FINANCIAL HIGHLIGHTS Ted Baker Plc Half Year Results Presentation - - PowerPoint PPT Presentation
1 FINANCIAL HIGHLIGHTS Ted Baker Plc Half Year Results Presentation 28 weeks ended 11 August 2018 11 AUG 12 AUG 2018 2017 VAR M M % Group sales revenue 306.0 295.7 3.5 Profjt before tax and exceptionals 25.0 24.2 3.5 Profjt
Ted Baker Plc Half Year Results Presentation 28 weeks ended 11 August 2018 1
AUTUMN WINTER 2018
11 AUG 2018 £M 12 AUG 2017 £M VAR % Group sales revenue 306.0 295.7 3.5 Profjt before tax and exceptionals 25.0 24.2 3.5 Profjt before tax 24.5 25.3 (3.2) Adjusted EPS 43.8p 41.7p 5.0 Basic EPS 42.8p 43.6p (1.8) Interim dividend 17.9p 16.6p 7.8
Ted Baker Plc Half Year Results Presentation 28 weeks ended 11 August 2018 2
11 AUG 2018 £M 12 AUG 2017 £M VAR % CONSTANT CURRENCY VAR % Retail 220.1 217.7 1.1 2.9 Wholesale 85.9 78.0 10.1 12.8 SALES REVENUE 306.0 295.7 3.5 5.5 Licence income 10.9 9.7 11.7 TOTAL INCOME 316.9 305.4 3.7 – Retail sales up 1.1% to £220.1m (2.9% in constant currency), on an average square footage increase of 5.5%. Unseasonable weather and challenging external trading conditions particularly in the UK have impacted performance – Wholesale sales up 10.1% (12.8% in constant currency) to £85.9m with a good performance from our UK business, a strong performance from our North American business and the earlier timing
– Licence income increased by 11.7% to £10.9m with both territorial and product licences performing well
AW18 MENSWEAR
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11 AUG 2018 £M % OF SALES 12 AUG 2017 £M % OF SALES VAR % Womenswear 191.3 62.5 177.4 60.0 7.8 Menswear 114.7 37.5 118.3 40.0 (3.0) SALES REVENUE 306.0 100.0 295.7 100.0 3.5 – Womenswear was positively received with sales up 7.8%, representing 62.5%
– The growth in the womenswear mix refmected the increased mix of online sales, where womenswear represents a higher proportion of sales – Menswear sales were down 3.0% impacted by challenging trading conditions within our UK business, representing 37.5% of total sales
AW18 WOMENSWEAR
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UK & EUROPE 11 AUG 2018 £M 12 AUG 2017 £M VAR % CONSTANT CURRENCY VAR % Retail 147.1 145.6 1.0 0.7 Wholesale 54.9 50.0 9.8 9.8 Sales Revenue 202.0 195.6 3.3 3.1 NORTH AMERICA Retail 61.8 60.7 1.8 8.1 Wholesale 31.0 28.0 10.7 18.0 Sales Revenue 92.8 88.7 4.6 11.3 REST OF WORLD Retail 11.2 11.4 (1.8) 1.8 Wholesale
11.2 11.4 (1.8) 1.8 GROUP UK & Europe 202.0 195.6 3.3 3.1 North America 92.8 88.7 4.6 11.3 Rest of World 11.2 11.4 (1.8) 1.8 Sales Revenue 306.0 295.7 3.5 5.5 – In the UK & Europe retail sales increased 1.0% (0.7% in constant currency) to £147.1m (2017: £145.6m) despite challenging trading conditions. The wholesale business increased 9.8% to £54.9m (2017: £50.0m). This refmected a good performance from sales to trustees – In North America, sales from our retail division increased 1.8% (8.1% in constant currency) to £61.8m (2017: £60.7m) driven by our continued
10.7% (18.0% in constant currency), to £31.0m (2017: £28.0m) refmecting a strengthening relationship with key trustees – Across the Rest of World, sales decreased 1.8% (increased 1.8% in constant currency) to £11.2m (2017: £11.4m). We continue to refjne and develop our strategy for success in this market
* Rest of World includes: Asia and Africa
