Kingfisher Plc · LSE:KGF
Kingfisher — Shareholder Meeting (2009)
46 slides from Kingfisher's shareholder meeting presentation, 2009
Slide 1: Annual General Meeting 2008/09
Annual General Meeting 2008/09
Slide 2: Disclaimer
Disclaimer The ffollowing Th ll i presentation t ti is i being b i made d only l to, t and d is i onlyl directed di t d at,t persons to t whom h suchh presentation may lawfully be communicated (“relevant persons”). Any person who is not a relevant person should not act or rely on this presentation o
Slide 3: Peter Jackson, Chairman
Peter Jackson Chairman Management, Capital and Returns
Slide 4: Agenda
Agenda Introduction Peter Jackson Business review Ian Cheshire Questions and answers Resolutions Management, Capital and Returns
Slide 5: Peter Jackson, Chairman
Peter Jackson Chairman Management, Capital and Returns
Slide 6: Introduction – 2008/09 progress
Introduction – 2008/09 progress • Challenging backdrop • Strong business • Strengthened management team • Good progress – New leadership team team, integrated approach – Strengthened balance sheet, focus on cash, capital and d It Italy l disposal di l Management, Capital and Returns
Slide 7: 2008/09 - Financial highlights
2008/09 - Financial highlights • Sales up 10.8%, LFL down 4.1% • Adjusted pre pre-tax tax profit up 3% to £368m • Net debt down 36% to £1.0 billion • Free cashflow £387m (2007/08: £65m) – Working o g capital cap ta ge generation e at o ££180m 80 – Gross capital expenditure £390m (2007/08: £513m) • F
Slide 8: 2009/10 – First quarter highlights
2009/10 – First quarter highlights • Total sales up 10% – Seasonal strong g – Resilient performance in non-seasonal • Retail p profit up p 40% – UK nearly doubled, helped by margin and cost control at B&Q – Outside the UK, a solid performance in France – A strong result in Eastern Europe – China pla
Slide 9: Ian Cheshire, Group Chief Executive
Ian Cheshire Group Chief Executive Management, Capital and Returns
Slide 10: A strong business in an attractive sector
A strong business in an attractive sector • Home improvement is an attractive market… – Good demand (nesting/improving is a long term trend) – Buying scale (similar product worldwide and fragmented supply) – Defensible market (against internet, grocers and specialists) • Kingfisher is clear European
Slide 11: Aim - a step change in value for shareholders
Aim - a step change in value for shareholders Management - a unified team Capital - leaner, leaner shrewder Returns - focus on generating cash Management, Capital and Returns
Slide 12: Management
Management “a new senior team, working with a new collective responsibility for overall Group delivery of results as well as key existing cross-Group activities” 2008/09 progress • New leadership team, integrated approach • Store manager share incentives across the UK & France 2009/10 milestones • E
Slide 13: Slide 13
Slide 14: Capital
Capital “investment will be prioritised, targeting higher hurdle rates and faster payback periods. A key target is to stabilise debt at currentt levels, l l prior i tto reducing d i it iin ddue course”” 2008/09 progress* • Gross capex down 31% to £390m • Sold Castorama Italy for €615m, post tax prof
Slide 15: Returns
Returns “greater focus will be placed on generating higher cash returns from the retail businesses. The new leadership team h id has identified tifi d seven major j steps t tto achieve hi thi this”” 1. Driving up B&Q UK’s profit 2. Exploiting the UK Trade opportunity 3. Expanding our total French bu
Slide 16: Delivering value – 7 steps
Delivering value – 7 steps 1. Driving up B&Q UK’s profit 2 Exploiting the UK Trade opportunity 2. 3. Expanding our total French business 4. Rolling out in Eastern Europe 5 Turning 5. T i around d B&Q China Chi 6. Growing Group sourcing 7. Reducing working capital Management, Capital and Returns
Slide 17: Kingfisher
KINGPSHER
Slide 18: UK – priorities remain unchanged
UK UK – 3 priorities remain unchanged 1. Driving the basics at B&Q 2. Unlocking UK synergies 3 Completing the B&Q renewal and expanding 3. Screwfix
Slide 19: B&Q – driving the basics
UK B&Q – driving the basics – 91% of stores now compliant –SStore o e managers a age s Kingfisher g s e sshare aeaawards a ds – Quarterly sign off to maintain consistency – Staff training
Slide 20: B&Q – delivering the basics
UK B&Q – delivering the basics • Operating and overhead costs – Reduced by £55m in 2008 – Target 150 bps CTS% savings over next 3 years • Working capital* – Stock S k now running i 12 d days b below l llast year – Target 10 less working capital days over next 3 years *stock less creditors plus debto
Slide 21: UK – unlocking the synergies
UK UK – unlocking the synergies • Combined buying – Direct sourcing plans in place to double previous levels – Active joint sourcing across the group CPR Product Partners Consolidation Timing Benefit 2 1 Copper pipe vendor 2008/09 7% Cable 3 2 2008/09 6% vendors 0% 71% Spot heating common 2009/10 7%
