Investor Relations FY 2018

Transcription

1 Investor Relations FY 2018

2 History Leading Authentic Sports Brand Inspired by the Style, Elegance and Passion of our Italian Heritage Founded by FILA brothers in Biella, Italy Established FILA Korea FILA Korea acquired FILA trademark and global assets (USD 400M LBO) FILA Korea & Mirae Asset Global Investments Consortium acquired Acushnet Holdings Corp. (USD 1.2B LBO) First sports apparel market (Tennis) FILA Korea MBO FILA Korea IPO (081660:KS) FILA Korea became a controlling shareholder of Acushnet Holdings Corp. 1

3 Group Structure FILA Holdings (Holding Company) 20% Magnus Holdings 100% FILA Korea (Controlling Shareholder) 53% 100% Acushnet Holdings Corp. GLBH Holdings (Acquisition Vehicle) 100% FILA Luxembourg (Trademark Owner) 40 Licensees (Global Royalty) 15% 100% 100% Full Prospect (JV with ANTA) FILA USA (USA, Canada, Mexico) FILA Sport HK (In-house Sourcing) 2

4 FILA A Leading Authentic Global Sports Brand Brand renewal in Korea Expanding into upper channels of distribution in the US: Foot Locker, Bloomingdale s, Neiman Marcus etc. Successful product collaborations including Fendi, Urban Outfitters, Baja East, Gosha Rubchinskiy, Marion Bartoli (LOVE FILA by Marion Bartoli), Nas (Nas x Ghostbusters footwear collection, Mountain Dew, Staples etc.) Successfully established FILA as leading high-end lifestyle casual brand in China Distribution channel re-structuring process Cost-competitiveness through product sourcing strategy Various collaboration reflecting global Heritage trends Collaborations with Anna Sui, Jason Wu and Ginny Hilfiger etc. Total of 40 licensees Led by Anta, a leading sports apparel company in China, FILA has been expanding into major markets across China, Hong Kong, Macau and Singapore 3

5 FILA Group Business Overview Direct FILA Korea FILA USA Apparel and footwear based retail and wholesale distributor Total number of stores: 570 (as of YE 2018) Multi-category: FILA, FILA KIDS, FILA UNDERWEAR, FILA GOLF North America (U.S.A., Canada, Mexico) Footwear based wholesale distributor FILA Licensee Total 40 licensees in Asia, North America, South America and EMEA Revenue and profit contribution from licensee partners that operate the FILA branded products globally Indirect Full Prospect Joint venture (15% ownership) with ANTA Sports from Offering premium sports & lifestyle products in China, Hong Kong, Macau, and Singapore Contributes 3% of its wholesale revenue as Design Service Fee to FILA Korea Acushnet Hold. Magnus Holdings Co., Ltd., a wholly-owned subsidiary of Fila Korea Co., Ltd., or Fila Korea, owns approximately 53% of Acushnet Holdings Corp. as a controlling shareholder. Acushnet Holdings Corp. designs, develops, manufactures, and distributes golf products worldwide. The company operates through four segments: Titleist Golf Balls, Titleist Golf Clubs, Titleist Golf Gear, and FootJoy Golf Wear. Owned brands: Titleist, FootJoy, Vokey, Scotty Cameron, Pinnacle 4

6 Consolidated Financial Summary 3 months (Oct. - Dec.) ended 12 months (Jan. - Dec.) ended [Unit: KRW mn] Variance (%) 2018 Variance (%) Variance(%) 2018 Variance(%) Revenue 414, , % 761, % 967,128 2,530, % 2,954, % Gross Profit 172, , % 367, % 418,971 1,240, % 1,467, % G.P.(%) 41.7% 49.5% 7.7%p 48.2% (1.2%)p 43.3% 49.0% 5.7%p 49.7% 0.6%p Operating Profit (25,500) 51,451 N/A 82, % 11, ,466 1,737.1% 357, % O.P.(%) (6.2%) 8.4% N/A 10.8% 2.5%p 1.2% 8.6% 7.4%p 12.1% 3.5%p Net Income 357,314 15,127 (95.8%) 3,872 (74.4%) 311, ,110 (65.3%) 210, % 5

