NINE MONTHS 2020 - EQS Group

Transcription

/ NINE MONTHS 2020Results PresentationDecember 2020

/ DISCLAIMERThis presentation does not constitute an offer of securities or otherwise constitute an invitation or inducement to any person to subscribe for or otherwise acquire or dispose of securities ofGERRY WEBER International AG (the “Company”) or any of its affiliates.This presentation contains “forward-looking statements” with respect to the Company’s financial condition, results of operations and business plans and objectives. These forward-lookingstatements reflect the current views of the Company’s management with respect to future events. Forward-looking statements are sometimes, but not always, identified by their use of a date inthe future or such words as “will”, “anticipates”, “aims”, “could”, “may”, “should”, “expects”, “believes”, “intends”, “plans” or “targets”. By their nature, forward-looking statements are inherentlypredictive, speculative and involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could causeactual results and developments to differ materially from those expressed or implied by these forward-looking statements. Such factors may have a materially adverse effect on the costs andrevenue development of the Company. For example, economic downturns in the Company’s markets and changes in currency exchange rates may have negative effects on the Company’sbusiness development and financial condition. The factors that could affect the Company’s future financial results are discussed more fully in the Company’s most recent annual and interimreports, which can be found on its investor relations website at ir.gerryweber.com. All written or oral forward-looking statements attributable to the Company or any of its affiliates or anypersons acting on its behalf or contained in or made in connection with this presentation are expressly qualified in their entirety by factors of the kind referred to above. No assurances can begiven that the forward-looking statements in this presentation will be realized. Except as otherwise stated herein and as may be required to comply with applicable law and regulations, theCompany does not intend to update these forward-looking statements and does not undertake any obligation to do so.This presentation has been prepared by the Company’s management solely for information purposes. This presentation is in summary form and does not purport to be a full or completedescription of the Company and its subsidiaries. No representation or warranty, express or implied, is made as to the fairness, accuracy, adequacy, completeness or correctness of suchinformation, nor as to the achievement or reasonableness of any projections, targets, estimates, or forecasts. Nothing in this presentation should be relied upon as a promise or representationas to the future./ DECEMBER 20202

/ 9M 2020 HIGHLIGHTS100%* OF STORES OPEN“ZUKUNFTSKONZEPT“MOSTLY IMPLEMENTEDMAJOR ONLINE INITIATIVESSuccessful ramp-up of stores and robust recoverysupported by 100% of stores open“Zukunftskonzept” mostly implemented and costoptimization program continuingAccelerated shift to online purchases tacked bymajor initiatives for top line growth POSITIVE EBITDALIQIUDITY & SALESEXPECTATIONS ON TRACKROBUST LIQUIDITY POSITIONPositive EBITDA of EUR 15.6 mn in the first 9months of 2020GERRY WEBER s 2020 liquidity and salesexpectations will be metLiquidity with EUR 74.3 mn better than expectedand business continuity secured* Q3/ DECEMBER 20203

/ GERRY WEBER GROUP

/ GERRY WEBER GROUP OVERVIEWRevenue split2 by Key Facts and FiguresKey Management brand7.2%21.8%GERRY WEBER1973Halle (Westphalia)ca. EUR 280 mnFoundedHeadquarterTarget sales 202071.0%TAIFUN 60#3CountriesBrands 54.1%2,562 SAMOON channelEmployeesAlexander GedatInterims-CEO (Feb. 2020)45.9%WholesaleAngelika Schindler dObenhausCOO (Aug. 2020)Retail geographyGermany44.9%55.1%3062,015Best ager1Own retail storesWholesales POSTarget customerSource: Company Information Q3 Report 30.09.20201 For GERRY WEBER Brand; 201.01.2020-30.09.20201995-2017 Marc O Polo (BoardMember, CFO, CSO, CEO)Various positions at Ahlers AG,Fynch-Hatton GmbH, SportalmGmbHStudied Business in Münster2010-2020 Katag AG, ManagingBoard, Procurement, Marketing, IT2005-2010 Katag AG, Head ofStrategic Coordination Procurement and SalesFlorian FrankCRO / CFO (Oct. 2018) Abroad 20 years of restructuring expertiseLast 10 years lead partnerrestructuring Dr. Wieselhuber &PartnerVarious successful interim CRO aswell as CFO positions/ DECEMBER 20205

