INTERIM RESULTS For the six months ended 30 September 2017 - - PowerPoint PPT Presentation

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INTERIM RESULTS

For the six months ended 30 September 2017

INTERIM RESULTS

For the six months ended 30 September 2017

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DISCLAIMER

Forward Looking Statements This presentation may include certain statements that are, or may be deemed to be, "forward-looking statements" in respect of QUIZ plc's ("QUIZ") operations, performance, prospects and/ or financial position. These statements can be identified by the use of terms such as “may”, “will”, “should”, “expect”, “anticipate”, “estimate”, “intend”, “continue”, “target” or “believe” (or negatives thereof) or other variations thereon or comparable terminology. By their nature, forward-looking statements involve risk, uncertainty and assumptions since they relate to future events and circumstances. Actual results or events may differ materially from those expressed or implied by those forward-looking statements. Any forward-looking statements in this presentation reflect management's view with respect to those future events as to the date of this presentation only, and no reliance may be placed on them for any purposes

• whatsoever. No representation or warranty is made as to the achievement or reasonableness of those forward-looking statements and should not be taken as a

representation that such trends or activities will continue in the future. Any of the assumptions underlying these forward-looking statements could prove inaccurate or incorrect and therefore any results contemplated in the forward-looking statements may not actually be achieved. Nothing contained in this presentation or communicated verbally should be construed as a profit forecast or profit estimate. Investors or other recipients are cautioned not to place undue reliance on any forward-looking statements contained herein. Past performance cannot be relied upon as a guide to future performance and persons needing advice should consult an independent financial adviser. Save as is required by applicable law, QUIZ undertakes no responsibility or obligation to publicly update or revise any forward-looking statement in this presentation resulting from new information, future events or otherwise. Disclaimer This presentation has been prepared by QUIZ for information purposes only and in good faith. These slides and the accompanying verbal presentation relating to QUIZ are being supplied to you solely for your information. The contents of the presentation are confidential and is being delivered to either (a) are persons having professional experience in matters relating to investments who fall within the definition of investment professionals in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) or (b) are high net worth bodies corporate, unincorporated associations and partnerships and trustees of high value trusts as described in Article 49(2) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (together, being “Relevant Persons”). Any other person who receives this presentation should not rely or act upon it. By accepting this presentation and not immediately returning it, the recipient represents and warrants that they are a person who falls within the above description of persons entitled to receive the

• presentation. This presentation should not be disclosed to any other person or used for any other purpose. Neither this presentation nor any verbal

communication shall constitute an invitation, inducement nor does it constitute a recommendation to any person to subscribe for or otherwise acquire securities in QUIZ. Statements in this presentation reflect the knowledge and information available at the time of its preparation. Liability arising from anything in this presentation shall be governed by English Law. Nothing in this presentation shall exclude any liability under applicable laws that cannot be excluded in accordance with such laws. Subject to certain limited exceptions, neither the Presentation nor any copy of it should be distributed, directly or indirectly, by any means (including electronic transmission) to any persons with addresses in the United States of America (or any of its territories or possessions) (together, the "US"). Any securities referenced in the presentation have not been registered under the United States Securities Act of 1933, as amended (the “Securities Act”), or under any securities laws of any state or other jurisdiction of the United States and may not be offered or sold within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. Neither the presentation nor any copy of it should be distributed, directly or indirectly, by any means (including electronic transmission) to any persons in any other jurisdiction, including but not limited to persons with addresses in Canada, Japan, Australia or the Republic of South Africa. Recipients of these slides in any such jurisdiction should return the slides to QUIZ and may not act on them. Any failure to comply with this restriction may constitute a violation of relevant local securities laws. 1

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CONTENTS

Highlights: Tarak Ramzan, Chief Executive Officer Financial review: Gerry Sweeney, Chief Financial Officer Operational review: Sheraz Ramzan, Chief Commercial Officer Current trading and outlook: Tarak Ramzan, Chief Executive Officer

