Woolworths Holdings Limited · JSE:WHL
Woolworths — H1 2004 Earnings Presentation
16 slides from Woolworths's earnings presentation, February 2004
Slide 1: Investment Analysts Presentation February
WOOLWORTHS HOLDINGS LIMITED \ ( H [ investment analysts presentation february
Slide 2: Agenda
woolworths holdings limited agenda • Group results • Woolworths Holdings Limited • Woolworths Operating Group • Country Road Limited • Clothing and home • Foods • Financial services • Franchise and international • Country Road Limited • Woolworths Holdings Limited • Strategy • The future
Slide 3: Highlights
woolworths holdings limited highlights • Revenue up 10.5% • Operating profit up 22.3% • Net profit before tax and exceptional items up 18.5% • Headline earnings per share up 20.0%: • Cash distribution up 23.8% • ROE of 27.2% (2003 : 25.1%)
Slide 4: Trading environment
woolworths holdings limited trading environment • Strong rand • impact on exports • impact on competitive position • Food market buoyant • Rapidly declining usury rate • Australia • tough trading conditions • lost market share
Slide 5: Woolworths operations highlights
woolworths operations highlights • Sales up 13.7% • Operating profit up 23.2% • Clothing : • Good performance in womenswear, footwear, lingerie and accessories • Homeware is turning • Foods continues to grow market share • Roll out of food micro stores • Financial services achieved growth in all pro
Slide 6: Country Road Limited highlights
country road limited highlights • Sales below expectation • Profit before tax A$0,6m (operating profit A$1,0m (2002 : A$1,6m)) • Further sustainable cost reductions • More retail focussed business • Benefiting from improved supply chain process • Improved design brief
Slide 7: Woolworths Holdings income statement
woolworths holdings results income statement Dec 2003 Dec 2002 % Change Rm Rm Revenue 5 579,7 5 051,3 10.5 Turnover 5 266,0 4 794,9 9.8 Cost of merchandise 3 574,6 3 199,5 11.7 Gross profit 1 691,4 1 595,4 6.0 Other revenue 313,7 256,4 22.3 Expenses 1 455,1 1 402,0 3.8 Operating profit 550,0 449,8 2
Slide 8: PBTAE, HEPS and DPS as at Dec 2003
woolworths holdings results PBTAE, HEPS and DPS as at dec 2003 HEPS 40,2 (cents) 33.5 20.9 * DPS (cents) 16.0 15.8 13.0* 10.5 7.5 7.5 7.5 204.3 R360,0 224.6 R376,6 303.1 R433,7 415.2 R640,7 491.9 R800,6 m m m m m 1999 2000 2001 2002 2003 * distribution from share premium
Slide 9: Balance sheet
woolworths holdings results balance sheet Dec Dec Change 2003 2002 Rm Rm Rm Assets Property, plant and 1 145,1 966,7 178,4 equipment Export partnerships 177,8 187,9 (10,1) Inventories 684,9 601,3 83,6 Financial services’ assets 2 534,7 2 014,8 519,9 Accounts receivable 707,5 629,6 77,9 Cash 201,1 17
Slide 10: Cash flow
woolworths holdings results cash flow Dec 2003 Dec 2002 Rm Rm Cash generated by operations, before 577,2 635,8 tax* Increase in borrowings 266,2 83,3 843,4 719,1 Utilised by : Tax paid (175,4) (100,0) Distributions paid (159,2) (110,4) Capex (253,4) (199,0) Proceeds on disposal of property, 12,9 9,8
Slide 11: Cash flow (cont.)
woolworths holdings results cash flow (cont.) capex R236m* growth in IT R90m Retail woolworths financial development (38%) services assets R140m (59%) R314m Visa card Personal loans R26m (8%) R47m (15%) Other WW card R6m (3%) R241m (77%) *capex R236m capex cash flow R253m
Slide 12: Return on equity / WACC
woolworths holdings results return on equity / wacc 19.0% 16.0% 17.0% 13.0% 12.7% 11.6% 12.9% 18.3% 23.7% 27.2% Jun Jun 2001 Jun 2002 Jun 2003 Dec 2000 2003* ROE (headline earnings basis) WACC * Annualised (not projected)
Slide 13: Woolworths operations income statement
woolworths operations results income statement Dec Dec % 2003 2002 Change Rm Rm Revenue 5 097,0 4 461,8 14.2 Turnover 4 789,7 4 211,8 13.7 Cost of merchandise 3 348,9 2 911,2 15.0 Gross profit 1 440,8 1 300,6 10.8 Interest received and other 307,3 250,0 22.9 revenue Operating expenses 1 203,0 1 108,
Slide 14: Woolworths operations performance
woolworths operations performance Dec 2003 Dec % Rm 2002 Change Rm Turnover 4 789,6 4 211,8 13.7 Clothing and home 2 422,9 2 185,4 10.9 Corporate (retail) 2 109,2 1 919,2 9.9 Franchise 313,7 266,2 17.8 (wholesale) Foods 2 282,0 1 938,6 17.7 Corporate (retail) 2 225,1 1 892,3 17.6 Franchise 56,9 46,3
Slide 15: Country Road Limited income statement
country road limited results income statement Dec 2003 Dec 2002 % Change A$m A$m Revenue 100,0 107,2 (6.7) Turnover 98,7 106,0 (6.9) Cost of merchandise 46,8 52,3 (10.5) Gross profit 51,9 53,7 (3.4) Other revenue 1,3 1,2 8.3 Operating expenses 52,2 52,6 (0.8) Distribution centre outsourcing - 0,7 -
Slide 16: Country Road Limited balance sheet
country road limited results balance sheet Dec Dec Change 2003 2002 A$m A$m A$m Assets Property, plant and 25,3 25,3 - equipment Trademarks* 11,3 11,5 (0,2) Inventories 25,0 26,3 (1,3) Accounts receivable 12,5 12,0 0,5 Cash and cash equivalents 7,4 7,3 0,1 81,5 82,4 (0,9) Equity and liabilities Ordi