Interim Results. 17 October 2013

Transcription

1 Interim Results 17 October 2013

2 Highlights Financial Highlights Total sales 2.2bn, +16.5% Booker like-for-like sales +2.3%, tobacco sales -2.2% and non tobacco sales +5.0% Operating profit (pre 7.0m exceptional credit related to Makro acquisition) +16% to 59.0m Profit before tax (pre exceptionals) 58.1m +17% Profit after tax (post exceptionals) 53.8m +43% Underlying earnings per share up 0.25 pence to 2.73 pence Reported basic earnings per share up 0.82 pence to 3.11 pence Net cash improved to 123.4m (2012: 69.8m) Interim dividend up 18% at 0.45 pence per share Operational Highlights Customer Satisfaction at Booker and Makro improved Non tobacco like for likes were up 5% Internet sales up 11% to 369m Booker Direct, Ritter Courivaud, Classic and Chef Direct are on track Makro turnaround is on plan and we should deliver 26m of synergies this year Our Indian business continues to progress, having opened two sites in the half. We now have six branches in India Interim dividend and proposed special cash return Booker s strategy to drive and broaden its business is working. As a result the Board has declared an interim dividend of 0.45 pence per share, up 18%. In July 2012 Booker Group plc issued 124m of shareholder equity to purchase Makro in the UK. Following the successful integration of Makro into the Group and strong cash generation, we intend to implement a special cash return to shareholders of approximately 60m in Further details will be provided at the time of our preliminary results in May Note: Makro consolidated from 19 April 2013 and 2012 restated for the new pension accounting standard 2

3 PLAN UPDATE

4 THE PLAN (NOV 2005) ACTION RESULTS FOCUS (Nov 05) DRIVE (Apr 06) BROADEN (Apr 07) Focus on Cash Reduce Costs to be most efficient operator Simplify the Business: less is more Improve Customer Satisfaction Choice up Prices down Better service On the way to offering the best choice, price and service to caterers and retailers and small business via the internet, delivery and cash and carry Be the suppliers preferred route to market in UK New products, services & customers 4

5 Drive is Working RETAIL CHOICE PRICE SERVICE CATERING CHOICE PRICE SERVICE +8% +18% SATISFACTION 81% +1.1% SATISFACTION 89% + 1.7% 5

6 Booker Direct is making good progress 6

7 DRIVE IS WORKING (Booker Group Excl. Makro) LFL Sales to Retailers (inc Tobacco) LFL Sales Non Tobacco % Change Year On Year % Change Year On Year LFL Sales to Caterers (inc Tobacco) H1 % Change Year On Year H1 7

8 Booker & Makro are different businesses Trade only Trade & small business Sales bn % shopping with other business 10% 6% Outlets Note: Adoption of Group Buying, Group Customer Management/ Group Operations and best of both back of house 8

9 Together Booker & Makro will benefit all our customers Seeking to become the UK s leading wholesaler to caterers, retailers and small business with the best choice, prices and service via the internet, delivery and cash and carry Caterers Retailers Small Business 9

10 CHOICE UP Best of Both 10 INTO INTO

11 Makro & Booker are making progress on Customer Satisfaction 11

12 We anticipate synergies of circa 26m in 2013/14 growing to circa 32m in 2015/16 GROUP SYNERGIES 2013/ / /16 IT/Central costs 6 Supply Chain 3 4 Goods not for resale 1 2 Cost of goods 7 12 Improved margin on fresh 2 5 Rent & rates savings 1 3 TOTAL

13 Sheffield is on track Booker annual sales 47m, Makro sales 24m Sheffield capex 0.6m. Annual rent and rates saving 0.4m. 13

14 There are 8 new markets for Booker using Makro space and circa 8 sites where Booker and Makro can operate from the same unit 2013/ / / /17 Cost per site m Fold Makro & Booker into one site eg Sheffield New markets for Booker in a Makro site eg Belfast The lessons from Sheffield are being rolled out to all Booker and Makro branches 14

