Arvind Limited Q4 Performance Review 12th May 216, Ahmedabad 1
Contents Performance Review Q4 and FY 215-16 Financial Performance: Consolidated Business Analysis 2
Key Highlights In the back drop of difficult macro economic environment Strong Brand & Retail revenue growth Q4 Growth : 3% 21516 Growth : 16% EBIDTA margin of Brand & Retail Segment improved significantly Q4: up 37 bps 215-16: up 13 bps Arvind Lifestyle Brand Limited became PBT positive as per the forecast Very Successful launch of 4 speciality retail formats- GAP, TCP, Sephora & Aeropostale Speciality Retail to contribute significantly to future revenue growth MegaMart restructuring complete Loss making stores closed Launched Value Retail format under the name Unlimited Gross Margin improvement of 5% Textile Margins & ROCE nearly maintained 3
Financial Performance: Q4 215-16 Consolidated revenue growth of 14% and PAT growth of 14% Strong growth in revenues......as well as margins Rev, Rs Cr 2,5 14% 2,41 2, 2,32 EBITDA, Rs Cr 14% 3 26 2 1 FY214-15 297 FY215-16 1,5 PAT*, Rs Cr 1, 15 1 97 14% 11 5 5 FY214-15 FY215-16 FY214-15 FY215-16 *PAT before exceptional Item 4
Business Highlights: Q4 215-16 Strong top-line growth and Profit Growth All Figures in INR Crs Q4 FY16 Q4 FY15 Change Revenue from Operations 2,32 2,41 14% Raw Materials 1,4 847 Project Expenses 7 18 Employees' Emoluments 25 23 Others 748 649 Stock (Increase) / Decrease -27 7 Forex (Gain) / Loss 4-5 EBIDTA 297 26 14% Margin 12.8% 12.7% Other Income 2 23 Interest & Finance Cost 94 96 Cash Accruals 223 187 19% Depreciation 66 56 Profit Before Taxes 156 131 19% Tax 46 36 Profit After Tax 11 97 14% Less : Exceptional Item 48 Net Profit 11 48 128% Key highlights Revenue growth of 14% achieved due to 3% top-line growth in Brands & Retail 27% top-line growth in Garments PBT growth of 2%, PAT growth 14% 5
Financial Performance: FY 215-16 Revenue growth of 8% and PAT de-growth of 6% Moderate revenue growth as well as margins Rev, Rs Cr EBITDA, Rs Cr 9, 7,5 7,851 8% 8,45 1,5 1, 5 1,13 5% 1,65 6, FY214-15 FY215-16 4,5 3, 1,5 PAT*, Rs Cr 4 3 2 395-6% 371 FY214-15 FY215-16 1 FY214-15 FY215-16 *PAT is before exceptional Item 6
Business Highlights: FY 215-16 Moderate top-line & bottom-line growth All Figures in INR Crs 215-16 214-15 Change Revenue from Operations 8,45 7,851 8% Raw Materials 3,75 3,696 Project Expenses 29 71 Employees' Emoluments 928 82 Others 2,744 2,48 Stock (Increase) / Decrease -28-22 Forex (Gain) / Loss 7-8 EBIDTA 1,65 1,13 5% Margin 12.6% 12.9% Other Income 96 93 Interest & Finance Cost 381 395 Cash Accruals 78 711 1% Depreciation 256 212 Profit Before Taxes 524 499 5% Tax 152 17 Profit After Tax 371 395-6% Less : Exceptional Item 8 54 Net Profit 363 341 6% Key highlights Revenue growth of 8% achieved due to 16% top-line growth of Brands & Retail 3% top-line growth of Textiles EBIDTA margin % slightly lower Higher weightage of Brand & Retail Business PBT growth of 5% : PAT growth of -6% due to higher taxation 7
Strong Margin growth in B&R Business: Textile Margin lower as share of Garments revenue increased Textiles Brands & Retail EBITDA % EBITDA % FY comparison Vs LY 2 15 1 17.4% 17.1% FY 214-15 FY 215-16 8 6 4 2 5.2% FY 214-15 6.5% FY 215-16 Q4 comparison Vs LY EBITDA % 2 16.9% 15 1 Q4 214-15 16.2% Q4 215-16 EBITDA % 8 6 4 2 4.1% Q4 214-15 7.9% Q4 215-16 8
Consolidated Balance Sheet, as at Mar 31 st 216 As at Rs Cr 31st Mar'16 31st Mar'15 Shareholders' Fund Share Capital 258 258 Reserves and Surplus 2652 2545 Non Current Liabilities 1629 1495 Shortterm Borrowings 1716 171 Current Liabilities 2264 1943 Minority Interest 53 35 Total 8572 7976 Assets Fixed Assets 366 338 Non -Current Investment 69 57 Long Term Loans and Advances 58 61 Other Non Current Assets 2 8 Current Assets 4296 3991 Total 8572 7976 9
