INVESTOR PRESENTATION Q1 2007/08

Transcription

INVESTOR PRESENTATION Q1 2007/08
14 November 2007
AGENDA
> INTRODUCTION
> Henrik Theilbjørn, CEO
> Q1 2007/08 FINANCIALS
> Chris Bigler, CFO
> INWEAR PRESENTATION
> Thomas Ulstrup, Brand Director
> GENERAL DEVELOPMENT & CONCLUSIONS
A BRIEF ABOUT Q1…
> REVENUE UP BY 9% TO DKK 1,190 MILLION
> Planned later winter deliveries of DKK 45 million will be realized in Q2
> GROSS MARGIN UP BY 2.6%-POINT TO 60.9%
> Currency impact 2.3%-point
> EBIT UP BY 14%
> EBIT-margin up by 1%-point to 21.0%
> CONTINUING PROGRESS IN ALL CHANNELS OF DISTRIBUTION:
> Same-store growth of 15%
> Franchise growth of 22%
> 4.2%-point improvement in retail profitability
> 0.8%-point improvement in wholesale profitability
WE MAINTAIN OUR GUIDANCE FOR 2007/08…
> REVENUE GROWTH OF 12% - 15% TO DKK 3,750 – 3,850 MILLION
> EBIT GROWTH OF 30% - 40% TO DKK 440 – 480 MILLION (EBIT MARGIN 11.5% 12.5%)
> TOTAL INVESTMENTS OF DKK 150 – 170 million
> SHARE BUY BACK PROGRAMME OF DKK 200 MILLION
> Will start January 2008
STRONG ORDER INTAKE FOR AUTUMN, WINTER &
SPRING 2007/08…
Growth
Peak Performance
Tiger of Sweden
InWear
Jackpot
Matinique
Cottonfield
Part Two
By Malene Birger
Soaked in Luxury
Designers Remix Collection
Total own brands
Autumn, Winter
& Spring
2007/08
12 months
2006/07
12 months
2005/06
15%
38%
2%
-18%
22%
8%
9%
40%
13%
30%
13%
22%
5%
11%
-10%
16%
17%
14%
32%
9%
68%
12%
16%
31%
2%
0%
3%
18%
-1%
77%
12%
85%
11%
> Expected growth of 10% - 12% in order intake for Summer
2008
AGENDA
> INTRODUCTION
> Chris Bigler, CFO
INCOME STATEMENT Q1 2007/08
DKK million
2007/08
2006/07
Inde x
1,190
1,096
109
725
639
113
60.9%
58.3%
+2.6PP
(475)
(419)
113
39.9%
38.3%
+1.6PP
249
219
114
21.0%
20.0%
+1.0PP
(5)
(3)
176
Profit be fore tax
244
217
113
Income tax
(68)
(63)
109
Ne t profit
176
154
114
Re ve nue
Gross profit
Gross margin
OPEX
OPEX efficiency
Ope rating profit
EBIT margin
Net financials
REVENUE BY BRAND Q1 2007/08
DKK million
Peak Performance
Tiger of Sweden
InWear
Jackpot
Matinique
Cottonfield
Part Two
By Malene Birger
Saint Tropez
Soaked in Luxury
Designers Remix Collection
Total own brands
Q1 2007/08
Q1 2006/07
Growth
301
187
173
134
88
84
63
62
33
30
26
1,181
274
144
179
155
73
77
59
43
38
30
15
1,087
10%
30%
-4%
-14%
20%
9%
6%
45%
-14%
-1%
70%
9%
REVENUE BY MARKET Q1 2007/08
DKK million
Sweden
Denmark
Norway
Holland
UK and Ireland
Belgium
Finland
Germany
Switzerland
Canada
Poland
Spain
Austria
Russia
France
Other
Total own brands
Q1 2007/08
Q1 2006/07
Growth
268
212
115
92
64
63
58
57
44
36
29
22
20
17
16
68
1,181
250
184
96
99
64
54
54
52
40
31
23
28
19
26
15
52
1,087
7%
15%
20%
-7%
0%
17%
7%
10%
10%
16%
26%
-21%
5%
-35%
7%
31%
9%
REPORTING OF OUR DISTRIBUTION CHANNELS NOW
CORRESPONDS WITH UPDATED GROUP STRATEGY…
> RETAIL IS NOW LONGER ONLY WHOLESALE SUPPORT
> Retail now carries a proportional share of the cost related to product development and
brand building
> THE NEW COST ALLOCATION UNDERLINES THE VAST POTENTIAL IN RETAIL AND
THE ATTRACTIVENESS OF WHOLESALE
> Full Year 2006/07 Retail margin 8.5% (14.9% before change)
> Full Year 2006/07 Wholesale margin 16.6% (14.1% before change)