7 Consolidated Financial Summary (4Q 2018 & FY 2018) Fila Group (Without Acushnet 4Q 2018 & FY 2018) (Unit: KRW mn) 16.3% 15.1% 10.8% 371, % 1,157, , ,228 4Q Q 2018 FY 2017 FY 2018 Revenue OPM Revenue OPM Fila Consolidated Financial (With Acushnet 4Q 2018 & FY 2018) (Unit: KRW mn) 8.4% 10.8% 761, % 2,954, , % 2,530,324 4Q Q 2018 Revenue OPM FY 2017 FY 2018 Revenue OPM 6

8 FILA Group Business Overview Direct FILA Korea FILA USA Apparel and footwear based retail and wholesale distributor Total number of stores: 570 (as of YE 2018) Multi-category: FILA, FILA KIDS, FILA UNDERWEAR, FILA GOLF North America (U.S.A., Canada, Mexico) Footwear based wholesale distributor FILA Licensee Total 40 licensees in Asia, North America, South America and EMEA Revenue and profit contribution from licensee partners that operate the FILA branded products globally Indirect Full Prospect Joint venture (15% ownership) with ANTA Sports from Offering premium sports & lifestyle products in China, Hong Kong, Macau, and Singapore Contributes 3% of its wholesale revenue as Design Service Fee to FILA Korea Acushnet Hold. Magnus Holdings Co., Ltd., a wholly-owned subsidiary of Fila Korea Co., Ltd., or Fila Korea, owns approximately 53% of Acushnet Holdings Corp. as a controlling shareholder. Acushnet Holdings Corp. designs, develops, manufactures, and distributes golf products worldwide. The company operates through four segments: Titleist Golf Balls, Titleist Golf Clubs, Titleist Golf Gear, and FootJoy Golf Wear. Owned brands: Titleist, FootJoy, Vokey, Scotty Cameron, Pinnacle 7

9 FILA Korea Domestic Financial Summary 3 months (Oct. - Dec.) ended 12 months (Jan. - Dec.) ended [Unit: KRW mn] Variance (%) 2018 Variance (%) Variance(%) 2018 Variance(%) Revenue 82, , % 132, % 306, , % 499, % Gross Profit 40,078 59, % 79, % 156, , % 297, % G.P.(%) 48.7% 58.5% 9.8%p 60.3% 1.8%p 51.2% 57.1% 5.9%p 59.5% 2.4%p Operating Profit (13,608) 4,285 N/A 14, % (31,021) 1,415 N/A 56,454 3,889.8% O.P.(%) (16.5%) 4.2% N/A 11.2% 7.0%p (10.1%) 0.4% N/A 11.3% 10.9%p Net Income 4,811 1,424 (70.4%) 10, % (17,845) (3,389) N/A 59,017 N/A * DSF (Design Service Fee) from Full prospect (JV with Anta Sports) is included Full Prospect Design Service Fee Income Summary 3 months (Oct. - Dec.) ended 12 months (Jan. - Dec.) ended [Unit: USD K] Variance (%) 2018 Variance (%) Variance(%) 2018 Variance(%) Design Service Fee Income 2,001 3, % 6, % 6,811 10, % 20, % 8

10 FILA Products Displayed at the Multi-Brand Stores 9 9

11 FILA Domestic Products 10

12 FILA Group Business Overview Direct FILA Korea FILA USA Apparel and footwear based retail and wholesale distributor Total number of stores: 570 (as of YE 2018) Multi-category: FILA, FILA KIDS, FILA UNDERWEAR, FILA GOLF North America (U.S.A., Canada, Mexico) Footwear based wholesale distributor FILA Licensee Total 40 licensees in Asia, North America, South America and EMEA Revenue and profit contribution from licensee partners that operate the FILA branded products globally Indirect Full Prospect Joint venture (15% ownership) with ANTA Sports from Offering premium sports & lifestyle products in China, Hong Kong, Macau, and Singapore Contributes 3% of its wholesale revenue as Design Service Fee to FILA Korea Acushnet Hold. Magnus Holdings Co., Ltd., a wholly-owned subsidiary of Fila Korea Co., Ltd., or Fila Korea, owns approximately 53% of Acushnet Holdings Corp. as a controlling shareholder. Acushnet Holdings Corp. designs, develops, manufactures, and distributes golf products worldwide. The company operates through four segments: Titleist Golf Balls, Titleist Golf Clubs, Titleist Golf Gear, and FootJoy Golf Wear. Owned brands: Titleist, FootJoy, Vokey, Scotty Cameron, Pinnacle 11

