Migros T icaret A.Ş. 1Q 2019 Financial Results
CONTENTS Market Share Sales Evolution Capital Expansion Expenditures Ataşehir Migros Management Financial Overview Overview Financial Format Results Summary 1
Sales in 1Q 2019 ▪ Consolidated sales growth of 24.9% in 1Q 2019 ▪ Solid sales performance of existing Migros stores Sales in 1Q 20 19 (TL million) Sales in 2018 (TL million) Strong consolidated 4,923 18,717 growth in 1Q19 … 3,940 15,344 1Q 2018 1Q 2019 2017 2018 24.9% Sales Growth in 2018 22.0% Sales Growth in 1Q 2019 * Kipa’s financial results are consolidated since 01 March 2017. 2
Market Share Evolution Market Share Gain Migros FMCG Market Share Evolution (%) 90 bps market share gain in 16.7 15.8 modern FMCG market. 110 bps market share gain in total FMCG market. 7.7 6.6 Source: Nielsen Note: FMCG stands for Fast Moving Consumer Goods; 1Q 2019 1Q 2018 1Q 2019 1Q 2018 Modern FMCG market and total FMCG market include all food-retail formats Total FMCG Market Share Modern FMCG Market Share 3
Expansion Net Sales Area Split By Banner - 1Q 2019 Number of Stores - Total 19 +167 new store openings in 1Q 2019 2,100 1,933 17 new store openings in April 2019 1Q 2018 1Q 2019 81 cities operating in every Space growth (m 2 ) 5.0% city in the Country Net Sales Area (1Q 2019) 1,501K sqm 2,100 number of stores as of 1Q 2019 4
Capital Expenditures Capex (TL million) % of Sales 2.6% 2.6% 2.7% 2.0% 0.9% 488 77 399 297 Space optimization 42 continues in large stores, 1Q 2018 1Q 2019 2016 2017 2018 17 completed since Kipa acquisition so far (including 3 this year) and 1 is under construction 5
Consolidated Gross Profit in 1Q 2019 ▪ Consolidated gross profit increased by 34.1% y-o-y despite price investments ▪ Merger synergies and new store acquisitions lead to an improvement in gross profitability Increased price Gross Profit in 2018 (TL million) Gross Profit 1Q 2019 (TL million) competitiveness mainly in fresh 5,249 lines 1,356 1,339 4,082 998 Strong gross profitability in 1Q 2019 1Q 2018 1Q 2019 1Q 2019 2017 2018 (IFRS 16) Margin 25.3% 27.2% 27.5% Margin 26.6% 28.0% 6
Consolidated EBITDA(R) in 1Q 2019 EBITDA in 1Q 2019 (TL million) EBITDA2018 (TL million) 6.4% 490 1,217 EBITDA margin in 872 314 1Q19, w/o IFRS 206 16 impact driven by better 1Q 2019 2017 2018 1Q 2018 1Q 2019 sales performance (IFRS 16) and strong gross Margin 5.2% Margin 6.4% 9.9% 5.7% 6.5% profitability EBITDAR 1Q 2019 (TL million) EBITDAR 2018 (TL million) 11.3% 556 2,186 EBITDAR margin 400 1,634 in 1Q19, excluding IFRS 16 1Q 2018 1Q 2019 2017 2018 Margin 10.2% 11.3% Margin 10.7% 11.7% *EBITDA(R)= Operating Profit+Amortization+EmployeeTermination Benefits +Unused Vacation Provision-Other Income+Other Expenses+(Rent Expenses) 7
Deleveraging Migros 1Q 2019 Cash and Leverage Position Gross Euro Debt (in million) Total TL m Cash & Debt Items Total TL m (w/ IFRS 16) Cash & Cash equivalents 1,632 1,632 692 TL m 1,322 1,322 672 EUR m 49 49 7,622 1 4,762 Financial Debt 611 515 TL m 1,508 4,368 <500 EUR m 515 515 3,130 5,990 Net Debt 2,028 2 1,325 EBITDA LTM 2.4x 3.0x Net Debt / EBITDA LTM 2016 2017 2018 1Q19 2019E 1 Includes capitalized costs of lease contracts over their maturity 2 IFRS 16 implemented since 01.01.2019. Includes the IFRS 16 LTM rent cost impact which was extrapolated based on 1Q19 rent cost. (TL 175.8 x 4 = TL 703.4 mn) Deleveraging Profile - Net Debt / EBITDA LTM 3.2x 3.0x 3.0x 2.9x 2.7x 2.6x 2.4x 2.3x 1Q18 1Q19 1Q19 2014 2015 2016 2017 2018 (IFRS 16) Euro/TL 3.7099 2.8207 3.1776 4.5155 6.0280 4.8673 6.3188 Currency Change: + 30% 8
Expectations and Guidance 2019 Guidance [consolidated] 20% Sales Growth ~6%* EBITDA Margin 100 new stores Expansion Target TL 300 m CAPEX Guidance * excluding IFRS 16 impact Management Agenda in 2019 Growth Operational Profitability Deleveraging • There has been an upside • Vigilant cost management, • Free cash flow generation, potential for the 2019 FY top- • Asset divestitures, • Increased focus on staff cost, line growth guidance, rent cost & logistics considering Company’s 1Q19 • Absolute amount of Euro debt growth performance, is expected to decrease by almost 20% in 2019 • Increased focus on Migros’ online business together with omni-channel experience 9
Financials & Format Summary - Financials - Operations
