 • 1Q22 (prior year) impacted by 24.74 25 government lockdowns 1H23 FINANCIAL RESULTS 600 Normalisation of 23.26 23.48 24 +26 • Additional store co
Slide 18: Operating Cash Flow
Operating Cash Flow For personal use only $ MILLIONS 1H23 1H22 Strong growth in operating cash flow (before interest & tax); favourable cash EBITDA 240.7 206.8 conversion Working capital movement 57.1 45.5 CAPEX increase reflects investments in key projects including the National Distribution Ce
Slide 19: Balance Sheet
Balance Sheet For personal use only $ MILLIONS 1H23 FY22 1H22 Held inventory flat on corresponding prior period, even though sales 24% Inventory 383.6 371.4 383.2 higher; supply chain challenges successfully navigated Newness of inventory continues to improve Creditors (495.8) (429.3) (499.8) 1H
Slide 20: Strong liquidity position – Net cash for entire 1H trading period
Strong liquidity position – Net cash for entire 1H trading period For personal use only NET CASH / (DEBT) $M – 1H19 TO 1H23 +$229m Remained in a net cash position for 1H23; first time since ASX listing ABL (Asset Based Loan) announced Nov-21, provides an appropriate 1H23 FINANCIAL RESULTS struct
Slide 21: Agenda
For personal use only Agenda 1H23 Highlights 1H23 Financial Results Customer First Plan Conclusion Appendices MYER HOLDINGS LTD
Slide 22: Customer First Plan progress
Customer First Plan progress means Myer is well placed to drive For personal use only significant value creation for all shareholders A C C E L E R AT E FA C TO R Y TO IN-STORE RE-FOCUS R AT I O N A L I S E P R O P E R T Y ONLINE CUSTOMER EXPERIENCE MERCHANDISE / OVERHEADS Built large scale busine
Slide 23: Country Road Group returns to Myer
Country Road Group returns to Myer For personal use only CUSTOMER FIRST PLAN Provides a significant opportunity given sales of $70 million in FY19 which was a significantly smaller offer (not inclusive of Country Road Kids and Home, Witchery and Trenery brands which are in the new agreement). We
Slide 24: MYER one Rewards and Pay with Points program
Our MYER one Rewards and Pay with Points program uniquely For personal use only positions us to deliver more value for customers New partner added to Points Plus Pay program: American Express members are now able to redeem points on Myer online1 CUSTOMER FIRST PLAN The combined reach and access
Slide 25: Focus – we continue to invest in our stores and our people
Focus – we continue to invest in our stores For personal use only and our people Sales productivity up +16% vs 1H20 New Point of Sale hardware and Continued roll-out of new brands software rollout to be completed during CUSTOMER FIRST PLAN including American Eagle, Aerie and the 2H23; deliveri
Slide 26: Agenda
For personal use only Agenda 1H23 Highlights 1H23 Financial Results Customer First Plan Conclusion Appendices MYER HOLDINGS LTD
Slide 27: Current Trade Update
Current Trade Update For personal use only Trading continues to build on the momentum seen in 2022 across our omni-channel network The eight weeks since Christmas has seen sales1 increase by 16.1% over the corresponding period CONCLUSION SALES1 GROWTH 8 weeks post Christmas +16.1% FY22 FY23 M Y
Slide 28: Conclusion
Conclusion For personal use only Our Customer First Plan has been, and continues to Updated trading for calendar 2023 remains be, the right Plan and has underpinned our growth strong albeit we are cautious of potential and momentum in 1H23 macroeconomic headwinds Delivered strong sales growth u
Slide 29: Agenda
For personal use only Agenda 1H23 Highlights 1H23 Financial Results Customer First Plan Conclusion Appendices MYER HOLDINGS LTD
Slide 30: Appendix 1: Income Statement – post AASB
Appendix 1: Income Statement – post AASB 16 For personal use only $ MILLIONS 1H23 1H22 CHANGE Total Sales1 1,884.9 1,517.4 24.2% Operating Gross Profit 683.2 582.2 17.4% Cost of Doing Business (442.5) (375.4) 17.9% APPENDICES EBITDA 240.7 206.8 16.4% Depreciation (101.1) (110.1) (8.2%) EBIT 139.6 96
Slide 31: Appendix 2: Income Statement – AASB impact
Appendix 2: Income Statement – AASB 16 impact For personal use only 1H23 AASB 16 1H23 1H22 CHANGE $ MILLIONS (STATUTORY) IMPACT (PRE-AASB 16) (PRE-AASB 16) (PRE-AASB 16) Total Sales1 1,884.9 - 1,884.9 1,517.4 24.2% Operating Gross Profit 683.2 (0.3) 682.9 581.9 17.4% Cost of Doing Business (442.5) (