13 FILA USA Consolidated Financial Summary 3 months (Oct. - Dec.) ended 12 months (Jan. - Dec.) ended [Unit: USD K] Variance (%) 2018 Variance (%) Variance(%) 2018 Variance(%) Revenue 82,828 92, % 169, % 319, ,665 (4.8%) 452, % Gross Profit 24,137 29, % 56, % 98,509 91,906 (6.7%) 145, % G.P.(%) 29.1% 31.5% 2.4%p 33.0% 1.5%p 30.8% 30.2% (0.6%)p 32.1% 1.9%p Operating Profit 5,377 6, % 17, % 21,127 9,247 (56.2%) 34, % O.P.(%) 6.5% 6.9% 0.4%p 10.1% 3.1%p 6.6% 3.0% (3.6%)p 7.5% 4.5%p Net Income 2,763 (529) N/A 11,835 N/A 11,604 1,136 (90.2%) 23,262 1,947.2% 12

14 FILA USA Products 13

15 FILA Group Business Overview Direct FILA Korea FILA USA Apparel and footwear based retail and wholesale distributor Total number of stores: 570 (as of YE 2018) Multi-category: FILA, FILA KIDS, FILA UNDERWEAR, FILA GOLF North America (U.S.A., Canada, Mexico) Footwear based wholesale distributor FILA Licensee Total 40 licensees in Asia, North America, South America and EMEA Revenue and profit contribution from licensee partners that operate the FILA branded products globally Indirect Full Prospect Joint venture (15% ownership) with ANTA Sports from Offering premium sports & lifestyle products in China, Hong Kong, Macau, and Singapore Contributes 3% of its wholesale revenue as Design Service Fee to FILA Korea Acushnet Hold. Magnus Holdings Co., Ltd., a wholly-owned subsidiary of Fila Korea Co., Ltd., or Fila Korea, owns approximately 53% of Acushnet Holdings Corp. as a controlling shareholder. Acushnet Holdings Corp. designs, develops, manufactures, and distributes golf products worldwide. The company operates through four segments: Titleist Golf Balls, Titleist Golf Clubs, Titleist Golf Gear, and FootJoy Golf Wear. Owned brands: Titleist, FootJoy, Vokey, Scotty Cameron, Pinnacle 14

16 FILA Global Royalty Summary 3 months (Oct. - Dec.) ended 12 months (Jan. - Dec.) ended [Unit: USD K] Variance (%) 2018 Variance (%) Variance(%) 2018 Variance(%) Asia 2,388 2, % 3, % 9,434 11, % 14, % North America 2,035 1,307 (35.8%) 1, % 7,621 5,342 (29.9%) 6, % South America % % 1,027 1, % 2, % EMEA 3,500 4, % 8, % 14,073 16, % 26, % Category % 284 (26.9%) 1,685 1,654 (1.8%) 1,616 (2.3%) Total (Adjusted) 8,781 9, % 15, % 34,305 36, % 53, % 15

17 Global License Business Global License Structure (40 licensees) General License Conditions FILA Luxembourg (Trademark owner) License period is 5 years (10 years for master licensees) Based on the wholesale revenue from each licensee On average, 6-7% of FILA s wholesale revenue generated from each licensee Asia 10 regional licensees North America 11 regional licensees EMEA 1 master licensees South America 1 master licensee Global Product 8 category licensee Each licensee has minimum guaranteed royalty (MGR) based on the forecasted revenue Semi-annual Global Collaboration Meetings (GCM) held to set broad, global strategic guidelines among all licensees 9 regional licensees 16