> INFORMATION AND COMPARABLE QUARTERLY DATA ARE AVAILABLE IN NOTE 6 TO
THE QUARTERLY REPORT
DISTRIBUTION CHANNELS Q1 2007/08
DKK million
Revenue
Growth
Distribution channel profit/(loss)
Distribution channel profit margin
Wholesale
Q1
Q1
2007/08
2006/07
Retail
Q1
Q1
2007/08
2006/07
Outlet
Q1
Q1
2007/08
2006/07
Group
Q1
Q1
2007/08
2006/07
894
5%
854
265
26%
211
31
0%
31
1,190
9%
1,096
253
28.4%
235
27.6%
22
8.3%
9
4.1%
10
33.6%
9
28.7%
285
24.0%
253
23.1%
(36)
(34)
249
21.0%
219
20.0%
Unallocated corporate costs*
Operating profit
EBIT margin
* Unallocated corporate costs comprise IT, finance, HR and general management.
BALANCE SHEET Q1 2007/08
30 June
2007
30 September
30 September
2007
2006
Total non-current assets
826
832
Inventories
430
375
Receivables and prepayments
824
812
Cash and cash equivalents
195
128
2,274
2,147
1,849
Equity
732
736
567
Non-current liabilities
203
205
Short Term Debt
721
594
Trade Payables
231
234
Other Debts
388
379
2,274
2,147
D KK milli on
Total as s ets
Total liabili ties and equity
Working capital adjusted for non-cash
items as a percentage of 12 month trailing
revenue
20.5%
19.9%
816
466
422
145
202
535
297
249
1,849
11.7%
CASH FLOW STATEMENT Q1 2007/08
30 September
30 September
2007
2006
Cash flow from operating activities
(115)
(148)
Cash flow from investing activities
(34)
(74)
Cash flow from financing activities
11
32
DKK million
Change in cash and cash equivalents
(137)
(190)
N et interes t- bearing debt
(694)
(642)
Committed credit lines
1,419
1,216
AGENDA
> INTRODUCTION
> Chris Bigler, CFO
InWear Presentation
Thomas Ulstrup Brand Director InWear
Copenhagen 14 November 2007
Agenda

InWear history
InWear today
InWear future
InWear the beginning – Niels Martinsen
The Myth and the Historical Meeting
Time: 1969
Place: Copenhagen, Local Music Club at Vesterbro
Problem:
In 1968 there was two kinds of wardrobe – adults & children.
Challenge:
To create fashion for modern women attracted to the cosmopolitan
life style.
Two people got together:
Niels Martinsen – 20 years old, trainee in a men’s wear shop – and the
young innovative designer Kirsten Teisner. Together they created
InWear.
1970’ies
Beige, soft and neat
At the same time as demand rose
at home, InWear became better
at marketing itself internationally.
This resulted in increased
production, volume and sales.
During the 1970s, the small
fashion brand quickly expanded
and established a professional
network of agents throughout
Europe.
1980’ies
Shoulder pads and peachcoloured blazers
By the mid-80s, InWear had its
own shop in New York City, five
shops
in California and one on London’s
Kings Road.
At that time, InWear’s models
included such names as Helena
Christensen.
1990’ies
Yuppie suits, black and white
InWear celebrates major success
with Renée Toft Simonsen as
figurehead in the ”Living is…”
campaign.
Increased competition results in
the company becoming more
attentive to consumer needs. The
1990s was the era when both
style and sales curves became
streamlined.
The 21st Century
Casual chic and classically stylish
Despite the fact that a great deal
has happened and changed since
the 1960s, the idea is still to
create fashion with feminine
appeal, quality with an edge and
style.
