(Shrinked) - Investor presentation/media/Files/M/Mother-Care/...presentatio… · Group network...
Transcript of (Shrinked) - Investor presentation/media/Files/M/Mother-Care/...presentatio… · Group network...
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Investor presentation
Interim results 2010/11
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Half year highlights
• Worldwide network sales up 7.5%
• Underlying profit from operations up 22%
• International franchise retail sales up 17.3%
• Direct in Home up 15.8%
• Wholesale sales doubled
• EPS up 23%
• Interim dividend up 16.4%
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Mothercare group strategy
Two global brands
UKRetailing
InternationalFranchise
Direct Wholesale
Four growth channels
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Clothing
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Clothing
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Home and Travel
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Toys
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Four growth channels
UKRetailing
Direct WholesaleInternationalFranchise
International franchise
Two global brands
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International franchise
• 39 franchise partners
• 840 stores in 53 countries
• 368 in Europe
• 248 in Middle East & Africa
• 224 in Asia Pacific
• 3 agreements
• DLF in India
• Goodbaby in China
• Headline in Australia
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International update
Mothercare & ELC (53) countries outside the UK
Albania (1)Armenia (2)Australia (43)Azerbaijan (4)Bahrain (5)Belarus (5)Belgium (2)Brunei (3)Bulgaria (4)Channel Islands (2)China (10)Cyprus (12)Czech Republic (8)Egypt (8)Estonia (3)Germany (3)Gibraltar (2)Greece (75)Hong Kong (12)India (52)Indonesia (26)Ireland (35)Jordan (4)Kazakhstan (10)Kuwait (32)
Latvia (1) Lebanon (12)Lithuania (1)Macedonia (1)Malaysia (15)Malta (5)New Zealand (2)Nigeria (2)Oman (5)Pakistan (9)Philippines (3)Poland (26)Qatar (9)Romania (9)Russia (59)Saudi Arabia (88)Serbia (1)Singapore (15)Slovakia (4)Slovenia (2)South Africa (15)Spain (19)Taiwan (27)Thailand (7)Turkey (46)UAE (68)Ukraine (25)Uzbekistan (1)
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China
Huai Hai Road
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India
Pune
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Russia
Moscow
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New country - Australia
Chadstone
• 25% stake in Headline Group
• 6 Mothercare; 27 Early Learning Centre
• Convert 19 newly acquired stores
• 60 store chain in 3 years
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International 2 year growth trends
H108/09
Base Year
H1 09/10
H1 10/11
2 YearGrowth
Store numbers 572 671 840 21% CAGR
Retail selling space (‘000 sq. ft.)
1,207 1,420 1,729 20% CAGR
Total international network sales
£195.0m £252.8m £297.3m 23% CAGR
Underlying profit from operations
£7.7m £11.8m £15.8m 43% CAGR
Underlying profit margin 3.9% 4.7% 5.3% 140 bps
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UK Retailing
DirectInternationalFranchise
Wholesale
UK retailing
Two global brands
Four growth channels
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Parenting centres
• 7 opened in H1
• 92 in total
• 110 by 2012
• Shopping destinations
• 8,000 to 12,000 sq ft
• Flexible space
Doncaster
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Service
• 50 years experience
• Product ambassadors in parenting centres
• Specialists in pushchairs, car seats, nursery and bra fitting
• Car seat fitters in every parenting centre
• Trialling
playologists
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Property restructure
Number of stores -
Space sq. ft.
(000s)
Out of town
Landmark
In town
438
411
389
365
377
1,967
2,1142,023 1,9732,015
• 7 parenting centres opened; 20 in town closed H1
•Benefits £5.0m 10/11 and additional £5.0m 11/12
•Average lease term reduced from 6 to 4.5 years
44
12
77
76
8192
110
281243
304335
361
0
50
100
150
200
250
300
350
400
450
500
H1 07/08 H1 08/09 H1 09/10 H1 10/11 FY 2012
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INPUT COSTSINPUT COSTS
Cotton prices
Labour costs
Freight
Bigger b
uy
Commodity costs
Dire
ct supply
New Countrie
s
2011/12Smarte
r sourcing
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UKRetailing Direct
WholesaleInternationalFranchise
Direct
Two global brands
Four growth channels
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Direct
• 100% clothing online
• H&T 70% of online business
• 15m unique users, 24% growth YOY
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Delivery and collection
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ELC online
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UKRetailing
Direct WholesaleInternationalFranchise
Wholesale
Two global brands
Four growth channels
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Wholesale
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Mini Club
• Mini Club in around 370 Boots stores
