Tokmanni Group Oyj · OMXHEX:TOKMAN
Tokmanni Group Oyj — Investor Day (December 2018)
41 slides from Tokmanni Group Oyj's investor day presentation, Dec 4, 2018
Slide 1: Capital Markets Day 2018
Capital Markets Day 2018 1 TOKMANNI CMD 4.12.2018
Slide 2: Tokmanni Business Drivers and Strategic Goals 2020
TOKMANNI BUSINESS DRIVERS AND STRATEGIC GOALS 2020 2 4.12.2018 TOKMANNI CMD 4.12.2018
Slide 3: Tokmanni business drivers 2020
Tokmanni business drivers 2020 CUSTOMERS Customer NPS >60 PERSONNEL Best place to work in retail REVENUE 1 billion € PROFITABILITY Adjusted EBITDA 10 % SUSTAINABILITY Tokmanni values people and environment 3 TOKMANNI CMD 4.12.2018
Slide 4: Tokmanni business drivers 2020
Tokmanni business drivers 2020 CUSTOMERS Customer NPS >60 PERSONNEL Best place to work in retail REVENUE 1 billion € PROFITABILITY Adjusted EBITDA 10 % SUSTAINABILITY Tokmanni values people and environment 4 TOKMANNI CMD 4.12.2018
Slide 5: Tokmanni's customer base
Tokmanni’s customer base Whole population Tokmanni’s customers 43% 40% 17% 17% 16% 16% 13% 12% 7% 7% 5% 6% Family households Adult households Pensioners Adult singles Young singles Young couples 5 TOKMANNI CMD 4.12.2018 Note: Tokmanni’s customers = Customers that frequently visit Tokmanni Sources: T
Slide 6: Very good customer satisfaction
Very good customer satisfaction NPS 56 6 TOKMANNI CMD 4.12.2018
Slide 7: Tokmanni business drivers 2020
Tokmanni business drivers 2020 CUSTOMERS Customer NPS >60 PERSONNEL Best place to work in retail REVENUE 1 billion € PROFITABILITY Adjusted EBITDA 10 % SUSTAINABILITY Tokmanni values people and environment 7 TOKMANNI CMD 4.12.2018
Slide 8: Tokmanni's target: best place to work in retail
Tokmanni’s target: best place to work in retail Unified Tokmanni Supportive Competence and common Meaningful supervisory development values work work opportunities Active Functional Open development Fair pay tools communication of well-being 8 TOKMANNI CMD 4.12.2018
Slide 9: We are on the right track
We are on the right track 2017 2018 “Please, indicate how you agree with the following statements in a scale from 1 to 5, where 1 is completely disagree and 5 is completely agree?” 5 +0.5 4.4 +0.4 +0.4 4.0 4 3.9 3.6 3.6 3.2 3 2 1 I am aware of the goals The information flow in our I feel that we are
Slide 10: TOKMANNI CMD 4.12.2018
10 TOKMANNI CMD 4.12.2018
Slide 11: Tokmanni business drivers 2020
Tokmanni business drivers 2020 CUSTOMERS Customer NPS >60 PERSONNEL Best place to work in retail REVENUE 1 billion € PROFITABILITY Adjusted EBITDA 10 % SUSTAINABILITY Tokmanni values people and environment 11 TOKMANNI CMD 4.12.2018
Slide 12: No. 1 retailer in Finland in selected destination categories
No. 1 retailer in Finland in selected destination categories Home decoration and kitchen Health, Home beauty and improvement well-being No. 1 in customer minds or No. 1 in customer reach or No. 1 in sales Cleaning and storage Clothing Garden 12 TOKMANNI CMD 4.12.2018
Slide 13: Tokmanni is building the destination categories
Tokmanni is building the destination categories • Unbeatable price levels • Wide and inspiring assortment • Attractive store concept • Strong marketing • Dedicated personnel serving Tokmanni’s customer 13 TOKMANNI CMD 4.12.2018
Slide 14: Target: very strong sales growth in private labels
Tokmanni target: very strong sales growth in private labels Home decoration and kitchen Health, Home beauty and improvement well-being Food Cleaning and Clothing storage Garden 14 TOKMANNI CMD 4.12.2018
Slide 15: Tokmanni's actions to increase private label sales
Tokmanni’s actions to increase private label sales • +20% increase in Shanghai office spending • Launch of two new private label ranges 2019 and extending current private label ranges with more than 1,000 SKUs • Special actions in store merchandising for Tokmanni private labels and stronger role in
