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MC GROUP Public Company Limited Q3 2017 Results Summary 15 November - PowerPoint PPT Presentation

MC is Life MC GROUP Public Company Limited Q3 2017 Results Summary 15 November 2017 Disclaimer The information contained in our presentation is intended solely for your personal reference only. In addition, such information contains


  1. MC is Life MC GROUP Public Company Limited Q3 2017 Results Summary 15 November 2017

  2. 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. 1

  3. Agenda Pages Results Highlights 3 Recent Development 5 Q3 2017 & 9M 2017 Financial Results 19 2

  4. Results Highlight 3

  5. Results Highlight Q3/16 Q3/17 % YoY 9M16 9M17 % YoY (THB millions) 880 903 +3% 3,031 3,041 +0% Sales Revenue Gross Profit 484 473 -2% 1,625 1,564 -4% 175 137 -22% 683 578 -16% EBITDA Net Profit 132 94 -29% 525 416 -21% Net Profit Margin 14.9% 10.4% 17.2% 13.5% 0.17 0.12 0.66 0.52 EPS (THB) 4

  6. Recent Development 5

  7. The Denim Focus MC ME MC COOL Increasing just a touch of stretch into jeans – shape up your body. - - - - - - - - - - - - - - High waist gives a slim look and highlight the feminine curves. CONFIDENTIAL 6

  8. The Denim Focus Flattering fits, premium fabrics (from Japan), custom washes and our new perfect detail … This is everything you need in a pair of jean. MC SELVEDGE DENIM CONFIDENTIAL 7

  9. The Jacket Focus KAIHARA JACKET Mc proudly present the supreme collection from Kaihara denim who is the largest denim supplier in Japan and the leading denim supplier in the world. Mc continually produces jeans in Kaihara denim both premium fabric and innovation fabric. CONFIDENTIAL 8

  10. Core Product Extension MC JOGGER These jogger jeans are MC's most comfortable pants ever. Featuring a relaxed fit like sweatpants, with the look as denim. The stretchy easy waist design make them a great option for everyday casual wear. A trendy tapered cut gives them a sleek style, ideal for seasonal looks. CONFIDENTIAL 9

  11. Core Product Extension SMART DENIM JACKET Denim Blazers create a great geek chic look. Or wearing a denim jacket creates a more relaxed appearance. Get to work with dark washed or raw denim styles from Mc denim jacket and Mc denim blazer. CONFIDENTIAL 10

  12. Core Product Extension Embroidery Denim Jacket Corduroy Collar Denim Jacket The blue washed denim jacket is present It’s time for FALL ESSENTIALS takes on the classics mix corduroy fabrics with denim. embroidered brand’s signature with twill fabric appliqués CONFIDENTIAL 11

  13. Mc-T Innovation Softech 180 g. Dual Blend 165 g. 100% cotton 60% cotton 40% poly Micro brush Micro brush T-Shirt Dri Balance Polo Dri Balance 150 g. 215 g. 75% cotton 21% poly 65% cotton 35% poly 4%Spandex T-Shirt Yarn dry 150 g. 100% cotton CONFIDENTIAL 12

  14. Activewear Innovation THE FUSION OF FASHION AND FUNCTION The Sportswear Windbreaker Jacket features a sleek design with hood for lightweight wind protection. The Hoodies made from sustainable materials. - the brand's signature is reflective . CONFIDENTIAL 13

  15. Activewear Innovation The Tech Fleece Jackets feature innovative fabric for LIGHTWEIGHT WARMTH Inspired by '90s styles, the Sports Light Jacket delivers lightweight coverage and an old-school look that can wear any day, anywhere. CONFIDENTIAL 14

  16. Aromatique Active Masstique Home Spa 3 Collections with full line Deep Blue - Body Lotion - Shower gel - Soap bar - Talcum Power - Eau de Parfum ▪ Specialist in aromatic skincare for more than 30 years Light Blue ▪ Products are developed from natural extracts and pure essential oils exclusive from Charabot, a perfumery leader in Grasse, France ▪ Formulated without color, mineral oil, parabens, silicone and animal testing ▪ Our products are designed to make True Blue customers feel good nourishing their bodies and minds. 15 CONFIDENTIAL

  17. Aromatique Active Pop-up Stores Centerpoint of Siam Square Mega Bangna Robinson Lopburi Robinson Kanchanaburi Robinson Petchburi BIG+BIH Bitec Bangna Terminal 21 Robinson Ratchburi Promenade Robinson Pitsanulok • Seacon Square • Potential location in • Bangkok and upcountry Jun Jul Aug Sep Q4 Mc Shops >290 POS Online Channel Retailer • Online Channel • Counter in Depart Phuket – Jang Ceylon • Retailers and Other channels CONFIDENTIAL 16