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UK & EUROPE 11 AUG 2018 £M 12 AUG 2017 £M VAR % CONSTANT CURRENCY VAR % Stores 104.5 110.9 (5.8) (6.2) E-commerce 42.6 34.7 22.8 22.9 Retail revenue 147.1 145.6 1.0 0.7 Sales per sq ft £395 £439 (10.0) (10.4) Average sq ft 264,393 252,484 4.7 REST OF WORLD 11 AUG 2018 £M 12 AUG 2017 £M VAR % CONSTANT CURRENCY VAR % Stores 9.5 10.3 (7.8) (3.5) E-commerce 1.7 1.1 54.5 50.4 Retail revenue 11.2 11.4 (1.8) 1.8 Sales per sq ft £313 £341 (8.2) (4.4) Average sq ft 30,351 30,053 1.0 NORTH AMERICA Stores 53.1 53.8 (1.3) 4.6 E-commerce 8.7 6.9 26.1 35.8 Retail revenue 61.8 60.7 1.8 8.1 Sales per sq ft £416 £457 (9.0) (3.5) Average sq ft 127,599 117,776 8.3 GROUP Stores 167.1 175.0 (4.5) (2.7) E-commerce 53.0 42.7 24.1 25.7 Retail revenue 220.1 217.7 1.1 2.9 Sales per sq ft £396 £437 (9.4) (7.8) Average sq ft 422,343 400,313 5.5 – In the UK & Europe, retail sales increased despite the unseasonable weather and tough trading conditions where trade has been impacted by the well publicised challenges facing some of our trading partners – E-commerce sales increased, demonstrating how e-commerce sales are an integral part of the retail proposition in the UK and European markets – In North America, retail sales growth was driven by continued expansion and a strong performance from our e-commerce business – In Rest of World, we continue to refjne and develop our strategy for success in this market
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11 AUG 2018 % 12 AUG 2017 % VAR POINTS Retail 64.2% 65.6% (140bps) Wholesale 43.4% 40.2% 320bps Group 58.3% 58.9% (60bps) – Retail gross margin fell by 140bps to 64.2% (2017: 65.6%) as a result of a measured increase in promotional activity in response to challenging external trading conditions – Wholesale gross margin increased by 320bps to 43.4% (2017: 40.2%) refmecting a higher mix of sales to trustee partners which carry a higher margin compared to retail licence partners and some foreign exchange benefjt – Composite gross margin decreased to 58.3% (2017: 58.9%)
Retail Gross Margin Wholesale Gross Margin Group Gross Margin
15-Aug-15 Gross margin %
70 65 60 55 50 45 40
11-Aug-18 9-Aug-14 13-Aug-16 12-Aug-17
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11 AUG 2018 £M 12 AUG 2017 £M VAR % Revenue 306.0 295.7 3.5 Gross profjt 178.5 174.1 2.5 Gross margin 58.3% 58.9% (60bps) Operating expenses (162.7) (159.3) (2.1) Licence income 10.9 9.7 11.7 Other operating income 0.0 0.7 (94.1) OPERATING PROFIT BEFORE EXCEPTIONAL ITEMS 26.7 25.2 6.0 % of revenue 8.7% 8.5% 20bps Net fjnance expense (2.0) (1.2) (65.5) Share of joint venture profjt 0.3 0.2 55.0 PROFIT BEFORE TAX AND EXCEPTIONAL ITEMS 25.0 24.2 3.5 Exceptional items (0.5) 1.1 (150.3) PROFIT BEFORE TAX 24.5 25.3 (3.2)
UKRAINE: OCEAN PLAZA KIEV
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* Distribution and administrative costs exclude depreciation, payroll, bonus and exceptional items
– Distribution costs increased by 1.3% and as a percentage of sales were 25.7% (2017: 26.6%). The decrease refmects the variable elements of costs in our business model – Administrative costs remained level on last year and as a percentage of sales were 5.8% (2017: 6.0%). This decrease was a result of a measured and controlled approach to multiple cost saving initiatives across central functions – Dual running costs in respect of IT systems were £1.3m (2017: £1.2m). We would expect further costs of £1.1m in the second half
TED BAKER: COLOUR BY NUMBERS
11 AUG 2018 £M 12 AUG 2017 £M VAR % CONSTANT CURRENCY VAR % Distribution costs* (79.8) (78.8) (1.3) (2.5) Administrative costs* (17.7) (17.7) (0.0) (1.9) Depreciation (12.9) (12.3) (4.9) (7.1) Payroll (52.3) (50.5) (3.6) (5.5) Performance related bonus