Slide 16: Tokmanni's nationwide store network
Tokmanni’s nationwide store network Tokmanni’s target is to increase its store network to +200 stores in Finland by the end of 2020 • 186 Tokmanni stores in 4 Dec. 2018 • 2017: 13 new and 2 re-located • 2018: 11 new and 3 re-located (includes 9 Ale-Makasiini stores) • 2019: 3 new and 2 re-located 16
Slide 17: Tokmanni acquired Ale-Makasiini
Tokmanni acquired Ale-Makasiini • Ale-Makasiini is a well established general discount retailer • Stores in Äänekoski, Suolahti, Viitasaari, Saarijärvi, Laukaa, Siilinjärvi, Pielavesi, Pihtipudas and Kangasniemi • Revenue was EUR 19.7 million and operating result EUR 1.0 million in 2017 17 TOKMANNI
Slide 18: Tokmanni performance in geographical areas
Tokmanni performance in geographical areas Whole population Tokmanni’s customers 54% 48% 40% 32% 15% 12% Urban areas City centers Rural areas 18 TOKMANNI CMD 4.12.2018 Note: Tokmanni’s customers = Customers that frequently visit Tokmanni Sources: TNS Mind 2018
Slide 19: Tokmanni online
Tokmanni online Reliable low price online store which offers a wide range of inspiring products with a convenient customer experience through nationwide store network. 19 TOKMANNI CMD 4.12.2018
Slide 20: Tokmanni online business drivers
Tokmanni online business drivers CUSTOMERS Customer NPS >60 REVENUE Significant growth Continuous improvement of SUPPLY CHAIN efficiency PROFITABILITY % Solid improvement 20 TOKMANNI CMD 4.12.2018
Slide 21: Tokmanni competitive advantages
Tokmanni competitive 1. Low prices advantages 4. Lean and efficient operation model 2. Inspiring and wide 3. Nationwide store network assortment combined with click & collect service 21 TOKMANNI CMD 4.12.2018
Slide 22: Tokmanni business drivers 2020
Tokmanni business drivers 2020 CUSTOMERS Customer NPS >60 PERSONNEL Best place to work in retail REVENUE 1 billion € PROFITABILITY Adjusted EBITDA 10 % SUSTAINABILITY Tokmanni values people and environment 22 TOKMANNI CMD 4.12.2018
Slide 23: Comparable EBITDA-% development
Comparable EBITDA-% development Targeting 2-3% improvement 8.1% 7.7% 6.9% 5.8% 4.8% 2015 2016 2017 Q1-Q3/2017 Q1-Q3/2018 23 TOKMANNI CMD 4.12.2018 Sources: Tokmanni Group Oyj annual and quarterly reports
Slide 24: Tokmanni's profitability is driven by
Tokmanni’s profitability is driven by 1. Like-for-Like sales growth 2. Gross margin-% 3. Operating expenses-% 24 TOKMANNI CMD 4.12.2018
Slide 25: Gross margin
Gross margin 25 TOKMANNI CMD 4.12.2018
Slide 26: Comparable gross margin-% development
Comparable gross margin-% development Targeting 1-2% gross margin improvement 34.5% 34.2% 33.7% 33.7% 33.2% 2015 2016 2017 Q1-Q3/2017 Q1-Q3/2018 26 TOKMANNI CMD 4.12.2018 Sources: Tokmanni Group Oyj annual and quarterly reports
Slide 27: Targeting 1-2% gross margin improvement
Targeting 1-2% gross margin improvement Our target is to • Increase private label, no-labels and exclusive label sales Share of branded label sales Share of private label, no-label, and exclusive label sales 100% 100% 100% 66% 66% 68% 34% 34% 32% 2015 2016 2017 27 TOKMANNI CMD 4.12.2018 Sources: Tok
Slide 28: Targeting 1-2% gross margin improvement
Targeting 1-2% gross margin improvement Our target is to • Increase direct sourcing Share of other direct import sales Share of shanghai JV import sales 25% 25% 25% 12% 11% 15% 13% 14% 10% 2015 2016 2017 28 TOKMANNI CMD 4.12.2018 Sources: Tokmanni Group Oyj annual and quarterly reports
Slide 29: Targeting 1-2% gross margin improvement
