Presentation of Q1 2019 result Eggert Kristfersson, CEO 21 May 2019 - - PowerPoint PPT Presentation

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Presentation of Q1 2019 result Eggert Kristfersson, CEO 21 May 2019 - - PowerPoint PPT Presentation

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Presentation of Q1 2019 result Eggert Kristfersson, CEO 21 May 2019 CONSOLIDATED HIGHLIGHTS ISK 1,367 m 32.0% 0.8% EBITDA* Q1 2019 Equity ratio Return on equity ISK 1,329 m 32.3% 54.1% EBITDA Q1 2019 EBITDA*/Gross profit

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SLIDE 1

Presentation of Q1 2019 result

Eggert Kristófersson, CEO

21 May 2019

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SLIDE 2

CONSOLIDATED HIGHLIGHTS

*EBITDA, excluding the cost related to the acquisition of Hlekkur ehf.

ISK 1,367 m 32.0% 0.8%

EBITDA* Q1 2019 Equity ratio Return on equity

ISK 1,329 m 32.3% 54.1%

EBITDA Q1 2019 EBITDA*/Gross profit Salaries/Gross profit

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SLIDE 3

Financials

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SLIDE 4

CONSOLIDATED OPERATIONS IN Q1 2019

*EBITDA, excluding the cost related to the acquisition of Hlekkur ehf.

Amounts are in ISK million Q1 2019 Q1 2018 Change % Chg. Gross profit 4.231 1.989 2.242 112,7% Lease revenue and operating income 372 106 267 252,7% Salaries and personnel expenses

  • 2.291
  • 1.094

1.196 109,3% Sales expenses

  • 258
  • 211

46 21,9% Other operating expenses

  • 725
  • 389

337 86,6% EBITDA* 1.367 436 931 213,8% Key Figures EBITDA*/Gross profit 32,3% 21,9% 10,4% 47,5% Salaries/Gross profit 54,1% 55,0%

  • 0,9%
  • 1,6%

Earnings per share 0,16 0,31

  • 0,15
  • 49,5%

Income statement

ISK 521 m ISK 436 m ISK 1.367 m 22,6% 21,9% 32,3% 0,0% 20,0% 40,0% 60,0% 80,0% 100,0%

  • 500.000

1.000.000 1.500.000 Q1 2017 Q1 2018 Q1 2019 EBITDA* EBITDA*/Gross profit ISK 1.052 m ISK 1.035 m ISK 3.240 m ISK 1.008 m ISK 954 m ISK 991 m ISK 2.061 m ISK 1.989 m ISK 4.231 m

  • 1.000.000

2.000.000 3.000.000 4.000.000 5.000.000 Q1 2017 Q1 2018 Q1 2019 Gross profit from other goods Gross profit from fuel

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SLIDE 5

HIGHLIGHTS

ISK 1.920 m 46,3% 0,0% 20,0% 40,0% 60,0% 80,0%

  • 500.000

1.000.000 1.500.000 2.000.000 2.500.000 Q1 2019 Gross profit Salaries/Gross profit ISK 2.292 m 12,1% 0,0% 10,0% 20,0% 30,0% 40,0% 50,0% 60,0% 70,0% 80,0%

  • 2.000.000

4.000.000 6.000.000 8.000.000 1F 2019 Sales Salaries/sales ISK 8.319 m 8,9% 0,0% 10,0% 20,0% 30,0% 40,0% 50,0% 60,0% 70,0% 80,0% 2000000 4000000 6000000 8000000 10000000 1F 2019 Sales Salaries/sales ISK 373 m 4,5% 0,0% 10,0% 20,0% 30,0% 40,0% 50,0% 60,0% 70,0% 80,0%

  • 50.000

100.000 150.000 200.000 250.000 300.000 350.000 400.000 1F 2019 EBITDA EBITDA/sales ISK 68 m 3,6% 0,0% 10,0% 20,0% 30,0% 40,0% 50,0% 60,0% 70,0% 80,0%

  • 50.000

100.000 150.000 200.000 250.000 300.000 350.000 400.000 Q1 2019 EBITDA EBITDA/Gross profit ISK 6 m 0,3% 0,0% 10,0% 20,0% 30,0% 40,0% 50,0% 60,0% 70,0% 80,0%