InWear Brand positoning from the beginning
”Dressed”/formal
The 21st Century
1990’ies
Young
Mature
1980’ies
1970’ies
Casual/relaxed
2006 – Status in InWear
•
•
•
•
A growth in the turnover with 8 – 15% the past years
Turnover increasing in all channels
Strong Retail KPI’s
Strong merchandise flow in the InWear collection
But
•
•
•
The product was going in the wrong direction to the Design philosophy
Missing senior people in key positions
Marketing and branding was zig zag the past years
2007/08 Order Intake
•
Combined growth of 2% in Autumn, Winter & Spring 2007/08
•
Country Specific Issues
– Holland
– Sweden
•
OTB special program
•
New design team
Agenda

InWear history
InWear today
Inwear future
What have we done the past year
•
Product - Full attention – The heart of our business
•
Building up a strong management team and team in InWear
•
Marketing and communication - Back on track on our brand values
•
International people in the HQ team
Product / Design – the heart of our business
the RIGHT CON-STRUC-TION
com-po-si-tion
easy-to-wear FABRICS
UPDATED classics
Back to our core design strenght
•
•
•
New Design Manager - Lene Borggaard
Product is driving the brand
Product = InWear image
International design team
Core brand values
Inspirational
Our brand is named In-Wear, because we're in fashion, in style and
like to in'spire women to dress more beautifully.
Attractive
Like all women InWear wants to be attractive. Not only in our fashion
degree, our lines of products and our shops, but also in the way we do
business, price levels, and last but not least the way we are, the way we
behave.
International
The Cosmopolitan influence
InWear is rooted in a cosmopolitan life style. We are inspired by the city's
design, architecture, art, books, music, magazines, colours, shopping, high
streets and people, the pulse, the energy and the possibilities of a
cosmopolitan life.
Change Collection structure – Step by step 2007 - 2010
60/40
Profile 20%
Core 55%
Basic 25%
90/10
Profile
Dressed
Casual
Core
Basic
Future
Today
Brand building
Create the total service and
innovative shopping experience
in all our InWear stores and
Wholesale partners
The store
The customer
Merchandise
Generate fashion authority
and clear fashion statements
- Through our products
Communication
Build up the InWear
brand attitude in all
our communication
and manner of behaving
Design philosophy
InWear is synonymous with
quality and style.
Our design is international and
contemporary.
We craft modern, wearable pieces
that mix and match to make
versatile collections.
Delicate details and fabulous fits
combine to create a seductive
feminine appeal.
Medium
Low
Price
High
Product positioning
Prada
Gucci
Dolce & Gabbana
Miu Miu
Marc Jacobs
Chloe
Marni
Donna Karan
Paul & Joe
Dries Van Noten
Hugo Boss
Sand
By Malene Birger
Isabel Marant
Burberry
Barbara Bui
Armani Collezioni
Cacharel
Strenesse
Ralph Lauren
Sand
Tommy Hilfiger
Armani Collezioni
Ralph Lauren
Mulberry
Caractere
Gant
Donaldson
Escada
Laura Ashley
Marella
Marina Rinaldi
Phillip Lim
Vanessa Bruno
Baum und
Pferdgarden
Patrizia Pepe
Acne
Diesel
J. Lindeberg
Filippa K
Tiger of Sweden
Qui Set
Turnover
Whistles
Marco Polo
Noa Noa
Part Two
French Connection
Mexx
Esprit
RedGreen
Jackpot
Signal
Coast
Benetton
Betty Barclay
Basler
Gerry Weber
Rosner
Kriss
Lucia
Bison
Miss Selfridges
Bershka
Topshop
Only
Zara
Oasis
Mango
River Island
Street One
EDC
H&M
S. Oliver
Jane Norman
Saint Tropez
B-Young
Vera Moda
Gap
Old Navy
Sandwich
M&S
C&A
Advanced
Max & Co
Bruuns Bazaar
Day et Mikkelsen
Karen Millen
Modern
Updated
Lifestyle
Classic
Traditional
30 countries - 1500 selling points and 119 stores/shops
Ecommerce live from the 2nd November 2007 – 2 weeks old
06/07 Real
07/08 Est.
08/09 Est.
