Company Presentation. Karsten Odemann, CFO. Munich, 19 September Baader Investment Conference

Transcription

1 Company Presentation Karsten Odemann, CFO Munich, 19 September

2 Investment Summary: ADLER Modemärkte is well positioned to face short-term challenges and lift mid- to long-term potentials Assets Growing target group 45+ Very loyal customer base (90% of sales generated via customer card) Own brands as strong USP Lean and integrated business model Solid network of 180+ stores Sound balance sheet to finance future growth Potential Numerous internal and external growth opportunities New marketing campaign started in September 2017 Online-shop expansion Significant cost efficiency and profitability improvements Substantial improvements already achieved in H on all business levels 2

3 Unique brand positioning with strong target group focus 45+ Brand positioning of ADLER Unique brand position Upper Middle Discount Value Outstanding value-for-money perception Fashion follower approach conservative fashion grade management of market proven styles minimizing fashion risk Excellently positioned in the attractive fast growing value fashion segment and above the vulnerable discount segment low Fashion degree high Source: Company information 3

4 Great popularity of ADLER Customer Card reflects high loyalty and supplies ADLER with detailed customer insight Which customer cards of textile retailers do you use on a regular basis? 7% 7% ADLER Esprit 3.8 million active ADLER Customer Card members -> wide customer database 4% 4% 3% 2% 2% 2% 1% 1% 1% 7% Peek&Cloppenburg s.oliver Takko Ernsting`s Family Charles Vögele Wöhrl Tom Tailor Orsay Ulla Popken Bonita ~ 40,000 new Customer Cards every month 90% of revenues generated via Customer Card Best in class: ADLER Customer Card classified best out of 24 loyalty card schemes* Focused and efficient marketing opportunities: loyalty card scheme allows exact market segmentation and a targeted marketing approach High profitability of ADLER card customers: high acceptance of ADLER customer card enables steering of customer frequency and cash flows Source: Statista / nhi2; 1,005 participants; 2013 Source: *Finanztest (2010) 4

5 Potential for internal growth through expansion of ADLER online-shop Revenue: CAGR of 28.3% in the last three years (2016: 8.9 million) Roundabout 9.4 million visitors in ,000 buying clients in 2016 Average size of shopping cart increases constantly (2016: 80.7) 9 direct ecommerce employees > 60 employees work indirectly for service providers for ADLER ecommerce Constantly 5,500 items online Meanwhile 35% of customers reached via mobile devices Continued dynamic growth for 2017 expected (H1-2017: + approx. 30 %) Targets: Organic growth to 50 million online sales within the next five years -> equivalent to 10% of total sales 5

6 Phase of consolidation continues in 2017 Further mid- to long term potential Number of ADLER stores per country Regional presence and potential for expansion Markt entry Number of stores Germany Austria Luxembourg Switzerland Total Organic openings Acquisitions Closings / sales Net difference Targets Short-term focus on investment discipline: only 1 organic store opening planned for 2017 after 7 stores in 2016 (6 stores net) Focus on large formats such as retail centers and stand-alone markets with a retail space of > 1,400 m² Focus on DACH region and Luxembourg (optimisation and consolidation of existing store network) 6

7 ADLER is very successful in addressing the difficult market environment 7

8 Continued difficult environment: textile market in massive transition Spendings on clothes have been decreasing for years in absolute as well as relative terms Structural change enforced by online shopping, accompanied by aggressive expansion policy of large players Aggressive expansion policy of large players puts massive pressure on their profits Absolut spendings on clothes per head in 2015 Spendings as percentage of net household income At the same time, retail space per head is growing constantly 8

9 Key Facts H Efficiency measures bear fruit Expected slight drop in revenue; like-for-like revenue in line with industry Significant EBITDA growth to 10.2 million from 0.7 million in H due to improved profitability and non-recurring effect Working capital reduced markedly thanks to improved cash flow management Positive free cash flow of 8.0 million (up more than 16 Mio. compared to H1 2016) Outlook for 2017 confirmed Event after the end of the reporting period Thomas Freude appointed as new CEO with effect of 11 September

10 EBITDA boosted by improved operative performance and non-recurring effect from real estate transaction in m -1, EBITDA H Operative Performance Non-recurring effect from real estate transaction Non-recurring effect from personnel restructuring EBITDA H

11 Rock solid balance sheet structure - successful cash management in m 30 June June Dec 2016 Change Total assets % Working Capital 54,8 44,2 50,7-19,3% Free Cashflow -8,2 8,0 11,4 +>100% Cash position % Equity % Equity ratio 39.5% 41.1% 42.8% +160 BP 11

12 H1-2017: Cost saving- and efficiency program on track further potential with focus on purchase and value chain optimisation Personnel restructuring largely completed, head count reduction of ~8% or almost 350 employees: Substantial positive impact on cost structures in H Full-year savings in personnel expenses of more than 6 million All other efficiency measures fully in line with schedule Re-adjustments where necessary Substantial additional savings potential with medium- to long-term impact: Optimisation of purchase agreements Renegotiation of logistic contracts initiated 12

13 New ADLER Brand Campaign 2017 started in September 2017 Target Increase of footfall and revenue through Activation of existing clients New client wins Add emotions to the brand by linking it with appealing content ( Great appreciation of and compliments for our clients ) Boost brand awareness Implementation Focus on ADLER`s core brand value Mode ist für Menschen da ( Fashion is for people ) Deployment of authentic, charismatic self-confident people (instead of models) 360-degree-implemenation across all channels (TV, Mailings, Digital, PoS) Adressing of clients and employees at the same time 13

14 Forecast FY 2017 confirmed: substantially higher profitability despite continued market weakness Revenue Revenue slightly below prior-year level Revenue generated online Significant increase Gross profit margin Slight increase Personnel expenses Slight decrease Transport and logistics costs EBITDA Slight increase million plus non-recurring effect which cannot yet be quantified yet Free Cash Flow At least level with 2016 Expansion 1 store opening in

15 The ADLER Value Added! With its strong brand, market position and growth opportunities ADLER simultaneously offers value and growth potential and is therefore unique within the fashion and textile industry! 15

16 BACKUP 16

17 Update on real estate transactions Real estate portfolio under lease (exp. 30 April 2017) bought out at purchase price of 1.3 million Klagenfurt* Salzburg Vösendorf Ansfelden Klagenfurt St. Pölten (formerly owned) *not used as ADLER store GBS Sold to retailer with effect from 1 April 2017 Vösendorf Salzburg Ansfelden Liquidity generated enabled ADLER to acquire GBS Grundstücksverwaltungsgesellschaft m.b.h. with effect from 3 May 2017; purchase price: 6.7 million Sales revenue: 9 million, 7.5 million recognized as non-recurring effect in Q2 Resale to strategic investor pending; additional positive effect on EBITDA expected within the upcoming quarters 17

18 Shareholding Chain Steilmann Holding AG 89.09% G. & C. Holding S.r.l. Equinox Two S.C.A Steilmann SE 33% 67% 100% STB Fashion Holding GmbH Excalibur I S.A % S&E Kapital GmbH 52.81% 43.93% 18