/ MARKET OVERVIEWGERRY WEBER customerFashion expenditures by age groupMonthly expenditures perhousehold 2018 (EUR)FemaleBest Agerunder 25Change in expenditures 2018vs. 2013 (%)EUR 9311%Demanding, stylish and qualityconsciousEUR 135 -7%25 to 55Low degree of price sensitivityTarget CustomersEmphasis on fit, cut andsustainability55 to 70EUR 1153%High purchasing powerand trend-driven70 13%EUR 85Significant brand loyaltySource: Destatis - Sample of income and expenditure 2013 and 2018/ DECEMBER 20206

/ STRONG BRAND NAME WITH 3 DIVERSIFIED BRANDSCUSTOMERFOCUSPOSITIONINGFASHIONSTYLESTANDS FORSource: Company Information50 years40 yearsBest AgerModern womenFeminine Fashion and LifestyleFeminine smart casual lookModern plus size fashionCategory leaderRelevantCategory LeaderModern classic mainstreamModern CasualModern MainstreamFeminine fashion for real womenModern women’s fashionSelf-confident, Natural beauty,Casual dressed, Modern,Self-confident, Joy of life,FeminineCourageousFemaleSelf-confident plus size womenPlus size collection/ DECEMBER 20207

/ STRONG AND EXPERIENCED MANAGEMENT TEAMCompany‘s management is fully alligned with shareholders through an ESOP and MIPCEO – Chief Executive OfficerAlexander GedatCOO – Chief Operating OfficerAngelika Schindler-Obenhaus1.85%EVP Sales Wholesale (nat. & int.)Michael Dotterweich0.21%1.85%Director Product TAIFUN/SAMOONElena WeegeEVP Sales Retail (nat. & int.)Peter Krosta (ad interim)Director Group Purchasing & OfficesStephan WilkesHead of E-CommerceAljoscha KollmeyerDirector Supply Chain ManagementAlicia Cano0.41%Director Product PlanningXavier Casares0.21% Head of Marketing & Brand CommunicationSimon Hoecker0.21%% Percentage of share capital acquired through the Management incentive Program (MIP) Participated in the Employee Stock Ownership Plan (ESOP)Source: Company InformationCFO – Chief Financial OfficerCRO – Chief Restructuring OfficerFlorian FrankTL Corporate CommunicationsKristina Schütze 1.85%Director Finance & ControllingDaniel Langemeier (ad interim)EVP Shared Services - HRDirk Wefing0.74%Director Group ITStefan BeylerHead of Shared Services & PMOGökay BostanciManaging Director Distribution CenterMartin Samanek0.37% Capital Markets & IRExternal/ DECEMBER 20208

/ MEASURES TAKEN TO MITIGATE COVID-19 IMPACTImmediate Actions Taken for Short-Term and Long-Term Viability12Continued operations ensuredLiquidity safeguardedThe management was well prepared for the lockdowns as it has anexcellent restructuring expertiseSuccessful renegotiation of the debt structure and deferral of 35% ofoutstanding claimsSuccessful implementation of COVID-19 health and safety measuresfor customers and employeesUtilization of state-supported short-time labor programs, including theheadquartersPOS are mostly open and operational, however there is reducedcustomer frequencyNegotiations with landlords to waive and save rental costsE-Commerce efforts are intensified by further enhancing traffic on thewebshop, as well as shifting inventory to E-CommerceStrict cost discipline especially regarding investmentsNew future concept with focus on streamlining processes and strategyOngoing strict cost discipline3Long-term visionClear brand differentiation, positioning and managementHigh degree of product competenceAmbitious E-Commerce strategy with 20% growth yoyAll brands are a must for wholesalers/ DECEMBER 20209