  • 20.000

40.000 60.000 80.000 100.000 1F 2019 EBITDA EBITDA/sales

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SLIDE 6

HIGHLIGHTS

  • More business activities in Q2 and Q3
  • Decrease in inventories from year-end due

to decrease in business activities in JET fuel

  • Sale less that expected in Q1 2019
  • World market price development of fuel

had a positive impact on gross profit in Q1 2019

  • Positive development in Krónan‘s
  • perations and it‘s sales more than

expected in Q1 2019

  • A new store opened at Skeifan in Q1 2019
  • Opportunities available via opening of

new stores

  • Less sale than expected in Q1 2019
  • A competitive market and difficult

economic environment in Q1 2019

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SLIDE 7

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Assets at the end of the period

Amounts are in ISK million Q1 2019 Q1 2018 Change % Chg. Goodwill 14.070 14.070

  • Other Intangible assets

4.519 206 4.313 2097,2% Property and equipment 31.911 16.870 15.041 89,2% Leased assets 3.798 3.798

  • Investment properties

8.725 8.725

  • Shares in associates

2.140 1.854 286 15,4% Securities 137 132 5 4,0% Non-current assets 65.301 19.062 46.239 242,6% Inventories 7.092 3.252 3.840 118,1% Trade receivables 3.607 3.051 556 18,2% Receivable from related parties 155

  • 155
  • Other short-term receivables

791 391 400 102,1% Cash and cash equivalents 4.411 2.387 2.024 84,8% Current assets 15.900 9.236 6.664 72,2% Total assets 81.201 28.298 52.903 187,0% Statement of Financial Position (Assets)

1,4 1,5 1,3 2,0 1,9 1,7 1,1 1,1 1,1 0,0 0,5 1,0 1,5 2,0 2,5 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019

Current ratio

7,6 7,5 6,1 5 10 Q1 2019 Q1 2018 Q1 2017

Inventory turnover

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SLIDE 8

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Equity and liabilites at the end of the period

Amounts are in ISK million Q1 2019 Q1 2018 Change % Chg. Equity 26.021 13.873 12.148 87,6% Payable to credit institutions 33.457 8.000 25.457 318,2% Lease liabilities 3.327 3.327

  • Deferred tax liabilities

3.894 1.474 2.421 164,2% Non-current liabilities 40.679 9.474 31.205 329,4% Current tax 575 380 194 51,1% Payable to the Icelandic State 2.776 2.676 101 3,8% Payable to credit institutions 3.725 3.725

  • Lease liabilites

492 492

  • Trade payables

5.108 1.146 3.962 345,8% Other short-term liabilities 1.825 749 1.075 143,5% Current liabilities 14.501 4.951 9.550 192,9% Total equity and liabilities 81.201 28.298 52.903 187,0% Statement of Financial position (equity and liabilites)

46,7% 46,4% 46,4% 49,9% 49,0% 47,5% 32,0% 33,4% 32,0% 0% 10% 20% 30% 40% 50% 60% Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019

Equity ratio

ISK 4.154 m ISK 5.055 m ISK 22.569 m 1,1 1,5 4,1

  • 1,00

1,00 3,00 5,00 7,00 9,00 11,00 13,00 15,00 5.000.000 10.000.000 15.000.000 20.000.000 25.000.000 Q1 2017 Q1 2018 Q1 2019 Average net interest bearing liabilities Average net interest bearing liabilities / EBITDA

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SLIDE 9

CONSOLIDATED STATEMENT OF CASH FLOWS

Amounts are in ISK million Q1 2019 Q1 2018 Change % Chg. Cash at the beginning of the year 4.267 2.800 1.467 52,4% Cash flows from operating activities 690

  • 252

942

  • 373,6%

Investing activities

  • 233
  • 163
  • 70

42,9% Financing activities

  • 345
  • 345
  • FX difference on cash

32 2 30 1357,9% Cash at the end of the period 4.410 2.387 2.024 84,8%

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SLIDE 10

OPERATING SEGMENTS OF THE GROUP

N1 68 Krónan 373 Elko 6 Real estate 827 Other

  • 76

Segment EBITDA

First quarter 2019

Amounts are in ISK million Festi Krónan Elko Real estate Other Elimination entries Application

