INTERIM RESULTS FOR THE 26 WEEKS ENDED 25 AUGUST 2018 - 16 October 2018 - Footasylum plc
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INTERIM RESULTS
FOR THE 26 WEEKS ENDED 25 AUGUST 2018
16 October 2018
AGENDA
Key highlights
Barry Bown, Executive Chairman & Interim CEO
Financial review
Danielle Davies, CFO
Strategic and operating review
Barry Bown, Executive Chairman & Interim CEO
Summary
Barry Bown, Executive Chairman & Interim CEO
FOOTASYLUM PLC • HY19 RESULTS 2
KEY HIGHLIGHTS BARRY BOWN, EXECUTIVE CHAIRMAN
HY19 HIGHLIGHTS
Financial highlights
• Revenue up 19% to £98.6m, (HY18: £83.2m) with growth across all channels and major product categories
• Gross margin of 42.9% (HY18: 44.8%); adjusted EBITDA margin down 680bps to (1.5)% (HY18: 5.3%)
• Cash at period end of £4.5m (HY18: £(0.7)m)
Strategic and operating highlights
• Store roll-out plans progressing
• Improved consumer user experience online with further investment in the footasylum.com website
• Relaunched our native shopping app
• Launched UNLCKD, a new customer rewards programme
• Added Tommy Hilfiger to our third-party brand line up
FOOTASYLUM PLC • HY19 RESULTS 4CURRENT TRADING AND OUTLOOK
• Company trading in line with the lowered expectations communicated on 3 September, which were:
‒ Lower than expected store revenue growth impacted by challenging summer trading and delays to store
roll-outs
‒ Lower gross margin resulting from higher amount of clearance activity
‒ Expect adjusted EBITDA for FY19 to be less than half of the FY18 adjusted EBITDA of £12.5m
• In light of current circumstances, taken the decision to scale back store expansion targets to 2 new stores and 2
upsizes per annum from FY20
• Growth strategy refined to give greater web focus
• Encouraged by progress made to date in strengthening partnerships with core suppliers and improving
technology and consumer systems
• Remain confident that our differentiated, product-led, multi-channel proposition, combined with strong
partnerships with core suppliers, will underpin our continued progress
FOOTASYLUM PLC • HY19 RESULTS 5FINANCIAL REVIEW DANIELLE DAVIES, CFO
FINANCIAL HIGHLIGHTS
Revenue growth across all channels
HY19 HY18 Abs Var
Revenue (£m) 98.6 83.2 15.4
Gross profit (£m) 42.3 37.3 5.0
Gross margin (%) 42.9% 44.8% (190) bps
Adjusted EBITDA (£m)1 (1.5) 4.4 (5.9)
Adjusted EBITDA margin (%) (1.5)% 5.3% (680) bps
Adjusted (loss) / profit before tax2 (£m) (4.0) 2.3 (6.3)
(Loss) / profit before tax (£m) (2.5) 1.7 (4.3)
Non-GAAP adjusted diluted EPS (p)3 (3.98) 1.70 (5.68)
Cash (£m) 4.5 (0.7) 5.2
1 Adjusted EBITDA is stated as earnings before interest, tax, depreciation, amortisation, exceptional items and the share-based payment charge
2 Adjusted profit before tax is stated as adjusted EBITDA after interest, depreciation and amortisation
3 Non-GAAP adjusted diluted earnings per share (“EPS”) is stated as profit after tax (“PAT”) before exceptional items and the share-based payment charge per the diluted
issued ordinary shares as at 25 August 2018. Share options are not included in the calculation at HY19 as they would be anti-dilutive
FOOTASYLUM PLC • HY19 RESULTS 7REVENUE
Strong growth across all channels
Channel
£m HY19 HY18 Var REVENUE BY CHANNEL (£m)
Stores 66.3 59.0 12%
1.4 98.6
Online 30.2 23.5 29% 2.1
6.7
Wholesale 2.1 0.7 200% 83.2 7.3
0.7 30.2
Total 98.6 83.2 19%
23.5
Channel
% total revenue HY19 HY18 Var
Stores 67% 71% (4)% 66.3
59.0
Online 31% 28% 3%
Wholesale 2% 1% 1%
Total 100% 100%
HY18 Stores Online Wholesale HY19
Stores Online Wholesale
FOOTASYLUM PLC • HY19 RESULTS 8REVENUE
Growth across major product categories
Product category
£m HY19 HY18 Var REVENUE BY PRODUCT (£m)
Footwear 53.8 45.9 17%
(0.2) 98.6
Apparel 41.2 33.5 23%
7.7 3.6
Accessories 3.6 3.8 (5)% 83.2 7.9
Total 98.6 83.2 19% 3.8
41.2
33.5
Product category
% total revenue HY19 HY18 Var
Footwear 54% 55% (1)%
Apparel 42% 40% 2% 53.8
45.9
Accessories 4% 5% (1)%
Total 100% 100%
HY18 Footwear Apparel Accessories HY19
Footwear Apparel Accessories
FOOTASYLUM PLC • HY19 RESULTS 9GROSS MARGIN
