Embed Size (px)
Citation preview
3Q09 Conference Call3Q09 Conference CallNovember 5, 2009November 5, 2009
Disclaimer
This presentation contains forward-looking statements regarding the prospects of the business, estimates for operating and financial results, and those regarding Cia. Hering's growth prospects. These are merely projections and, as such, are based exclusively on the expectations of Cia. Hering management concerning the future of the business and its continued access to capital to fund the Company’s business plan. Such forward-looking statements depend, substantially, on changes in market conditions, government regulations, competitive pressures, the performance of the Brazilian economy and the industry, among other factors and risks disclosed in Cia. Hering’s filed disclosure documents and are, therefore, subject to change without prior notice.
AGENDA:
• Highlights• Operating Performance• Business Strategy and Outlook
3Q09 Highlights
MAIN INDICATORS
• Total Gross Revenue + 34.7%, of which +40.3% in the domestic market;
• Hering brand Sales +43.5%, PUC + 39.0% and dzarm. +12.6%;
• EBITDA Margin +5.5 p.p., ending the quarter with 21.9%;
• Hering Stores sales + 40.1% and same-store sales +20.9%.
OTHER HIGHLIGHTS
• Opening of 14 Hering Stores (1 owned) and 1 PUC Store (owned);
• Marketing Campaign “eu uso Hering...” for Father´s Day and Jeanswear;
• Execution of dzarm. brand repositioning plan.
4
AGENDA:
• Highlights• Operating Performance• Business Strategy and Outlook
Domestic Market
Foreign Market
Gross Revenue (R$ million)
Domestic market accounts for 98.1% of the total gross revenue, indicating a 40.3% growth.
6
147.3
206.89.2
4.0
3Q08 3Q09
40.3%
56.4%
34.7%
156.5
210.8
By Market
400.7
576.8
27.8
12.4
9M08 9M09
43.9%
55.3%
37.5%
428.5
589.2
115.6
166.0
21.8
15.7
14.6
13.03.0
4.4
3Q08 3Q09
43.5%
39.0%
12.6%147.3
206.840.3%
By Brand
PUC
dzarm.
Others
Hering
Gross Revenue – Domestic Market (R$ million)
Hering brand stood out with 43.5% growth.dzarm. shows the first results of its repositioning plan, with a 12.6%
increase in the quarter.
313.8
470.1
54.9
42.1
38.4
35.98.9
13.4
9M08 9M09
49.8%
30.5%
7.1%
400.7
576.8
43.9%
7
Franchise/Own Store
Multibrand
By Distribution Channel
In 9M09, the multibrand retail grew 45.9%, due to the 57.6% expansion for Hering and 34.8% for PUC in such channel.
185.8
214.9
313.6
263.4
9M08 9M09
400.7
576.8
41.7%
45.9%
88.963.2
84.1
117.9
3Q08 3Q09
147.3
206.8
40.5%
40.2%
8
Gross Revenue – Domestic Market (R$ million)
Private Label vs. Own Brands
Private Label
Own Brands
In the foreign market, the Company continues the strategy to focus in Latin American countries with its own brands.
5.0 4.0
4.1
3Q08 3Q09
56.4%
19.9%
100.0%
9.1
4.0
9
Gross Revenue – Foreign Market (R$ million)
13.4 12.4
14.4
9M08 9M09
55.3%
7.6%
100.0%
27.8
12.4
Excluding the AVP (Current Value Adjustment), the gross margin in 9M09 would have been 45.5%.
155.3
217.0
44.9%
44.1%
0
5 0
1 00
1 5 0
2 00
2 5 0
9M08 9M090.1
0.1 5
0 .2
0 .2 5
0 .3
0 .3 5
0 .4
0 .4 5
39.7%
0.8 p.p.
58.383.4
47.5%
45.5%
0
5 0
1 00
1 5 0
2 00
2 5 0
3Q08 3Q090.1
0.1 5
0.2
0.2 5
0.3
0.3 5
0.4
0.4 5
0.5
0.5 5
0.6
43.0%
2.0 p.p.
Gross Profit
10
Gross Profit (R$ million) and Gross Margin (%)
Gross Profit Gross Margin
The improvement in operational performance, due to the increase in sales and dilution of fixed expenses reflected in a 82.6% EBITDA growth in 3Q09.
53.8
91.8
19.0%
15.3%
0
2 0
4 0
6 0
8 0
1 00
9M08 9M090
0.02
0.04
0 .06
0 .08
0 .1
0 .1 2
0 .1 4
0 .1 6
0 .1 8
0 .2
3.7 p.p.
70.6%
21.0
38.5
21.9%
16.4%
0
2 0
4 0
6 0
8 0
1 00
3Q08 3Q090
0.05
0.1
0 .1 5
0 .2
0 .2 5
5.5 p.p.
82.6%
EBITDA
11
EBITDA (R$ million) and EBITDA Margin (%)
15 stores were opened and the multibrand retail grew 7.0% in number of clients in the 3Q09.
Stores Distribution
12
In the 9M09, 33 stores were opened (28 Hering Stores and 5 PUC). In the foreign market, the Company decided to discontinue the franchise stores
in markets that are not its current target.