15 Everything will be via the web (H1) Web Sales 109m 250m 407m 525m 635m 704m 369m % Change 165% 129% 63% 29% 21% 11% 11% Active Customers 12k 19k 37k 105k 170k 255k 295k eg longtail and Makro ranges

16 Through utilising the current central distribution and c. 200 business centres, Booker Group will have capacity for c. 6bn of sales ILLUSTRATIVE SALES OPPORTUNITY BY BUSINESS bn Independents Independents & Multiples Multiples Total 2012/ Estimated Sales Opportunity to Best choice, prices and service for caterers, retailers and small business via co.uk, delivery and cash and carry 16

17 BROADEN: TWO OPENINGS IN INDIA Mira Road Surat TOTAL BRANCHES HAPPY SHOPPER SHOPS 17

18 SUSTAINABILITY First UK wholesaler to achieve a third consecutive Carbon Trust Standard Six years of verified absolute emission reductions despite a 29% growth in business Grocer Gold Green Wholesaler of the Year 2013 Award winning customer packaging recycling service. 14,500 customers now recycle with Booker Overall Booker recycling volumes up 28% YOY Booker sites linked with local food charities for surplus food donations. Over 330,000 meals donated locally from Booker branches year to date

19 FINANCIAL PERFORMANCE and GUIDANCE

20 FINANCIAL SUMMARY : REPORTED RESTATED ¹ 24 weeks 24 weeks 24 weeks 13-Sep Sep Sep-12 m m m % Revenue 2, , , % Operating profit (pre exceptional) % Profit before tax (pre exceptional) % Profit after tax (post exceptional) % Reported basic earnings per share (pence) % Underlying earnings per share (pence) ² % Interim dividend per share (pence) % Net cash Shareholder funds Notes figures have been restated due to the adoption of IAS19 (Revised) 'Employee Benefits' 2. Underlying earnings per share (pence) is calculated using PAT (pre exceptional) 20

21 PROFITS REPORTED RESTATED 24 weeks 24 weeks 24 weeks 13-Sep Sep Sep-12 m m m Operating Profit Operating Profit % of Sales 2.7% 2.7% 2.7% Net financing (costs)/income (0.9) 2.4 (1.3) Exceptional items - Fees in relation to acquisition of Makro - (3.0) (3.0) - Gain on bargain purchase Restructuring costs (4.2) - - Profit before tax Tax (11.3) (10.2) (9.1) Profit after tax Actual tax rate 17.4% 20.0% 19.5% Underlying effective tax rate (pre exceptional items) 18.8% 18.9% 18.3% 21

22 NET FINANCING COSTS REPORTED RESTATED 24 weeks 24 weeks 24 weeks 13-Sep Sep Sep-12 m m m m m m Facility costs (0.2) (0.2) (0.2) Unwinding of discount on provisions (0.7) (0.8) (0.8) Net pensions (charge)/credit (0.3) Other financing (costs)/income (0.7) 2.6 (1.1) Net financing (costs)/income (0.9) 2.4 (1.3) As a result of IAS19 Employee Benefits (2011), the Group has changed its accounting policy with respect to determining the income or expense related to the defined benefit scheme. 22

23 CONSOLIDATED BALANCE SHEET 13-Sep Sep-12 m m Tangible fixed assets Intangible fixed assets Investments Stock Debtors Creditors (620.0) (492.1) Net cash Provisions & tax (24.2) (35.4) Pensions (0.9) (23.8) Net assets

24 CASH FLOW 24

25 The Makro turnaround is on plan Makro EBIT (2013/14) H1 H2 Total m m m Makro (3) (13) (16) Synergy Total Makro performance / Dec 2012 Dec 2013/14 March Ebit m (20) (18)