Mix and clearance impacts
GROSS PROFIT AND GROSS MARGIN
£42.3m
Gross margin • Apparel margin
44.8% 42.9%
• Footwear stock
£37.3m • Clearance activity
• Channel mix
HY18 HY19
FOOTASYLUM PLC • HY19 RESULTS 10COSTS
Growing our capability
Admin expenses as
a % of revenue 1 £43.8m
(excluding exceptional items)
• Rent
£32.9m
• Marketing
44.5%
39.5% • Wages
HY18 HY19
1 Admin expenses do not include depreciation and amortisation, exceptional items and the share-based payment charge
FOOTASYLUM PLC • HY19 RESULTSCASH FLOW
Reflects trading environment
£m HY19 HY18
Adjusted EBITDA (1.5) 4.4
Working capital (2.0) (4.0)
Corporation tax paid (0.9) (0.9)
Free cash flow (4.4) (0.5)
Property, Plant and Equipment & Intangible assets (4.8) (2.6)
Cash used in / generated from Financing activities (0.2) 0.2
Net Exceptional P&L Income / (Cost) 2.3 (0.6)
Other 0.2 0.0
Net cash flow (6.9) (3.5)
Cash and cash equivalents at beginning of year 11.4 2.8
Cash and cash equivalents / (overdraft) at end of the period 4.5 (0.7)
FOOTASYLUM PLC • HY19 RESULTS 12CAPEX
Investment in infrastructure underpins growth
£m HY19 HY18 • IPO proceeds support investment in business
Capex on stores 1.5 2.5
Warehouse 0.8 0.2 • Continued store roll-out
Technology 1.2 0.5
• Warehousing – ready for peak trading
Other 0.8 0.3
Total capital expenditure* 4.3 3.5 • Investment in the footasylum.com website and
launch of our native shopping app
FY19 store roll-out New Upsize
H1 1
H2 to date 1 1
Pre peak 4 3
Post peak 1
Total 6 5
* Capital additions
FOOTASYLUM PLC • HY19 RESULTS 13OPERATING
REVIEW
BARRY BOWN,
EXECUTIVE CHAIRMAN
FOOTASYLUM PLC • HY19 RESULTS 14OVERVIEW
Key actions taken
Short-term Medium-term Longer-term
• Footwear stock • Scale back store • Brand relationships
expansion
• Apparel brands • New store concepts
• Store expansion delays • More focus on web • Strengthened
o International management
o Data
o Logistics
o Mobile
FOOTASYLUM PLC • HY19 RESULTS 15GROWTH DRIVERS
• Digital & consumer engagement
• Stores
• Third-party brands
• Wholesale and own brands
• Infrastructure and investment
FOOTASYLUM PLC • HY19 RESULTS 16DIGITAL & ENGAGEMENT
FOOTASYLUM PLC • HY19 RESULTS 17DIGITAL & ENGAGEMENT
Online presence continues to develop
Online improvements: KEY STATS
• Website redesign TRAFFIC FROM MOBILE & TABLETS
• Live chat rolled out > 80%
• Relaunched shopping app NUMBER OF DOWNLOADS OF NEW APP
> 40k Since launch on 10 August to 1 September 2018
Engaging our consumers:
CUSTOMER SATISFACTION RATES
• Launch of UNLCKD, our consumer rewards scheme
c.95% Post live chat as per our survey findings
• Data driven, hyper local approach to segmentation EMAIL OPEN RATES
• Successful marketing initiatives +18% Since June 2018
FOOTASYLUM PLC • HY19 RESULTS 18STORES
STORES
Delivering unique consumer experiences
• Upsizes continue to perform well KEY STATS
• Positive reactions from third-party suppliers FY19 ROLLOUT
6 NEW
• Generating increased online traffic locally 5 UPSIZES
• We’ll open 6 new stores and complete 5 upsizes in FY19 STORES
66 including one fascia for
SEVEN and one for Drome
• Targeting 2 new stores and 2 upsizes p.a. from FY20
YOUNG ESTATE
30 stores opened or upsized
since February 2016
FOOTASYLUM PLC • HY19 RESULTS 20THIRD-PARTY BRANDS
FOOTASYLUM PLC • HY19 RESULTS 21THIRD-PARTY BRANDS
Bringing together global and niche brands to appeal to the urban style consumer
• Footasylum is a valuable route to market for brands seeking our
consumer base
• Brand portfolio and mix is constantly evolving
• Added Tommy Hilfiger
• Continue to strengthen relationships with key suppliers
• Progress in ‘exclusives’
FOOTASYLUM PLC • HY19 RESULTS 22SUMMARY
BARRY BOWN,
EXECUTIVE CHAIRMAN
FOOTASYLUM PLC • HY19 RESULTS 23SUMMARY
• A difficult trading period with a number of challenges
• Remain focused on the same growth drivers having taken corrective actions
• Continue to invest for the future across key areas, with promising early signs of progress in building
on our capabilities
• Scaling back store expansion programme to reflect current trading conditions
