“Very Good” score in 2017 MC Group Public Company Limited from National CG Committee Q2 FY2018-2019 Results Summary A leading multi-brand apparel & lifestyle products retailer 18 February 2019 Financial performance in the years prior to the change of fiscal year from January-December to July-June, have been reclassified to the July-June period for management discussion and analysis purposes in this presentation.
DISCLAIMER The information contained in our presentation is intended solely for your personal reference only. In addition, such information contains projections and forward-looking statements that reflect our current views with respect to future events and financial performance. Financial performance in the years prior to the change of fiscal year from January- December to July-June, have been reclassified to the July-June period for management discussion and analysis purposes in this presentation. These views are based on assumptions subject to various risks and uncertainties. No assurance is given that future events will occur, that projections will be achieved, or that the our assumptions are correct. Actual results may differ materially from those projected. 1
AGENDA 01 02 03 Company Business Financial Overview Update Result 2
C O M P AN Y O V E R V I E W 1 3
Key milestones Extended Brand Portfolio Expanded Brand Expanded Expanded Expanded Started CRM Portfolio Brand Portfolio Brand Portfolio Brand Portfolio Premium & Kidswear Jeanswear Launched membership “Mc ” brand program Expanded to Women's’ Skin care Lifestyle Business “M&C” Jeans & Active wear Street wear “U - P” Topwear Acquired 51% in 1975 2005 2013 2015 2017 2008 2012 2016 2018 FY2019 Listed on the SET Integrated 1 st Mc Shop Launched Expanded to Revamped Expanded warehouse online website Middle East e-commerce to management Opened the first platform Myanmar solution for E- Free Standing Opened mcmc & Laos commerce outlet stores in PTT Shop gas stations Started as manufacturing Moving forward to become Onto managing brands Emerged as a leader in and selling through a leading apparel and distribution channels denim market in Thailand traditional trade and lifestyle products retailer 4
MC Group’s Structure MC Group PLC (“MC”) Lifestyle Business Retail platform Operation Production 99.9% 99.9% 99.9% 99.9% 99.9% 99.9% 99.9% P.K. Garment Mc Jeans Mc Look WoWme Winnerman MC Inter (Import- Manufacturing Jeanious Balance Limited Co., Ltd. Limited Export) Co., Ltd. Co., Ltd. Co., Ltd. (“WOWME”) (“WNM”) (“MCI”) Co., Ltd. (“MJM”) (“P K G”) • Online and Manage sales • omni channel force and management warehouse workforce for MC 51.0% 51.0% 55.0% 45.0% Time Deco Aromatique Mcmillion Top T 2015 Corporation Active (Thailand) Co., Ltd Co., Ltd. Co., Ltd. Co., Ltd. • Supplier of • Importer, • Develop innovative top wear retailer and skincare technology under distributor of products the brand “ McT ” famous int ’l watch brands 5
Management team 1 Mrs. Kaisri Nuengsigkapian • Chairman of the Board • Executive Chairman 2 Ms. Sunee Seripanu • Chief Executive Officer • Managing Director 4 3 Mr. Somchai Soongswang Mr. Virach Seripanu • Chief Commercial Officer • Chief Operations Officer Mr. Bundit Praditsuktavorn 5 Mr. Nopadol Tangdenchai 6 • Chief Financial Officer • Chief Information Officer Mr. Sakesan Serksiri 7 • Chief Supply Chain Officer 6
Overview Integrated retail business … Brand Retail platform Mc Store Poised to become a leading multi-brand apparel Integrated warehouse solution for e-commerce and lifestyle products retailer 7
B U S I N E S S U P D A T E 2 Financial performance in the years prior to the change of fiscal year from January-December to July-June, have been reclassified to the July-June period for management discussion and analysis purposes in this presentation. 8
Mc Jeans-denim Jeans market in Thailand From FY13-14 to FY16- 17, Mc’s denim sales grew with the market due to expansion and Total Jeans Market 55% marketing campaigns Size in Thailand 45% THB 21,000 MB FY17-18 and FY18-19 slower-than expected growth Premium and standard in 2018 due to jeans brands Source : Euromonitor one-time contraction from wholesale channel • 6.0% Others (Super Premium, Economy margin conservation strategy on the back of • CAGR Growth up to 2022 and non-brand) sluggish economy • Jeans is expected to post a retail value CAGR of Going forward 6% reaching THB 27,000 MB in 2022. • In 2018, Jeans market grew from promotion In light of expected recovery of the domestic economy, campaigns and ‘fast fashion denim’ segment in MC looks to: Bangkok “expand denim business and continue to • Jeans remain classic items in most people’s enhance 'Brand Equity’” wardrobes and are gaining popularity for enhanced comfortable and style. 9
