Earning Slides 17 Feb 2014
Matahari Department Store
Full Year 2013 Results Update
Earnings call: February 17, 2014
1
Indonesia’s Most Preferred Department Store
Key Highlights Q4 2013
Key Highlights FY 2013
Financial Update
Summary
2
Key Highlights Q4 2013
3
Indonesia’s Most Preferred Department Store
Key Highlights – Q4 2013
• Consumer demand in our middle income segment continues to be strong
• Net Income up 77.8%
• Total gross sales were up 18.1%
• Comp store growth accelerated to 13.3%
• Strong Gross Margin performance
• Opened 4 new stores in Q4, or 9 new stores in FY2013, giving a total of 125
stores by the end of 2013
4
Key Highlights FY 2013
5
Indonesia’s Most Preferred Department Store
Key Highlights FY 2013
• Net income increased by 49.2% to Rp1,150 bn or 9.0% of gross sales
• Total gross sales Rp12,735 bn, 17.2% over 2012
• Comp store sales growth 12.1%
• Merchandise gross margin improved 20 bps over 2012
• Adjusted EBITDA was 15.2% over LY, at 16.5% of gross sales, 20 bps lower
than LY
6
Financial Snapshot FY2013
Gross Sales
Adjusted EBITDA
Net Income
IDR Bn
IDR Bn
IDR Bn
1,150
2,096
12,735
1,819
10,867
16.5%
12.1%
9.0%
771
16.7%
11.1%
7.1%
FY12
FY13
SSSG
FY12
FY13
Adjusted EBITDA Margin
FY12
FY13
Net Income Margin
7
MDS’s exclusive brands continue to deliver strong performance
DP increased by 280 bps in FY2013, as compared to FY2012
% of Gross Sales
FY12
FY13
8
9 new stores opened in 2013
125 stores in 61 cities across Indonesia
Up to Jan 2014
MDS Store Overview
No. of Stores
Kalimantan, Bali and East
Indonesia
26 stores (15 cities)
(3 new stores)
Sumatra
20 stores (11 cities)
(2 new stores)
As of 31 Dec 2012
Added in 2013
Total
116
9
125
Greater Jakarta
35 stores (11 cities)
(2 new stores)
West Java
11 stores (7 cities)
Central Java
17 stores (8 cities)
(1 new store)
East Java
16 stores (9 cities)
(1 new store)
9
Store pipeline continues to grow
No
Geographic area
As at 31 Dec 2012
As at 31 Dec 2013
Future pipeline 2014-2016
# of stores
% mix
# of stores
% mix
# of stores
% mix
1
Jabodetabek (Greater Jakarta)
33
28.5%
35
28.0%
14
19.2%
2
Java (Exc Greater Jakarta)
42
36.2%
44
35.2%
22
30.1%
3
Outside Java
41
35.3%
46
36.8%
37
50.7%
Total
116
100.0%
125
100.0%
73
100.0%
10
Financial Update
11
Indonesia’s Most Preferred Department Store
Q4 delivered a 18.1% sales growth, FY13 growth was 17.2%
Strong sales growth
IDR Bn
12,735
10,867
3,102
2,626
Q4'12
Q4'13
FY12
FY13
12
Improving SSSG for both Q4 and FY13
Strong SSSG
SSSG %
13.3%
12.1%
12.0%
11.1%
Q4'12
Q4'13
FY12
FY13
13
Expected cost pressures, driven by minimum wage
and electricity increases
Adjusted Opex(1) as a % of Gross Sales
19.2%
18.8%
17.7%
17.2%
Q4'12
Q4'13
FY12
FY13
Note
1. Opex calculated as Adjusted Gross Profit less Adjusted EBITDA
14
EBITDA grew by 15.2% in FY13 , equivalent to 16.5% sales
Adjusted EBITDA and Margins
IDR Bn
2,096
1,819
16.5%
493