(162.7) (159.3) (2.1) (3.7) Operating exp as a % of sales 53.1% 53.9% 80bps
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11 AUG 2018 £M 12 AUG 2017 £M VAR £M Cash generated from operations* 37.8 38.7 (0.9) Working capital movement (13.9) (22.8) 8.9 Interest paid (1.8) (1.5) (0.3) Income taxes paid (5.7) (6.3) 0.6 TOTAL 16.4 8.1 8.3 Capital expenditure (18.5) (19.1) 0.6 Repayment of term loan (3.0) (3.0)
(19.4) (17.2) (2.2) Other 0.1 0.6 (0.5) Net decrease in cash (24.4) (30.6) 6.2 Opening net cash (59.3) (36.7) (22.6) Exchange rate movement 0.5 (0.1) 0.6 Closing net cash (83.2) (67.4) (15.8) – The net decrease in cash and cash equivalents of £24.4m (2017: £30.6m) primarily refmected an increase in working capital, further capital expenditure to support our long-term development and the payment of the full year dividend
£19.1m) comprised the costs of opening and refurbishing stores, concessions and
investment in business-wide systems to support our continued growth. We expect full year capital expenditure to be in line with previous guidance
planned openings
*Excluding working capital movement, interest paid and income taxes paid
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11 AUG 2018 £M 12 AUG 2017 £M VAR £M ASSETS Intangible assets 37.2 29.8 7.4 Property, plant & equipment 145.3 145.3
208.2 176.4 31.8 Trade & other receivables 65.4 65.9 (0.5) Cash & equivalents 19.2 18.0 1.2 Other assets 9.1 11.2 (2.1) TOTAL ASSETS 484.4 446.6 37.8 LIABILITIES Trade & other payables (85.3) (85.5) 0.2 Income tax payable (9.0) (9.2) 0.2 Overdraft (102.4) (85.4) (17.0) Term loan (49.5) (55.5) 6.0 Other liabilities (3.3) (3.2) (0.1) TOTAL LIABILITIES (249.5) (238.8) (10.7) NET ASSETS 234.9 207.8 27.1 Cash & equivalents 19.2 18.0 1.2 Overdraft (102.4) (85.4) (17.0) NET CASH (83.2) (67.4) (15.8) – Total working capital, which comprises inventories, trade and other receivables and trade and other payables, increased by £31.3m to £188.2m (2017: £156.9m). This was primarily driven by an increase in inventories of £31.8m to £208.2m (2017: £176.4m) refmecting the projected growth of our business, some earlier phasing of stock deliveries between the fjrst and second half of the year and, to a lesser extent, the impact of the movement in foreign exchange rates – Trade and other receivables decreased by £0.5m to £65.4m (2017: £65.9m) and trade and other payables decreased by £0.2m to £85.3m (2017: £85.5m)
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CAPITAL EXPENDITURE BY REGION 11 AUG 2018 £M 12 AUG 2017 £M VAR £M UK & Europe 6.0 8.0 (2.0) North America 3.0 2.7 0.3 Rest of World 0.2 1.2 (1.0) Central 9.5 7.5 2.0 TOTAL 18.7 19.4 (0.7) – Expenditure in the UK & Europe includes two new stores in the UK in London Bridge and London Luton Airport, a new store in Barcelona Airport, two new
and new concessions across the UK, France, Germany and Spain. There was also a relocation of an outlet in France and a refurbishment of an outlet in the
Germany, Netherlands and Spain were also refurbished or relocated during the period
new stores in Austin, Orlando and San Francisco and a relocation of a concession
refurbishment of a store in Beijing
investment in business-wide IT systems, e-commerce and infrastructure, including
ORLANDO: MILLENIA MALL