Key Financial Ratios Particulars 214-15 Q4 15-16 215-16 EPS (Annualised) 15.3 17.1 14.4 Debt / Equity 1.21 1.22 1.22 Debt / EBIDTA 3.7 2.79 3.5 ROCE 14.1% 15.5% 13.9% ROE 14.1% 15.2% 12.7% Revenue Growth 14.4% 13.5% 7.6% 1
Agenda Performance Review Q4 and FY 215-16 Financial Performance: Consolidated Business Analysis 11
Textiles Business: Revenue Mix in FY215-16 Rev, Rs Cr 3% 5,122 5,5 4,977 32 5, 275 345 36 4,5 712 883 4, 3,5 3, 1,944 2,15 2,5 2, 1,5 1, 1,927 1,879 5-241 -32-5 FY 214-15 FY 215-16 Knits Voiles Garments Wovens Denim Internal sale Rev. Growth % 1% -4% 24% 4% -3% Textile revenue grew by 3% Led by 4% growth Woven fabrics 24% growth in garments 3% degrowth in Denim 1% growth on a smaller base for the Knits business 12
Volume growth: Wovens volume growth at 5% : Lower Volumes at denim by 6 % Denim Wovens (Shirting & Khaki) Q4 comparison Vs LY Volume, Mn Mtrs 3 26. 2 1-4% 25.1 Volume, Mn Mtrs 3% 3 28.2 2 1 29.1 Q4 214-15 Q4 215-16 Q4 214-15 Q4 215-16 Volume, Mn Mtrs Volume, Mn Mtrs FY comparison Vs LY 15 1 5 16.1-6% 1.2 15 1 5 111.7 5% 116.9 FY214-15 FY215-16 FY214-16 FY215-16 Product mix change in Denim resulted in bottlenecks in capacity leading to lower volume: Investments to debottleneck the plant made operational in March 16 13
Key Parameters: FY215-16 Textiles Denim Woven Q4 15-16 Q4 14-15 Q4 15-16 Q4 14-15 Exports(Mn Mtrs) 11 12 8 8 Domestic (Mn Mtrs) 14 14 21 2 Avg Prices 189 18 17 166 Major Components Cotton Cost in Rs / Kg 13 95 Denim Woven 15-16 14-15 15-16 14-15 Exports(Mn Mtrs) 41 47 29 25 Domestic (Mn Mtrs) 59 6 88 86 Avg Prices 185 179 168 168 Major Components Cotton Cost in Rs / Kg 12 19 14
Brands & Retail Business grew topline by 3% in Q4 215-16 Strong revenue growth Key highlights Rev, Rs Cr Revenue growth of 3% achieved due to 44% revenue growth in Brands /Retail formats 8 3% 766 (-)4% growth revenue in MegaMart Retail 7 6 587 Like to Like growth 2.7% LTL growth in Brands 5 4 3 2 Q4 214-15 Q4 215-16 *Without Arvind Internet Business 15
Brands & Retail Business grew topline by 16% in FY215-16 Strong revenue growth Key highlights Rev, Rs Cr Revenue growth of 16% achieved due to 26% revenue growth in Brands/Other formats 3, 2,5 2,361 16% 2,74-11% revenue growth in MegaMart Retail, as business went through a repositioning and model change to consolidate operations and restore margins 2, Like to Like growth 1,5 2.3% LTL growth in Brands Overall LTL growth of -13% in Megamart Retail 1, 5 FY 214-15 FY 215-16 *Without Arvind Internet Business 16
Performance of Power Brands Revenues Rs Cr 6 +31% +2% 2, Power brands 463 1,64 354 1,5 1,334 4 2 Q4 214-15 Q4 FY 215-16 Q4 215-16 Revenues Rs Cr 1, 5 FY 214-15 FY 215-16 EBITDA Rs Cr 8 6 4 2 11.7% 41 Q4 214-15 EBITDA % 14.4% 15 1 67 5 Q4 215-16 EBITDA Rs Cr 3 2 1 11.4% 152 FY 214-15 13.3% 213 FY 215-16 EBITDA % 15 1 5 EBITDA % EBITDA Rs Cr Revenue Rs Cr 1. Note: Tommy Hilfiger numbers reflect 5% Arvind share of the JV company 17
Brands & Retail Business Distribution Q3 215-16 Q4 215-16 Particulars Stores Sq Ft Stores Sq Ft Unlimited & Megamart 95 7,29,462 92 7,19,526 Others 93 8,66,361 957 9,61,35 Total 998 15,95,823 149 16,8,561 No of KA Exclusive Counters 1427 1566 Sales Increase in Key Account Counters: Growth of 19.7% in FY215-16 18
Outlook Revenue Growth likely to be between 15-16% primarily driven by volume growth in brands & retail business and Garments manufacturing : Revenue Growth in Textiles 8-9% Revenue Growth in Brands & Retail at about 24% Weighted Margins likely to be marginally lower due to mix change in favour of Brand & Retail business Textile Margins likely to be maintained B & R Margin likely to increase by.75-1% 19
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