Targeting 1-2% gross margin improvement In addition, our target is to Increase gross Increase batch Increase supply margin of buying chain efficiency branded labels through increased volumes 29 TOKMANNI CMD 4.12.2018 Sources: Tokmanni Group Oyj annual and quarterly reports
Slide 30: Targeting further improvement in supply chain efficiency
Tokmanni is targeting further improvement in supply chain efficiency • Logistics optimisation • Further optimisation of logistic flows in Finland, from Europe, and Far East • Further process development to improve stock turnover rate • Further improvement of delivery and warehouse efficiency 30 TOKM
Slide 31: Targeting better on-shelf availability
Tokmanni is targeting better on-shelf availability • Improving on-shelf availability • Improving campaign management process and stronger deviation management • Improving sales forecasting and increasing share of automated replenishment 31 TOKMANNI CMD 4.12.2018
Slide 32: Operating expenses
Operating expenses 32 TOKMANNI CMD 4.12.2018
Slide 33: Comparable operating expenses-% development
Comparable operating expenses-% development Targeting 1-1,5% operating expense-% improvement 28.9% 28.3% 27.2% 27.0% 26.9% 2015 2016 2017 Q1-Q3/2017 Q1-Q3/2018 33 TOKMANNI CMD 4.12.2018 Sources: Tokmanni Group Oyj annual and quarterly reports
Slide 34: LFL sales growth and process development to improve operational efficiency
LFL sales growth and process development to further improve operational efficiency Operating expenses and it’s share development by category 2016 2017 217.8 207.5 50% 40% 30% 26.9% 27.2% 20% 10% 0% Operating expenses Salaries Rents Marketing Real estates External Other opex in total and as a share s
Slide 35: Tokmanni aims to improve EBITDA-% for the upcoming years
Tokmanni aims to improve EBITDA-% for the upcoming years Target 10% 1.0% - 1.5% 1.0% - 2.0% 6.9 % EBITDA-% 2017 Gross margin Operating expenses EBITDA-% improvement potential improvement potential 35 TOKMANNI CMD 4.12.2018
Slide 36: Tokmanni business drivers 2020
Tokmanni business drivers 2020 CUSTOMERS Customer NPS >60 PERSONNEL Best place to work in retail REVENUE 1 billion € PROFITABILITY Adjusted EBITDA 10 % SUSTAINABILITY Tokmanni values people and environment 36 TOKMANNI CMD 4.12.2018
Slide 37: Tokmanni values people
Tokmanni values people • Tokmanni hires people from varied backgrounds to better serve its diversified customer base • Tokmanni respects human rights in all its activities 37 TOKMANNI CMD 4.12.2018
Slide 38: Tokmanni values environment 1/2
Tokmanni values environment 1/2 • Tokmanni aims to reduce 15% of greenhouse gas emissions in its own operations • In 2018, all old refrigerated cabinets are changed to new and more environmental friendly cabinets in all (13) of its fresh food stores • Energy efficient led lightning in 70 stores and
Slide 39: Tokmanni values environment 2/2
Tokmanni values Tokmanni has one of Finland’s biggest solar panel plants on the roof of its HQ environment 2/2 • Tokmanni aims to increase the use of solar power • In 2018, 3,000 solar panel’s plant installed on the roof of the HQ in Mäntsälä. This is estimated to produce 740,000 kWh, and account fo
Slide 40: Tokmanni strategic targets
Tokmanni strategic targets Like-for-like revenue growth Low single digit Approximately 5 p.a. / New stores 12,000 sqm Progressively Comparable EBITDA margin reaching ~10% Long-term Net Debt / Comparable EBITDA < 2x Dividend policy Approximately 70% 40 TOKMANNI CMD 4.12.2018
Slide 41: Tokmanni's Capital Markets Day Disclaimer
Tokmanni’s Capital Markets Day Disclaimer This presentation has been produced by Tokmanni Group Oyj for Capital Markets Day. Tokmanni Group Oyj does not accept any responsibility to anyone for the information contained in this document. Tokmanni Group Oyj has indicated within this document the sourc