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– Estimated worldwide brand sales are calculated by converting wholesale sales and licence income to their equivalent retail value – The Ted Baker brand and collections continue to travel well and expand internationally 11 AUG 2018 £M % OF TOTAL 12 AUG 2017 £M % OF TOTAL 27 JAN 2018 £M % OF TOTAL UK 361.3 54.1 331.2 53.7 694.8 57.0 Overseas 307.0 45.9 285.2 46.3 523.4 43.0 ESTIMATED BRAND SALES 668.3 100.0 616.4 100.0 1,218.2 100.0 TED BAKER SALES 11 AUG 2018 £M % OF TOTAL 12 AUG 2017 £M % OF TOTAL 27 JAN 2018 £M % OF TOTAL UK 171.1 55.9 165.8 56.1 336.1 56.8 Overseas 134.9 44.1 129.9 43.9 255.6 43.2 SALES REVENUE 306.0 100.0 295.7 100.0 591.7 100.0
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11 AUG 2018 £M 12 AUG 2017 £M VAR % 10.9 9.7 11.7 – Licence income was up 11.7% to £10.9m (2017: £9.7m), with both territorial and product licences performing well. – We saw good performances from
childrenswear, eyewear, fragrance, skinwear and suiting – Two new global licence agreements were signed with Delta Galil (underwear and loungewear) and Timex Group (watches) – Our licensed stores performed well during the period. Our licence partners opened new stores in India, Kazakhstan, Mexico, Singapore and Taiwan. We also opened
TED BAKER FRAGRANCE
Ted Baker Plc Half Year Results Presentation 28 weeks ended 11 August 2018 14 CUSTOMER & BRAND CENTRIC APPROACH
decision we make
MULTIPLE PATHS TO MARKET
wholesale and licence
FULLY OMNICHANNEL
and online
SELECTIVE SPACE GROWTH
GLOBAL LICENCE PARTNERS
low capital expenditure
global capability LEVERAGE INVESTMENTS
LONG-TERM FINANCIAL SUSTAINABILITY
earnings growth
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TED BAKER FOOTWEAR
TED’S BRINGING HOME THE FOOTWEAR – The Group entered into an agreement to acquire the global licence to manufacture and distribute footwear from Pentland Group Plc KEY HEADLINES – £13m purchase price – Acquisition completes on 31st December 2018 – Cash payback within 3 years – Leveraging of infrastructure and systems – £4-8m anticipated incremental working capital increase – Exciting opportunity to drive further growth
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– We are pleased with the performance of our e-commerce business with sales growing 24.1% (25.7% in constant currency) to £53.0m (2017: £42.7m) – E-commerce now represents 24.1% (2017: 19.6%) of total retail sales – We maintain our focus on tailoring our digital marketing channel plans for each collection and market, to build upon the traction we have seen since launching localised language websites in France and Germany – As we advance in visually articulating the brand in the difgerent regions, we are seeing improved customer engagement – During the period, we opened our new North American distribution centre in Atlanta and implemented our Hybris
globally to fully underpin our omnichannel ambitions 11 AUG 2018 £M 12 AUG 2017 £M VAR % CONSTANT CURRENCY VAR % 53.0 42.7 24.1 25.7
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Ted Baker Plc Half Year Results Presentation 28 weeks ended 11 August 2018 18
conditions across our global markets
planned
sites to enhance the customer experience; ensuring maximum engagement through multiple channels
anticipated across our wholesale businesses
development of product licences to drive licence income
long-term development
Ted Baker Plc Half Year Results Presentation 28 weeks ended 11 August 2018 19 *Partner stores include stores operated by our Australian joint venture partner. **Square footage excludes partner stores.