/ E-COMMERCE GROWTH STRATEGY7 Major initiatives for top line growth of 20% from 2021 onwards1234567Increase online marketing budget for all brands to broaden customer baseSignificant increase of inventory in the E-Commerce distribution centerUsing predictive technology (CRM Database) to increase the conversion rateOffer more personalized content with a higher conversion probabilityConnecting at least three more marketplaces in 2021 to use their traffic strength in foreign marketsTransformation from the current “Rest of Europe” shop to a “Rest of World” shop and offer GERRY WEBER, SAMOON andTAIFUN in over 200 destinations worldwideStrengthen brand appearance with new shops for TAIFUN and SAMOON/ DECEMBER 202010

/ STRATEGIC TARGET MAP GERRY WEBER (2021 - 2023)"GERRY WEBER is the leading womenswear lifestyle brand in the Modern Classic mainstream market“Brand & CommunicationProductIncrease of brand desirability (b2b / b2c)Increase product competence EditionConsistent brand managementConsistent brand managementSupply chain optimizationWHSGERRY WEBER is a brand the specialized trade must haveNational & international franchise growthRetailProfitable growthOwn Retail as a model channelE-CommerceGrowthExpansion CRMDistributionProcesses / Digitalisation / ITModernization of IT incl. BIDigitalization of the companyBusiness model-adequate logisticsChange-Mgmt / Culture / PeoplePerformance and fun cultureIncreasing employer attractivenessFinancesRe-financing until the end of 2023 (incl. equity story)Business ity as an integral part of the companySource: Company Information/ DECEMBER 202011

/ STRATEGIC TARGET MAP SAMOON & TAIFUN (2021 - 2023)"SAMOON is the leading Curvy Womanswear brand inthe modern mainstream segment"Brand & CommunicationIncrease brand desirability (b2b/ b2c)Consistent brand managementProductProduct competence in joy oflife & femininityOptimize online capability of thecollection"TAIFUN is the relevant brand in the modern casualmainstream market for every moment of the day of themodern active woman"Increase branddesirability (b2b /b2c)TAIFUN 2.0RepositioningConsistent brandmanagementProduct focus TAIFUN 2.0WHSSAMOON is a brand the specialized trade must haveIncrease brand relevance for specialized tradeECommerceStrong E-Commerce Growth / high E-Commerce ShareSignificant growthDistributionSource: Company Information/ DECEMBER 202012

/ Q3/9M FINANCIALS

/ GRADUAL SALES RECOVERY IN Q3Sales 2020 (compared with 2019 in %)Q1 2020Q2 2020E-Commerce83.74.6 ( 1%)RetailQ3 2020Wholesale(EUR mn)-32 %34.3 (-53% /LfL186.56.6 ( 16%) 52 %-32%)56.941.6 (-22% / LfL -16%)8.2 (-2%)27.5 (-58% / LfL -52%)44.7 (-24%)38.3 (-37%)21.2 (-45%)Q1 2020 Slight decline of sales compared to 2019 inJanuary and February 2020Heavy dropdown from March on because of thelockdownQ1 Retail -32% LfL mainly driven by COVID-19Q2 2020 1) LfL: Like for Like sales compared to 2019 in % (without sales of closed stores)Massive decrease in sales esp. in Retail in Q22020Q3 2020 Recovery in Q3 E-Commerce sales increase of 16% in comparisonto previous year/ DECEMBER 202014