• Remain confident that our strategy, proposition and partnerships will underpin future success
FOOTASYLUM PLC • HY19 RESULTS 24Q&A
FOOTASYLUM PLC • HY19 RESULTS 25THANK YOU
APPENDIX
27WHAT MAKES US DIFFERENT ?
A unique and distinctive offer
WE ARE CONSUMER FOCUSED • Strong understanding of core 16-24 year old
consumer base
WE ARE PRODUCT LED • Trend-leading, bringing together global brands
and local trends
WE ARE DIGITAL • Immersed in digital
• Innovative approach to marketing
WE COLLABORATE • Long-term collaborative relationships
WE SWEAT THE SMALL STUFF • Hyper-local and relevant offer
WE LEAD • Fast-moving and always pushing boundaries
FOOTASYLUM PLC • HY19 RESULTS 28FOOTASYLUM OVERVIEW
Dynamic business with a differentiated proposition led by experienced retail operators
STORE OPENING HISTORY
• Established UK retailer bringing on-trend lifestyle fashion to Number of stores at period end
our consumers
65
• Target market is the 16 to 24-year-old fashion-conscious consumer 56
44
• Founded by David Makin in 2005 and joined by John Wardle in
34
2008 – original co-founders of JD Sports 28 30
21 23
• Multiple routes to market 2 10
14
7
66 5 dedicated Nascent FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18
stores websites wholesale arm
• Strong financial track record REVENUE (£m)
194.8
• Proven store roll out model 147.0
• Strong online sales growth 110.4
78.0
• Multi-faceted, well funded growth strategy
FY15 FY16 FY17 FY18
FOOTASYLUM PLC • HY19 RESULTS 29STORE ESTATE
66 STORE PORTFOLIO 31
2 59
62
39 35
65
1 22 Stratford 43 54 27 9
Wilmslow Bexley Heath 56
63
2 4 61
8 55 32 33 24
2 23 Croydon 44 Speke 1 19
Preston 44
1
3 Middlesbrough 24 Meadowhall 45 Dundee
64
4 Manchester 25 Kingston 46 Reading
5 26 Teeside 47 Walsall 45
Solihull
6 27 Middlebrook
48 Glasgow Fort
Romford
49 Sunderland 41
13 48
7 Hanley 28 Nottingham 12
50 Redditch
8 Paradise St, Liverpool 29 Meadowhall
51 Lewisham
9 Bolton 30 Lakeside
17
52 Plymouth 57 49
10 Westfield London 31 Blackpool
3
53 Newport 26
11 Bull Ring 32 Trafford Megastore
54 Wigan 6
22
12 Silverburn 33 Drome Manchester 30
10 51
55 7Liverpool 43
18 31 35
25 2 59 39
13 Glasgow 34 Wolverhampton 40 65 60
62
56 Huddersfield 23 63 54 27 9
19
56
821
14 Birmingham Fort 35 Leeds 55 3246133 24
44 29
57 Carlisle 1
15 Cardiff 36 Coventry 64 7
58 Milton Keynes 28
16 Leicester 37 Portsmouth 16
59 Blackburn
34 47
17 Metro Centre 38 Bristol 20 1114
60 Hull
5 36
18 Bluewater 39 Bradford 50
61 Manchester Women’s 58
19 Trafford 40 Bromley 62 Bury 53 6
22 30
42 10 23 18
15 25 43
41 66
38 46 51
20 Merryhill 41 Braehead 63 Edge Lane, Liverpool
21 Bold St, Liverpool 42 Swindon 64 Broughton Park, Chester New Stores 37
65 White Rose
52
66 Thanet
FOOTASYLUM PLC • HY19 RESULTS 30DISCLAIMER
The information contained in this document and the accompanying verbal presentation (“Presentation”) has been prepared by Footasylum plc (the “Company”). This Presentation has not been approved by an
authorised person in accordance with Section 21 of the Financial Services and Markets Act 2000 and therefore it is being delivered for information purposes only to a very limited number of persons and companies who
are persons who have professional experience in matters relating to investments and who fall within the category of person set out in Article 19 of the Financial Services and Markets Act 2000 (Financial Promotion)
Order 2005 (the “Order”) or are high net worth companies within the meaning set out in Article 49 of the Order or are otherwise permitted to receive it. By accepting this Presentation and not immediately returning it, the
recipient represents and warrants that they are a person who falls within the above description of persons entitled to receive the Presentation. This Presentation is not to be disclosed to any other person or used for any
other purpose. Reliance on the Presentation for the purpose of any investment activity may expose an individual to a significant risk of losing all of the property or assets invested.