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OPERATIONAL HIGHLIGHTS

GROWTH ACROSS EACH REVENUE STREAM

INTERNATIONAL

STRENGTHENED FIRST CLASS TEAM

ACTIVE ONLINE CUSTOMERS ONLINE MOMENTUM

204.6% 85.8%**

H1 2018: 262,000 H1 2017: 141,000

26.1%*

H1 2018: £10.0m H1 2017: £8.0m * Excludes non-recurring wholesale revenue in relation to Spain in the year ended 31 March 2017 ** Active customer is a customer that is registered on our database and has transacted in the last 12 months UK STORES AND CONCESSIONS MARKETING RETURNS INVESTMENT IN GROWTH

DC EXPANDED TO SUPPORT GROWTH ROI FOCUSED MARKETING DRIVING AWARENESS

15.2%

H1 2018: £32.3m H1 2017: £28.1m H1 2018: £13.8m H1 2017: £4.5m 3

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FINANCIAL HIGHLIGHTS

TRANSFORMATIONAL GROWTH ACROSS ALL CHANNELS

UNDERLYING EBITDA UNDERLYING PBT REVENUE * Underlying earnings exclude non-recurring items relating to the costs of admission to AIM and the Group reorganisation undertaken prior to admission and share based payment charges NET CASH UNDERLYING EPS 4

35.2% 31.0%* 34.0%*

+£11.5m

35.5%*

H1 2018: £56.1m H1 2017: £41.5m H1 2018: £4.8m H1 2017: £3.7m H1 2018: £6.2m H1 2017: £4.7m H1 2018: £11.9m H1 2017: £0.4m H1 2018: 3.28p H1 2017: 2.42p CURRENT TRADING

32.9%

Continued strong current trading in the seven weeks to 18 November 2017

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Financial review Gerry Sweeney Chief Financial Officer

Interim Results for the six months ended 30 September 2017

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SUMMARY INCOME STATEMENT

Underlying* (£m) H1 2018 H1 2017 Change FY 2017 Revenue 56.1 41.5 +35.2% 89.8 Gross profit 35.6 26.4 56.3 Gross margin 63.5% 63.6% 62.7% Other costs (30.8) (22.7) +35.6% (48.1) Costs as % of revenue 54.9% 54.7% 53.6% Operating profit 4.8 3.7 +31.0% 8.1 Basic EPS (pro- forma)** 3.28p 2.42p +35.5% 5.33 Operating profit 4.8 3.7 8.1 D&A 1.4 1.0 2.1 EBITDA 6.2 4.7 +32.1% 10.2 EBITDA margin 11.0% 11.2% 11.2%

REVENUE GROWTH MATCHED BY INCREASED PROFITS

Gross margin

• Consistent at 63.5%
• Mitigate increased costs through

improved sourcing

• Ensure there is product to meet range of

price points Operating costs

• Increased in line with business and plans

for growth

• Maintaining costs as a % of revenue

EBITDA margin consistent at 11.0%

** Pro-forma assumes that the number of shares in issue immediately post-IPO were in issue through the entire comparative period 5 * Underlying earnings exclude non-recurring items relating to the costs of admission to AIM and the Group reorganisation undertaken prior to admission and share based payment charges

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REVENUE BY CHANNEL

STRONG GROWTH IN EACH REVENUE STREAM

(£m) H1 2018 H1 2017 Change Online 13.8 4.5 +204.6% International underlying 10.0 8.0 +26.1% International non- recurring*

• 0.9

T

• tal international

10.0 8.9 +12.3% UK stores and concessions 32.3 28.1 +15.2% T

• tal sales

56.1 41.5 +35.2%

• Online +204.6%

– 24.6% of overall total revenues, up from 10.8% – Sales through QUIZ sites +122% – Increased sales through third party sites – Next started October 2016 – Zalando, Germany started May 2017 – Increase in number of SKUs – Success of new product ranges including Curve and Bridal

* Non-recurring wholesale revenue in relation to Spain in the year ended 31 March 2017 6

• International underlying +26.1%

– Three stores opened in Spain – International franchise and wholesale outlets increased from 65 to 76

• UK stores and concessions +15.2%

– 57.6% of total revenues, down from 67.8% – Sales space consistent at 185k sq. ft. (Sept 2016: 187k sq. ft.)