Denim – Mc Jeans Selvedge Series have been introduced with unique identity and premium feature that denim people seek after… 10
Denim – Mc Jeans Selvedge denim are made out of narrow and tightly woven fabric with a clean look with edges of single red stripe… … 11
Non denim / Casual wear – Mc Jeans, U-P From FY13-14 to Y17-18, more product varieties were added particularly non-denim casual wear with high quality fabric as well as special techniques. 4-year CAGR of non denim/casual wear has been 7% • Total Apparel Market Size 5.0% in Thailand THB 310,000 MB in 2017 CAGR Growth up to 2022 Source : Euromonitor Going forward Continue growth of casual wear products by U-P activewear • Shirts, T-shirts and Jackets • Seasonal products • 12
Non denim / Casual wear – Mc Jeans, U-P The trend towards athleisure continues in Thailand… Teen lifestyle under ‘my Mc my best look’ concept… 13
Sport Casual- U-P Products and collections C O N C E P T Fun Energy Cool Minimal D E S I G N 2 nd Collection – March! 1 st Collection – Dec 18 Monochrome & Pastel Lover… 14
Lifestyle products – Mc Jeans From FY13-14 to FY17-18, lifestyle products growth with CAGR of 5% due to product assortments FY18-19 saw slight decline due to domestic • consumption and Chinese tourist contraction in certain periods Note :Other lifestyle products (accessories, skin care, watches) Going forward New collections of successful products • Limited edition and quantity • Content marketing e.g. product review by • micro influencer E-commerce • New kiosks with enhanced brand visibility • 15
Watch - timedeco Brand Portfolio Distribution channel expansion Shop Luxury Fashion Activities for smart watch introduction Brand concept Stores Lifestyle Fashion Terminal 21, Pattaya New kiosks with brand concepts • Social media marketing strategies to drive • exposure In-store promos continuously • 16
Watch- timedeco Distribution channel expansion www.timedeco.co.th Online/Home shopping Revamped timedeco.co.th website for more • efficiency in communication 17
Distribution channel - offline & online 1. Free Standing Shops 2. Modern Trade 3. Mobile Unit 4. International Markets Located mainly in Points of sales or sales Currently, expanded New sales channel that commercial centers or in counters in department through distributors with helps expand the reach the plaza sections of stores (both chain and presence in Myanmar, to customers as well as department stores as local non-chain) as well Laos and Middle-east. build brand recognition well as hypermarket and as hypermarket PTT gas station (Songkla, Pattani) (Lampang) POS as end of Dec 2018 2Q FY18-19 (Oct-Dec 18) Geographical Analysis of Outlets Geographical Analysis of Sales Free- Mobile Inter- Brand Standing Modern Total unit national Trade 279 511 6 14 810 23 23 19 75 94 Total 321 586 6 14 927 # POS Online 6 18
Distribution Channel for sales growth Offline channels: numbers adjusted to align with strategy Offline channels : numbers adjusted to align with strategy 810 783 746 733 737 658 554 20 20 18 23 8 2 109 104 94 93 94 79 FY12-13 FY13-14 FY14-15 FY15-16 FY16-17 FY17-18 FY18-19(6M) Time Deco mcmc Outlet Mc New opening for MC: >30 POS CAPEX: THB 80-100 mn. for POS Expansions (FY18-19) 19
Outlet channel - mcmc Newness… Community Store Variety of products and brands, suitable with all ages and genders End of season 50% - 70% discount of MC’s Affordability Quality products and others lifestyle products at affordable price DNA Convenience Located close to communities with parking space mcmc store presence NORTH TH 1. Gas station NORTHE THEAST AST WEST CENTRAL AL 2. Big box retailer EAST #Points of sales 27 3. Commercial SOUTH TH Jomtien Beach Pattaya, Chonburi (PTT Gas Station) building in local (end of Feb 19) communities 20
Omni channel/E-market place Omni channel sales growth +340% YoY (Jul-Dec) +35% QoQ Website traffic 9% contributed to all Ship to shop service* shipments in FY18-19 (Jul-Dec) *started on late-June 18 >5,000 SKUs Products offering product mix from MC Group and selected lifestyle product partners 21
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