Brait Plc · JSE:BAT
Brait — New Look Retail Group — H1 FY2018 Earnings Presentation
23 slides from Brait's earnings presentation, November 2017
Slide 1: Investor Presentation H1FY18
INVESTOR PRESENTATION H1FY18 26 weeks to 23 September 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 INTRODUCTION FINANCIAL REVIEW and RECOVERY FY18 RECOVERY BEYOND FY18 and SUMMARY Q&A
Slide 4: Introduction
INTRODUCTION JOHN GNODDE Non Executive Director
Slide 5: Headlines
~) iil a uP Headlines * Performance weakened further in Q2 * H2FY18 will remain challenging * Leadership change actioned * We continue to identify major causes of decline and are already implementing corrective measures * We have a strict focus on cost control * We have an adequate cash profile and
Slide 6: Leadership Changes
Leadership Changes * Alistair McGeorge appointed as Executive Chairman * Significant industry experience * Led previous New Look turn-round and recovery in 2011-2014 * Tom Singh (Founder) taking active product role alongside Roger Wightman (Chief Product Officer) * Danny Barrasso resumes his role of
Slide 7: Financial Review
FINANCIAL REVIEW RICHARD COLLYER CFO
Slide 8: Reasons for underperformance
Reasons for underperformance We moved away from our successful broad appeal * We had become too young and edgy * Customer messaging was becoming overly fashionable and did not highlight value Chased E-commerce sales at the expense of profitability We were late to some trends and have lost flexibilit
Slide 9: Segmental Performance
Segmental Performance Sales by Segment H1FY18 vs. H1 FY17 £600m £500m mHIFYI8 £400m MHIFYI7 £300m 3 £200m £100m 16.9 15.8 ——s £0m UKRetail E-commerce 3rd PartyE- International Franchise commerce UNDERLYING OPERATING PERFORMANCE (UOP) * UK Retail UOP declined by £51.1m, due to the sales decline and o
Slide 10: 3.3 343.8 6.9 2.9 3.4 2.0 1.6 2.3 7.1 322.5 2.0 315.4 (3.1)
10 3.3 343.8 6.9 2.9 3.4 2.0 1.6 2.3 7.1 322.5 2.0 315.4 (3.1)
Slide 11: Liquidity and Operating Facilities
11 Liquidity and Operating Facilities. A focus on adequate cash and liquidity control is in place MevIg HIEYIZ” H1 FY18 total cash, liquidity and operating facilities available . was £242.5m Cash, cash equivalents and bank overdrafts 93.4 108.8 © £93.4m Cash ; oo a * £115.0m Overdraft and RCF (fully
Slide 12: What Are We Doing Now to Recover?
WHAT ARE WE DOING NOW TO RECOVER? RICHARD COLLYER CFO
Slide 13: Recovery FY18
Recovery FY18 Quarter 3 * Product committed — we will trade hard and aim to exit he season ‘clean’ Quarter 4 * Progressive return to broad appeal product at a great price * Improved planning cycle and speed — greater flexibility Focus on restoring UK profitability: * Back to basics mentality * Long
Slide 14: Recovery Beyond FY18 and Summary
RECOVERY BEYOND FY18 and SUMMARY ALISTAIR MCGEORGE Executive Chairman
Slide 15: Recovery — beyond FY18
15 Recovery — beyond FY18 We have total belief in the New Look brand We wi fully recover our broad appeal with a planning cycle and speed fit for today’s market We wi advan We wi We wi leverage our omni-channel competitive age rigorously review our store portfolio optimise our cost investment to gen
Slide 16: Summary
16 Summary . . . . . . We have the liquidity and operating facilities to implement our plans — and we have the time to recover H2 FY18 will remain difficult — we will continue focussing on improving trading in a challenging market Necessary changes have been made in senior management We are a proven
Slide 17: Q&A
Q&A ALISTAIR MCGEORGE Executive Chairman RICHARD COLLYER CFO JOHN GNODDE Non Executive Director
Slide 18: Appendices
APPENDICES
Slide 19: Summary Consolidated Income Statement
19 Summary Consolidated Income Statement H1FY18 H1FY17 (26weeks) (26 weeks) im im Revenue 686.0 718.1 Cost of sales (352.6) (343.4) Gross profit 333.4 374.7 Gross profit % 48.6% 52.2% Administrative expenses (SG&A) (367.8) (323.0) Operating profit (34.4) 51.7 Operating profit % (5.0%) 7.2% Operating
Slide 20: Summary Consolidated Balance Sheet
Summary Consolidated Balance Sheet Inventory reduced £18.2m compared to last year as a result of lower intake and an exceptional increase in the stock provision At H1 FY18 our Euro FRN was c. 54% hedged via cross currency swaps, c. 84% of our total debt is at fixed rates, with the balance subject to
Slide 21: Summary Consolidated Cash Flow Statement
Summary Consolidated Cash Flow Statement HI1FY18 HI1FY17 (26 weeks) (26 weeks) * Operating Profit declined by £86.1m compared to £ £ . + ™ ™ H1 FY17 as a result of the decline in sales and fe) tit fit (34.4) 51.7 . . woe . Peraungpres increases in administrative expenses Non cash items 39.3 21.4 Cha
Slide 22: Capital Expenditure
Capital Expenditure COMMITTED INVESTMENT IN CURRENT YEAR - FLEXIBLE IN FUTURE YEARS * UK new space -opened 6 core stores, 1 Mens standalone with 3 store closures * We have slowed our Concept refurbishment program in line with current trading * 36 net new stores opened in China, with 60-80 total plan
Slide 23: New Look
NEW LOOK
New Look Retail Group — H1 FY2018 Earnings Presentation on 6ix