INTERIM RESULTS SIX MONTHS TO 31 DECEMBER 2016 · strengthening the management team mysale group...
Transcript of INTERIM RESULTS SIX MONTHS TO 31 DECEMBER 2016 · strengthening the management team mysale group...
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I N T E R I M R E S U L T SS I X M O N T H S T O 3 1 D E C E M B E R 2 0 1 6
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WE ARE MYSALE
O V E R 2 5 0 0B R A N D P A R T N E R S
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I N T R O D U C T I O N
H 1 F Y 1 7 F I N A N C I A L R E V I E W
O P E R A T I O N A L R E V I E W
S T R A T E G Y & F U T U R E P L A N S
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OUR MISSIONB R A N D S
T O B E T H E M O S T E F F E C T I V E P L A T F O R M T O C L E A R E X C E S S
I N V E N T O R Y & R E A C H N E W C U S T O M E R S
C U S T O M E R S
T O P R O V I D E T H E M O S T D E S I R A B L E G L O B A L B R A N D S , L E A D I N G
S E R V I C E P R O P O S I T I O N , B E S T P R I C E S .
S H A R E H O L D E R S
D E V E L O P A H I G H G R O W T H , R O B U S T L Y P R O F I T A B L E B U S I N E S S
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H1 FY17 OVERVIEWA N E X C E L L E N T F I R S T H A L F
S I G N I F I C A N T I M P R O V E M E N T I NF I N A N C I A L P E R F O R M A N C E
R E V E N U E G R O W T H I N A L L T E R R I T O R I E S
G R O S S M A R G I N P R I O R I T I S E D &G R O W N F A S T E R T H A N R E V E N U E
T E C H N O L O G Y , M A R K E T I N G &O P E R A T I O N S P L A T F O R M S I NP L A C E F O R F U T U R E G R O W T H
A C T I V E C U S T O M E R N U M B E R SI N C R E A S E D S H A R P L Y
S O L I D F O U N D A T I O N S F O R A G O O D Y E A R
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H 1 F Y 1 7 F I N A N C I A L R E V I E W
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H1 FY17 INCOME STATEMENT HIGHLIGHTSM A I N T A I N E D P O S I T I V E M O M E N T U M F R O M F Y 1 6
Gross Profit growth was the main priority ( +17% )
Gross Profit and GP% rising progressively since mid 2015
GP% further +260 bp in H1
Customer numbers +19% driving online revenue +19%
(lower group revenue growth with planned reduction in lower margin
offline)
Improved merchandising, reduced promotions and localisation of
customer offer = strong gross margin improvement in all territories
Continued strong growth in nascent UK market under Cocosa brand
H1FY17 GrowthvsFY16 H1 FY16AUDMillion Revenue GrossProfit GP% Revenue GrossProfit Revenue GrossProfit GP%
Group 136.7 38.4 28.1% +7% +17% 128.2 32.7 25.5%ANZ 112.3 32.8 29.2% +3% +18% 109.5 27.9 25.5%S-EAsia 17.4 4.5 25.8% +12% +16% 15.5 3.9 24.9%ROW 7.0 1.1 15.8% +112% +14% 3.3 1.0 29.4%
25.5%
27.3%
28.1%
24.0%
25.0%
26.0%
27.0%
28.0%
29.0%
H1FY16 H2FY16 H1FY17
MaintainfocusonGP/GM
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H1 FY17 SUMMARY INCOME STATEMENTS T R A T E G I C P L A N I M P R O V I N G F I N A N C I A L P E R F O R M A N C E
Total revenue growth +7%, online revenue +19%
Key focus was gross margin improvement +17%
Non-ANZ trade increasing its weighting
Opex is weighted to H1
Marketing at 7% in line with plan
Opex split is fixed 14% : variable 12%
Improved trading performance drives EBITDA
AUDMillion H1FY17%Rev
H1FY17 H1FY16%Rev
H1FY16