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OPERATING COSTS

(£m) H1 2018 H1 2017 Change Employment costs 9.4 7.6 Operating leases 2.9 2.7 D&A 1.4 1.0 Marketing costs 1.0 0.3 Other costs 5.9 4.7 T

• tal admin costs

20.6 16.3 +26.6% Distribution 10.2 6.4 +58.7% Underlying costs 30.8 22.7 +35.6% Non-recurring 1.2

• T
• tal costs

32.0 22.7 +40.7%

COST INCRESEAS CONSISTENT WITH REVENUE GROWTH

• Admin costs +26.6%

– Increased employee recruitment for marketing,

• nline and other central functions

– Rising marketing costs given return on investment achieved – Depreciation and amortisation increased further to previous investment spend on DC, IT and rollout of stores

• Distribution +58.7%

– Carriage and online delivery costs rise with revenues – Includes commission paid to third party customers and websites

• Non-recurring costs of £1.2m

– £1.0m relating to admission to AIM and Group reorganisation undertaken prior to admission – £0.15m of share based payment charges

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CASH FLOW AND CAPEX

(£m) H1 2018 H1 2017 Underlying EBITDA 6.2 4.7 Working capital 0.6 (3.1) Underlying operating free cash flow 6.8 1.6 Non-recurring costs (1.0)

• Operating free cash flow

5.8 1.6 Capital expenditure (2.6) (1.9) Other (0.1)

• Share issue

10.3

• Loan repayments (net)

(1.0) (0.4) Free cash flow 12.4 (0.7) Net cash 11.9 0.4

STRONG OPERATONAL CASH GENERATION AND CONTINUED INVESTMENT IN THE BUSNESS

• Strong cash generation in the period
• Positive working capital inflow of £0.6m

– Stock increased by £2.1m – Offset by £2.2m increase in creditors – Debtors due reduced by £0.5m

• Capital expenditure of £2.6m

– DC expansion cost of £0.7m – International store investment of £0.6m – Other spend includes IT spend and new in-house photo studio

• Net inflow from share issue and Group

restructure of £10.3m

• Remaining loans of £0.5m

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Operational review Sheraz Ramzan Chief Commercial Officer

Interim Results for the six months ended 30 September 2017

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CLEAR GROWTH STRATEGY

OMNI-CHANNEL APPRAOCH AND INTERNATIONAL BRAND DRIVING GROWTH

UK Stores & Concessions Online International

Flexible and adaptable business model Brand and marketing

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ONLINE GROWTH - KPIs

SALES UP 204.6%, NOW 24.6% OF TOTAL SALES (H1 2017 – 10.8%)

Online Traffic (m)

2 4 6 8 10 12 14 16 18 2015 2016 2017 2018 Total Traffic Mobile Traffic

• Active customers increased by 85.8% to 262,000

(30 September 2016: 141,000)

• Website traffic continued to grow, reflecting our

increased and effective marketing investment, and was up 61.5% year on year, primarily driven by mobile.

• Sales through QUIZ's own websites increased by

122% in H1 2018. The strong growth in sales made through third-party websites, includes the benefit of commencing sales on the Next website in October 2016 and through Zalando in May 2017

• Of the £13.8m of online sales in H1 2018, £1.1m is

generated from international markets (H1 2017: £0.5m)

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ONLINE GROWTH DRIVERS

IMPLEMENTING KEY GROWTH DRIVERS THIRD-PARTY WEBSITES Successful launch with Zalando in May 2017 Strong growth with Next, started in H2 2017 INCREASED MARKETING INVESTMENT Investment in own website Customer insight - CRM and data analytics Investment in engaging

• nline content

INTERNATIONAL COUNTRY SPECIFIC WEBSITES Spain website launched in September 2017 USA website to be launched by end of financial year DEVELOPING MOBILE CHANNELS Fastest growing channel New Android and iOS app launched in October 2017 BROADENING THE PRODUCT RANGE Curve, Bridal and extended online only

• ccasion ranges

SKUs increased more than 35% since September 2016

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INTERNATIONAL

• Standalone stores

– Three stores opened in Madrid in the period – New store opened in Dublin in October

• Franchise stores

– New points of sale in Dubai, UAE and Morocco – Points of sale increased from 65 to 76

