2020 RESULTS PRESENTATION FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019 - PowerPoint PPT Presentation

2020 RESULTS PRESENTATION FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019

01 OPERATING CONTEXT by Anthony Thunström Anthony Thunström Chief Executive Officer 02 WHY WE STAND OUT by Anthony Thunström Bongiwe Ntuli Chief Financial Officer Jane Fisher TFG Africa Group Director 03 FINANCIAL PERFORMANCE by Bongiwe Ntuli WHAT’S NEXT FOR TFG 05 04 CREDIT by Jane Fisher by Anthony Thunström TFG RESULTS PRESENTATION 2 FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019

ANOTHER STRONG PERFORMANCE BY THE GROUP 53,2% TFG Africa 52,0% online turnover Gross margin growth maintained (Sept 2018: 53,6%) TFG London online turnover -5,5% Online turnover growth 4,3% growth (excl HoF: 0,3%), +5,4% now at 33,5% TFG Australia EPS growth 37,1% online turnover (Sept 2018: +9,0%) TFG Africa growth comparable 6,5% turnover growth 4,6% (Total TFG Africa +3,1% +3,0% +1,5% turnover growth: Turnover 6,4%)* Headline earnings HEPS growth DPS growth growth growth (Sept 2018: +8,3%) (Sept 2018: +1,5%) (Sept 2018: +14,3%) TFG Australia 6,1% comparable turnover growth 91,4% 60,0% +91,7% (Total TFG Australia turnover Free cash flow Debt to equity ratio Investment in digital & growth: 11,1%) to net profit (excluding IFRS 16) technology-related (Sept 2018: 82,5%) capital (Sept 2018: 65,1%) * Excluding store closures during the period, turnover growth is 8,0% TFG RESULTS PRESENTATION 3 FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019

OUR OPERATING CONTEXT by Anthony Thunström TFG RESULTS PRESENTATION 4 FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019

OPERATING CONTEXT: Macro environment TFG RESULTS PRESENTATION 5 FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019

TFG AFRICA: CONSUMERS REMAIN UNDER PRESSURE South Africa remains our largest Consumer confidence operating segment. Obstructive GDP remains negative regulatory environment burdens under pressure 2019 Q3: -7 growth and suppresses economic 2019 Q2: 1,0% 2018 Q3: 7 activity. Concerns over global economic growth persist. Business confidence Trading conditions at 20-year low deteriorate across 2019 Q3: 21 retail sector 2018 Q3: 34 (2019 Q3 BER retail survey) Sales volume Unemployment growth slowed remains high significantly 2019 Q3: 29,1% (2019 Q3 BER retail survey) 2018 Q3: 27,5% FNB/BER CONSUMER RMB/BER BUSINESS CONFIDENCE INDEX CONFIDENCE INDEX 30 90 80 20 70 60 10 50 Trend of 40 0 30 pressure on 20 -10 10 consumer continues -20 0 Mar-10 Sep-10 Mar-11 Sep-11 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 Mar-15 Sep-15 Mar-16 Sep-16 Mar-17 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19 2007 Q1 2007 Q4 2008 Q3 2009 Q2 2010 Q1 2010 Q4 2011 Q3 2012 Q2 2013 Q1 2013 Q4 2014 Q3 2015 Q2 2016 Q1 2016 Q4 2017 Q3 2018 Q2 2019 Q1 2019 Q4 Sources: BER, Stats SA TFG RESULTS PRESENTATION 6 FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019

TFG LONDON AND TFG AUSTRALIA: CONSUMERS REMAIN UNDER PRESSURE TFG London • Uncertainties surrounding Brexit and upcoming General Election • Expectations of higher future trade costs and continuing weak pound • Challenged trading in certain UK department stores China / US trade wars continue TFG Australia • Unemployment remains low • Economy continues to be driven by business and government spending, while household spending and the consumer sector remains flat Source: BER, UK Office for National Statistics, Australian Bureau of Statistics TFG RESULTS PRESENTATION 7 FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019

OPERATING CONTEXT: Retail environment TFG RESULTS PRESENTATION 8 FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019

RETAIL AS WE KNOW IT IS TRANSFORMING Customer engagement Data analytics - understand through social media is customer behaviour to ultimately pivotal provide personalised customer service Price savvy – consumers Planet friendly – are increasingly price- consumers demand social conscious and values-driven responsibility Technology – multi-channel retail is Experiential retail – retailers use the new normal experience to win and retain customers Source: Retail Trends 2019 (Global Consumer & Retail), KPMG TFG RESULTS PRESENTATION 9 Forbes: 5 trends that will redefine retail in 2019, Jia Wertz FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019