• Promoted through advantage card
• Retains high street presence
• ELC toys in 400 Boots stores
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Summary and outlook
Two global brands
Four growth channels
UKRetailing
InternationalFranchise
Direct Wholesale
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Appendices
• Income statement
• Reported sales by channel
• Group network sales by channel
• Underlying profit by segment
• UK operating profit
• Property strategy benefits
• Group balance sheet
• Group cash flow
• Share based payments charge
• Defined benefit pension schemes
• Outlook FY 2010/11
• Key store data as of October 2010
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10/11£m
09/10£m
Reported sales 397.1 387.3 +2.5%
Underlying profit from operations 14.5 16.4 -11.6%
Share based payments (2.0) (6.1)
Financing (0.3) (0.3)
Underlying profit before tax 12.2 10.0 +22.0%
Exceptional items (1.4) (0.8)
Other non-underlying items (10.5) (16.3)
Profit before tax 0.3 (7.1)
Income statement
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Reported sales by channel
Revenue10/11
£m09/10
£m
International International franchisee reported sales
97.7 87.9 +11.1%
International Wholesale sales 4.3 3.1 +38.7%
International reported sales
102.0 91.0 +12.1%
UK UK retail sales 286.8 293.1 -2.1%
UK Wholesale reported sales 8.3 3.2 +159.4%
UK reported sales 295.1 296.3 -0.4%
Group reported sales 397.1 387.3 +2.5%
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Group network sales by channel
Network sales10/11
£m09/10
£m
International International franchisee retail sales
293.0 249.7 +17.3%
International Wholesale sales 4.3 3.1 +38.7%
International network sales 297.3 252.8 +17.6%
UK UK retail sales 286.8 293.1 -2.1%
UK Wholesale network sales 6.1 3.2 +90.6%
UK network sales 292.9 296.3 -1.1%
Group network sales 590.2 549.1 +7.5%
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Underlying profit by segment
Underlying profit 10/11 £m
09/10 £m
International 15.8 11.8 +33.9%
UK 2.8 9.0 -68.9%
Corporate (4.1) (4.4) +6.8%
14.5 16.4 -11.6%
Share based payments (2.0) (6.1)
Financing (0.3) (0.3)
12.2 10.0 +22.0%
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UK operating profit • UK LFL sales -3.8%
• FX headwinds H1; tailwinds H2
• Full year 10/11 gross margin remains -100 bps
• Tight cost control
• Property strategy benefits on track
09/10 £9.0m
10/11 £2.8m
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Property strategy benefits
£ millionIncremental benefit per
annum
2008/09 2.4
2009/10 3.7
2010/11 5.0
2011/12 5.0
Annual benefit by 2011/12 £16.1m
“Phase 1”£5.0m
announced May 2008
“Phase 2”£10.0m
announced Nov 2009
£2.9m H1
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Group balance sheet
H1 10/11
£m
H1 09/10
£m
FY 09/10
£m
Non current assets
– Fixed assets 101.1 92.1 95.6
– Intangibles 108.3 104.0 104.9
Net current assets
– Working capital 70.5 49.0 35.6
– (Debt)/cash (8.6) 8.2 38.5
– Other (7.2) (15.2) (2.1)
Non current liabilities
– Pensions
– Tax
– Other
Net assets
(64.0)
12.2
(40.0)
172.3
(44.5)
9.2
(33.7)
169.1
(55.1)
6.5
(35.5)
188.4
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Group cash flow
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Share based payments charge
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Defined benefit pension schemes
10/11 Full Year Estimate
£m
09/10Full Year
Actual£m
08/09 Full Year
Actual£m
Income Statement
Service cost (3.1) (2.1) (2.5)
Return on assets/interest on liabilities (0.6) (1.2) 1.6
Net charge (3.7) (3.3) (0.9)
Cash Funding
Regular contributions (2.7) (2.7) (2.1)
Deficit contributions (2.3) (2.3)* (2.6)
Total cash funding (5.0) (5.0)* (4.7)
Balance Sheet
Net liability N/A (55.1) (25.4)
* Excludes one-off payment of £3.0m
In addition the group operates defined contribution schemes. The charge for 2009/10 was £0.4m (2008/09: £0.3m). Estimate for 2010/11 £0.5m
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Outlook FY 2010/11
• International, Direct and Wholesale continue strong growth
• At least 150 new overseas stores, increasing space by c.
20%
• Planning negative LFL sales in UK, c. 1-2% cannibalisation
by new stores
• UK retail gross margin guidance unchanged at -100 bps
• Tight cost control; property strategy benefits @ £5.0m
• Working capital outflow £10.0m, plus Mini Club £5.0m
• Capex £20m net of landlord contributions
• Year end cash balance c. £20m
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Key store data at October 2010
October 2008
March 2009
October 2009
March 2010
October 2010
UK Stores
Total stores 411 405 389 387 377
High street 335 326 308 300 284
Out of town 76 79 81 87 93
Selling area (000s sq. ft.) 2,023 2,007 1,967 2,008 2,015
Sales* per sq. ft. 288 288 297 292 287
International Stores
Europe 238 262 301 327 368
Middle East and Africa 188 198 213 225 248
Asia Pacific 146 149 157 176 224
Total stores 572 609 671 728 840
Selling area (000s sq. ft.) 1,207 1,294 1,420 1,538 1,729
* Rolling 12 months UK sales inc. Direct ex. VAT