MC GROUP Public Company Limited Q1 2018 Results Summary 21 May - - PowerPoint PPT Presentation

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MC GROUP Public Company Limited Q1 2018 Results Summary 21 May - - PowerPoint PPT Presentation

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MC BIKER DENIM Motorcycle series MC GROUP Public Company Limited Q1 2018 Results Summary 21 May 2018 Moto-apparel Denim style Biker collar Dark blue A leading multi-brand apparel & lifestyle products retailer DISCLAIMER The

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MC BIKER DENIM

Motorcycle series

MC GROUP

Public Company Limited

Q1 2018 Results Summary 21 May 2018

Denim style Biker collar Dark blue Moto-apparel

A leading multi-brand apparel & lifestyle products retailer

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1

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. 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.

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AGENDA

2

01

Company Overview

02

Recent Development

03

Financial Result

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COMPANY OVERVIEW

1

3

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Launched

  • nline website

JV with Phetkasem Holding to revolutionize top wear

2008

Opened the first Free Standing Shop

1st Mc Shop 2012 Expanded to Myanmar & Laos

2005

Launched “Mc ” brand 2013

Extended Brand Portfolio

Casual menswear Women's’ Jeans & Street wear

Extended Brand Portfolio

Acquired 51% in

1975

Expanded to Lifestyle Business

Kid’s Jeanswear Fashionable Ladies wear Value-for-Money Casual wear Premium Jeanswear

Started as manufacturing and selling through traditional trade Onto managing brands and distribution channels Emerged as a leader in denim market in Thailand 2014 2015 Expanded to Vietnam Expanded to Cambodia Alliance with PTT

Opened mc mc shop in PTT gas station

Listed on the SET

Extended Brand Portfolio 2016 Extended Brand Portfolio

Active wear “UP” Skin care “M&C”

Set up new subsidiary 2017

Invested 55% in to distribute home spa products

Expanded to Iran

Key milestones

Revamped e-commerce platform

CRM & membership program

2018 Moving forward to become a leading apparel and lifestyle products retailer

4

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WoWme Limited (“WOWME”) Look Balance Co.,Ltd Winnerman Co., Ltd. (“WNM”) MC INTER LIMITED (“MCI”) P.K. Garment (Import-Export) Co., Ltd. (“PKG”) 99.97% 99.98% 99.97% 99.97% 99.99%

  • Manufactures

50% of total production

  • With BOI

privilege

Mc Jeans Manufacturing Co., Ltd. (“MJM”) 99.97%

  • Manufactures

20% of total production

  • Without BOI

privilege

  • Offers quality

Thai and foreign brands products and services through online platform

  • Manages sales

force and warehouse workforce for MC

  • Incorporated for

the future business and investment abroad

Time Deco Corporation Co., Ltd.

51%

  • Importer,

retailer and exclusive distributor of famous int’l watch brands

New Businesses Operations Production

Mc Jeanious Co., Ltd. 99.99% Top T 2015 Co., Ltd.

51%

  • Supplier of top

wear with latest fabric technology under the brand “McT”

MC GROUP PLC (“MC”)

Registered Capital 400 MB Paid-up Capital 400 MB Aromatique Active Co., Ltd. 55%

  • Sales of skincare

and aromatic products

  • Not yet commercially
  • perated

5

MC GROUP structure

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866 819 694 511 446

Points of Sales

Q1/18 Geographical Analysis of Outlets

304 Shops

  • 1. Free Standing Shops

570 PoS

  • 2. Modern Trade

6 Units

  • 3. Mobile Unit

14 PoS

  • 4. International Markets

Located mainly in commercial centers or in the plaza sections of department stores as well as hypermarket and PTT gas station New sales channel that helps expand the reach to customers as well as build brand recognition Points of sales or sales counters in department stores (both chain and local non-chain) as well as hypermarket

(Songkla, Pattani) (Lampang)

Currently, expanded through distributors with presence in CLMV and Iran.