TFG’S RESPONSE TO MACRO AND RETAIL ENVIRONMENT FACTORS TFG RESULTS PRESENTATION 10 FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019

TFG Investment in data Quality product RESPONDS analytics to offering at the deepen our right price Price WITH Data customer insights savvy analytics PURPOSE Experiential retail - launch of customer- Investment in focused technology and digital transformation – experiences conveniently growing importance of Technology Experiential provided in store omni-channel and single retail view of stock Investment in social spend - Local manufacturing bursaries, capability developed in internships and 2012 and grown two-fold Planet Planet trainee positions with further investment friendly friendly offered through our in QR capability Retail Academy Voice of customer – Voice of employee – proactive engagement continuous engagement with customers on with employees drives Social Social various platforms culture of innovation media media FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019 11 TFG RESULTS PRESENTATION

TFG BRANDS CONSISTENTLY RECOGNISED BY CUSTOMERS AS GREAT VALUE FOR MONEY 1.50 Customer perception of latest fashion Price savvy Markham Markham (P) 1.00 Edgars (p) Mr Pricep Mr Price Edgars The FIX (P) The FIX Foschini (P) Foschini H&Mp H&M Woolworths 0.50 Truworths Woolworthsp Identityp Truworthsp Identity Cotton On (P) Cotton On Sportscene (P) Sportscene Refinery Refineryp 0.00 -2.50 -2.00 -1.50 -1.00 -0.50 0.00 0.50 1.00 1.50 2.00 Exact (P) Exact Totalsports (P) Ackermans Ackermansp Totalsports Jetp Jet Pick n Pay Clothingp Pick n Pay Clothing -0.50 Donna Donna (P) Customer perception of lowest price Pep Pepp -1.00 Customer perception of value for money Source: Columinate Brand Health Tracker: 08-17 th October 2018, ladies and menswear landscape. FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019 12 TFG RESULTS PRESENTATION

FOCUSED DIGITAL TRANSFORMATION ENSURES GROUP REMAINS AT FOREFRONT OF RAPIDLY CHANGING RETAIL LANDSCAPE Technology The purpose of TFG’s customer -focused digital journey: Enable customers to shop and interact with brands Match customer’s however, whenever and experience on multi- wherever they want channel platform Offer customers new interactions that improve their experience Establish culture of innovation across the Group Ensure dynamic, digital Personalised infrastructure to support customer offering growth at every touch point FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019 13 TFG RESULTS PRESENTATION

DIGITAL TRANSFORMATION STOCK ACCURACY Technology The case : Improved stock accuracy and availability which also forms the foundation for OneStock RFID The benefit : Enhanced customer experience and increased revenue through increase in average basket size FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019 14 TFG RESULTS PRESENTATION

DIGITAL TRANSFORMATION ONESTOCK Technology ONESTOCK The case : M aximise revenue opportunity by leveraging stock availability across all our channels (online and stores) The benefit : Seamless customer experience across all our retail channels FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019 15 TFG RESULTS PRESENTATION

DIGITAL TRANSFORMATION CONVERSION / WORKFORCE MANAGEMENT Technology The case : Right people, right place, right time, to drive customer conversion, increased revenue and customer experience The benefit : Improved customer experience and conversion FOOTCOUNTERS WORKFORCE MANAGEMENT (WFM) FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019 16 TFG RESULTS PRESENTATION

DIGITAL TRANSFORMATION OPERATIONAL EFFICIENCIES Technology The case : Improve efficiencies and visual consistency across stores and increase customer engagement YOOBIC The benefit : Operational efficiencies / cost reduction / increased conversions FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019 17 TFG RESULTS PRESENTATION

E-COMMERCE AND OMNI-CHANNEL REVENUE UP 4,3% Technology 32% (TFG Africa) 19% (TFG London) 70% 30% (TFG Australia) TFG Africa online click and collect at store shoppers that are account holders 9,1 million social media followers 55% (TFG Africa) 43% (TFG Africa) 52% (TFG London) 13% (TFG London) 68% (TFG Australia) 11% (TFG Australia) online transactions increase in new users to through mobile devices site FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019 18 TFG RESULTS PRESENTATION

EXPERIENTIAL Tattoo parlour RETAIL DJ booth OFFERING Basketball court EXCEPTIONAL CUSTOMER SERVICE Available in Foschini Fourways and Sportscene Sandton Nail bar Sneaker cleaning Experiential retail is coming to life FOR THE HALF-YEAR ENDED 30 SEPTEMBER 2019 19 TFG RESULTS PRESENTATION