RevenueANZ 112.3 82.2%% 109.5 85.4%S-EAsia 17.4 12.7% 15.5 12.1%ROW 7.0 5.1% 3.3 2.6%Group 136.7 100.0% 128.2 100.0%
GrossProfit 38.4 28.1% 32.7 25.5%
StaffCosts 16.9 12.4% 14.4 11.5%Marketing 9.7 7.1% 8.0 6.2%Occupancy 2.7 2.0% 2.7 2.1%
Financial 2.8 2.0% 2.8 2.2%Other 3.3 2.4% 2.6 2.1%
UnderlyingOpEx 35.4 25.9% 30.9 24.1%
UnderlyingEBITDA 3.0 2.2% 1.8 1.4%
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H1 FY17 SUMMARY BALANCE SHEETS T R E N G T H T O S U P P O R T G R O W T H I N I T I A T I V E S
Intangible assets $29m includes goodwill and
technology investments
Deferred tax balance represents previous losses
to be utilised over time
Deferred revenue stable at $11.6m
Loan facilities utilised to manage currency
requirements
*Net Working Capital is trade and other receivables plus inventories less trade and other payables and deferred revenue
Strong balance sheet – brand partner credibility
Net Cash position $29.1m is $5.8m up vs H1 FY16
(and $1.8m from year end)
Working Capital net balance $0.4m another
reduction vs. Jun-16 and down from peak H1
FY16 as anticipated
AUDMillion H1FY17 H1FY16 Change
Cashandcashequivalents 37.8 30.0 7.8Tradeandotherreceivables 8.8 22.1 -13.4Inventories 32.2 35.1 -2.9Propertyplantandequipment 2.2 2.5 -0.3Intangibles 30.5 23.5 7.1Deferredtax 10.9 11.0 -0.1Other 5.9 8.3 -2.4Totalassets 128.3 132.4 -4.1
Tradeandotherpayables 29.1 30.0 -0.9Deferredrevenue 11.6 13.3 -1.7Provisions 3.0 2.6 0.4Other 9.0 8.5 0.5Totalliabilities 52.7 54.3 -1.6Netassets 75.6 78.1 -2.5
WorkingCapitalbalances 0.4 14.1 -13.7%ofrevenue 0.2% 11.0%
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FH1 FY17 OPERATING CASHFLOWC A S H G E N E R A T E D F U N D S T O G R O W
Main non-cash items:
• $0.6m Depreciation (2015 : $0.7m)
• $1.8m amortisation (2015 : $1.3m)
Financing: H1 FY16 includes retail website acquisition
Improved working capital as Dec –15 peak normalizes
Total capex $3.2m: part of planned doubling of
investment in development of the technology
platform
• Tactical incl. ourpay
• Strategic incl. New Platform
Financing: PY was retail website acquisition
AUDMillion H1FY17 H1FY16
Openingcashbalance 34.0 39.9
ProfitbeforeTax -1.4 -0.5
Non-cash:Depreciation,Sharebased,FX 2.4 2.0
WorkingCapitalmovement 4.2 -13.1
MovementinLTI 0.0 0.0
Interest 0.1 0.1
Taxrefunded/(paid) -0.4 0.8
CapitalExpenditure -3.2 -1.5
Acquisition/JVpayments 0.0 -3.0
Financingactivities/leasepayments 2.2 5.3
Closingcashbalance 37.8 30.0
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H 1 F Y 1 7 O P E R A T I O N A LR E V I E W
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$65
$70
$75
$80
$85
$90
H1-FY15 H1-FY16 H1-FY17
AVG.ORDERVALUEYOY+3%
MARKETING FOCUSED ON HIGHER VALUECUSTOMERS
G O O D I N C R E A S E I N A C T I V E B A S E & O T H E R K P I ’ S S T R E N G T H E N
$265
$270
$275
$280
$285
$290
$295
$300
H1FY15 H1FY16 H1FY17
REVENUEPERACTIVECUSTOMERROBUST
0
100000
200000
300000
400000
500000
600000
700000
800000
900000
1000000
H1-FY16 H1-FY17
ACTIVEBASE+19%
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MARKETING STRATEGY EVOLVINGR E M A I N S D Y N A M I C & F L E X I B L E
R E - E N G A G E & A Q U I R E A Q U I R E A Q U I R E
• Notable diversification into re-engagement during H1
• Ave customer CPA reduced -25%• New members conversion to buyers +9%
• Ave customer CPA reduced -20%• Ave customer CPA 52% of ANZ• Remains a slower conversion curve than