Retail
Wholesale/Franchise
38 %
42 %
45 %
62 %
56 %
51 %
E commerce
0%
2%
4%
Strategy – distribution
•
Add new customers on all our markets
•
Higher wholesale penetration in central europe and Capital cities
•
Grow with concept / franchise
•
Grow with retail/ concessions – Scandinavian focus this year
•
Develop main markets with new distribution in acc. and Apparel
InWear collection structure
Collection structure
4 main collections yearly
23 deliveries pr year
We offer 23 deliveries a year in drops every 14 days to
increase sell through and to ensure good stock turn
The OTB concept
To increase sell-through and improve stock turn, InWear
offers 4 different open to buy concepts available from stock
each season
In-stock:
Basics seasonal and non seasonal colours
Catch – up: Bestsellers and new fashion collection
Repeat:
Stock products bulked from estimated bestsellers
Specials:
Any needs from specific countries
Agenda

InWear history
InWear today
Inwear future
Segment focus – clear focus
Basic options for InWear
Up scale
1
‘Trading
up‘
Future
Price Level
2
Differenti
ation
InWear
future
Selective trading up
and sharpening
profile by clear
focus on target
segments.
- In product
Discounting
- branding
3
‘Downmarket‘
Wide
focus
Todays Positioning
Segment - Focus
Narrow
Focus
Future positioning
Future market opportunity and objectives for InWear
InWear has identified an enormous market opportunity throughout
The international market
–
Strong growth on existing markets
–
Build up a strong retail and franchise business in all our main markets
–
Create a collection structure with a wider price and fashion range to support InWear’s
internationalisation to the next level
–
Enter and build up Accessories lines
Accessories are an exclusive way to express a strong brand image.
It is not a fast moving category, it is a way to align the brand
position in the market and make a clear fashion statement, which
can live and grow for many years, without changing the
collection and look a lot……………….
The accessories category has doubled the turnover from 05/06 – 06/07
InWear’s growth and internationalization will continue
Supported by :
• New shop concept
• International fair plan
• Retail and franchise openings
•
Accessories lines
AGENDA
> INTRODUCTION
> Chris Bigler, CFO
JACKPOT – UPDATE
> SPRING 2008 ORDER INTAKE DOWN BY 17%
> Jackpot is still losing selling points (net), but in a declining pace
> Spring 2007 → Fall 2007 Down by 130 Selling Points (net)
> Fall 2007 → Spring 2008 Down by 26 Selling Points (net)
> Order intake for Summer 2008 is promising
> AND THE STRONG JACKPOT RETAIL PERFORMANCE CONTINUES
> 8 consecutive months of double digit same-store growth
> Q1 2007/08 same-store growth of 37%
> Jackpot has 6,000 retail square meters
RETAIL ACADEMY – DOES IT WORK?!
> SO FAR 40% OF ALL RETAIL SHOPS TRAINED
> THE TRAINING SESSIONS ARE VERY POSITIVELY RECEIVED ACROSS
BRANDS AND MARKETS
> WE ARE SEEING SIGNIFICANT IMPROVEMENT IN KPI’S
> Especially in hit rate, which is up by 2 - 5%-points
> But, also in items per transaction, average price and basket size
> ALSO FRANCHISE PARTNERS WANT THE TRAINING
MISCELLANEOUS…
> LEADERSHIP ACADEMY PROCEEDING
> The first 20 participants have provided exceptionally positive feedback
> NEW COUNTRY MANAGER IN HOLLAND
> E – COMMERCE LAUNCH
> InWear – 2 November 2007
> Tiger of Sweden – Start December
> And more brands to follow…
15/15 IS OUR GOAL…
> OUR MISSION
> WE BUILD SUCCESSFUL INTERNATIONAL FASHION BRANDS
> OUR VISION
> WE WANT TO BE THE BEST OWNER AND BUSINESS SUPPORT FOR
INTERNATIONAL FASHION BRANDS
> OUR GOAL
> NO LATER THAN OVER A PERIOD OF THREE TO FIVE YEARS, THE TARGET OF IC
COMPANYS IS TO CREATE A GROUP THAT ANNUALLY ACHIEVES A MINIMUM OF
15% ORGANIC GROWTH AND AN EBIT MARGIN OF MINIMUM 15%
Q1 WAS A STEP IN THE RIGHT DIRECTION…
Category
FY Guidance
Q1 development
Preorder
11 – 13%
13% growth in order intake for 3 out of 4 Collections. Expected growth of 10% – 12% in last.
OTB
(In-Season-Sales)
10 – 13%
OTB Growth of 5%in Q1
Franchise
15 – 30%
Franchise growth of 22% in Q1
Retail
11 – 15%
Retail growth of 26% in Q1
Outlet
0 – 5%
0% growth in Outlet in Q1
Q&A