HALF YEAR RESULTS August 21, 2015

Transcription

1 HALF YEAR RESULTS 2015 August 21, 2015

2 AGENDA 2 1 HIGHLIGHTS OVERVIEW 2 HALF YEAR 2015 FINANCIAL REVIEW 3 TRADING UPDATE & OUTLOOK 4 ADDITIONAL INFORMATION

3 HIGHLIGHTS - OVERVIEW

4 SALE OF OUTBOUND UNITS FASTER THAN PLANNED EXPECTED CLOSING OF ALL SALE TRANSACTIONS IN 2015 Successful withdrawal from all tour operating activities Indian travel activities and tour operator in Hong Kong sold to the Canadian group Fairfax. The Indian travel activities comprise outbound tour operating, business travel, travel agencies and inbound business (DM activities) Net result from discontinued operations as per HY CHF m, including the net result, one-time effects from the cost of the sales process and an impairment charge on goodwill from sale of European outbound units Outlook for the 2nd HY 2015: 4 European tour operating activities sold to REWE Group DM India will be restated as discontinued operations for full year results The sale of the Asian tour operating activities and Destination Management India will have a slightly positive effect on the net result from discontinued operations At closing accumulated currency translation losses (CTA) to be recorded under results from discontinued operations. This on-off special accounting effect to the deconsolidation does not impact the equity or cash position. As at end-june 2015, the accumulated currency translation losses come to around CHF 215m.

5 HIGHLIGHTS OF HY 2015 FOR CONTINUING OPERATIONS POSITIVE ORGANIC GROWTH SUPPORTS NEW STRATEGIC DIRECTION INITIATED AT THE BEGINNING OF THE YEAR Positive organic turnover growth of +6.8% offset by negative translation impact on turnover -7.4% due to Swiss franc appreciation GTD achieved 6.6m room nights +7.8% (organic turnover growth by 10.9%) New reporting of GTS as one division strong currency headwind of -7.5% and organic growth of -4.4% VFS Global processed for the first time more than 10 million visa applications organic growth of 28.8% EBITA at CHF 16.7m (vs CHF 45.4m included a positive contribution of CHF 10.1m from disposal of a property in Zurich in HY 2014) Net result from continuing operations at CHF 5.9m (vs CHF 28.4m) Free cash flow from continuing operations at CHF 31.9m (vs CHF 50.0m) GTD GTS -8,0-11,9-4,4 VFS Group 5 10,9 in % of turnover -7,4 Organic FX Acq./Div. -7,5-4,4-0,6 2,9 28,8 6,8 24,4

6 APAC MOST IMPORTANT SOURCE OF NEW CORE WHILE EUROPE REMAINS MOST SIGNIFICANT DESTINATION EUROPE USED TO BE MOST IMPORTANT SOURCE WITH 55% IN THE OLD GROUP STRUCTURE in % of turnover HY 2015 Source HY 2015 Destination MEA MEA 9% 11% 32% Europe APAC 19% 44% 55% 17% 13% APAC 6 Americas Americas HY 2014 (new structure) : HY 2014 (new structure) : Europe APAC Europe APAC 36% 42% 57% 17% Europe

7 HALF YEAR 2015 FINANCIAL REVIEW

8 ORGANIC TURNOVER GROWTH OF 6.8% APPRECIATION OF SWISS FRANC IMPACTED TOP LINE BY 7.4% TURNOVER (CHF million) HY15 Global Travel Distribution Global Travel Services HY14 Δ% nominal organic Group Travel Destination Management Specialists , , VFS Global Less turnover elimination between segments Kuoni Group *) Restatement of prior year figures due to the decision to sell all outbound activities 8 Δ% restated*)

9 LOWER GROSS PROFIT, HIGHER COSTS OF GROWTH STRATEGY IN GTD AND SCALE DOWN OF BUSINESS IN GTS HAD AN EFFECT ON OPERATING PROFIT PROFIT & LOSS FROM CONTINUING OPERATIONS HY14 Δ% 1, , % 18.7% EBITA EBITA-Margin % % % EBIT EBIT-Margin % % % Diluted earnings per registered share A Diluted earnings per registered share B Free cash flow (CHF million) HY15 Turnover GOP Margin Net result from continuing operations restated*) *) Restatement of prior year figures due to the decision to sell all outbound activities 9 FY14 restated*) 3, %

