GrandVision Full Year 2017 Results. 28 February 2018

Transcription

1 GrandVision Full Year 2017 Results 28 February

2 Forward looking statements This presentation contains forward-looking statements that reflect GrandVision s current views with respect to future events and financial and operational performance. These forward-looking statements are based on GrandVision s beliefs, assumptions and expectations regarding future events and trends that affect GrandVision s future performance, taking into account all information currently available to GrandVision, and are not guarantees of future performance. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future, and GrandVision cannot guarantee the accuracy and completeness of forward-looking statements. A number of important factors, not all of which are known to GrandVision or are within GrandVision s control, could cause actual results or outcomes to differ materially from those expressed in any forward-looking statement as a result of risks and uncertainties facing GrandVision. Any forward-looking statements are made only as of the date of this press release, and GrandVision assumes no obligation to publicly update or revise any forward looking statements, whether as a result of new information or for any other reason. 2

3 Full Year 2017 performance highlights 5.6% increase in revenue to 3,450 million Revenue growth of 5.6% at constant exchange rates and 3.5% organic growth Revenue ( million) 3,316 3,450 Comparable growth of 1.8 % (FY16: 2.2%) Further 7% increase in stores Store network expanded by 485 to 7,001 Improved profitability Adjusted EBITDA ( million) Adjusted EBITDA 1 up 4.0% at constant exchange rates to 552 million (FY16: 537 million) Adjusted EBITDA margin decreased by 21 bps to 16.0%, and increased by 20 bps to 16.4% excluding the loss in the United States Net result attributable to equity holders -1.5% to 228 million EPS ( per share, basic) Adjusted EPS 1 of 0.97 (FY16: 0.96) 1 Adjusted EBITDA, EPS = EBITDA, EPS excluding non-recurring items EPS Adjusted EPS 3

4 Fourth Quarter 2017 performance highlights Revenue increased by 8.1% to 871 million Revenue growth of 8.1% at constant exchange rates and 1.6% organic growth Revenue ( million) Comparable growth of -0.8% (4Q16: 3.8%) 4Q16 4Q17 Adjusted EBITDA up 2.7% Adjusted EBITDA 1 up 2.7% at constant exchange rates to 129 million (4Q16: 126 million) Adjusted EBITDA ( million) Adjusted EBITDA margin decline of 50 bps to 14.8% driven by lower comparable growth 7.3% contribution from acquisitions, mainly reflecting the margin accretive inclusion of Visilab 4Q16 Adjusted EBITDA margin 15.3% 4Q % 4Q16 4Q17 4

5 Key drivers of comparable growth GrandVision operates in a growing market with attractive fundamentals Long term: favourable underlying market trends of aging populations and growing middle classes, stable repurchase cycles and the fundamental need for eye care Short term: performance is impacted by the number of selling days, timing of public holidays, specific commercial decisions and other short term impacts on retail traffic (e.g. weather) 2017 comparable growth would have been +2.3% on a selling-day adjusted basis 2018 will benefit from 1.5 additional selling days in 4Q18 Comparable growth development 4.3% 4.1% 3.6% 3.8% 4.1% 3.1% 2.2% 1.8% 1.6% 0.8% 0.9% 0.4% 0.7% FY12 FY13 FY14 FY15 FY16 FY17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17-0.8% 5

6 Omni-channel development Evolve from provider of eyewear to becoming a leading platform for eye care in the digital age, 2017 by understanding customers pain points and unmet needs; and providing innovative solutions to address those needs at each step of the customer journey Established Customer Experience and Digital Teams both centrally and in countries Improved local websites including implementation of appointment booking tools, virtual try-ons, mobile apps, etc. Ongoing shift from traditional to digital marketing Comprehensive dashboards to track real time website data Positive impact of social media 2017 omni-channel facts and figures: Total store visits 231m Total website visits 56.5m % website visits 24.4% % mobile penetration 60% Total appointment bookings 1.5m 6