While the information contained herein has been prepared in good faith, neither the Company nor any of its shareholders, directors, officers, agents, employees or advisers give, have given or have authority to give, any
representations or warranties (express or implied) as to, or in relation, to the accuracy, reliability or completeness of the information in this Presentation, or any revision thereof, or of any other written or oral information
made or to be made available in connection with it (all such information being referred to as “Information”) and liability therefore is expressly disclaimed. Accordingly, neither the Company nor any of its shareholders,
directors, officers, agents, employees or advisers take any responsibility for, or will accept any liability whether direct or indirect, express or implied, contractual, tortuous, statutory or otherwise, in respect of, the
accuracy or completeness of the Information or for any of the opinions contained herein or for any errors, omissions or misstatements or for any loss, howsoever arising, from the use of this Presentation.
This Presentation may contain forward-looking statements that involve substantial risks and uncertainties, and actual results and developments may differ materially from those expressed or implied by these
statements. These forward-looking statements are statements regarding the Company’s intentions, beliefs or current expectations concerning, among other things, the Company’s results of operations, financial
condition, prospects, growth, strategies and the industry in which the Company operates. 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. These forward-looking statements speak only as of the date of this Presentation and the Company does not undertake any obligation to publicly release any
revisions to these forward-looking statements to reflect events or circumstances after the date of this Presentation.
In furnishing this Presentation, the Company does not undertake or agree to any obligation to provide the recipient with access to any additional information or to update this Presentation or to correct any inaccuracies
in, or omissions from, this Presentation which may become apparent.
This Presentation should not be considered as the giving of investment advice by the Company or any of its shareholders, directors, officers, agents, employees or advisers. In particular, this Presentation does not
constitute an offer or invitation to subscribe for or purchase any securities and neither this Presentation nor anything contained herein shall form the basis of any contract or commitment whatsoever.
Neither this Presentation nor any copy of it may be (a) taken or transmitted into Australia, New Zealand, Canada, Japan, the Republic of Ireland, the Republic of South Africa or the United States of America (each a
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outside a Restricted Territory who is a resident thereof in any such case for the purpose of offer for sale or solicitation or invitation to buy or subscribe any securities or in the context where its distribution may be
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by law and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. Any failure to comply with these restrictions may constitute a violation of the laws
of the relevant jurisdiction.
Note: The financial information contained in this document, including the financial information presented in a number of tables in this document, has been rounded to the nearest whole number or the nearest decimal
place. Therefore, the actual arithmetic total of the numbers in a column or row in a certain table may not conform exactly to the total figure given for that column or row. In addition, certain percentages presented in the
tables in this document reflect calculations based upon the underlying information prior to rounding, and accordingly, may not conform exactly to the percentages that would be derived if the relevant calculations were
based upon the rounded numbers.
FOOTASYLUM PLC • HY19 RESULTS 31You can also read