10 ONE-TIME EFFECT ON NET RESULT DUE TO THE SALE OF EUROPEAN TOUR OPERATING ACTIVITIES PROFIT & LOSS INCLUDING DISCONTINUED OPERATIONS HY14 Δ% 1, , ,436.0 EBITA EBITA-Margin % % % EBIT EBIT-Margin % % % Net result from continuing operations Net result from discontinued operations, net of income tax Net result (CHF million) HY15 Turnover restated*) FY14 restated*) Earnings per share in CHF From continuing and discontinued operations: Diluted earnings per registered share A Diluted earnings per registered share B *) Restatement of prior year figures due to the decision to sell all outbound activities

11 TURNOVER CURRENCY MIX HAS CHANGED SIGNIFICANTLY SINCE THE SALE OF THE EUROPEAN TOUR OPERATING ACTIVITIES TURNOVER CURRENCY MIX FOR TRANSLATION HY 2015 EUR USD GBP AUD INR CHF Other 53% 19% 8% 4% 3% 3% 10% TURNOVER CURRENCY MIX FOR TRANSLATION HY 2014 (AS REPORTED IN PRIOR YEAR) EUR USD GBP 31% 10% 12% AUD INR 3% 7% CHF Other 17% 20% Due to the changed currency mix of the subsidiaries operating activities, the SNB decision to remove the CHF peg has a considerable negative impact on the Swiss franc-denominated consolidated income statement. 11

12 GLOBAL TRAVEL DISTRIBUTION (GTD): STRONG ORGANIC GROWTH OF 10.9% ACHIEVED 6.6 MILLION ROOM NIGHTS SOLD (CHF million) Turnover HY HY % +2.9 GOP EBITA ,499 1,387 FTE (end of period) Room nights up by 7.8% Currency impact on turnover of -8.0% resulting in a nominal growth of 2.9% Key market penetration in H and H through targeted promotion activities GOP-margin improved in June due to enhanced pricing model Continuous investment in people (insourcing for better scale effects), service and technology (new applications/features) to fuel growth strategy Significant double digit growth in Asia and key markets China, India, Singapore and Indonesia Over average growth rates in the following European countries achieved: UK, Germany and Spain 12

13 GLOBAL TRAVEL SERVICES (GTS): CONTINUOUS HEADWIND IN KEY SOURCE MARKET JAPAN HY14 % EBITA FTE (end of period) 3,309 3,464 Turnover GOP 13 GROUP TRAVEL HY15 (CHF million) Organic turnover growth of +4.1% Strong currency headwind by -12.8% Forward bookings as of June in positive territory (in local currency terms) Demand for destinations out of Japan remains depressed Restructuring and downsizing of organisation ongoing Strong double digit growth rate from source market China and Taiwan (lower GOP margin business) DESTINATION MGMT SCALE DOWN OF BUSINESS CONSIDERABLY IMPROVED PROFITABILITY IN DESTINATION MGMT UNITS Organic growth of -21.4% Units in the Middle East and in Kenya have been re-scaled Low demand from the Russian market still affecting business in the Middle East and in India (Goa charter) Devaluation of against US$ and other currencies makes travelling more expensive for European source markets

14 VFS GLOBAL: SIGNIFICANT ORGANIC TURNOVER GROWTH OF +28.8% ACHIEVED A TEMPORARY CONTRACT WITH SOUTH AFRICAN GOVERNMENT CONTRIBUTED TO GROWTH (CHF million) HY15 HY14 % 11.2% increase in visa applications processed Threshold of 10m visas processed in H1 passed Turnover GOP EBITA - whereof JV n/a FTE (end of period) 3,659 3,103 Strong organic growth realized mainly through a time-limited mandate from the South African government (H through H1-2015) Growth also achieved out of the following source markets: South America, India, Middle East and Africa Difficult economic situation in Russia led to a decrease in number of applications First time positive contribution from the Saudi MoFA contract Ongoing expansion of the footprint with 230 new application centres opened for new contracts won 14 1,709 visa application centres for 45 governments in 121 countries

