Home Product Center Public Company Limited Analyst Meeting 1H’14 Results August 5, 2014
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HomePro is the leading home improvement retailer in Thailand. Our products range cover 60,000 items. We operate 66 stores nationwide, providing complete services as One Stop Shopping to attain highest customer satisfaction. The HomePro’s stock is traded on the Thailand Stock Exchange (SET - hmpro, BB - hmpro:tb). 3
Agenda 1H ’ 14 Financial Results Business Outlook 4
Footprint in Thailand as at June 30, 2014 Greater Bangkok Upcountry HomePro 21 Stores HomePro 45 Stores Mega Home 1 Store Mega Home 3 Stores Chiang Rai 2 Chiang Mai Lampang Loei Phare Phitsanulok Udonthani Phetchabun Nakhonsawan Sakonnakhon Khonkaen Suphanburi Chaiyaphum Kanchanaburi Roi-et Nakhonpathom Burirum Chachoengsao Ubonrachathani Phuttamonthon 3 Nakornratchasima Ayutthaya Ratchaburi Chonburi Chathaburi Surin Samutsakhon Lopburi Hua-Hin Prachinburi Pattaya Rayong Prachuapkhirikhan Chumphon Samui NakhonSrithammarat 2 Phuket Suratthani Krabi Trang 2 Had Yai
P & L Summary Unit : MB % on % on 1H’14 1H’13 VAR %G Sales Sales Sales 23,102.1 19,106.7 3,995.3 20.9 100.0 100.0 Other Income 1,512.4 1,217.6 294.8 24.2 6.6 6.4 Total Revenue 24,614.4 20,324.3 4,290.1 21.1 106.6 106.4 COGS 17,041.6 14,072.2 2,969.4 21.1 73.8 73.7 SG&A 4,392.1 3,609.1 783.1 21.7 19.0 18.9 Total Expenses 21,433.7 17,681.2 3,752.5 21.2 92.8 92.6 EBITDA 3,180.7 2,643.1 537.6 13.8 13.8 20.3 Depreciation & Amortization 1,065.1 742.4 322.6 43.5 4.6 3.9 EBIT 2,115.6 1,900.7 215.0 11.3 9.2 9.9 Financial Expenses 206.9 102.2 104.7 102.5 0.9 0.5 TAX 390.2 376.8 13.5 3.6 1.7 2.0 Net Profit 1,518.5 1,421.7 96.8 6.8 6.6 7.4 6
Sustainable Sales Growth Unit : MB FY. 40,112 34,542 28,363 24,073 23,102 19,107 H’ 1H14, sales growth 20.9% YoY, driven by same store sales 5.3%, 16.5% by sales of new stores, EXPO, project sales, and Mega Home. 7
Rising Other Income Unit : MB 7.5% 7.0% 6.8% 6.5% 6.4% 6.4% 6.0% FY. 2,718 2,428 2,139 583 21% 482 1,512 1,218 271 26% 214 929 26% 736 494 32% 375 1H'14 1H'13 1H'14 2Q'13 2Q'14 Others Rent & service %on Sales • Rental & Service Income increased by the rental income of retail space in HomePro and Market Village. • The increase in Other Income was driven by the advertising, in-store promotion with vendors and service income received from customers.
SG&A Expenses Unit : MB 23.3% 23.6% 23.6% 22.8% 22.5% 23.0% 22.5% FY. 9,350 22% 746 7,781 611 6,384 397 5,457 21% 327 4,351 4,712 3,741 26% 2,440 1,913 28% 1H'14 1H'13 1H'14 2Q'13 2Q'14 Sale Related Admin Exp %on Sales 1H’14 SG&A represented 23.6% to sales comparing with 22.8% of the same period of last year. The main increase in absolute amount is due to the increase in salaries, cost of transportation, cost of service, utilities expenses, depreciation, marketing expenses, and pre-operational cost of 9 HomePro in Malaysia and Mega Home.
GP & EBIT Unit : % 26.3 26.9 26.8 25.7 26.0 26.2 26.4 25.0 10.7 10.5 10.3 9.9 10.0 9.2 10.0 9.2 1H'13 1H'14 2Q'13 2Q'14 %EBIT %GP GP decreased as a result of the change of product-mix in Homepro business and lower gross margin structure of Mega Home business. 10
NPAT & EPS Unit : MB 7.7% 7.6% 7.1% 6.8% 7.4% FY. 6.6% 0.38 3,068 0.28 0.29 0.28 2,671 0.14 0.13 2,005 1,638 1,519 1,422 1H14 1H14 NPAT EPS NPAT %on Sales EPS in 2013 taking full dilution impact of stock 1H’14 NPAT growth by 6.8%, and NPAT % to dividend (interim) at the ratio of 6:1 paid in Sales decreased from 7.4% to 6.6%. November 2013. EPS in 1H14 taking dilution effect impact at ratio of 7:1 paid in May 2014 (Final).
Balance Sheet at a Glance Unit : MB 30 Jun 14 31 Dec 13 VAR % 410.9 50.9 Cash & Deposit 396.5 807.5 8,162.1 6,505.6 1,656.5 25.5 Inventory 2,580.3 9.7 Land Building & Equipment 29,141.9 26,561.2 Others 2,033.9 2,067.4 33.5 1.6 Total Assets 39,734.1 35,941.7 3,792.4 10.6 Financial Debt 11,030.1 9,787.1 1,243.0 12.7 Account Payable 12,113.1 11,056.7 1,056.4 9.6 Others 127.5 5.4 2,509.0 2,381.5 Total Liabilities 25,652.2 23,225.3 2,426.9 10.4 10,959.5 9,589.6 1,369.9 14.3 Paid-Up Capital 646.3 646.3 - Share Premium - 2,476.1 2,480.5 4.4 0.2 Retain Earnings Total Equities 14,081.9 12,716.4 1,365.5 10.7 12
Agenda 1H ’ 14 Financial Results Business Outlook 13
Consumer Confidence Index picked up since May CCI CPI 120 10 8 110 6 100 4 90 2 80 0 70 -2 60 -4 50 -6 CCI Inflation Rate The Consumer Confidence Index (CCI) in June rose to 75.1, the highest in 8-month since November 2013, as political uncertainties had been reduced and the economy is set for recovery. The National Council for Peace and Order took control of national administration and as a result consumer confidence had risen in the overall economic and political situation in Thailand. Consumption is expected to steadily grow in the second half, and payments for farmers' pledged rice should increase nationwide purchasing power. The improvement was seen across the different components e.g. present assessment, future expectations, and economic view. Still, more work needs to be done about the economy. 14 Source : The center for economic and business forecasting, UTCC.
Continuous margin expansion through Private Label The main objective of the development and selection of private brand products is an adherence to build up value-added to customers. Therefore, the core element of private brand products is quality and worthiness. In addition to the Company’s increase of variety of products, it had continued to develop and select products with quality to continuously provide worthiness to customers. To date, we have a total of 36 private brands and over 1,000 items.
3Q’14 Marketing Highlight HomePro Champion 8 18 th Anniversary 28 August – 24 September Decorating room in multi-function style with limited time and budget by using HomePro’s products to win prizes worth Baht 400,000. The final round will be set on November in HomePro Expo 20 at IMPACT, Muang Thong Thani. 16 16
Contact us Q & A Tel+66 2832 1416 Email : IR@homepro.co.th
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