• Concessions

– New concessions in Cyprus opened in period

UNDERLYING SALES UP 26.1%, NOW 17.8% OF TOTAL SALES (H1 2017 – 21.4%)

International sales (£m) Key Growth Drivers

2 4 6 8 10 H1 2017 H1 2018 Ireland and Spain Consignment Wholesale

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PICTURES OF NEW STORES/WESTFIELD

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UK STORES AND CONCESSIONS ROLLOUT

UNDERLYING SALES UP 15.2%, NOW 57.6% OF TOTAL SALES (H1 2017 67.8%)

Wales & West Midlands 5 stores North West 7 stores Northern Ireland 7 stores

STORE LOCATIONS

South West 4 stores Scotland 22 stores North East 9 stores East Midlands 4 stores London & South East 12 stores

• One new store in Warrington; one store closed in

Manchester

• Three new stores opened since period end; Plymouth,

Leicester and Glasgow

• Bristol store to open by end of November
• Plans for two additional stores by year end
• New leases for stores all have five year term
• Currently 70 stores

Wales & West Midlands 16 Debenhams 3 House of Fraser

CONCESSIONS LOCATIONS

South West 10 Debenhams 1 House of Fraser North West 14 Debenhams Northern Ireland 2 Debenhams Scotland 5 Debenhams North East 12 Debenhams 1 House of Fraser East Midlands 3 Debenhams 1 House of Fraser London & South East 41 Debenhams 5 House of Fraser

• Four new concessions in the period with existing partners
• Three new concessions opened since period end
• Three new concessions planned for current year
• Currently 149 concessions

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STORE EXPERIENCE

• Increased store traffic being driven by marketing
• Launch of Digital kiosks in selected stores reflecting omni-

channel approach

• Roll out of iPads across out store estate
• “Click & Collect” fulfilment available in-store
• Stores receive new styles every working day keeping the retail

environment fresh and relevant

• Store refurbishment programme

UNDERLYING SALES UP 15.2%, NOW 57.6% OF TOTAL SALES (H1 2017 67.8%)

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EXPANDING THE QUIZ BRAND

H1 2018 H1 2017 Change 256k 88k +190.1% 523k 333k +57.1% 101k 89k +13.5%

Increased marketing investment (£m) Social media – growing following and increasing engagement

0.00 0.25 0.50 0.75 1.00 15 30 45 60 H1 2017 H2 2017 H1 2018 Revenue Marketing

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MARKETING APPROACH

• Appointed Lesley Morton, Head of Marketing to drive

marketing activities in August 2017

• Awareness-driving campaigns including a collaboration

with Love Island’s Gabby Allen

• In-store activity
• Media / PR activity
• Influencer events
• Offline and online advertising such as on the

London Underground

• Increased

investment in performance-focused digital marketing - SEO, PPC, Display and Socials Ads

• Influencer outreach campaigns with blogger trips to Ibiza

and Morocco in 2017 driving social engagement

ROI FOCUSED MARKETING STRATEGY

Pictures of bloggers dressed in QUIZ in Marrakech, Summer 2017

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INVESTMENT IN GROWTH

• Continued recruitment at Head Office to support our growth
• This includes the appointment of Scott Cottingham, Head of IT,

started post-period end

• New 180k sq. ft. DC near Glasgow opened in 2016, supporting omni-channel expansion
• Accelerated investment at distribution centre to support targeted growth - cost of £0.8m
• Utilised space up by circa 30% to 232k sq. ft.
• Packing stations for online sales increased from 24 to 78
• Capable of being able to distribute c.450k items to stores each week
• BespokeWarehouse Management System
• Fully integrated ERP and POS system – gives live stock and sales information

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Current trading and outlook Tarak Ramzan Chief Executive Officer

Interim Results for the six months ended 30 September 2017

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CURRENT TRADING AND OUTLOOK

• 1. Distinctive fast

fashion brand

• 3. Omni-channel

growth

• pportunity with
• utstanding online

momentum

• 4. Targeted

international expansion plans

• 2. Growing

customer base and awareness

• 5. Continued

strong current trading with revenue in seven weeks to 18 November 2017 up 32.9% year on year

