I n v e s t o r P r e s e n t a t i o n. Jean-Marc Duplaix, CFO Hong-Kong, March 2013

Transcription

1 2013 I n v e s t o r P r e s e n t a t i o n Jean-Marc Duplaix, CFO Hong-Kong, March 2013

2 Disclaimer This presentation does not constitute an offer of securities for sale in the United States of America or any other jurisdiction. Certain information contained in this document may include notably projections and forecasts. They express objectives based on current assessments and estimates of the Group s executive management which are subject to numerous factors, risks and uncertainties. Consequently, reported figures and assessments may differ significantly from projected figures. The following factors among others set out in the Reference Document (Document de Référence) filed with the French Financial Markets Authority (Autorité des Marchés Financiers- AMF) on March 21, 2012 which is available on PPR* s website at may cause actual figures to differ materially from projected figures: any unfavourable development affecting consumer spending in the activities of the Group in France and abroad, notably for products and services sold by the Retail brands or for Luxury Goods, the events, crises, fears, and resulting costs of complying with environmental, health and safety regulations and all other regulations with which Group companies are required to comply; the competitive situation on each of our markets; the impact of current or future public regulations; exchange rate and other risks related to international activities; risks arising from current or future litigation. PPR* gives no commitment to updating and/or revising and/or commenting any projections and forecasts, or their impact on the results and perspectives of the Group, which may be contained in this presentation. The information contained in this document have been selected by the Group s executive management to inform about the 2012 full year results. This document has not been independently verified. PPR* makes no representation or undertaking as to the accuracy or completeness of such information. None of the PPR* or any of its affiliates representatives shall bear any liability (in negligence or otherwise) for any loss arising from any use of this presentation or its contents or otherwise arising in connection with this presentation. IN NO WAY DOES PPR* ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED IN THIS PRESENTATION. READERS ARE ADVISED TO REVIEW THE COMPANY'S REFERENCE DOCUMENT AND THE COMPANY'S APPLICABLE AMF FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISION. 2 *PPR will become Kering, subject to approval of the annual general meeting on 18 June 2013.

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4 Kering Empowering Imagination Jean-Marc Duplaix Group CFO 4

5 I n v e s t m e n t Thesis (1/2) Unique combination Unique combination of global luxury and premium sports & lifestyle brands, enjoying: Leading positions in their respective segments Broad consumer appeal as self-fulfillment and indulgence increasingly drive buying decisions Considerable organic growth potential Management Management experienced in propelling brands and operations beyond their instinctive limits while giving them autonomy and creative freedom Central organization Central organization realigned to create value above and beyond what operating units can generate independently 5

6 I n v e s t m e n t Thesis (2/2) Human values Strong human values at the core of our success and transformation Value chain Mastering the entire value chain of our brands Flexible production and distribution infrastructure Total control over design, development and brand characteristics Financial and operational Financial and operational disciplines Relentless monitoring & challenging of business and financial plans Strong cash flow generation, robust capital structure to support longterm growth 6

7 W h o We are Young company celebrating its 50th birthday this year Longstanding heritage in specialized distribution Unique expertise in assessing consumer tastes, expanding retail concepts, developing new formats, channels and brands Entered the Luxury goods universe in 1999 with an initial stake in Gucci; Gained full control over the House and its portfolio built around it in 2004 Initiated a second strategic pillar in premium Sport & Lifestyle brands with the acquisition of a controlling interest in Puma in 2007 In 2012, we further accelerated the transformation and streamlining of our organization to enable all our brands to fully benefit from the power of the Group In 2013, we change the name of our Group, to better reflect the achievement of this transformation. In 2013, PPR becomes Kering* 7 *PPR will become Kering, subject to approval of the annual general meeting on 18 June 2013.