Summary of Income Statement – 1Q 2019 IFRS Consolidated Income Statement Summary 1Q 2019 1Q 2018 (TL Million) Net Sales 4,922.7 3,940.1 Cost of sales -3,566.9 -2,941.6 Gross Profit 1,355.8 998.5 Operating Expenses -1,113.8 -889.2 Other Operating Income / (Expense) -99.5 -59.7 Operating Profit 142.5 49.6 Income / (Expense) from Investment activities -4.7 -3.3 Operating Income Before Finance Income / (Expense) 137.7 46.3 Financial Income / (Expense) -359.8 -283.0 Income/Loss Before Tax From Continuing Operations -222.1 -236.7 Tax Income / (Expenses) -0.7 -15.3 Deferred Tax Income -8.0 6.1 Net Profit / Loss -230.8 -245.9 Net Profit / Loss - Non-controlling interest 0.0 -2.2 Net Profit / Loss - Equity holders of parent -230.9 -243.7 EBITDA (with IFRS 16 impact) 489.7 - EBITDA 313.8 205.8 EBITDAR 555.5 399.9 11
Summary of Balance Sheet – 1Q 2019 IFRS Consolidated Balance Sheet Summary 1Q 2019 2018 (TL Million) Current Assets 4,431.1 4,474.3 Non-current Assets 9,167.1 6,410.6 Total Assets 13,598.1 10,884.9 Current Liabilities 6,695.3 6,674.9 Non-current Liabilities 6,491.5 3,574.9 Total Liabilities 13,186.8 10,249.8 Equity 411.3 635.1 Total Liabilities and Equity 13,598.1 10,884.9 12
Migros at a Glance 65 th Year! Operating in 3 countries — Turkey (81 cities out of 81) Geographical Footprint — Macedonia and Kazakhstan (45 stores) 1,984 (supermarkets) 51 (upscale supermarkets) 20 (wholesale and foodservice stores) 45 (international stores) 2,100 Stores 1 Migros Online — 2m members and 60% mobile orders — Re-launch of Tazedirekt 5.8m loyal households Money Club Card Innovation, Loyalty & 38% 80% +100 of HH Customer Service of HH Introduced more than 100 innovations for the retail market Only retail company in the “BIST Sustainability Index” Included Corporate Governance Index since 2015 Sustainability and 31,504 employees of which 40% are women Corporate Governance Best retailer of the country 15 years in a row 2 1 as of March 31, 2019 2 Capital Business magazine. 13
Three-year Summary Consolidated Sales (TL million) 18,717 15,344 11,059 9,390 Consolidated sales & EBITDA 2015 2016 2017 2018 doubled in 3 years Consolidated EBITDA (TL million) 1,217 872 677 602 2015 2016 2017 2018 14
Migros Migros, Largest National Supermarket Chain Number of stores: 1,984 including 1,153 Supermarkets. 56 Hypermarkets, and 775 Migros Jet stores, Penetration: 81 cities ─ (40*-4,500) sqm / (1,800* – 18,000) SKUs ─ Differentiated offering and service on fresh product categories ─ Wide branded assortment of FMCG products ─ Consistent Every Day Low Pricing on commodity Private Label products ─ Fashionable, complementary and seasonal non-food selection Focus on proximity supermarkets Migros Jet and M Migros Proximity Stores, (40*-300) sqm, 1,800* – 3,000 SKUs Loyalty Program CRM applications for different customer segments ─ Customized & Differentiated Offering for Money Club Card holders ─ Club Card Loyalty Program for 18 years (*): including Migros Jet stores and Migros Jet 7/24 forecourt stores as of March 31, 2019 15
Macrocenter Exclusive shopping Number of stores: 51 400 - 2,500 sqm / 10,000 SKUs ─ Upscale gourmet store serving with strong brand loyalty ─ Wide product range in delicatessen, appetizers and spirits. Premium quality in fresh products ─ Complementary and premium non-food Customized service such as banquet ready meal delivery Penetration: 6 cities 16
Wholesale & Food Service Focus on Horeca Penetration Currently operating in 7 regions through dedicated sales team. Dedicated warehouses and customer delivery 20 Wholesale stores Penetration: 15 cities 17
Enhancing online penetration.. Four online channels ▪ Same day delivery, ▪ For over 28,000 SKUs, ▪ Service in 31 cities, Migros Online ▪ Night delivery between 22:00-24:00 in selected regions ▪ Click-collect option for customers Taze Customer Macro direkt Online Migros Now ▪ Delivery within 30 minutes only ▪ Same prices with Migros stores ▪ For over 1,500 SKUs 18
International Operations Kazakhstan Macedonia 1.3% of consolidated sales from Kazakh operations 1.5% of consolidated sales from Macedonian operations Number of stores: 18 , including 2 hypermarkets and Number of supermarkets: 27 16 supermarkets. Owns 1 shopping mall in Almaty Owns 1 shopping mall in Skopje Total sales area of 24,491 sqm Total sales area of 22,568 sqm Serving in the cities of Almaty and Astana in a large ─ country Operations started in 2005 Operates in multi-format since 1999 1 Shopping Mall 2 Hypermarkets 16 Supermarkets 1 Shopping Mall 27 Supermarkets 19
Recommend
More recommend
