Conference Call 3Q15arezzoco.com.br/.../2017/07/3T15_Arezzo...Call-ING.pdfR:152 G:216 B:218 R:80...
Transcript of Conference Call 3Q15arezzoco.com.br/.../2017/07/3T15_Arezzo...Call-ING.pdfR:152 G:216 B:218 R:80...
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| Apresentação do Roadshow
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Conference Call
3Q15
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Information contained in this document may include forward-looking statements and reflect Management’s
current view and estimates of the evolution of the macroeconomic environment. industry conditions. Company’s
performance and financial results. Any statements. expectations. capabilities. plans and assumptions contained
in this document. which do not describe historical facts. such as information about declaration of dividend
payment. future direction of operations. implementation of relevant operating and financial strategies.
investment program and factors or trends affecting the financial condition. liquidity or results of operations. are
forward-looking statements. as set forth in the “U.S. Private Securities Litigation Reform Act of 1995”. and
involve several risks and uncertainties. There is no guarantee that these results will occur. Forward-looking
statements are based on several factors and expectations. including economic and market conditions. industry
competitiveness and operational factors. Any changes in such expectations and factors may cause actual
results to differ from current expectations.
The Company’s consolidated financial statements presented herein are in accordance with the International
Financial Reporting Standards - IFRS. issued by the International Accounting Standards Board - IASB. based
on the audited financial statements. Non-financial information and other operating information have not been
subject to an audit by independent auditors.
Important Disclaimer
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Gross revenue reached R$403.7 million in the 3Q15, an increase of 6.5% against 3Q14.
Gross Revenue
In 3Q15, net income reached R$36.1 million, with net margin of 11.5%, and an increase of 7.4% in comparison with 3Q14.
Net Profit
In 3Q15, gross profit was R$133.0 million, a growth of 6.5%. Gross Profit
EBITDA for 3Q15 amounted to R$49.7 million, with a margin of 15.8%. EBITDA
During the quarter, Arezzo&Co’s opened eight stores and expanded another four, with growth of 9.7% in the sales area. totaling 46 stores over the last 12 months.
Sales Area Expansion
3Q15 Highlights
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Gross revenue reached R$403.7 million in the 3Q15. an increase of 6.5% against 3Q14. with
particular mention to external market with a growth of 55.7%.
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3.1%
55.7%
6.5%
5.4%
8.7%
68.5%
Company Growth
Gross Revenues – Domestic and Export Market (R$ million)
354.5 365.5
931.6 982.1
24.5 38.2
50.8 85.5
379.0 403.7
982.4
1,067.6
3Q14 3Q15 9M14 9M15
Domestic Market External Market
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In domestic market, the highlight was the Anacapri brand, growing 19.4%, leveraged by the
opening of 27 franchises in the last twelve months, and for the Schutz brand, which increased
11.9%, boosted by the strength strategy of monobrand stores and the great performance of
handbags category.
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-3.4%
19.4%
3.1%
-0.2%
33.4%
5.4%
10.5%
11.9%
1) Others: Decreasing of 18.3% in the 3Q15 and an increasing of 9.4% in the 9M15.
Gross Revenues by brand – Domestic Market (R$ million)
Gross Revenue Breakdown by Brand –
Domestic Market
210.6 203.4
550.2 549.0 119.3 133.5
324.7 359.0
22.5 26.8
50.8 67.7
2.1 1.7
5.9 6.5
354.5
365.5
931.6 982.1
3Q14 3Q15 9M14 9M15
Arezzo Schutz Anacapri Others¹
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In 3Q15, the highlight for the Owned Stores channel, presenting a growth of 15.7%, leveraged by
the web commerce growth.
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SSS Sell-out (owned stores + franchises) 8.0%
-0.4% SSS Sell-in (franchises)
-7.2%
-8.1%
SSS Sell-out (owned stores + web + franchises) 10.4% -6.8%
6.1%
2.7%
7.5%
-2.2%
-6.2%
-1.3%
-3.0%
5.9%
3.1%
-0.2%
8.9%
5.4%
14.6%
15.7%
1) Others: Decreasing of 81.1% in 3Q15 and 20.4% in 9M15.
180.9 175.5
477.9 476.8 75.4 87.3
214.3 245.5
96.8 102.5
236.1 257.2
1.3 0.2
3.3 2.6
354.5
365.5
931.6 982.1
3Q14 3Q15 9M14 9M15
Franchise Owned Stores Multi-brand Others¹
Gross Revenue Breakdown by
Channel – Domestic Market
Gross Revenue by channel – Domestic Market (R$ million)
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The sales area increased 9.7% in the 3Q15 due to the opening of 46 stores and expansion of ten
stores in the last 12 months.