/ LOSS IN GROSS PROFIT PARTIALLY MITIGATED BY COSTREDUCTION MEASUREMENTSPositive EBITDA in 9M 2020 (EUR 44.1)%64.1%29213797159SalesChange lExpenses16OtherexpensesEBITDAHigh cost efficiency and flexibility enables GERRY WEBER to post positive EBITDA in Q3 Sales down by 38.2% compared to LY due to COVID-19 and multiple store closuresGross margin ratio improved by 4.0%-Points due to better inventory managementPersonal costs -24.1% to EUR 70.9 mn based on headcount reduction and usage of short time workOther expenses down by 44.1% due to COVID-19 related spending freeze/ DECEMBER 202015

/ SOLID CASH POSITION EXCEEDING FORECASTCash Flow Chart 2020 (EUR mn)126.9Cash Flow statement (EUR mn)9M 20199M 2020CF from Operating activities61.111.0CF from Investing activities-4.3-2.4Free Cash Flow56.78.6CF from Financing activities-31.7-60.1Changes in cash and cash equivalents25.0-51.5Cash & Cash Equivalents at the beginning56.0126.9Cash & Cash Equivalents at the CF fromInvestingCF fromFinancingExchange ratedifferences74.3Cash30/09/2020Positive FCF of EUR 8.6 mn maintained in spite of COVID-19CF from financing activities use of FCF Positive Operating CF due to successful restructuringInvestments kept low due to uncertainty of COVID-19*01.04.2019-31.12.2019Insolvency Quota & ELQ EUR 18.8 mnAdaption of SSL / escrow accounts EUR 11.4 mnRepayment of liabilities relating to the rights of use (IFRS 16) EUR 30.0 mn/ DECEMBER 202016

/ CAPITAL STRUCTURE IN DETAILStable Net Debt emphasizes long-term viabilityDebt WaterfallEUR mnDebt distribution profile - NPV in EUR mn1H 20203Q 2020Seniority-90.8-74.3-Revolving Credit Facility1,28.50.0Senior SecuredAccrued Int. Term Loans30.10.4Senior SecuredPrincipal Term Loans322.422.4Senior SecuredNet Senior Debt-59.8-51.5-Cash*Straight Bonds38.538.5UnsecuredConvertible Bonds1.81.8UnsecuredInsolvency Cash Quota412.47.9UnsecuredGWR Quota47.17.2UnsecuredExcess Liquidity Quota411.59.4UnsecuredNet Unsecured Debt11.513.3-Additional quota**28.528.8SubordinatedProvisions and Adjustments6.65.5ProvisionsNet Debt46.647.6-79.6Senior 5.95.5No .00.95.812/31/202212/31/20236/30/20241Full amount available EUR 17,500,0004% p.a. commitment fee. 8% p.a. cash interest on drawn amounts3 12% p.a. of which up to 8% p.a. may be capitalized (PIK)4 All cash quota given as PV, discounted at a rate of 4.5% annually compounding on an Act/365 Basis2Third quarter leaves us with a liquidity of EUR 74.3 mn which is better than expected. Weanticipate our 2020 goals to be met and in line with the insolvency plan.Source: Company InformationAs of 30.09.2020, *thereof EUR 21.30 mn deposited in insolvency plan escrow account, **EUR 23.00 mn yet to be funded by liquidation of Ravenna Park/ DECEMBER 202017

/ OUTLOOK

/ OUTLOOKSales and EBITA targets for FY 2020 on trackVarious scenarios for 2021 are being calculatedBased on the currentCOVID-19 measurements might get extendeddevelopment GERRY WEBERStrengthening of E-Commerceshould be able to refinance itsoutstanding debt in 2023Focus on brand differentiation and product competencesMoving step by step back into the original pre-pandemic business plan/ DECEMBER 202019

Key Facts and Figures Revenue split2 by Key Management Florian Frank CRO / CFO (Oct. 2018) 20 years of restructuring expertise Last 10 years lead partner restructuring Dr. Wieselhuber & Partner Various successful interim CRO as well as CFO positions Alexander Gedat Interims-CEO (Feb. 2020) 1995-2017 Marc O Polo (Board Member .