15 LOWER GOP AND HIGHER COST OF THE GROWTH STRATEGY IN GTD AND VFS GLOBAL HAD AN EFFECT ON OPERATING EARNINGS EBIT BRIDGE (CHF million) REPORTED 15 TURNOVER GOP MARGIN STAFF COSTS MARKETING & OTHER OPS COSTS SALE OF PROPERTY JOINT VENTURE DEPRECIATION &AMORTISATION 2015 REPORTED

16 POSITIVE CASH FLOWS, DECLINE YOY IS DUE TO LOWER OPERATING EARNINGS (EBIT) AND SLIGHT WEAKENING IN NWC CHANGES OPERATING AND FREE CASH FLOW FOR CONTINUING AND DISCONTINUED OPERATIONS CONTINUING OPERATIONS CONTINUING AND DISCONTINUED OPERATIONS (CHF million) (CHF million) Operating cash flow 142 Free cash flow FCF from discontinued operations 32 FCF from continuing operations HY HY 2015 HY 2014 HY 2015

17 EQUITY DECLINE OWING THE NET RESULT, DIVIDEND PAYMENT, IMPAIRMENT AND CURRENCY TRANSLATION ADJUSTMENTS BREACH OF EQUITY RELATED COVENANT CREDITORS AGREED TO WAIVER (CHF million) 2,800 2,400 in % ,393 2, ,419 Liability 2, ,000 1,600 1,614 1,954 1, Dec ,941 1, Jun Dec 2014 Equity ratio 30 Jun Equity

18 SENIOR CREDIT FACILITY USED AT CHF 30M ORDINARY CREDIT AMOUNT REDUCTION BY CHF 47M TO NEW CHF 209M LIQUIDITY AND DEBT POSITION AS PER FOR CONTINUING AND DISCONTINUED OPERATIONS (CHF million) vs CHF -393m vs CHF 233m Liquid funds 18 Bond nominal Other debt Net Liquid Funds Advance payments by customers Net debt position

19 TRADING UPDATE & OUTLOOK

20 TRADING UPDATE & OUTLOOK BOOKING LEVELS COMPARED WITH EQUIVALENT PRIOR-YEAR PERIOD FOR DEPARTURE IN 2015 (AS AT 9 AUGUST 2015) CHF LCY Global Travel Distribution (GTD) + 3% + 12% Global Travel Services (GTS) 1) 10% 0% VFS Global + 11% Number of application processed 1) Excluding Destination Management India unit sold in August 2015 OUTLOOK Outlook 2015: Expected full year operating earnings (EBIT) in the range of CHF million includes: - negative foreign currency impact of around CHF 7.5m - Indian DM business in discontinued operations Net result from discontinued operations will be impacted by total CTA recycling at closing of sale of tour operating and Indian travel activities of around CHF 215m as at 30 June

21 ADDITIONAL INFORMATION

22 MAIN DESTINATION REMAINS EUROPE AND APAC KEY SOURCE MARKET By destination By source Market GEOGRAPHICAL SPREAD OF TURNOVER HY 2015(IN %) Group GTD CHF 1,532m CHF 873m MEA MEA 11% APAC 9% 17% Americas 22 11% Europe MEA 6% 9% 18% Americas 5% Americas 9% APAC 20% 21% Americas 57% 26% Europe APAC Americas MEA 55% Europe Americas APAC Americas 81% 15% MEA 19% 5% 31% Americas APAC MEA 39% 13% APAC CHF 158m Europe 14% VFS DM Specialists CHF 502m Europe 15% 32% Europe 44% Group Travel GTS GTS APAC MEA 3%5% 1% MEA Americas MEA 22% 28% 68% APAC APAC 16% 50% Europe 21% 91% Europe 50% APAC 15% Americas 48% Europe

