Brait PLC · JSE:BAT
Brait — New Look Retail Group — Debt Investor Presentation (February 2018)
19 slides from Brait's debt investor presentation, February 2018
Slide 1: Investor Presentation Q3 (YTD) FY18
INVESTOR PRESENTATION Q3 (YTD) FY18 39 weeks to 23 December 2017
Slide 2: Disclaimer
2 This presentation has been prepared by New Look Retail Group Limited and its subsidiaries (“New Look”) solely for informational purposes and does not constitute, and should not be construed as, an offer to sell or issue securities or otherwise constitute an invitation or inducement to any person t
Slide 3: Agenda
AGENDA 3 KEY HEADLINES Alistair McGeorge, Executive Chairman FINANCIAL REVIEW Richard Collyer, CFO TURNAROUND MEASURES Alistair McGeorge SUMMARY & OUTLOOK Alistair McGeorge Q&A Alistair McGeorge Richard Collyer
Slide 4: Key Headlines
KEY HEADLINES ALISTAIR McGEORGE Executive Chairman This presentation and all of the content is Private and Confidential. Please do not distribute without prior authorisation.
Slide 5: Key Headlines
5 Key Headlines • As anticipated in our last update, Q3 FY18 was challenging • UK high street headwinds • Dealing with product focussed on ‘young’ & ‘edgy’ customers, higher prices and weak supply chain • Significant activity to clear excessive stock • E-commerce being re-aligned to full price model
Slide 6: Financial Review
FINANCIAL REVIEW RICHARD COLLYER CFO This presentation and all of the content is Private and Confidential. Please do not distribute without prior authorisation.
Slide 7: Summary Consolidated Income Statement
Summary Consolidated Income Statement 7 Q3 (YTD) Q3 (YTD) • Revenue declined by 6.3% (£71.5m). Under the previous operating FY18 FY17 (39 weeks) (39 weeks) model, we were committed to higher than necessary volumes of stock, £m £m which was also focussed on the younger, edgier customer. As a result o
Slide 8: Segmental Performance
Segmental Performance SALES(1) • UK Retail sales declined by 7.3% (£56.1m) due to the significant promotional 8 and discounting activity • E-commerce (2) sales declined by 15.0% (£26.4m) following a similar promotional and discounting strategy and lower traffic • 3PE sales continued to perform stron
Slide 9: Summary Consolidated Balance Sheet
9 Summary Consolidated Balance Sheet As at 23 Dec 17 As at 24 Dec 16 • Inventory reduced by £15.2m compared to last year with the £m £m one off stock clearance, higher stock provisions and movement Derivatives - 30.5 in foreign exchange rates Other non current assets 892.4 919.2 Non current assets 8
Slide 10: Summary Consolidated Cash Flow Statement
10 Summary Consolidated Cash Flow Statement Q3 (YTD) Q3 (YTD) FY18 FY17 • Operating profit declined by £156.3m compared to Q3 (39 weeks) (39 weeks) £m £m (YTD) FY17 as a result of weak full price trading, Operating (loss)/profit (56.9) 99.4 discounting activity and higher administrative expenses Non
Slide 11: Capital Expenditure
11 Capital Expenditure Q3 (YTD) Q3 (YTD) FY18 FY17 (39 weeks) (39 weeks) £m £m • Year to date expenditure has been actively reduced to reflect year to date trading Total UK 24.0 41.2 New Space 7.9 11.6 Refurbishments 1.6 4.3 IT Infrastructure 7.7 15.5 • UK new space – opened 8 core stores, 1 Mens Lo
Slide 12: Liquidity and Operating Facilities
12 Liquidity and Operating Facilities Q3 FY18 Q3 FY17 • Total Liquidity and Operating facilities £200.0m £m £m • £100.0m RCF (fully drawn on 26.01.18) Cash, cash equivalents and bank overdrafts1 73.3 132.5 • £100.0m Operating Facilities - Bi-lateral multi- Available liquidity facilities Overdraft fa
Slide 13: Turnaround Measures
TURNAROUND MEASURES ALISTAIR McGEORGE Executive Chairman
Slide 14: Cost Savings Initiatives
14 Cost Savings Initiatives • Significant annual cost reductions of c.£25m already identified and being actioned, including: • Marketing efficiencies • Inventory shrinkage • Other cost efficiencies and organisational structure changes • Plan to relocate our London office to King’s Cross cancelled •
Slide 15: Operational Turnaround
15 Operational Turnaround We are reconnecting with our customer and have already executed changes to recover our broad appeal and deliver full price sales and profit growth Product • Realigned the product to our broad appeal core customer • Reduced options by 15% -20% • Reduced prices to deliver bet
Slide 16: Operational Turnaround
16 Operational Turnaround Brand • Significantly improved windows, photography, point of sale and value messaging • Clarity of target customer and brand relaunch during Spring/Summer 18 Retail • Lower stocks will reduce activity allowing greater emphasis on customer service • Store layout simplified
Slide 17: Summary & Outlook
SUMMARY & OUTLOOK ALISTAIR McGEORGE Executive Chairman
Slide 18: Summary & Outlook
18 Summary & Outlook • Whilst FY18 remains challenging, we are already taking the necessary actions to address current issues and return to long term profitability from FY19 onwards • All cost options are being investigated • Confidence in the changes implemented across BMD and all trading channels
Slide 19: Q&A
Q&A ALISTAIR McGEORGE Executive Chairman RICHARD COLLYER CFO
New Look Retail Group — Debt Investor Presentation (February 2018) on 6ix