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Appendix

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EXPERIENCED EXECUTIVE MANAGEMENT TEAM

Tarak Ramzan

Chief Executive Officer

• Founder and Chief Executive

Officer of QUIZ

• The driving force behind the

Group’s success, he opened his first retail store in Glasgow in 1993

• Inherited his father’s

manufacturing business at 18, Tarak made the decision to move into retail once UK manufacturing began to move

• ff-shore
• With his passion for retail & a

keen eye for fashion, he has steered the Group to success using a strategy that is centred around the Company’s USP & ability to stay ahead of the competition

• Tarak has developed QUIZ’s

fast fashion omni-channel business model over the past 23 years & is responsible for brand strategy, buying & merchandising

Gerry Sweeney

Chief Financial Officer

• Gerry joined QUIZ in 2016

as Chief Financial Officer

• He was previously Group

Finance Director at Robert Wiseman Dairies PLC where he worked for 15 years

• Gerry is responsible for the

finance function & the development of systems & reporting to support the continued growth of the business

• After completing an

Accountancy degree he qualified as a Chartered Accountant when working with Arthur Andersen

Sheraz Ramzan

Chief Commercial Officer

• Sheraz joined QUIZ in 2003

after completing a degree in Engineering & then a Masters in Business Management

• Initially tasked with raising the

profile of the non-clothing merchandise part the business, he developed a fast & flexible Far East supply chain supporting growth of the footwear & accessories ranges

• In his current role, Sheraz is

responsible for strategic planning, brand marketing & facilitating company growth by engaging with new partners & territories

• As online sales presented

themselves as the biggest retail opportunity in recent years, he plays a vital role in

• verseeing the development
• f the QUIZ UK &

International online

• perations

Peter Cowgill

Independent Non-Executive Chairman

Roger Mather

Independent Non-Executive Director

Charlotte O’Sullivan

Independent Non-Executive Director

• Charlotte will join the

Company on Admission

• She has over 15 years'

experience in luxury marketing & leading omni- channel business transformation

• She is currently the

Marketing & Digital Director at Mulberry Group plc where she is an executive board member

• Charlotte studied Modern

History at Oxford University & previously held e- commerce & marketing roles with decoration specialist St Nicolas & luxury lingerie brand Myla, before joining Mulberry in 2007

• Peter joined QUIZ in June

2017

• He has been Executive

Chairman of JD Sports Fashion Plc since March 2004, prior to which he was Finance Director

• Peter has been instrumental

in driving the strong performance of JD Sports Fashion over the past decade

• Peter is also the Non-

executive Chairman of United Carpets Plc & was appointed as a Non- executive Director of Better Bathrooms (UK) Limited in January 2017

• Roger joined the QUIZ

Board in May 2017

• Previously, he was the

Group Finance Director & a Board member of Mulberry Group plc for eight years, stepping down in May 2016

• Roger is a Fellow of the

Institute of Chartered Accountants in England & Wales having trained professionally with Price Waterhouse

• He spent the previous 10

years in senior finance & commercial roles within the multinational Otto Group based in both Hong Kong & United Kingdom

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“TEST AND REPEAT” FAST FASHION SUPPLY CHAIN

Styles & trends identified & developed Fabric sourcing & sampling process Product manufacturing Transport product to QUIZ DC allocates products to stores & online Products available for sale in stores &

• nline next

day delivery

In house team selects 1 – 5 days Up to 7 – 10 days in the UK 7 – 21 days in the Far East 60 core domestic & international manufacturers 1 – 2 days from UK Up to 5 days from Far East by air Up to 21days from Far East by sea 1 – 2 days New products supplied to stores every working day

New trends in stores in 2 – 4 weeks*

* On average from the point of order

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QUIZ BRAND

• Value fast fashion and occasion wear primarily for

16-35 year olds

• Founded in 1993
• Employs more than 1,400 people
• QUIZ brand has a distinct & differentiated selling

proposition

• QUIZ’s brand proposition is very attractive to a

broad range of women who like to dress up

• Targets primarily 16 – 35 year old fashion

forward females

• Aims to empower fashion forward females to

look glamorous and stand out from the crowd

Glamorous occasion wear and fast fashion at value prices

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