23 NEW KUONI GROUP CONSISTS OF 3 DIVISIONS WHICH ARE ABLE TO PARTICIPATE IN GLOBAL GROWTH KEY FACTS (2014 FY *) Global Travel Distribution (GTD) A B2B distributor of accommodation and destination services Turnover: CHF 1,934m Global Travel Services (GTS) Long-standing and leading provider of group travel and destination management services Turnover: CHF 1,234m Pioneer and global leader as visa service provider Turnover: CHF 271m VFS Global 1,414 FTE (end of period) 3,365 FTE (end of period) 3,209 FTE (end of period) *) Restatement of prior year figures due to the decision to sell all outbound activities 23

24 KUONI GROUP OFFERS ITS SERVICES GLOBALLY IN THE B2B TRAVEL AND B2G MARKET CHARACTERISTICS OF THE NEW KUONI GROUP Relevant global travel-related service provider with leading positions in respective markets Agile and flexible with no sizeable fixed operating assets KUONI GROUP High cash-conversion Multiple businesses balancing risks across geographies and business models Truly global footprint Strong position in Asia Focus on B2B/B2G 24

25 KUONI GROUP IS WELL POSITIONED WITHIN THE COMPLEX TRAVEL ECOSYSTEM SUPPLIERS Highly fragmented Supplier.com e.g. British Airways, Hilton Large international OTAs e.g. Booking.com, Expedia Hotels Metasearch Smaller/regional OTAs Transfers e.g. Kuoni, Apollo, TUI, Thomas Cook Travel Retail Tours B2B distributor Flights hotelbeds.com Group travel Destination Management Changing behaviours Countless desires e.g. Kuoni, Flight Centre Switches/GDS e.g. Amadeus, Travelport Consolidators/ Brokers e.g. Albatravel Miki Visa Processing Services Kuoni Group : >1bn international arrivals e.g. Kayak, Trivago e.g. HRS, Opodo.de Tour Operators CUSTOMERS CSC Source: Euromonitor

26 KUONI GROUP BRINGS A SET OF DISTINCTIVE STRENGTHS Expansion capabilities in the APACMEA region Expertise in scaling businesses and capturing growth opportunities Deep expertise in Europe as a destination Global footprint and workforce with unrivalled capabilities 26 Building on existing revenue streams and rapidly expanding footprint (APACMEA FTE end of period 2014 at 6, % vs 2012) Leveraging strong relations with all major travel distribution networks in APACMEA GTD successfully integrated GTA and grown to CHF 1.9bn in turnover in 2014, running global IT applications with ~200m data requests per day VFS Global doubled its application centres in less than 2 years Europe as a destination representing most significant share of total turnover, GTS operated ~50,000 tours last year (95% to Europe) Strong supplier relationships, experienced staff & broad product coverage across divisions in Europe (19,000 hotels across Europe) Global network of 1,400+ Visa Application Centres (VACs) in 120 countries with strong relationships and multi-year contracts with 45 governments Sales and contracting work force in all regions of the world

27 TO BOOST GROWTH AND IMPROVE PROFITABILITY WE FOCUS ON THREE STRATEGIC INITIATIVES Expanding footprint in Asia, Middle East and Africa Invest additional resources in Asia, the Middle East and Africa by leveraging existing footprint and expanding capabilities across all segments Further Digitalization Enhance customer service and increase efficiency by implementing new state-of-theart technology platforms Develop new service offering for digital travellers Expand Service Offering Build on existing customer base and global footprint Provide existing services to a wider range of customer segments by realizing cross-selling potential Introduce new products and services 27

28 KUONI GROUP ORGANISATIONAL STRUCTURE as of August 2015 Chief Executive Officer Peter Meier Human Resources Finance1) IT Thomas Peyer Strategy & Communication2) Global Travel Distribution Global Travel Services VFS Global Ivan Walter Rolf Schafroth Zubin Karkaria Member of Executive Board 1) Including Risk, Legal & Compliance; 2) Including Investor Relations 28

29 FINANCIAL CALENDAR REPORTS ON BUSINESS PERFORMANCE ON THE FOLLOWING DATES: Q3/9months Results November 2015 Annual Report March 2016 Annual General Meeting April 2016 CONTACT DETAILS 29 Corporate Communications Phone: communications@kuoni.com Investor Relations Phone: investor.relations@kuoni.com mailing list:

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