8 O u r Mission & management principles Our mission To empower our brands to reach their full global potential in a sustainable and responsible way Two coherent product areas: apparel and accessories Two fast-growing market segments: Luxury Goods and Sport & Lifestyle Our management principles Freedom within a framework Empower the development of our key assets the brands and help them reach beyond their limits We are a group and act as a group A single worldwide corporate team PPR Asia and PPR Americas to bring corporate support closer to the brands HR talent development driving the Group forward New governance Expanded Executive Committee Streamlined, more operational, closer to our customers 8

9 K e r i n g E f f e c t A better integrated Group Strategic joint venture with Yoox in Luxury Development of monobrand e-commerce sites Sustainable development guidelines Group strategies: human resources, real estate, brand marketing Shared service centers 9

10 L u x u r y d i v i s i o n Drivers of future growth and profitability Pertinent multibrand business model Well-rounded ensemble of complementary brands: Designs, manufactures and markets leather goods, shoes, ready-to-wear, jewellery & watches Highly differentiated positioning between brands, substantial organic growth potential A Group Characterized by The exceptional quality of its products A unique talent pool, from design to craftsmanship, from marketing to retail A highly controlled distribution network and a rigorous communication policy 10

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12 S p o r t & L i f e s t y l e d i v i s i o n Drivers of future growth and profitability Puma THE ultimate sportlifestyle brand One of the worlds largest providers of athletic footwear, apparel & accessories A business characterized by a brand value where product categories originating in sports are continued and amplified in lifestyle and on to fashion Rigorous and energetic Transformation Plan being implemented in 2013 Volcom A global action sports brand An iconic apparel and accessories brand with a heritage in skateboarding, surfing and snowboarding Synergies and complementarity with Puma & considerable growth potential 12

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14 2012 An excellent year Jean-Marc Duplaix Kering Group CFO 14

15 I n We sped up the pace of our transformation Excellent operating and financial performances Group consolidated revenue up 21% in reported terms Recurring net income, Group share: +28% Net debt / EBITDA ratio down to 1.2x Strategic transformation nearing completion Further consolidation around the Group s two strategic pillars Full exit of retail assets on track 15

16 , a h i g h l y Successful year Another year of strong growth in revenue and results for the Luxury brands Transition year in Sport & Lifestyle; rigorous and energetic transformation plan at Puma in m Revenue Reported Change Comp. Recurring Operating Income Change Recurring operating margin Luxury 6, % +15.1% 1, % 25.9% Sport & Lifestyle 3, % +3.3% % 8.6% Corporate & Others (8) (125) Total PPR 9, % +10.6% 1, % 18.4% Balanced growth across regions Mature countries (62% of revenue), up 9% comparable, of which North America up 12% Rapid-growth markets (38% of revenue), up 14% comparable, of which Asia Pacific up 13% 16

17 C o n c l u s i o n & Outlook Solid fundamentals Aligned with consumer aspirations driving today s buying decisions Powerful brands and flexible business models Confidence for 2013 Another year of solid progression in revenue and profits 17

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19 Appendix FY 2012 figures 19

20 K e r i n g H e r i t a g e % stake in Gucci Group 2000 Acquisition of Boucheron 2001 Acquisition of Bottega Veneta, Balenciaga, Stella McCartney and Alexander McQueen 2002 Disposal of Guilbert mail order activity, Finaref and Facet (credit subs) 2003 Disposal of Pinault Bois & Matériaux and Guilbert contract activity Stake in Gucci Group raised to 99.4% Disposal of Rexel F-H Pinault appointed PPR group CEO 2006 Disposal of Printemps department stores 2007 PPR holds 62.1% of PUMA at the end of successful offer process Disposal YSL Beauté Acquisition of 23% stake in Girard Perregaux watch brand manufacturer IPO of 58% of CFAO Acquisition by Puma of Cobra Sale of Conforama to Steinhoff Acquisition of Volcom, Inc. Stake in Girard Perregaux raised to 50.1% Announced acquisition of Brioni (closed in Q1 12) Disposal of the remaining 42% stake in CFAO; disposal of Redcats US Announced process to de-merge Fnac Acquisition of Qeelin 2013 Acquisition of Christopher Kane PPR becomes Kering 20

21 O p e r a t i n g p e r f o r m a n c e in m CONTINUING OPERATIONS Change Revenue 9,736 8, % Gross profit 5,960 4, % Gross profit margin 61.2% 61.7% Recurring operating income 1,792 1, % Recurring operating income margin 18.4% 18.6% EBITDA 2,067 1, % EBITDA margin 21.2% 21.6% 21

22 F i n a n c i a l p e r f o r m a n c e in m Change Recurring operating income 1,792 1, % Other non-recurring operating income and expenses (25) (24) Financial charges (148) (202) Corporate income tax (298) (295) Income from equity affiliates Net income from discontinued operations (276) 19 Consolidated net income 1,082 1, % Of which net income Group share 1, % Net income, Group share, from continuing operations excluding non-current items 1, % Net income per share in % Net income per share from continuing operations, Group share, excluding non-current items in % 22