7 Strong growth in Solaris during the year Opened approx. 1,300 new points of sale mostly corners within GrandVision s stores Entered additional distribution platforms, including Hudson s Bay department stores in the Netherlands and Belgium Expansion into Switzerland (Visilab) Continued roll-out of pop-ups and other mobile points of sale 3, ,200 2,

8 G Highlights Revenue growth of 2.1% at constant exchange rates, with organic revenue growth of 1.4% Comparable growth flat (FY16: 1.5%) Total number of stores increased by 11% from 3,020 to 3,348 through store openings the acquisition of Tesco Opticians G4 key figures FY17 4Q17 Revenue growth (constant rates) 2.1% 1.7% Revenue growth (organic) 1.4% 0.2% Comparable growth 0.0% -1.7% Adj. EBITDA growth (constant rates) -0.1% -10.2% Adj. EBITDA growth (organic) -0.1% -8.8% Adj. EBITDA margin 21.1% 19.0% Increased market share in France, continued store roll out across the GV, mainly in Germany and Austria Adj. EBITDA of 418 million broadly flat year on year at constant exchange rates Adj. EBITDA margin decreased by 33 bps from 21.5% in FY16 to 21.1% in FY17 8

9 Vision Express at Tesco Acquisition of 209 stores in December % market share, taking Vision Express to #2 in the UK market with a 15% share overall Further opportunity to expand in additional Tesco stores Database of 4.6 million customers Full integration into network during Integration Plan Rebranding of 8 stores per week on average 45 rebranded stores by the end of February 2018 Store 100% remerchandised with Vision Express assortment in addition to IT and POS system Store teams trained, including at Vision Express buddy store Integration team support in first week after reopen 9

10 Other Europe 2017 Highlights Revenue growth of 9.4% at constant exchange rates, with organic revenue growth of 4.1% Comparable growth of 3.3% (FY16: 1.6%) Revenue and comparable growth achieved across all regions: Northern, Southern and Eastern Europe Other Europe key figures FY17 4Q17 Revenue growth (constant rates) 9.4% 19.8% Revenue growth (organic) 4.1% -0.4% Comparable growth 3.3% -1.1% Adj. EBITDA growth (constant rates) 14.0% 37.2% Adj. EBITDA growth (organic) 6.1% 6.7% Adj. EBITDA margin 15.9% 17.3% Acquisitions, primarily Visilab in Switzerland, contributed 5.4% to revenue Total number of stores increased from 1,818 to 1,876 Adj. EBITDA increased 14.0% at constant exchange rates to 157 million, with organic adj. EBITDA growth of 6.1% Adj. EBITDA margin increased by 62 bps from 15.3% in FY16 to 15.9% in FY17 10

11 Visilab Profile Market Share (2016, estimated) Visilab 34% 24% Fielmann McOptic 4% 6% 8% 24% Source: own estimates Optic 2000 Berdoz Optic Independents 3 GrandVision retail banners: 27 stores High-end positioning 77 stores Mid-to-high price positioning New format launched Mid-to-low price positioning 100% Exclusive Brands 11

12 [ Americas & Asia 2017 Highlights 13.2% increase in revenue at constant exchange rates, organic revenue up 11.8% Comparable growth of 6.5% (FY16: 7.4%), particularly strong performance in Chile, China, Mexico and Turkey US achieved both revenue & comparable growth, longer than expected restructuring Americas & Asia- key figures FY17 4Q17 Revenue growth (constant rates) 13.2% 11.4% Revenue growth (organic) 11.8% 11.4% Comparable growth 6.5% 3.6% Adj. EBITDA growth (constant rates) 27.4% 58.1% Adj. EBITDA growth (organic) 33.0% 57.9% Adj. EBITDA margin 2.2% -0.4% Total number of stores increased from 1,678 to 1,777 Adj. EBITDA up 27.4% at constant exchange rates to 11 million, organic adj. EBITDA growth of 33% Adj. EBITDA margin 2.2% in FY17 Excluding the US, adj. EBITDA would have been 11 million with a margin of 5.4% 12

13 Financial Review 13

14 Adjusted EBITDA and margin development % 16.0% 16.2% 16.0% 15.3% 14.5% 14.8% Adjusted EBITDA ( million) Adjusted EBITDA margin (%) 14