18 Consolidated Balance Sheet (K-IFRS) Consolidated Balance Sheet (K-IFRS) (KRW mn) FY 2018 FY 2017 FY 2016 Assets 3,304,340 3,078,924 3,384,915 Current Assets 1,337,878 1,154,081 1,240,992 Cash and cash equivalents 149, , ,389 Trade and other receivables 473, , ,528 Inventories 632, , ,896 Other current assets 82,776 80,676 82,178 Non-current Assets 1,966,462 1,924,843 2,143,923 Property and equipment 310, , ,467 Intangible assets 1,491,948 1,440,427 1,626,895 Other non-current assets 163, , ,561 Liabilities 1,797,846 1,844,594 2,082,752 Current Liabilities 672, ,581 1,193,035 Trade and other payables 405, , ,510 Borrowings 174, , ,312 Bonds - 69,558 - Other current liabilities 91,893 81,966 96,214 Non-current Liabilities 1,125,530 1,150, ,717 Borrowings 746, , ,438 Bonds 61,175-78,083 Other non-current liabilities 317, , ,195 Total Equity 1,506,494 1,234,330 1,302,163 17

19 Appendix Financial Summary I. FILA Korea (unit: KRW mn) 3 months (Oct.-Dec.) ended 12 months (Jan.-Dec.) ended Variance(%) 2018 Variance(%) Variance(%) 2018 Variance(%) Revenue 82, , % 132, % 306, , % 499, % Gross Profit 40,078 59, % 79, % 156, , % 297, % G.P. % 48.7% 58.5% 9.8%p 60.3% 1.8%p 51.2% 57.1% 5.9%p 59.5% 2.4%p O. Profit (13,608) 4,285 N/A 14, % (31,021) 1,415 N/A 56,454 3,889.8% O.P. % (16.5%) 4.2% N/A 11.2% 7.0%p (10.1%) 0.4% N/A 11.3% 10.9%p Net Income 4,811 1,424 (70.4%) 10, % (17,845) (3,389) N/A 59,017 N/A I-a. Full Prospect Design Service Fee Income (unit: USD '000) 3 months (Oct.-Dec.) ended 12 months (Jan.-Dec.) ended Variance(%) 2018 Variance(%) Variance(%) 2018 Variance(%) Design Service Fee Income 2,001 3, % 6, % 6,811 10, % 20, % 4Q Revenue (approx. +KRW 30.4bn) - Increase in revenue mainly from FILA segment - Increase in Design Service Fee Income contributed by Full Prospect (YoY approx %) 4Q Operating Profit (approx. +KRW 10.5bn) - Resulted from increase in revenue and product margin improvement - Decrease in sales commission expense proportion to revenue due to wholesale business expansion - Decrease in SG&A expense proportion to revenue (cost leverage effects) due to lower rate of increase in SG&A compared to revenue increase (56.7% 48.2%) 4Q Net Income (approx. +KRW 9.1bn) - Resulted from increase in revenue - Gains on foreign currency translation ('17 Q4 : 1, KRW/USD vs '18 Q4 : 1, KRW/USD) due to appreciation of KRW against USD 18

20 Appendix Financial Summary II. FILA USA Consolidated (unit: USD '000) 3 months (Oct.-Dec.) ended 12 months (Jan.-Dec.) ended Variance(%) 2018 Variance(%) Variance(%) 2018 Variance(%) Revenue 82,828 92, % 169, % 319, ,665 (4.8%) 452, % Gross Profit 24,137 29, % 56, % 98,509 91,906 (6.7%) 145, % G.P. % 29.1% 31.5% 2.4%p 33.0% 1.5%p 30.8% 30.2% (0.6%)p 32.1% 1.9%p O. Profit 5,377 6, % 17, % 21,127 9,247 (56.2%) 34, % O.P. % 6.5% 6.9% 0.4%p 10.1% 3.1%p 6.6% 3.0% (3.6%)p 7.5% 4.5%p Net Income 2,763 (529) N/A 11,835 N/A 11,604 1,136 (90.2%) 23,262 1,947.2% 4Q Revenue (approx. +USD 77.1M) - Market headwind from the mid-market disruption has shown improvement on retailers compared to last year - Sales mix has improved with higher margin product (i.e. heritage etc.) through upper tier distribution channel reflecting the continuing market trends for retro and brand equity improvement 4Q Operating Profit (approx. +USD 10.8M) - Resulted from increase in revenue - Decrease in SG&A expense proportion to revenue (cost leverage effects) due to lower rate of increase in SG&A compared to revenue increase (27.7% 24.9%) III. Global Royalty (unit: USD '000) 3 months (Oct.-Dec.) ended 12 months (Jan.-Dec.) ended Variance(%) 2018 Variance(%) Variance(%) 2018 Variance(%) Asia 2,388 2, % 3, % 9,434 11, % 14, % North America 2,035 1,307 (35.8%) 1, % 7,621 5,342 (29.9%) 6, % South America % % 1,027 1, % 2, % EMEA 3,500 4, % 8, % 14,073 16, % 26, % Category % 284 (26.9%) 1,685 1,654 (1.8%) 1,616 (2.3%) Total (Int_Adj) 8,781 9, % 15, % 34,305 36, % 53, % EMEA (approx. +USD 4.2M) - Increase in revenue from UK & Europe region Asia (approx. +USD 1.1M) - Increase in revenue from Austrailia and Taiwan region North America (approx. +USD 0.5M) - Increase in revenue from North America region 19