894

PoS

Q1/18 Geographical Analysis of Sales

1Q18

897 894

6

Greater Bangkok 28% Upcountry 70% International 2% Greater Bangkok 37% Upcountry 62% International 1%

Comprehensive network

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R E C E N T D E V E L O P M E N T

2

7

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8

Y2018 priorities moving towards long term results

✓ Leverage large customer base using 1st ever CRM & membership program under “MC Club” ✓ Segment products to suit customer preference and for efficient supply chain management ✓ Extend lifestyle product range ✓ Deliver exceptional omnichannel retail experience ✓ Nurture International market for medium to long term growth

New collection MC Sneaker selvedge walker – Launched in March 2018

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9

MC CLUB

12,000 40,000 100,000 170,000 210,000 15 200 270 600 650 00 00 00 00 00 00 00 January February March April May

  • 50,000

100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000 ints of Sale

  • No. of

members Members POS

MC Club’s members & POS

Progress and indicative projection - year 2018 Projection

Examples of CRM in-store media

Membership means more…

Members can enjoy special deals & offers all year. Sign up today at https://mcclub.mcshop.com/user FREE!

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10

By Lifestyle Segment…

BIKERS

Booth display for bike lover at ‘Naked City’ free concert held by Yamaha REV community

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11

By Lifestyle Segment…

FAMILY

“Thai Loincloth Jeans” inspires traditional dress

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12

By Lifestyle Segment…

TEENS

Booth display for collaboration marvel products with Disney (Thailand) at leading movie theatre

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13

By Lifestyle Segment

OFFICE WORKERS

Exclusive concert “MusicJam MusicJeans” by MC Group

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14

Hello Beauty at Robinson

Skincare “Aromatique Active” Own points of sales and extending product lines

To be launched…

▪ Hand cream ▪ Sun body lotion ▪ Whitening body booster ▪ Body Moist

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15

Style Asia’s Most Stylish Fair 2018

Skincare “Aromatique Active” Brand building activities

‘Hand wash’ campaign – Pop-up Store

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Outlet numbers adjusted to align with strategy

End of 2017 # Points of sales

894

Q1/2018 # Points of sales

894

Remark: *Closed 9 small points of sale due to brand management and efficiency of stock control of Timedeco

Online channels

# Points of sales

6

Brand Free- Standing Modern Trade Mobile unit

International

Total 267 488 6 13 774 18 18 15 87 102 Total 300 575 6 13 894

+ 8 Mc, -9* Timedeco

+ 1 Mc International

Strengthen omnichannel (offline <> online)

16

Brand Free- Standing Modern Trade Mobile unit

International

Total 272 491 6 14 783 18 18 14 79 93 Total 304 570 6 14 894

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17

Newness on mcshop.com – Products & blogs

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18

Newness on mcshop.com – Campaign

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19

Newness on mcshop.com – New feature

Ship to shop feature available now in mcshop.com

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Lao PDR

▪ Equalize promotional campaigns between Thailand and Lao PDR

Nurture international market for medium to long term growth…

20

Iran

▪ Total 4 stores as of Q1 2018

3rd Store

Bam land shopping mall, Tehran

4th Store

Aren shopping center, Tehran

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Nurture international market for medium to long term growth

21

Costume Sponsorship TV Program The Voice Myanmar Contestant

Thaw Di

Teen Talk Master Ceremony

Zaw Htet and Wutt Yi

Myanmar

▪ To continue building brand awareness among young customers

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Q1/2018 F I N A N C I A L R E S U L T

3

22

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23

Stronger as expected margin performance amid softening spending

Results headlines

(THB millions)

Q1/17 Q1/18 % YoY

Sales Revenue

1,220 1,113

  • 9%

Total Revenue

1,232 1,145

  • 7%

Gross Profit

624 634 +2%

EBITDA

292 295 +1%

Net Profit

232 232 +0%

Gross Profit Margin

51.1% 57.0%

Net Profit Margin

18.8% 20.3%

EPS (THB)