ANZ• Repeat buyers metrics increased 6%
• Focus on the COCOSA brand and premium luxury channel
• Typical new territory – Acquisition led• Ave customer CPA 25% lower than ANZ*• Conversion metrics building
KEY STRATEGIC INITIAVITES
• Further integration / collaboration between Marketing and Tech teams• Investment into data capabilities to drive future revenue generation• Marketing, segmentation, customer journey, personalization
• Marketing investment diversified to improve overall efficiency• Increased re-engagement activity to complement acquisition ~ Encouraging early signs – Further deployment in H2
ANZ S-E ASIA ROW
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ENGAGEMENT & LOYALTYC O N T I N U E D M A R K E T I N G A C Q U I S I T I O N E F F I C I E N C Y O V E R T I M E
ANZ ASIA
• Active members growth 20% YOY
• New customers convert more quickly and continue to buy frequently
• AOV increased 2%
• Continue to focus on re-engaging lapsed customers
• Slower activation yet higher annual spend
• Return on investment underpins long term strategic opportunity in SE Asia which has a significantly larger addressable audience
• Focus on long-term sustainable growth
• Population 7.5x larger than ANZ
1 9 X
$ 1 M
G R O S S R E V E N U E /
M A R K E T I N G S P E N D
H216
H215
H214
H115
H114
H116
H117
$ 1 2 M
1 2 X
$ 1 M
G R O S S R E V E N U E /
M A R K E T I N G S P E N D
H216
H215
H214
H115
H114
H116
H117
$ 1 9 M
REPEAT BUYERS
• Reliable repeat buyer profile ANZ & SEA
• Ave frequency c 3.5 p.a.
• UK building as new territory
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
FY12 FY13 FY14 FY15 FY16 H1-FY17
ANZ ASIA ROW
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MOBILE DRIVES ENGAGEMENT
58%O F O R D E R S A R E
F R O M M O B I L EAPP AVAILABLE FOR
ANDROID, IOS, WINDOWS
AND SMARTWATCHES
6.75MA P P D O W N L O A D S
FREQUENCY FROM
MOBILE USERS
60%H I G H E R O R D E R
MOBILE OVER DESKTOP
1.63XFROM MOBILE USERS
58%R E T E N T I O N M O R E S P E N D
A T T H E H E A R T O F O U R C U S T O M E R E X P E R I E N C E S I N C E 2 0 1 2
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TECHNOLOGY & INNOVATIONO P E R A T I O N A L E F F I C I E N C I E S & P L A T F O R M D E V E L O P M E N T
O P E R A T I O N A LE F F I C I E N C I E S
P L A T F O R MD E V E L O P M E N T
DATA (DASHBOARDS)
USER INTERFACECAMPAIGN MANAGEMENT
PRODUCT MANAGEMENT
U S E RE X P E R I E N C E
OURPAY
PERSONALISATION
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ourpay - proprietary payment platform launched in
Australia and the UK
Available on website and mobile apps
Take up rate of 9.9%*. AOV increased by 20%*
Proactive fraud monitoring and mitigation
Opportunity to develop scalable white label platform
Integrated personalised experience and single click
signup
I M P R O V E C U S T O M E R E X P E R I E N C E & E N G A G E M E N T
INNOVATE WITHIN THE PAYMENT PLATFORM
*% of customers that paid with Ourpay vs other payment methods
£49.75
£49.75
£49.75
£49.75
£49.75
£49.75
£49.75
£49.75
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NEW ORGANISATIONAL STRUCTURES T R E N G T H E N I N G T H E M A N A G E M E N T T E A M
MYSALEGROUPPLCBOARD
EXECUTIVECOMMITEE
APAC
ScottGouge
TECHNOLOGY MARKETING ROW
GavinCliffe IsabellaJolly KevinCliffe
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S T R A T E G Y & F U T U R E