STORE & CONCESSIONS
PROJECTION
YE JAN 2019 HYE AUG 2018 FYE JAN 2018 FYE JAN 2017 FYE JAN 2016 UK 201 201 195 192 185 Europe 114 110 109 95 90 North America 110 108 105 97 90 Rest of World 23 23 28 26 19 Partner Stores* 110 102 95 80 64 TOTAL 558 544 532 490 448 GROUP
PROJECTION
YE JAN 2019 HYE AUG 2018 FYE JAN 2018 FYE JAN 2017 FYE JAN 2016 Own Stores 87 85 81 75 71 Concessions 327 325 327 307 287 Outlets 34 32 29 28 26 Partner Stores* 110 102 95 80 64 TOTAL 558 544 532 490 448 CLOSING SQ. FT** 441,097 433,466 420,158 395,088 377,830 AVERAGE SQ. FT** 430,876 422,343 410,190 387,373 357,096 UK: LONDON BRIDGE STATION
Ted Baker Plc Half Year Results Presentation 28 weeks ended 11 August 2018 20
AW18 WOMENSWEAR UK
London O2
EUROPE
GERMANY
SPAIN
ITALY
Serravalle KOSOVO
NORTH AMERICA
USA
Oakbrooke Chicago, UTC Centre San Diego
REST OF WORLD
SAUDI ARABIA
Saudi Robinsons Mens, Saudi Robinsons Womens, Riyadh Park UAE
Citywalk INDIA
Saket, Dehli
Ted Baker Plc Half Year Results Presentation 28 weeks ended 11 August 2018 22 *Partner stores include stores operated by our Australian joint venture partner. **Square footage excludes partner stores.
UK
PROJECTION
JAN 2019 HYE AUG 18 FYE JAN 18 FYE JAN 17 Own Stores 35 35 32 32 Concessions 155 156 154 151 Outlets 11 10 9 9 Partner Stores*
201 201 195 192 CLOSING SQ. FT** 196,154 196,040 189,340 187,792 AVERAGE SQ. FT** 194,927 191,913 189,325 186,536 NORTH AMERICA
PROJECTION
JAN 2019 HYE AUG 18 FYE JAN 18 FYE JAN 17 Own Stores 37 35 32 31 Concessions 61 61 61 55 Outlets 12 12 12 11 Partner Stores* 21 21 22 14 TOTAL 131 129 127 111 CLOSING SQ. FT** 137,104 133,106 126,524 116,590 AVERAGE SQ. FT** 131,760 127,599 121,081 112,110 REST OF WORLD
PROJECTION
JAN 2019 HYE AUG 18 FYE JAN 18 FYE JAN 17 Own Stores 10 10 12 8 Concessions 12 12 14 15 Outlets 1 1 2 3 Partner Stores* 82 75 69 63 TOTAL 105 98 97 89 CLOSING SQ. FT** 27,669 26,190 32,373 27,874 AVERAGE SQ. FT** 28,167 30,351 31,742 28,438 EUROPE
PROJECTION
JAN 2019 HYE AUG 18 FYE JAN 18 FYE JAN 17 Own Stores 5 5 5 4 Concessions 99 96 98 86 Outlets 10 9 6 5 Partner Stores* 7 6 4 3 TOTAL 121 116 113 98 CLOSING SQ. FT** 80,170 78,130 71,921 62,832 AVERAGE SQ. FT** 76,022 72,480 68,042 60,290
Ted Baker Plc Half Year Results Presentation 28 weeks ended 11 August 2018 23
TED BAKER COLOUR BY NUMBERS
CONSIDERED DEVELOPMENT OF OUR COLLECTIONS – Continued review of our collections – Collections are being well received internationally PRODUCT LICENCES – Bedding – Childrenswear – Footwear – Eyewear – Fragrance & Skinwear – Gifting & Stationery – Jewellery – Lingerie & Sleepwear – Luggage – Neckwear – Rugs – Suiting – Technical Accessories – Tiles – Watches CONTROLLED DISTRIBUTION THROUGH THREE MAIN CHANNELS – Retail / Wholesale / Licensing TERRITORIAL LICENCES – Demsa - Turkey – Dabsan - Panama – Multimoda - Mexico – Alfa Egypt - Egypt – RSH Middle East - UAE, Saudi Arabia, Bahrain & Qatar – Al-Mutawa and Al-Khatib Retail Company - Kuwait – ABC - Lebanon – Zeta - Azerbaijan & Kazakhstan – RSH Far East - Singapore, Malaysia, Indonesia & Thailand – Yun San - Taiwan – Maison - Vietnam – Aditya - India – Flair Pty Ltd - Australia & New Zealand – BD Fashion - Kosovo – CM Style - Ukraine
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