investors’ forum 2017 - global brands group · 2017-09-22 · global brands •one of the...
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CLSA Investors’ Forum 2017
September 11, 2017
Global Brands
•One of the world’s leading branded apparel, footwear and fashion accessories companies
•Listed on the Hong Kong Stock Exchange on 9 July 2014, after a spin-off from Li & Fung
•Constituent of Hang Seng Composite MidCap Index, FTSE4Good Index Series, MSCI Index Series, Hang Seng Corporate Sustainability Index Series, Hang Seng Stock Connect Hong Kong Index and Hang Seng Stock Connect Hong Kong MidCap & SmallCap Index
•A global company headquartered in Hong Kongwith offices and over 6,000 employees worldwide
Our Business Verticals
Approx.5%
Brand Management
Approx.33%
Footwear and Accessories
Approx.21%
Men’s and Women’s FashionKids
41%Approx.
FY2017 US$3.9 billion in revenue*
* Based on FY2017 Annual Results 3
4
Gap 1.61% H&M 1.48% Nike 1.46% Adidas 0.99% Zara 0.97% Children’s Place 0.93% Gymboree 0.75% Semir Group 0.73%
Carter’s Inc 2.64%
Our Position – Global Retail Sales by Vertical
Kids Men’s and Women’s Fashion
* Global Brands: retail sales based on the assumption at 2x of Global Brands’ revenue in FY2017 ** All other companies: data based on Euromonitor International 2016
Global Brands 0.16%
Global Brands 2.14%
H&M 1.57% Zara 1.56% Fast Retailing 1.24% Nike 1.19% PVH 1.08% Gap 1.05% Adidas 0.97% VF 0.82% Levi’s 0.69%
GlobalMarket Size
US$150bn
GlobalMarket Size
US$1,041bn
§ Source: “License! Global” magazine Aug 2016 issue, based on FY 2015 numbers reported
Footwear and Accessories Brand Management
Our Position – Global Retail Sales by Vertical
* Global Brands: retail sales based on the assumption at 2x of Global Brands’ revenue in FY 2017
** All other companies: data based on Euromonitor International 2016. Highlighting key companies in the affordable luxury space and excluding luxury and sports brands companies
Global Brands 0.47%
Steve Madden 0.33% Bata 0.32% Nine West 0.31% Ecco 0.23% Geox 0.23%
VF 1.66% Michael Kors 0.83% Coach 0.75% Belle 0.71%
CAA-GBG 19.15%
WME/IMG 14.12%
Beanstalk 9.57%
Equity Management 9.57%
LMCA 9.41%
Global Icons 8.44%
CPLG 4.38%
Brand Central 3.73%
Joester Loria 3.08%
Exim 2.43%
GlobalMarket Size
US$547bn
Top 20 Total Retail Sales§
US$61.6bn
5
Some of Our Key Brands
6
30+ Countries50+ Offices
6,000+ Employees
Florence
Tokyo
SeoulParis
Milan
Sao Paulo
Greensboro OperationSupport Hub
Singapore
New York US Headquarters
Los Angeles
Montreal
Hong Kong Global Headquarters
Shanghai China Headquarters
London European
Headquarters
Panyu Operation
Support Hub
Monheim
Our Global Reach
8
Three-Year Plan
10
Trend of U.S. Retail Sales (1992-2016)
Source: US Census Bureau
0
100,000
200,000
300,000
400,000
500,000
19921994
19961998
20002002
20042006
20082010
20122014
2016
(US$m)
4.2% CAGR
11
Changing Retail Environment
Source: Goldman Sachs research
Department Store Specialty Off-price Discount Fast Fashion EcommercePure Play
42.9%
18.0%15.4%11.9%0.2%
-5.2%
• Traditional retail model is no longer sustainable
• We have seen retail store closures and a shift from traditional retail model to omni-channel approach
• In a world of heightened transparency, quality of product and speed of response to consumer preference are both vital
Change in U.S. apparel sales by channel, 2014-2016
12
Global Brands’ Unique Platform
Unique advantages to exploit retail transformation
‣ Diversified brand portfolio ‣ Flexible licensing model ‣ Multiple product categories ‣ Multi-channel distribution ‣ Truly global
Trend: brand operation separating from
IP ownership
Global Brands has become thego-to operating partner for IP owners
- Recent examples: BCBG & Bebe
Growth Pillars:
* EBITDA is defined as net profit before net interest expenses, tax, depreciation and amortization. This also excludes share of results of joint ventures, material gains or losses which are of capital nature or non-operational related, acquisition related costs and non-cash gain on remeasurement of contingent consideration payable
30.7%
FY2013 FY2017
1,416
1,010
36.4%
% of Revenue
EBITDA*(US$m)
Core Operating Profit(US$m)
CAGR
5.8%increased
by over
500 basis points
Track Record of Last Three-Year Plan
13
FY2013 FY2017
3,891
3,288
Revenue(US$m)
% of Revenue
FY2013 FY2017
173
134
4.1%4.4% 9.8%
FY2013 FY2017
380
296
9.0%% of Revenue
Total Margin(US$m)
CAGR
9.0%CAGR
8.7%
EBITDA*
US$5bn
Revenuereaching increase by
150 basis points
14
Total margin
Targets of New Three-Year Plan - FY2020
* EBITDA is defined as net profit before net interest expenses, tax, depreciation and amortization. This also excludes share of results of joint ventures, material gains or losses which are of capital nature or non-operational related, acquisition related costs and non-cash gain on remeasurement of contingent consideration payable
increase by
50%
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CLSA Investors’ Forum 2017
September 11, 2017