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SUSTAINABLE COMPETITIVE ADVANTAGESW E L L P O S I T I O N E D T O E X P L O I T G R O W T H O P P O R T U N I T I E S I N A N Z , S - E A S I A & U K
O N L I N ES C A L E
8 C O U N T R I E S
1 2 W E B S I T E S
B R A N DP A R T N E R S
L O G I S T I C S &O P E R A T I O N S
P R O P R I E T A R YT E C H N O L O G Y
G R O W I N GM A R K E T S
U N I Q U E
I N T E R N A T I O N A L
F L E X I B I L I T Y
2 , 5 0 0 +
L O N G T E R M
M O B I L E & C U S T O M E R
F O C U S
D I V E R S I F I E D
O P P O R T U N I T I E S
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FLEXIBLE & SCALABLE GLOBAL OPERATIONSU N I Q U E I N T E R N A T I O N A L S O U R C I N G & L O G I S T I C S
N O R T H A M E R I C AA S I A
O C E A N I A
E U R O P E
D I S T R I B U T I O N C E N T R E S
W E B S I T E S
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OUR STRENGTH IN NUMBERSU N R I V A L E D I N - H O U S E C A P A B I L I T Y = E F F I C I E N C Y
IMAGES EDITED A MONTH
1 5 0 , 0 0 0
PRODUCTS SHOT A MONTH
3 0 , 0 0 0
NEW SKU’S LAUNCHED
DAILY
2 3 , 7 2 8UNITS SHIPPED IN H1 FY17
6 , 0 0 0 , 0 0 0
CAMPAIGNS LAUNCHED IN H1
FY17
1 1 , 7 4 9
FULL TIME EMPLOYEES
5 0 0 +
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BRAND PARTNERSSTRONG INTERNATIONAL SOURCING CAPABILITY
A U S T R A L I AI C O N I C H I G H S T R E E T B R A N D S
D E L I V E R I N G V O L U M E & A W A R E N E S S
U S , U K & E U R O P ES I G N I F I C A N T G R O W T H G L O B A L
B R A N D S R E S O N A T I N G I N A N Z & A S I A
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Provides highly price competitive customer offer in large Australia sports market
Launched Sports Direct inventory on the retail marketplace platform in Australia with access to c150,000 SKU
Fully integrated Product Catalogue, Stock updates, Order Processing and Tracking
Continue to leveraging Mysale freight rates into ANZ
Potential opportunity to expand partnership into SE Asia
KEY STRATEGIC PARTNERSHIPSF L A G S H I P P A R T N E R S O N T H E P L A T F O R M
Current access to over 1,100 new SKU’s on a daily basis from Gilt inventory
Partnerships with top brands including: Marc by Marc Jacobs, G-Star, Jimmy Choo, Longchamp, Burberry, Gucci, Prada, M Missoni, Adidas by Stella McCartney
Potential to access significant SKU volume
Own-Buy opportunities from the Hudson Group
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THE ENDLESS AISLEL A U N C H O F T H E R E T A I L M A R K E T P L A C E P L A T F O R M
Represents a step change in future revenue opportunities
Integration of flagship brands
Good progress onboarding vendors
New platform will reduce buying administration by ~50%
Mobile central to platform development
Launch of Vendor Portal
Scalable platform
FLASH RETAIL MARKETPLACE
ENDLESS AISLE
PROPRIETARY TECH PLATFORM
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D E V E L O P I N G V E R T I C A L S I N S P O R T S , H O M E & G I F T S
3P consignment, low inventory risk
Leveraging key strategic partnerships
Focused on sports and general goods
RETAIL MARKETPLACE
3P consignment, low inventory risk
Targeted at furniture and homewares sector
Online penetration in the segment is only 3.8% compared to the UK at 12.8%*
Focused on fun, relevant low value high margin product aimed at bargain hunters.