Slide 22: UK – unlocking the synergies
UK UK – unlocking the synergies • Combined multi-channel – DIYnextday.com launched – Reserve & Collect now available in 318 stores – Website refreshed
Slide 23: UK – completing the B&Q renewal
UK UK – completing the B&Q renewal • Low cost B&Q store revamps are working – Halved the capital outlay and sales disruption – 14 stores planned for 2009 • Range innovation Great DIY products at great Premium design at affordable prices (80% market share) prices
Slide 24: UK – Extending our trade business
UK UK – Extending our trade business +177,000 B&Q Trade Card holders +45 45 new Screwfix outlets opened Plumbfix f launch El Electricfix i fi ddeveloped l d
Slide 25: Delivering value – 7 steps
Delivering value – 7 steps 1. Driving up B&Q UK’s profit 2 Exploiting the UK Trade opportunity 2. 3. Expanding our total French business 4. Rolling out in Eastern Europe 5 Turning 5. T i around d B&Q China Chi 6. Growing Group sourcing 7. Reducing working capital Management, Capital and Returns
Slide 26: France
France
Slide 27: France – Delivering results
France Delivering results • Grew sales and profits • Grew market share • 10 new stores, stores 2 relocations relocations, 8 revamps • Driving the benefits of a unified management structure – Joint supplier buying agreements now in place – Coordinated store opening plan finalised
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Slide 29: France – Innovation
France • Innovation – More decorative/eco products – Revitalised and new stores
Slide 30: PEINTURE”
PEINTURE” QUINCAILL ERIE PARQUET = CUISINE
Slide 31: “Back to basics”
• “Back to basics” – Lower cost sites – Narrower range, big volume – One off deals – “Arrivages”
Slide 32: Delivering value – 7 steps
Delivering value – 7 steps 1. Driving up B&Q UK’s profit 2 Exploiting the UK Trade opportunity 2. 3. Expanding our total French business 4. Rolling out in Eastern Europe 5 Turning 5. T i around d B&Q China Chi 6. Growing Group sourcing 7. Reducing working capital Management, Capital and Returns
Slide 33: Slide 33
Slide 34: Eastern Europe – strong performance continues, store openings on track
Eastern Europe – strong performance continues, store openings on track Store Store openings openings Total sales* % LFL’s* % 08/09 09/10 Poland +9 +6 +19.1 +9.8 Turkeyy +6 +5 +34.7 +10.3 Russia +2 +3 +84 +84.2 2 +24 6 +24.6 *In constant currencies
Slide 35: Delivering value – 7 steps
Delivering value – 7 steps 1. Driving up B&Q UK’s profit 2 Exploiting the UK Trade opportunity 2. 3. Expanding our total French business 4. Rolling out in Eastern Europe 5 5. T i around Turning d B&Q China Chi 6. Growing Group sourcing 7. Reducing working capital Management, Capital and Returns
Slide 36: China – remains a significant value opportunity
Other International China – remains a significant value opportunity • One of the world’s largest economies – Fast growth in consumption – Growing home owning middle class – Housing is No1 non-food spending priority • £29 billion home improvement market – But renovation and decoration market yet to e
Slide 37: China – Fix it, grow
Other International China – Fix it, grow Making the stores different Easier to shop New categories and services g Better navigation More in-store p p lines pick up Smaller size More decorative product g Tighter range g Room make-over service Shop-within-shops Single product installation Merchandised
Slide 38: Delivering value – 7 steps
Delivering value – 7 steps 1. Driving up B&Q UK’s profit 2 Exploiting the UK Trade opportunity 2. 3. Expanding our total French business 4. Rolling out in Eastern Europe 5 5. T i around Turning d B&Q China Chi 6. Growing Group sourcing 7. Reducing working capital Management, Capital and Returns
Slide 39: Group sourcing and working capital
France Group sourcing and working capital • Group direct sourcing – now 10% of product COGS, 12% target for 2009/10 – payment terms +16 days • Working capital reduction – down £180 million – further £50 million target for 2009/10
Slide 40: Summary
Summary • Tough backdrop, solid results • Leadership team complete • Strong focus on cash and capital to drive returns • ‘Delivering value’ 7 step plan in progress • Challenging outlook outlook, clear 2009/10 milestones – Good start in Q1 Management, Capital and Returns
Slide 41: Peter Jackson, Chairman
Peter Jackson Chairman Management, Capital and Returns
Slide 42: Questions and answers
Questions and answers Management, Capital and Returns
Slide 43: Resolutions
Resolutions Management, Capital and Returns
Slide 44: Casting your vote
Casting your vote
Slide 45: Casting your vote
Casting your vote When invited to vote: Press button “1” to vote “for” Press button “2” 2 to vote “against” against Press button “3” to withhold your vote If you make a mistake or change your mind, simply enter your new choice – this will overwrite yyour p previous choice If you wish to withdraw you
Slide 46: Annual General Meeting 2008/09
Annual General Meeting 2008/09