  18. Mcshop.com Revamp Mega Banner New Features New brand Landing Page with recommended collection and new products CONFIDENTIAL 17

  19. Outlet Numbers Adjusted due to Strategy Total outlets declined by 18 points of sales in 3Q 2017 due mainly to the implementation of international dealership reprogram since early this year. New stores rollout and enlargement remained on-track in 3Q 2017. End of 3Q17 # Points of Sales End of 2016 879 # Points of Sales 897 (-18) Free- Modern Mobile Mobile Brand Int'l Total Free- Modern Brand Int'l Total Standing Trade unit unit Standing Trade 249 471 6 20 746 254 472 6 12 744 11 1 12 7 0 7 0 5 5 10 0 3 3 1 0 1 0 0 0 21 0 21 19 0 19 21 86 107 17 89 106 Total 303 563 6 25 897 Total 297 564 6 12 879 18

  20. Q3 2017 Financial Results 19

  21. Modest Growth in Sales amidst multiple headwinds Despite the growth of 13.9% of free standing shops, national chain department stores, superstores and other channels; overall same store sales declined at the rate of 9.0% yoy as the Company continued to feel an impact from temporary contraction of revenue from upcountry local department stores as anticipated. Sales Revenue Quarterly Sales Revenue 3% YoY (THB millions) 0.3% YoY Sales Revenue by Channel 9M17 9M16 Others = International, Mobile, Outside promotion, Factory sales 20

  22. Distribution Channels Performance Free Standing Shop THB Modern Trade (1) ’000 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.) 21

  23. Total System Sales (TSS) & Same-Store Sales Growth (SSSG) TSS & SSSG Quarterly TSS & SSSG Total System Growth Same Store Sales Growth Remark: Hypermarkets are not included in the calculation in SSSG. 22

  24. Same-Store Sales Growth by Channel SSG By Channel Free Standing Modern Trade Free standing shop Modern Trade Bangkok Upcountry Remark: Hypermarkets are not included in the calculation. 23

  25. Lower GPM yoy due to Special Promotional Offers Gross Profit Margin (GPM) of the apparel business slipped yoy. Similarly for the watch business, the gross profit margin dropped as a result of higher volume of special price products sold amidst a slowdown in domestic consumption. (THB millions) -4% YoY -2% YoY Gross Profit Gross Profit Margin Gross Profit Margin (excl TDC) 24

  26. Higher %SG&A to Sales – Reflective to selling expenses SG&A expenses increased yoy due mainly to higher selling expenses. The ratio of SG&A expenses to total sales revenue edged up on the back of modest revenue growth. % SG&A Expense to Sales YTD 2017 SG&A Breakdown (THB millions) +3% YoY +5% YoY 25

  27. Lower EBITDA YoY Due to lower operating performance, EBITDA and EBITDA margin declined yoy. (THB millions) -15% YoY -22% YoY EBITDA EBITDA Margin EBITDA Margin (excl TDC) 65.0% 0 -35.0% 26

  28. Lower Net Profit YoY Net profit dropped yoy due to lower GPM and higher SG&A to Sales. Overall net profit margin (NPM) declined yoy mainly as a result of lower NPM of apparel business. (THB millions) -29% YoY -21% YoY Net Profit Net Profit Margin Net Profit Margin (excl TDC) 65.0% 0 -35.0% 27

  29. Financial Position Remained Strong with Net Cash Position Net Debt to Equity Ratio Consolidated Balance Sheet 2016 Q3/17 (THB millions) Cash & Cash Equivalent 1,277 806 Accounts Receivable 787 567 Inventory 1,989 2,315 Other Assets 1,144 1,342 Total Assets 5,196 5,030 Accounts Payable 425 590 Interest-bearing Liabilities 147 112 Other Liabilities 338 376 Total Liabilities 910 1,078 Shareholders' Equity 4,286 3,952 28

  30. Higher Inventory Days from Lower Sales ROE ROA THB millions THB millions Finished Good Inventory Days (Months) Cash Cycle (Months) 29

  31. Consistent Dividend Payment Announced dividend payment for the performance during 1 Jan 2017 to 30 Jun 2017 as follows: DPS THB 0.45 XD 23 Aug 2017 Book Closing 28 Aug 2017 Payment 8 Sep 2017 Remark: Dividend policy is not less than 50% of net profit 30

  32. 2017 Guidance (Revised) Previous Revised Sales growth 3% -3 to -5% Gross profit margin 52%-53% Maintained % SG&A to sales 35%-36% Maintained CAPEX THB 80 mn Maintained Maintained Effective tax rate 9%-10% Dividend payout Not less than 50% Maintained 31

  33. Thank you Investor Relations MC GROUP Public Company Limited ir@mcgroupnet.com Tel: +662 117-9999 Ext 1210 Line ID: @mc_jeans 32

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