Anticipated 80% of product will be sourced outside Australia
100% 3P consignment, zero inventory risk
*Source: EUMONITOR
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M A R K E T P L A C EP L A T F O R M
S E C U R I T Y
PROPRIETARY TECH PLATFORM
M A C H I N EL E A R N I N G
D A T A
U S E RE X P E R I E N C E
F L A S HP L A T F O R M
P R O V I D E S E X A C T L Y W H A T B U S I N E S S N E E D S
BENEFITS
BUSINESS LED PRIORITISATION
FLEXIBLE COST EFFECTIVE SPEED CONSISTENCY
TAILORED TO OUR NEEDS
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VENDOR BENEFITSL A U N C H O F T H E R E T A I L M A R K E T P L A C E P L A T F O R M
Choiceof using API or
Web interface
Smart& Mobile data central to the
platform development
Scalable& flexible, suitable for
any size business
Analyticaltools for Vendors
Feasibilityprovided by single
integration
Eliminateerrors and reduce cost
Create
EditLoad
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GROWING ECOMMERCE MARKETSD I F F E R E N T Y E T A T T R A C T I V E O P P O R T U N I T I E S
A N Z R O W [ U K ]L A R G E S T I N F L A S H ,
L E V E R A G E S C A L E I N T O D I V E R S I F I E D I N C O M E
S T R E A M S
N E W E S T Y E T F A S T E S T G R O W I N G A S C O M P E L L I N G
P R E M I U M C U S T O M E R O F F E R R E S O N A T E S W I T H O N L I N E
S A V V Y C U S T O M E R S
S E A S I AS M A L L E R B U T W E L L E S T A B L I S H E D A N D
P O S I T I O N E D T O B E N E F I T F R O M S I G N I F I C A N T E C O M M
G R O W T H A N D G E N E R A T I O N A L C O N S U M E R S H I F T
P O P U L A T I O N 2 9 m P O P U L A T I O N 2 1 0 m P O P U L A T I O N 6 5 m
M Y S A L E
O Z S A L E
C O C O S A
C A G R + 8 % C A G R + 2 9 % C A G R + 1 0 %
* Source: eMarketer Inc, April 2016, CAGR 2015-2019 SE-Asia extrapolated from Asia – Pacific regional figures
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OUTLOOKH1 FY17 - A GOOD START– SOLID FOUNDATION FOR FULL YEAR
FULL–YEAR FY17 – CONFIDENCE IN PROSPECTS – GUIDANCE MAINTAINED
FUTURE – GROWTH IN BOTH FLASH & RETAIL MARKETPLACE
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IMPORTANT NOTICE & DISCLAIMERTHIS PRESENTATION (THE “PRESENTATION”) HAS BEEN PREPARED BY, AND IS THE SOLE RESPONSIBILITY OF, MYSALE GROUP PLC (THE “COMPANY”) AND ITS SUBSIDIARIES FROM TIME TO TIME (THE "GROUP") SOLELY FOR INFORMATION PURPOSES AND FOR USE AT PRESENTATIONS. BY ATTENDING MEETINGS WHERE THE PRESENTATION IS MADE OR READING THE INFORMATION CONTAINED IN THE PRESENTATION, YOU AGREE TO BE BOUND BY THE FOLLOWING LIMITATIONS IN RELATION TO THE EXISTENCE OF THE PRESENTATION AND ALL INFORMATION CONTAINED HEREIN OR CONVEYED IN CONNECTION WITH IT, INCLUDING ANY QUESTION OR ANSWER SESSION AND ANY WRITTEN OR ORAL MATERIAL DISCUSSED OR DISTRIBUTED IN CONNECTION WITH THE PRESENTATION EITHER BEFORE, DURING OR AFTER THE PRESENTATION (TOGETHER, THE “INFORMATION”), AND YOU ACKNOWLEDGE THAT YOU UNDERSTAND THE LEGAL AND REGULATORY SANCTIONS ATTACHED TO THE MISUSE, DISCLOSURE OR IMPROPER CIRCULATION OF THE INFORMATION.
The provision of the Information or any part of it does not constitute, and should not be construed as, investment advice or part of any offer or invitation to sell, or any recommendation or invitation to purchase, or any solicitation of any offer to purchase or subscribe for, any securities in any member of the Group and is not intended to provide the basis of any investment decision, nor does it nor is it intended to form the basis of any contract for acquisition or investment in any member of the Group, financial promotion, or any offer, invitation or recommendation in relation to any acquisition of, or investment in, any member of the Group in any jurisdiction. The Presentation is made available on the express understanding that it does not contain all information that may be required to evaluate, and will not be used by the attendees/recipients in connection with the purchase of or investment in any securities of the Company. No person affiliated with the Company, its directors, officers, employees, affiliates, agents or advisers has been authorised to give any information or to make any representation not contained in the Presentation and, if given or made, such information or representation must not be relied upon.