151 181230 231 244 258
39
59 61 63 64
1923
22 22 22 15
44
2006 2007 2008 1Q09 2Q09 3Q09
Hering PUC Abroad
209248
311 329337
314
Goal:224Goal:172
Goal:57
Distribution Network (Number of Stores)
13
Evolution of the Distribution Network
10 25 37 40 51 33 40
141
193233
274
176218
156
2006 2007 2008 2009* 2010* 3Q08 3Q09
Own Stores Franchise
151181
230273
325
209258
* estimated
Out of the 258 stores, 169 are already remodeled to the new architectural project. The goal for 2009 went from 268 to 273 stores.
Hering Store Expansion
14
Expansion Plan
Besides the expansion of 40.1% in the network sales, same-store sales growth of 20.9% and the average sales ticket increase of 4.4% were highlights of the quarter.
Hering Store Indicators
15
Hering Store Performance 3Q08 3Q09 Chg. 9M08 9M09 Chg.
Number of Stores 209 258 23.4% 209 258 23.4%
Franchise 176 218 23.9% 176 218 23.9%
Own 33 40 21.2% 33 40 21.2%
Sales (R$ thousand) 91,792 128,597 40.1% 269,816 388,043 43.8%
Same Store Sales growth (1) 25.6% 20.9% -4.7 p.p. 34.4% 23.8% -10.6 p.p.
Sales Area (m²) 27,588 33,233 20.5% 27,588 33,233 20.5%
Sales (R$ per m²) 3,395 3,956 16.5% 10,481 12,497 19.2%
Check-Outs 1,123,907 1,507,785 34.2% 3,184,937 4,389,165 37.8%
Units 2,654,189 3,428,509 29.2% 7,461,892 9,926,066 33.0%
Average Sales Ticket (R$) 81.70 85.29 4.4% 83.84 87.34 4.2%
(1) Compared to the same period of the previous year
Industry
Stores
IT
Others
By Activity
3.3
5.2
1.61.3
6.3
4.1
0.5
0.2
3Q08 3Q09
91.7%
22.2%
18.4%12.2
10.3 14.5%
Industry investment was the highlight of the quarter, 91.7% over the same period of 2008.
8.9 10.6
4.93.4
10.7 8.7
0.80.8
9M08 9M09
19.4%
18.6%
7.1%
23.525.3
30.6%
Capex (R$ million)
16
Indebteness
17
Indebtedness Evolution Short Term x Long Term
Total Debt = R$ 95.1 million
* EBITDA of the last 12 months
Net Debt/EBITDA*
Net Debt (R$ million)
LongTerm44%
Short Term56%
Financial Result
• Swap
– On July 7, 2009, Cia. Hering renegociated the swap operation in the amount of R$ 30.0 million, eliminating four monthly verifications (Feb/2010 until June/2010) at a cost of R$ 2.06 million and;
– On September 24, 2009, the Company terminated the swap operation, in an agreement with the counterpart, paying R$ 150 thousand reais for it.
18
R$ thousand 3Q08 3Q09 Chg. 9M09 9M08 Chg.
Net Financial Revenue (Expenses) (2,802) (15,174) 441.5% (10,258) (13,249) 29.2%Net Financial Derivative Instruments Results - (193) - - 24,866 -Total Financial Revenue (Expenses) (2,802) (15,367) (10,258) 11,617 -448.4%
Payment of Interest on Shareholder’s Equity
The payment on 10/August/09 in the amount of R$ 15.2 million refers to:
R$0,1411/share - related to the year ended on December 31 2008;R$0,1405/share - related to the first half of 2009;
Shareholder´s remuneration
19
Payment of Interest on Equity 2007 02/22/08 4,853 0.09000
Payment of Interest on Equity 2008 09/17/08 4,853 0.09000
Dividends 2008 05/11/09 10,578 0.19616
Payment of Interest on Equity 2008 08/10/09 7,609 0.14110
Payment of Interest on Equity 2009 08/10/09 7,576 0.14050
Shareholders´ remuneration Year End Date of Payment
Gross Value (R$ million)
Value per Share (R$)
AGENDA:
• Highlights• Operating Performance• Businees Strategy and Outlook
20
Hering Store
• Continuity of the growth plan– 325 store by the end of 2010, with the upside of 5 stores
for 2009, ending the year with 273 stores.
• Marketing Campaign “eu uso Hering …” focused on the commemorative year-end dates
• Hering Store Credit Card
• Hering Web Store
Opening of PUC stores in the new archictectural project and marketing campaign with more commercial appeal;
Execution of the dzarm. repositioning plan with the launching of the High Summer Collection;
Reestructure of the presence in the foreign market focusing on own brands´ sales to the Latin American countries.
Strategy & Outlook
21
Investor RelationsInvestor Relations
Fabio Hering Fabio Hering –– CEO and IR DirectorCEO and IR DirectorFrederico de Aguiar Oldani Frederico de Aguiar Oldani –– CFOCFOKarina Koerich Karina Koerich –– IR ManagerIR ManagerGracila Camargo Lopes Gracila Camargo Lopes –– IR AnalystIR Analyst
Tel.: +55 (47) 3321Tel.: +55 (47) 3321--3469 3469 EE--mail: [email protected]: [email protected]: www.ciahering.com.br/irWebsite: www.ciahering.com.br/ir
Investor Relations Consulting FirmFIRB – Financial Investor Relations BrasilLigia Montagnani – IR ConsultantTel: +55 (11) 3897-6857E-mail: [email protected]