0.29 0.29

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(THB millions)

2,973 3,470 3,895 4,442 4,228

500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 5,000

FY13 FY14 FY15 FY16 FY17

Annual Sales Revenue Quarterly Sales Revenue Sales revenue by channel

1Q2017 1Q2018

Others = E-Commerce, International, Mobile, Outside promotion, Factory sales 24

57% 38% 5%

Free standing 59% Modern trade 35% Others 6%

1,220 919 903 1,187 1,113 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18

Sales decreased from lessen degree of promotion campaign and high base in 1Q2017

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Modern trade (1)

’000 THB

Free standing shop

THB

Remark: (1) Figures are calculated based on modern trade sales revenue, before GP. Excluded sales from international markets and other source (i.e., exhibition etc.)

25

493 373 365 348 265 346 333 273 403 342 209 224 268 294

150 200 250 300 350 400 450 500 550 600 650 700 750

FY13 FY14 FY15 FY16 FY17 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 FY16 FY17 FY18

Average sales per PoS / month

Distribution channels performance

9,297 8,715 8,338 9,158 8,742 9,547 8,145 7,678 12,145 9,845 8,152 7,420 10,094 8,966

5,000 7,000 9,000 11,000 13,000 15,000

FY13 FY14 FY15 FY16 FY17 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 FY16 FY17 FY18

Average sales per SQM / month

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SSSG Quarterly SSSG (YoY)

Remark: Hypermarkets are not included in the calculation in SSSG.

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(2%) (8%) 4% 11% (7%)

FY13 FY14 FY15 FY16 FY17

Same-store sales growth (SSSG)

28% 6% 10% 4% 0.4% (1%) (9%) (17%) (12%)

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Y16 Y17 Y18

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(THB millions)

Gross Profit Gross Profit Margin Gross Profit Margin (excl TDC) 1,685 1,888 2,186 2,430 2,227 56.7% 54.4% 56.1% 54.7% 52.7%

20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0% 55.0% 60.0% 500 1,000 1,500 2,000 2,500 3,000 3,500

FY13 FY14 FY15 FY16 FY17

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592 549 484 805 624 468 473 662 634 51.8% 54.5% 55.0% 57.1% 51.1% 50.9% 52.4% 55.8% 57.0% 53.1% 55.8% 55.8% 58.0% 51.8% 51.3% 53.1% 57.2% 58.4%

  • 5.0%
5.0% 15.0% 25.0% 35.0% 45.0% 55.0% 65.0% 500 1,000 1,500 2,000 2,500

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Y16 Y17 Y18

Improved GPM

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Q1/18 SG&A breakdown % SG&A expense to sales

(THB millions)

2.8%YoY

SG&A expenses moved up YoY due mainly to an increase in marketing expenses

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Personnel 42% A&P 9% Rent 30% D&A 8% Others 11%

374 367 367 447 389 372 386 481 400 389 400

33% 36% 42% 32% 32% 40% 43% 41% 36% 32% 36%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 100 200 300 400 500 600

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 17 18 Y16 Y17 Y18 YTD YTD

SG&A % SG&A to sales

Lower %SG&A to sales QoQ but higher YoY

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(THB millions)

  • 35.0%

65.0%

EBITDA EBITDA Margin EBITDA Margin (excl TDC) 259 250 175 415 292 149 137 271 295 22.5% 24.7% 19.7% 29.0% 23.7% 16.0% 15.0% 21.8% 25.8%

24.3% 25.8% 21.5% 30.7% 25.3% 16.6% 15.2% 22.5% 26.7%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0% 200 400 600 800 1,000 1,200 1,400

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Y16 Y17 Y18

Higher EBITDA margin

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  • 35.0%

65.0%

Net Profit Net Profit Margin Net Profit Margin (excl TDC) (THB millions)

MC recorded net profit margin of 20.3%, rising YoY mainly from widen gross profit margin