23 F i n a n c i a l c h a r g e s I n c o m e t a x e s in m Cost of net indebtedness (212) (210) Other financial charges (net) 64 8 Financial charges (net) (148) (202) in m Current tax (expense) / Income (360) (297) Tax on on-current items 62 2 Total tax (298) (295) Effective tax rate 18.4% 23.1% Current tax rate 21.9% 22.9% 23

24 F r e e c a s h f l o w f r o m o p e r a t i o n s in m Cash flow before taxes, dividends and interest 2,001 1,696 Change in working capital requirement (before taxes) (273) (181) Coporate income tax paid (362) (6) Net cash flow from operating activities 1,366 1,179 Acquisition of fixed operating assets (442) (252) Sale of fixed operating assets 6 4 Free cash flow from operations

25 N e t f i n a n c i a l i n d e b t e d n e s s in m 2012 Net indebtedness at December 31, ,396 Free cash flow from operations (930) Net interest paid and dividend received 162 Dividends paid 473 Purchases of PPR shares 15 Purchases of Puma shares 120 Other disposals & acquisitions (653) Other (91) Net indebtedness at December 31, ,492 NET DEBT / EBITDA DOWN TO 1.2X AS OF 2012 YEAR END 25

26 D i v i d e n d In Dividend* per share (cash dividend, excl. Fnac shares to be distributed*) % % * 47.7% 63.2% 58.6% 48.3% Dividend payout 47.6% 52.9% 41.8% 59.8% 37.3% 61.6% 2008** 2009** 2010** 2011** 2012* % of recurring net income, Group share, from continuing operations % of free cash flow * Subject to June 18, 2013 AGM approval. ** Published not restated. 26

27 R e v e n u e Change in m m % Gucci 3, , % Bottega Veneta % Yves Saint Laurent % Other brands 1, % Luxury 6, , , % Puma 3, , % Other brands % Sport & Lifestyle 3, , % Corporate & others (7.9) (10.4) PPR 9, , , % 27

28 R e c u r r i n g o p e r a t i n g i n c o m e Change in m m % Gucci 1, % Bottega Veneta % Yves Saint Laurent % Other brands % Luxury 1, , % Puma (43.2) -13.0% Other brands % Sport & Lifestyle (41.9) -12.1% Corporate & others (124.9) (107.9) (17.0) - PPR 1, , % 28

29 C o n d e n s e d c o n s o l i d a t e d b a l a n c e s h e e t in m Goodwill, brands & other intangible assets - Net 14,361 14,546 Other net non-current assets (467) 115 Net current assets Provisions (365) (364) CAPITAL EMPLOYED 14,286 14,575 Net asset held for sale SHAREHOLDERS EQUITY 12,119 11,749 NET INDEBTEDNESS 2,492 3,396 29

30 In m S o l v e n c y 5,510 NFD NFD/EBITDA 4, ,781 3, , * 2009* 2010* 2011* ,05 3,15 3,25 3,35 3,45 3,55 3,65 3,75 3,85 3,95 4 2,15 2,25 2,35 2,45 2,55 2,65 2,75 2,85 2,95 1,15 1,25 1,35 1,45 1,55 1,65 1,75 1,85 1,95 22,05 11,05 * Published not restated 30

31 L i q u i d i t y In m 4,024 NFD 2,492 M (486) Confirmed undrawn credit lines 2013* 2014** 2015** 2016** 2017** beyond** * Gross debt minus cash & cash equivalents and financing of customer loans 31 ** Gross debt 31

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33 C o n t a c t s Kering Financial Communications Team Alexandre de BRETTES + (0) alexandre.debrettes@kering.com Edouard CROWLEY + (0) edouard.crowley@kering.com

34 GUCCI BOTTEGA VENETA YVES SAINT LAURENT ALEXANDER McQUEEN BALENCIAGA BRIONI STELLA McCARTNEY SERGIO ROSSI BOUCHERON GIRARD-PERREGAUX JEANRICHARD QEELIN CHRISTOPHER KANE PUMA VOLCOM COBRA ELECTRIC TRETORN

35 PPR will become Kering, subject to approval of the annual general meeting on 18 June 2013.