  • f IFRS 16

Total Operating revenue 7.626 8.319 2.292

  • 7

18.230 Other revenue 64 3 1.010 692

  • 1.397

372 Total segment revenue 7.690 8.322 2.292 1.010 18.602 Total operating expenses of segments

  • 7.622
  • 7.949
  • 2.286
  • 182
  • 768

1.404 131

  • 17.272

Segment EBITDA 68 373 6 827

  • 768

1.404 131 1.329 Segment depreciation and amortisation

  • 199
  • 125
  • 41
  • 216
  • 38
  • 102
  • 721

Fair value changes of investment properties

  • 45
  • 45

Share of profit from associates 60 60 Operating result of segments

  • 131

248

  • 35

566

  • 746

1.404 29 623 Segment assets 16.442 8.952 3.521 36.496 13.657

  • 4.800

3.798 78.066 Unallocted assets 3.135 Total assets 81.201

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SLIDE 11

REAL ESTATE OPERATIONS OF THE GROUP

* Net operating income ** Loan-to-Value

Properties, key figures Q1 2019 NOI* ISK 827 m NOI ratio 82% Utization ratio 97% LTV** 51% Number of Festi's properties 90 Total square meters 112 thousand m2 Own use 78% Leased to third parties 22%

ISK 827 m 82% 0% 25% 50% 75% 100% 125% 150% 175% 200% 100.000 200.000 300.000 400.000 500.000 600.000 700.000 800.000 900.000 1F 2019 NOI NOI %

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SLIDE 12

SHARE PRICE DEVELOPMENT

20 40 60 80 100 120 140 01.01.2016 01.04.2016 01.07.2016 01.10.2016 01.01.2017 01.04.2017 01.07.2017 01.10.2017 01.01.2018 01.04.2018 01.07.2018 01.10.2018 01.01.2019 01.04.2019

Shareholders (10 largest) Market information Stefnir 11,7% Issued shares 330 M Lífeyrissjóður verslunarmanna 10,1% Market cap at the end of March 2019 ISK 37.077 M Gildi - lífeyrissjóður 8,9% Market cap at the end of March 2018 ISK 29.750 M Lífeyrissjóður starfsmanna ríksins A-division, B-division & S-division 7,4% Number of shareholders 846 Lansdowne Icav Lansdowne Euro 6,1% Annual return from the beginning of the year 28,8% Birta lífeyrissjóður 5,4% Annual return from 2015 32,6% Almenni lífeyrissjóðurinn 4,8% Landsbréf 4,1% Stapi lífeyrissjóður 4,0% Global Macro funds (Eaton) 2,9%

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SLIDE 13

Position and outlook

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SLIDE 14

POSITION AND OUTLOOK

Financial forecast for the year 2019

  • Unchanged estimate of EBITDA, expected to be in the range of ISK 7,400 to 7,700 million

in 2019, excluding expenses related to the acquistion of Hlekkur, which has for the most part already been realised Assumptions:

  • Operations related to tourism expected to be similar to 2018
  • Uncertainty with respect to the number of tourists visiting the country 2019
  • Turmoil in the oil market and ISK exchange rate can lead to fluctuations of gross margin

and working capital Intergration:

  • Operations of N1 transferred to an operating company on 1.1.2019
  • N1 warehose operations transferred to Bakkinn on 1.1.2019
  • Combining of headquartes at Dalvegur in 2019
  • Realisation of synergy well underway

Investments:

  • Annual consolidated investments of approximately ISK 1,900 million
  • Operations of Dælan sold in Q1 2019
  • Real estate sold at the beginning of April in the amount of approximately

ISK 2,500 million

EBITDA forecast 2019 ISK million Operations Real estate IFRS 16 Total Lower limit 3.750 3.150 500 7.400 Higher limit 4.000 3.200 500 7.700

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SLIDE 15

DISCLAIMER

  • All information in this presentation is based on sources which Festi hf. considers reliable at the time of publication, but it cannot be guaranteed that the information is infallible.
  • All information in this presentation is owned by Festi hf. It is not permitted to copy, change or distribute in any way information from this presentation, in part or it its entirety.
  • This presentation is only intended for information purposes and is not part of, or a basis for, any decisions made by the recipient Recipients should not interpret information in this

presentation as a promise or as instructions. Festi hf. is not obliged to provide recipients of this presentation with further information about the company or to make changes or corrections to the presentation if information upon which it is based changes.

  • The company’s future outlook is dependent on a number of risks and uncertainties which may have the effect that the actual result in the future is considerably different to the

scenario described in this presentation. This includes factors such as exchange rates, the global price of fuel, the availability of funding, new legislation coming into effect and the impact of regulators, etc.

  • Festi hf. wishes to point out that recipients of the presentation should not rely on statements contained within in the future since they are only applicable on the date of publication
  • f the presentation. All statements concerning the company’s future prospects are entirely valid with respect to this proviso.
  • By receiving this presentation the recipient agrees that they are bound by the above provisos and limitations.