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13.3% 9.7%
18.2%
377
429
479
525
+52
+50
+46
Franchises
Multi Brands
Owned Stores
48
28
1,376
Multi Brands
Owned Stores 2
7
Franchises 61
Multi Brands
Owned Stores 4
1,060
Franchises
Multi Brands
Owned Stores
360
16
1,177
Distribution Channel Expansion
Owned Stores and Franchises Expansion Number of Stores – Domestic Market
1) Includes eight outlets with total area of 2,199 sqm
324 373
427 474
53
56
52
51
24.5 29.0
32.9 36.1
-
100
200
300
400
500
600
700
3Q12 3Q13 3Q14 3Q15
Franchises Owned Stores Area
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In 3Q15, gross profit reached R$133.0 million, an increase of 6.5%, with gross margin of 42.2%.
EBITDA for 3Q15 amounted to R$49.7 million, with a margin of 15.8%.
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6.5%
Gross Profit Gross Margin EBITDA EBITDA Margin
-3.4%
42.2%
5.9%
43.2% 41.8%
17.4% 15.8% 15.9%
14.4%
-0.2% 42.2%
Gross Profit and EBITDA
Gross Profit (R$ million) EBITDA (R$ million)
124.9 133.0
329.9 349.5
3Q14 3Q15 9M14 9M15
51.4 49.7
121.0 120.8
3Q14 3Q15 9M14 9M15
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The Company’s net income totaled R$36.1 million in 3Q15, a growth of 7.4% in the quarter with a
11.5% net margin.
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Net Margin Net Income
7.4%
11.3% 11.5%
4.2%
10.8% 10.3%
Net Income and Net Margin
Net Income (R$ million)
33.6 36.1
82.7 86.2
3Q14 3Q15 9M14 9M15
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Arezzo&Co generated R$4.6 million in operating cash in 3Q15, due mainly to the higher operating
profit for the period and impacted by an increase in working capital.
Cash Flow
Operating Cash Flow (R$ thousand)
Operating Cash Flow 3Q14 3Q15 Change
in R$
Change
in R$ 9M14 9M15
Change
in %
Change
in %
51,815 53,545 1,730 3.3% 121,845 122,806 961 0.8% 27,928
3,293 6,121 2,828 85.9% 9,599 18,026 8,427 87.8% -18,026
Other 1,249 1,169 (80) -6.4% (181) (17) 164 -90.6% 18,048
(9,957) (46,494) (36,537) 366.9% (21,610) (74,957) (53,347) 246.9% 14,717
(45,337) (50,216) (4,879) 10.8% (33,645) (63,630) (29,985) 89.1% 5,292
Inventories 4,666 (5,839) (10,505) n/a (31,269) (25,442) 5,827 -18.6% -11,121
Suppliers 28,843 15,857 (12,986) -45.0% 51,113 31,428 (19,685) -38.5% 30,963
1,871 (6,296) (8,167) n/a (7,809) (17,313) (9,504) 121.7% -10,418
(12,538) (9,733) 2,805 -22.4% (33,080) (23,861) 9,219 -27.9% -9,337
33,862 4,608 (29,254) -86.4% 76,573 41,997 (34,576) -45.2% 33,329
Income before income tax and
social contribution
Depreciation and amortization
Change in other noncurrent and
current assets and liabilities
Payment of income tax and
social contribution
Net cash flow generated by
operational activities
Decrease (increase) in current
assets / liabilities
Trade accounts receivables
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In 3Q15, the Company invested R$4.7 million, a decreasing of 62% over the same period of
3Q15, following the Cia. strategy of investment reduction in 2015. Indebtedness policy remained
conservative.
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-54.7%
-40.7%
-43.1%
-14.0%
-63.5%
-62.0%
Capital Expenditure (CAPEX) and
Indebtedness
CAPEX (R$ million) Indebtedness (R$ million)
1) Others: Decreasing of 86.7% in 3Q15 and 38.2% in 9M15.
3T14 2T15 3T15
Cash 175,856 176,311 193,486
Total debt 86,473 98,387 126,928
Short term 61,249 67,946 98,422
% total debt 70.8% 69.1% 77.5%
Long-term 25,224 30,441 28,506
% total debt 29.2% 30.9% 22.5%
Net debt (89,383) (77,924) (66,558) -
EBITDA LTM 164,586 162,820 161,091
Net debt/EBITDA LTM -0.5x -0.5x -0.4x
Cash position and Indebtedness
1.3 1.2
7.1 3.2
8.9
3.2
25.0
14.8 2.1
0.3
4.4
2.7 12.3
4.7
36.5
20.8
3Q14 3Q15 9M14 9M15
Stores Corporate Others¹
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B:232 Contacts
Thiago Borges
Leonardo Pontes, CFA
Telephone: +55 11 2132-4300
www.arezzoco.com.br
CFO and Investor Relations Officer
IR Manager
Leandro Vieira
IR Analyst