16.7%
390
15.9%
14.9%
Q4'12
Q4'13
FY12
FY13
Adjusted EBITDA as a % of Gross Sales
15
FY13 net profit increased 49.2% over 2012
Net Profit and Margins
IDR Bn
1,150
251
771
9.0%
141
8.1%
7.1%
5.4%
Q4'12
Q4'13
FY12
FY13
Net Profit as a % of Gross Sales
Note
Effective Q3 2013 the company is using a base tax rate of 20% per regulation no. 238/PMK.03/2008 dated 30 December 2008. (See FS note 2 (q))
16
Debt repayment plan is on track for 2013
Total Debt and Interest Expense
Total Debt
Commentary
Interest expense
Total debt at the end of 2013 was Rp1.6 T,
following Rp1.4 T of debt pay-down, in line with
the guidance given
416
2,959
On Dec 30th, 2013, we made a prepayment of
Rp300 bn
269
1,596
1,496
Additional debt prepayment of Rp100 bn was
made on Jan 30th, 2014
Management will continue the debt prepayment
this year
2012
2013
Jan-14
2012
2013
Effective interest rate declined from 12.3% in
FY12 to 11.6% in FY13, driven by the
refinancing in 2012
The current interest rate is JIBOR + 4.75%
Notes
1. Effective interest rate is computed by dividing interest expense (excluding amortization of upfront fees) during the relevant period by beginning gross debt of the relevant period
2. Total debt comprises of the bank loan, revolving facility, less anamortized upfront fee
17
Strong comp performance across geographic regions
Sales Growth and SSSG by region – FY2013
Geographic Area
Stores as at
Dec 2013
Store Mix
% to Total
Sales
(IDR Bn)
Total Sales
% growth FY13
SSSG%
Q4
SSSG%
FY13
Greater Jakarta
35
28.0
3,780.0
15.6
12.6
12.4
Java exclude Greater
Jakarta
44
35.2
4,132.0
19.5
17.0
15.4
Outside Java
46
36.8
4,823.0
16.5
10.8
8.9
Total
125
100.0
12,735.0
17.2
13.3
12.1
18
Financial Summary
Key Profit & Loss Items
IDR Bn
FY 2012
Q1. 2013
Q2 2013
Q3 2013
Q4 2013
FY 2013
10,866.9
2,372.4
2,787.2
4,473.4
3,102.0
12,735.0
SSSG
11.1%
13.2%
14.9%
9.0%
13.3%
12.1%
Growth
17.7%
18.3%
20.4%
14.1%
18.1%
17.2%
5,616.9
1,257.2
1,483.7
2,367.3
1,646.0
6,754.3
19.5%
21.6%
24.4%
16.9%
20.5%
20.2%
3,685.3
794.0
959.8
1,519.2
1,074.9
4,347.9
33.9%
33.5%
34.4%
34.0%
34.7%
34.1%
2,515.0
486.1
617.5
1,106.5
702.3
2,912.4
23.1%
20.5%
22.2%
24.7%
22.6%
22.9%
1,818.6
296.8
422.0
884.3
492.7
2,095.8
Margin
16.7%
12.5%
15.1%
19.8%
15.9%
16.5%
Profit before tax
1,159.0
138.1
274.5
767.5
343.5
1,523.6
Margin
10.7%
5.8%
9.8%
17.2%
11.1%
12.0%
770.9
82.2
182.7
634.6
250.7
1,150.2
Margin
7.1%
3.5%
6.6%
14.2%
8.1%
9.0%
growth
65.6%
82.9%
62.4%
34.3%
77.8%
49.2%
Gross Sales
Net Revenue
Growth
Adjusted Gross Profit
Margin
Adjusted EBITDAR
Margin
Adjusted EBITDA
Net Profit
19
Summary
20
Indonesia’s Most Preferred Department Store
Summary
Results in Q4 continue to show strength in sales and earning growth
Management continues to have a positive outlook for 2014
Accelerated debt prepayments were on track in 2013 and will continue in
2014
Store pipeline continues to be sufficient to drive future growth plans