15 Cash Flow generation Lower operating cash flow: lower movements in working capital linked linked to strong network expansion and temporary effects of the transition to global supply chain, as well as a one-off payables improvement in free cash flow impacted by higher capital expenditures than in the previous year Free cash flow generation in 2018 expected to improve back to normal levels x x x 2.1x 1.8x x 1.5x Net cash from operating activities ( mm); Free Cash Flow ( mm) Net debt / Adj. EBITDA 1 Net cash from operating activities / EBITDA and Free cash flow / EBITDA 2 Net debt/ebitda ratio impacted by late in year acquisitions 15

16 Capital Expenditure Development Capex continues to increase in line with the growing business, staying between 4-6% of revenue Increased store capex due to highest number of store openings ever in GrandVision s history and a step-up in store refurbishments to drive topline growth % % 4.3% % 5.0% % % % 5.0% 4.0% 3.0% % 1.0% Store capex Non-store capex Capex % revenue 0.0% 16

17 Outlook and Medium Term Objectives High single digit revenue growth at constant exchange rates, driven by improved comparable growth trends, acquisitions and store openings Outlook 2018 Adjusted EBITDA growth at constant exchange rates in line with revenue growth 1Q18 growth impacted by high prior year comparables and timing of school holidays in Northern Europe, affecting adjusted EBITDA growth Momentum to build as the year progresses Medium term financial objectives Annual revenue growth rate >5% at constant exchange rates Average annual EBITDA growth in high single digits Net debt / EBITDA ratio of max. 2.0x Intention to pay ordinary dividend in line with medium to long-term financial Dividend policy performance Target to increase dividend per share (DPS) over time Ordinary dividend payout ratio 25-50% 2017 DPS of 0.32, corresponding with payout ratio of 35.6% 17

18 Questions and Answers 18

19 Appendix 19

20 Consolidated Income Statement Consolidated Income Statement ( million) Revenue 3,450 3,316 Cost of sales and direct related expenses Gross profit 2,526 2,415 Selling and marketing costs -1,749-1,668 General and administrative costs Share of result of associates 2 4 Operating result Fair value gain on remeasurement of Associate 38 - Financial income 4 9 Financial costs Net financial result Result before tax Income tax Result for the year Attributable to: Equity holders Non-controlling interests

21 Summarized Consolidated Balance Sheet Summarized Consolidated Balance Sheet ( million) Property, plant and equipment Intangible assets 1,654 1,458 Other non-current assets Non-current assets 2,206 1,998 Inventories Other current assets Cash and cash equivalents Current assets Total assets 3,056 2,775 Total equity 1,121 1,007 Borrowings Other non-current liabilities Non-current liabilities Trade and other payables Borrowings Other current liabilities Current liabilities 1,321 1,200 Total equity and liabilities 3,056 2,775 21

22 Consolidated Cash Flow Statement in thousands of EUR Cash flows from operating activities Cash generated from operations Tax paid Net cash from operating activities Cash flows from investing activities Acquisition of subsidiaries, net of cash acquired Purchase of property, plant and equipment Proceeds from sales of property, plant and equipment 5 5 Purchase of intangible assets Proceeds from sales of intangible assets 2 2 Investments in Associates and Joint Ventures - 0 Proceeds from sales of investments in buildings 0 0 Other non-current receivables and assets 3-1 Dividends received 6 8 Interest received 4 5 Net cash used in investing activities Cash flows from financing activities Purchase of treasury shares - -2 Proceeds from borrowings Repayments of other borrowings Interest swap payments -2-3 Acquisition of non-controlling interest -1 - Dividends paid to non-controlling interests Dividends paid to shareholders Interest paid Net cash generated from/ (used in) financing activities Increase / (decrease) in cash and cash equivalents Movement in cash and cash equivalents Cash and cash equivalents at beginning of the year Increase / (decrease) in cash and cash equivalents Exchange gains/ (losses) on cash and cash equivalents -5-1 Cash and cash equivalents at end of year

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