21 Appendix Financial Summary IV. Consolidated Financial (unit: KRW mn) 3 months (Oct.-Dec.) ended 12 months (Jan.-Dec.) ended Variance(%) 2018 Variance(%) Variance(%) 2018 Variance(%) Revenue 414, , % 761, % 967,128 2,530, % 2,954, % Gross Profit 172, , % 367, % 418,971 1,240, % 1,467, % G.P. % 41.7% 49.5% 7.7%p 48.2% (1.2%)p 43.3% 49.0% 5.7%p 49.7% 0.6%p O. Profit (25,500) 51,451 N/A 82, % 11, , % 357, % O.P. % (6.2%) 8.4% N/A 10.8% 2.5%p 1.2% 8.6% 7.4%p 12.1% 3.5%p Net Income 357,314 15,127 (95.8%) 3,872 (74.4%) 311, ,110 (65.3%) 210, % 4Q Revenue (approx. +KRW 154.0bn) - Increase in revenue contribution from FILA Group (approx. +KRW 153.1bn) 4Q Operating Profit (approx bn) - Increase in operating profit contribution from FILA Group (approx. +KRW 35.9bn) - Operating loss impact from Acushnet Holdings Corp. (approx. -KRW 4.5bn) 4Q Net Income (approx. KRW 11.3bn) - Increase in Deferred Tax Liabilities and Tax Expenses due to increase in book value of retained earning of a subsidiary (approx. -KRW 11.7bn) - Goodwill impairment loss resulted from increase in book value of asset of a subsidiary (approx. -KRW 9.6bn) 20

22 Disclaimer This document includes information provided for the purpose of helping to understand the business, strategies, and financial situation of FILA KOREA Ltd. (hereinafter referred to as FILA ) and its group companies. It was not created to solicit investors to buy or sell FILA's stock. The uses of this document are advised to make their own investment decisions and responsibility. This document has been prepared for presentation, illustration and discussion purpose only and is not legally binding. Investment involves risk. Past performance figures are not indicative of future performance. Please carefully read through the documents and seek independent professional advice before you make any investment decision. FILA has made every effort to ensure the accuracy of the information contained in this document. However, FILA does not guarantee the appropriateness, accuracy, usefulness or any other matter whatsoever regarding the information. Regardless of the reason, FILA assumes no responsibility, whatsoever, for any loss or damages resulting from changes, suspension or deletion of information contained on the document, or from the unauthorized alteration of said information by a third party, or for damage resulting from the downloading or the use of the data. The information described in this document may contain forward-looking statements concerning the future performance excluding the past and present fact. These forwardlooking statements contain risks and uncertainties, and do not guarantee future performance. Please note that forward-looking statements may differ from actual results depending on changes in economic status, market trends and tax and the other systems. Please note that this document may be discontinued or terminated and that the contents may be altered without advance notice. In addition, this document may not be readily accessible at certain times due to internal or external circumstances. It should be recognized in advance that FILA assumes no responsibility for any trouble, loss, or damage caused thereby. 21