21
Full Year 2013 Results Update
Earnings call: February 17, 2014
1
Indonesia’s Most Preferred Department Store
Key Highlights Q4 2013
Key Highlights FY 2013
Financial Update
Summary
2
Key Highlights Q4 2013
3
Indonesia’s Most Preferred Department Store
Key Highlights – Q4 2013
• Consumer demand in our middle income segment continues to be strong
• Net Income up 77.8%
• Total gross sales were up 18.1%
• Comp store growth accelerated to 13.3%
• Strong Gross Margin performance
• Opened 4 new stores in Q4, or 9 new stores in FY2013, giving a total of 125
stores by the end of 2013
4
Key Highlights FY 2013
5
Indonesia’s Most Preferred Department Store
Key Highlights FY 2013
• Net income increased by 49.2% to Rp1,150 bn or 9.0% of gross sales
• Total gross sales Rp12,735 bn, 17.2% over 2012
• Comp store sales growth 12.1%
• Merchandise gross margin improved 20 bps over 2012
• Adjusted EBITDA was 15.2% over LY, at 16.5% of gross sales, 20 bps lower
than LY
6
Financial Snapshot FY2013
Gross Sales
Adjusted EBITDA
Net Income
IDR Bn
IDR Bn
IDR Bn
1,150
2,096
12,735
1,819
10,867
16.5%
12.1%
9.0%
771
16.7%
11.1%
7.1%
FY12
FY13
SSSG
FY12
FY13
Adjusted EBITDA Margin
FY12
FY13
Net Income Margin
7
MDS’s exclusive brands continue to deliver strong performance
DP increased by 280 bps in FY2013, as compared to FY2012
% of Gross Sales
FY12
FY13
8
9 new stores opened in 2013
125 stores in 61 cities across Indonesia
Up to Jan 2014
MDS Store Overview
No. of Stores
Kalimantan, Bali and East
Indonesia
26 stores (15 cities)
(3 new stores)
Sumatra
20 stores (11 cities)
(2 new stores)
As of 31 Dec 2012
Added in 2013
Total
116
9
125
Greater Jakarta
35 stores (11 cities)
(2 new stores)
West Java
11 stores (7 cities)
Central Java
17 stores (8 cities)
(1 new store)
East Java
16 stores (9 cities)
(1 new store)
9
Store pipeline continues to grow
No
Geographic area
As at 31 Dec 2012
As at 31 Dec 2013
Future pipeline 2014-2016
# of stores
% mix
# of stores
% mix
# of stores
% mix
1
Jabodetabek (Greater Jakarta)
33
28.5%
35
28.0%
14
19.2%
2
Java (Exc Greater Jakarta)
42
36.2%
44
35.2%
22
30.1%
3
Outside Java
41
35.3%
46
36.8%
37
50.7%
Total
116
100.0%
125
100.0%
73
100.0%
10
Financial Update
11
Indonesia’s Most Preferred Department Store
Q4 delivered a 18.1% sales growth, FY13 growth was 17.2%
Strong sales growth
IDR Bn
12,735
10,867
3,102
2,626
Q4'12
Q4'13
FY12
FY13
12
Improving SSSG for both Q4 and FY13
Strong SSSG
SSSG %
13.3%
12.1%
12.0%
11.1%
Q4'12
Q4'13
FY12
FY13
13
Expected cost pressures, driven by minimum wage
and electricity increases
Adjusted Opex(1) as a % of Gross Sales
19.2%
18.8%
17.7%
17.2%
Q4'12
Q4'13
FY12
FY13
Note
1. Opex calculated as Adjusted Gross Profit less Adjusted EBITDA
14
EBITDA grew by 15.2% in FY13 , equivalent to 16.5% sales
Adjusted EBITDA and Margins
IDR Bn
2,096
1,819
16.5%
493
16.7%
390
15.9%
14.9%
Q4'12