26 Guidance: Special cash return The Makro equity consideration was 124m The turnaround at Makro is proceeding as planned anticipated synergies of 26m TY, 30m 2014/15 and 32m 2015/16 the Sheffield plan and best of both is working the property assets are worth approximately 144m to 200m. We have done two sales and leasebacks and might do up to a further five Following the successful integration of Makro into the Group and strong cash generation, we intend to implement a special cash return to shareholders of approximately 60m in Further details will be provided at the time of our preliminary results in May

27 NOTES TO ANALYSTS Facilities the Group has a 5 year facility which commenced on 28 July 2011 comprising an unsecured 120.0m revolving credit facility (including a 7.0m guarantee facility) two covenants apply; fixed charge cover (EBITDAR/ (Net interest + rent) > x1.5) and Leverage (Net borrowing/ EBITDA < x3.0). Both tested at half and full year Bank interest funds drawn on the revolving credit facility bear floating interest rates linked to LIBOR plus a margin of 1.25% (where borrowings/ EBITDA < 1.0) commitment fee is 40% of margin Liquidity at 13 September 2013, 123.4m was held in cash and cash equivalents at 13 September 2013, the Group had in issue 5.9m of guarantees leaving undrawn facilities of 114.1m the revolving credit facility in the 24 weeks to 13 September 2013 was undrawn Tax tax of 10.9m on the profit before tax, exceptional items and the impact of the revaluation of Makro s deferred tax asset for the 24 weeks ended 13 September 2013 is based on an underlying effective rate of 18.8%, which has been calculated by reference to the projected charge for the full financial year in addition 0.4m tax charge arises on the exceptional items and the revaluation of Makro s deferred tax asset (as at 19 April 2013) due to a reduction in the future rates of tax enacted on 2 July 2013 the Group has unrecognised tax assets but the utilisation is not certain the Group expects the underlying effective rate of tax to remain below 20% for the next 3 years, subject to the manner of integration of Makro into the wider Booker Group Asset proceeds included in the asset proceeds of 12.6m realised in the period, 11.0m is from the sales and leasebacks of two Makro branches and 1.3m from the sale of part of a car park 27

28 SUMMARY Financial Year Net (debt)/cash m Sales Change % Operating Profit m Interim Dividend per Share p Sep Sep Sep Sep p Sep p Sep p Sep p Sep p Sep p 28

29 DISCLAIMERS This presentation may include oral and written forward-looking statements with respect to certain of Booker Group plc's ( Booker ) plans and its current goals and expectations relating to its future financial condition, performance and results. These forward-looking statements sometimes contain words such as anticipate, target, expect, intend, plan, goal, believe, may, might, will, could or other words of similar meaning. By their nature, forward-looking statements involve known and unknown risks and uncertainties because they relate to future events and circumstances which may be beyond Booker s control, including, among other things, UK domestic and global economic and business conditions, market-related risks such as fluctuations in interest rates and exchange rates, the policies and actions of regulatory authorities, the impact of competition, the possible effects of inflation or deflation, the impact of tax and other legislation and regulations in the jurisdictions in which Booker operates, as well as the other risks and uncertainties set forth in our announcement of interim results for the 24 weeks ended 13 September 2013, released on 17 October As a result, Booker s actual future financial condition, performance and results may differ materially from those expressed or implied by the plans, goals and expectations set forth in any forward-looking statements, and persons receiving this presentation should not place reliance on forward-looking statements. Booker expressly disclaims any obligation or undertaking (except as required by applicable law) to update the forward-looking statements made in this presentation or any other forward-looking statements it may make or to reflect any change in Booker s expectation with regard thereto or any changes in events, conditions or circumstances on which any such statement is based. Forward-looking statements made in this presentation are current only as of the date on which such statements are made. All oral or written forward-looking statements attributable to the Directors of Booker or persons acting on their behalf are qualified in their entirety by these cautionary statements. None of the statements in this presentation are, nor are any intended to be, a profit forecast and none should be interpreted to mean that the profits or earnings per share of Booker in the current or any future financial period necessarily is or will be above or below the equivalent figure for any previous period. 29