The Information is not directed to or intended for distribution to, or use by, any person or entity in any jurisdiction where such distribution, publication, availability or use would be contrary to local laws or regulations or require any registration or licensing within such jurisdiction, including without limitation Australia, Canada, Japan or the United States. None of the Company or any of their respective Associates, accepts any liability to any person in relation to the distribution or possession of the Information in or from any such jurisdiction.
The securities of the Company have not been and will not be registered under the US Securities Act of 1933 (the “Securities Act”) or with any securities regulatory authority of any state or jurisdiction of the United States and may not be offered, sold, resold, pledged, delivered, distributed or transferred, directly or indirectly, into or within the United States unless registered under the Securities Act or pursuant to an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act or in compliance with any applicable securities laws of any state or jurisdiction of the United States.
The Information has not been verified. No representation or warranty, express or implied, is given by or on behalf of the Company, agents, advisers, parent or subsidiary undertakings, shareholders, directors, partners, employees or any other person (“Associates”) as to, and no reliance may be placed for any purposes whatsoever on, the adequacy, accuracy, completeness, fairness or reasonableness of the Information, including any opinions contained within the Information. Each of the Company and their respective Associates disclaims, to the fullest extent permitted by applicable law and regulation, all and any responsibility or liability whether arising in tort, contract or otherwise, which they might otherwise have in respect of any of the Information. No duty of care is owed or will be deemed to be owed to you or any other person in respect of the Information.
Recipients should not construe the Information as legal, tax, regulatory, financial or accounting advice and are urged to consult with their own advisers in relation to such matters. The Information is provided as at the date of the Presentation, is subject to change, without notice. The Information may change materially. None of the Company or their respective Associates undertakes or is under any duty to update, complete, revise or keep current the Information or to correct any inaccuracies in the Information which may become apparent, or to provide you with any additional information.
The Information may contain "forward-looking statements" or "projections“ which include all statements other than statements of historical facts, including, without limitation, those regarding the Company's financial position, business strategy, plans and objectives of management for future operations, or any statements preceded by, followed by or that include the words "targets", "believes", "estimates", "expects", "aims", "intends", "will", "may", "anticipates", "projects", "plans", "forecasts", "would", "could", "should" or similar expressions or negatives thereof. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the Company’s control that could cause the actual results, performance or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward looking statements are based on numerous assumptions regarding the Company's present and future business strategies and the environment in which the Company will operate in the future. Forward-looking statements involve numerous risks and uncertainties that could cause actual results to differ materially from expected results. No attempt has been made by the Company to audit or verify the forward-looking statements or any other financial information. No representation or warranty, express or implied, is made that any of these statements, projections or forecasts will come to pass or that any forecasted result will be achieved. As a result, you are cautioned not to place undue reliance on such forward-looking statements. Past performance should not be taken as an indication or guarantee of future results, and no representation or warranty, express or implied, is made regarding future performance. Some of the information is still in draft form and will only be finalised, if legally verifiable, at a later date. Forward-looking statements speak only as of their date and the Company and their respective Associates expressly disclaim any obligation or undertaking to supplement, amend, update or revise any of the forward-looking statements made herein, except where it would be required to do so under applicable law or regulation.
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Glossary
Activecustomers theuniquecountofcustomersplacingorderswithinthepast12months
ANZ AustraliaandNewZealand
AverageOrderValue thetotalgrossrevenueofsalesinAUD– excludinganydiscountvouchersappliedorshippingcosts,dividedbythenumberofordersplaced,excludingreturnedorcancelledorders
CPA costperacquisition(newsubscriber)
NetWorkingCapital istradeandotherreceivablesplusinventorieslesstradeandotherpayablesanddeferredrevenue
Online thegroup’sonlineweb-basedretailactivities
ROI returnoninvestment
ROW UK
Revenueperactive totalgrossrevenueofsalesinAUD– excludinganydiscountvouchersappliedorshippingcosts,dividedbytheuniquecustomersplacingordersinthatyear
S-EAsia
HongKong,Singapore,Malaysia,ThailandandthePhilippines
UnderlyingEBITDA earningsbeforeinterest,taxation,depreciationandamortisation andbeforenon-recurringandcertainnon-cashitems asdisclosedinthesupportingnotestothefinancialstatements