Q4'13
FY12
FY13
Adjusted EBITDA as a % of Gross Sales
15
FY13 net profit increased 49.2% over 2012
Net Profit and Margins
IDR Bn
1,150
251
771
9.0%
141
8.1%
7.1%
5.4%
Q4'12
Q4'13
FY12
FY13
Net Profit as a % of Gross Sales
Note
Effective Q3 2013 the company is using a base tax rate of 20% per regulation no. 238/PMK.03/2008 dated 30 December 2008. (See FS note 2 (q))
16
Debt repayment plan is on track for 2013
Total Debt and Interest Expense
Total Debt
Commentary
Interest expense
Total debt at the end of 2013 was Rp1.6 T,
following Rp1.4 T of debt pay-down, in line with
the guidance given
416
2,959
On Dec 30th, 2013, we made a prepayment of
Rp300 bn
269
1,596
1,496
Additional debt prepayment of Rp100 bn was
made on Jan 30th, 2014
Management will continue the debt prepayment
this year
2012
2013
Jan-14
2012
2013
Effective interest rate declined from 12.3% in
FY12 to 11.6% in FY13, driven by the
refinancing in 2012
The current interest rate is JIBOR + 4.75%
Notes
1. Effective interest rate is computed by dividing interest expense (excluding amortization of upfront fees) during the relevant period by beginning gross debt of the relevant period
2. Total debt comprises of the bank loan, revolving facility, less anamortized upfront fee
17
Strong comp performance across geographic regions
Sales Growth and SSSG by region – FY2013
Geographic Area
Stores as at
Dec 2013
Store Mix
% to Total
Sales
(IDR Bn)
Total Sales
% growth FY13
SSSG%
Q4
SSSG%
FY13
Greater Jakarta
35
28.0
3,780.0
15.6
12.6
12.4
Java exclude Greater
Jakarta
44
35.2
4,132.0
19.5
17.0
15.4
Outside Java
46
36.8
4,823.0
16.5
10.8
8.9
Total
125
100.0
12,735.0
17.2
13.3
12.1
18
Financial Summary
Key Profit & Loss Items
IDR Bn
FY 2012
Q1. 2013
Q2 2013
Q3 2013
Q4 2013
FY 2013
10,866.9
2,372.4
2,787.2
4,473.4
3,102.0
12,735.0
SSSG
11.1%
13.2%
14.9%
9.0%
13.3%
12.1%
Growth
17.7%
18.3%
20.4%
14.1%
18.1%
17.2%
5,616.9
1,257.2
1,483.7
2,367.3
1,646.0
6,754.3
19.5%
21.6%
24.4%
16.9%
20.5%
20.2%
3,685.3
794.0
959.8
1,519.2
1,074.9
4,347.9
33.9%
33.5%
34.4%
34.0%
34.7%
34.1%
2,515.0
486.1
617.5
1,106.5
702.3
2,912.4
23.1%
20.5%
22.2%
24.7%
22.6%
22.9%
1,818.6
296.8
422.0
884.3
492.7
2,095.8
Margin
16.7%
12.5%
15.1%
19.8%
15.9%
16.5%
Profit before tax
1,159.0
138.1
274.5
767.5
343.5
1,523.6
Margin
10.7%
5.8%
9.8%
17.2%
11.1%
12.0%
770.9
82.2
182.7
634.6
250.7
1,150.2
Margin
7.1%
3.5%
6.6%
14.2%
8.1%
9.0%
growth
65.6%
82.9%
62.4%
34.3%
77.8%
49.2%
Gross Sales
Net Revenue
Growth
Adjusted Gross Profit
Margin
Adjusted EBITDAR
Margin
Adjusted EBITDA
Net Profit
19
Summary
20
Indonesia’s Most Preferred Department Store
Summary
Results in Q4 continue to show strength in sales and earning growth
Management continues to have a positive outlook for 2014
Accelerated debt prepayments were on track in 2013 and will continue in
2014
Store pipeline continues to be sufficient to drive future growth plans
21