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202 191 132 317 232 90 94 194 232 17.6% 18.8% 14.9% 22.2% 18.8% 9.7% 10.4% 15.6% 20.3% 19.5%

20.5% 16.8% 23.8% 20.4% 10.5% 11.1% 16.6% 21.5%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 200 400 600 800 1,000 1,200

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Y16 Y17 Y18

Higher NPAT margin

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Consolidated balance sheet Net debt to equity ratio

31

(THB millions)

2017 Q1/18 Cash & Short term investmen 971 1,057 Accounts Receivable 552 553 Inventory 2,216 2,250 Other Assets 1,342 1,359 Total Assets 5,082 5,219 Accounts Payable 381 323 Interest-bearing Liabilities 95 59 Other Liabilities 438 432 Total Liabilities 913 814 Shareholders' Equity 4,168 4,406

(0.5x) (0.4x) (0.2x) (0.3x) (0.2x) (0.2x)

(0.6x) (0.4x) (0.2x) (0.0x) 0.2x 0.4x 0.6x

FY13 FY14 FY15 FY16 FY17 Q1/18

Remained strong with net cash position

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Improved return on capital but higher inventory days

ROA ROE Finished Good Inventory Days Cash Cycle

(THB millions) (THB millions) (Months) (Months)

5,048 4,828 4,724 5,196 5,355 5,091 5,030 5,082 5,219

16% 16% 14% 16% 18% 12% 11% 12% 18%

0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% 1,000 2,000 3,000 4,000 5,000 6,000

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Y16 Y17 Y18 Total Assets ROA

4,279 4,152 3,967 4,286 4,521 4,214 3,952 4,168 4,406

20% 20% 18% 21% 22% 16% 14% 15% 23%

0% 5% 10% 15% 20% 25% 1,000 2,000 3,000 4,000 5,000 6,000

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Y16 Y17 Y18 Total Equity ROE 9.3 9.8 11.9 11.9 12.1 11.5 12.4 13.2 11.9 9.6 10.7 12.0 12.1 13.3 13 14 15 16 17 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 FY Y16 Y17 Y18 Cash cycle (months) 9.0 10.1 12.6 12.1 12.5 11.5 12.2 13.3 12.1 9.1 10.8 12.3 12.5 13.6 13 14 15 16 17 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 FY Y16 Y17 Y18 FG inventory days (months)

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0.73 0.80 0.75 0.90 0.75 80% 90% 82% 85% 98%

0% 20% 40% 60% 80% 100% 120%

2013 2014 2015 2016 2017 DPS (THB) Payout ratio

Dividend policy is not less than 50% of net profit

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Stock Information Shareholder Structure Dividend Information

Bloomberg/ Reuters : MC TB/ MC.BK Share price (May 18, 2018) : THB 13.10 52 week range : THB 20.70/ THB 11.40

  • No. of paid up shares

: 800 m Par value : THB 0.50 Market capitalization : THB 10,480 m

  • Avg. daily turnover (12 mths)

: THB 49.7 m

  • Avg. daily turnover (6 mths)

: THB 24.3 m Free float : 43.6% Foreign ownership/ Limit : 19.6% /49.0% Major shareholder :

  • Ms. Sunee Seripau (45.5%)

Share capital information and consistent dividend payment

2013 2014 2015 2016 2017 Local Institutional 17% Retail 18% Major shareholder 45% Foreign Institutional 20%

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Thank you

Investor Relations MC GROUP Public Company Limited ir@mcgroupnet.com Tel: +662 117-9999 Ext 1210

Line ID: @mc_jeans www.mcshop.com www.mcgroupnet.com

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  • mcshopthailand
  • mcjeans
  • mcladyjeans
  • Timedecowatch
  • AromatiqueActive
  • www.mcshop.com
  • www.mcjeans.com
  • mcshop_official
  • mcjeans_official
  • timedecowatchclub
  • @mcshop.com
  • @mc_jeans