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Preliminary Results Financial year to 30 April 2013
INTRODUCTION
Financial Year to 30 April 2013 vs Financial Year to 28 April 2012
For definitions see appendix
• Very strong year of progress
• Group underlying and LfL sales up 4%
• Finished the year strongly
• UK & Ireland LfL +13% in Q4
• Northern Europe +14% in Q4
• Material share gains
• Significant steps taken in resolving
Pixmania’s position
• Ended the year with net cash - ahead of
schedule
Preliminary Results 2012/13 20 June 2013 2
UK & IRELAND
Financial Year to 30 April 2013 vs Financial Year to 28 April 2012
For definitions see appendix
• Total sales up 7%
• Operating profit up 39% to £113m
• Strong market share gains
• Increased value for customers
• Advocacy ratings remain high
• New customer initiatives • New customer journeys
• Pay & Collect
• White goods repairs
• Showhows
• 9pm next day delivery
• Multi-award winning websites
• Good progress on store portfolio rationalisation • Targeting 380-400 stores
Preliminary Results 2012/13 20 June 2013 3
21%
UK & IRELAND MARKET SHARE
Overall market Comet share winners
12% Single Channel
Amazon & Others
22% Mass Merchants
Argos & Supermarkets
4% Others
63% SERVICE LED
37%
LIMITED OR NO SERVICE
41% Other specialists
Source: Dixons Retail estimates
0%
5%
10%
15%
20%
25%
30%
Preliminary Results 2012/13 20 June 2013 4
PRICING POSITION REMAINS STRONG
80%
85%
90%
95%
100%
105%
110%
115%
120%
125%
Competitor 1 Competitor 2 Competitor 3 Competitor 4
Ch
ea
pe
r tha
n C
urry
sP
CW
orld
M
ore
exp
en
siv
e th
an
Curry
sP
CW
orld
Source: Dixons Retail Competitor Price Index
Preliminary Results 2012/13 20 June 2013 5
ADVOCACY REMAINS HIGH
43% 44% 46%
53%
48%
53%
50%
57%
60%
63%
68% 65%
71%
67% 67%
71% 69%
67%
70%
75%
72% 72%
75% 74% 71%
74% 75%
72%
78% 76%
71% 73% 73%
Very likely to recommend %
Source: Dixons Retail customer exit surveys UK&I only
Preliminary Results 2012/13 20 June 2013 6
NORTHERN EUROPE
Financial Year to 30 April 2013 vs Financial Year to 28 April 2012
For definitions see appendix
• Strong growth in all markets with
full year LfLs up 12%
• Highest ever achieved profitability
at £120.5m
• Operating margin of 4.2%
• New customer initiatives
• Happy or Not
• Knowhow
• Reserve & Collect
• New management team embedded
Preliminary Results 2012/13 20 June 2013 7
SOUTHERN EUROPE
Financial Year to 30 April 2013 vs Financial Year to 28 April 2012
For definitions see appendix
• Total sales down 4%
• LfLs down 8%
• Operating loss of £24m
GREECE
• Robust performance in a
difficult market
• Strong cost controls
• Improved profitability y-on-y
• 3 store in store trial with
Carrefour/Marinopoulos
Preliminary Results 2012/13 20 June 2013 8
SOUTHERN EUROPE CONT’D
Financial Year to 30 April 2013 vs Financial Year to 28 April 2012
For definitions see appendix
ITALY
• Significant improvement in
profitability
• Excellent cost control
• Market likely to consolidate
• Recent high profile awards
TURKEY
• Very fragmented market
• Race for share growth
• Good store estate of 14 stores
and 18 franchise stores
• Market consolidation likely
Preliminary Results 2012/13 20 June 2013 9
PIXMANIA
Financial Year to 30 April 2013 vs Financial Year to 28 April 2012
For definitions see appendix
• Poor performance in difficult
markets
• Significant actions taken during
the year
• Day to day control
• Restructured operations
• Exited 12 countries
• Non-core ranges exited
• Headcount reductions
• Sales agreed of Webhallen and PLS
• Exploring strategic opportunities
Preliminary Results 2012/13 20 June 2013 10
YEAR AHEAD
Financial Year to 30 April 2013 vs Financial Year to 28 April 2012
For definitions see appendix
• Resolve strategic positions in Italy, Turkey and of PIXmania
• Knowhow services
• Roll out in Nordics
• New added value services
• Digital downloads
• Customer journeys
• Refrigeration
• Roll out overseas
• Future stores
• Exciting new High street format
• New superstore format in Aylesbury
• Continue to deliver improving returns
Preliminary Results 2012/13 20 June 2013 11
STRATEGIC PRIORITIES
SUSTAINABLE
BUSINESS MODEL
RESOLVE STRATEGICALLY
WEAK POSITIONS
DEVELOPMENT OF
GROUP BENEFITS
FUTURE
OPPORTUNITIES
Preliminary Results 2012/13 20 June 2013 12
Financial review
FINANCIAL SUMMARY
• Underlying profit before tax of £94.5 million
• Group gross margins down 0.7%
• Predominantly product mix
• £45 million cost reduction achieved
• Year 1 of £90 million 2 year programme
• Positive free cash flow of £173.2 million, before
restructuring items
• Net cash of £42.1 million
• RCF extended to June 2015
• Reducing to £200 million by August 2013.
Financial Year to 30 April 2013 vs Financial Year to 28 April 2012
For definitions see appendix
Preliminary Results 2012/13 20 June 2013 14
UNDERLYING PROFIT BEFORE TAX
Financial Year to 30 April 2013 vs Financial Year to 28 April 2012
For definitions see appendix
94.5
24.4
31.3
16.9
25.2
136.0 41.5
120.5
113.3
0
50
100
150
200
250
UK & Ireland
Northern Europe
Southern Europe
Pixmania Central costs
Property EBIT Net finance Underlying PBT
£ Million
Preliminary Results 2012/13 20 June 2013 15
UNDERLYING PROFIT BEFORE TAX
Financial Year to 30 April 2013 vs Financial Year to 28 April 2012
For definitions see appendix
80
85
90
95
100
105
110
115
120
125
0
500
1,000
1,500
2,000
2,500
3,000
3,500
2010/11 2011/12 2012/13
Operating profit (RH scale) Sales (LH scale)
Northern Europe £m £m
20
30
40
50
60
70
80
90
100
110
120
2,700
2,900
3,100
3,300
3,500
3,700
3,900
4,100
2010/11 2011/12 2012/13
Operating profit (RH scale) Sales (LH scale)
UK & Ireland £m £m
Preliminary Results 2012/13 20 June 2013 16
NON UNDERLYING ITEMS
£ million 12/13 11/12
Underlying profit before tax 94.5 82.1
Business exited/to be exited (7.7) (8.5)
Business impairment (79.4) (196.0)
Net restructuring charges (89.4) (16.3)
Amortisation of acquired intangibles (4.2) (4.5)
Jönköping disposal - 37.2
Other items (10.2) (4.3)
Loss on sale of Equanet (9.6) -
Net fair value remeasurement (1.9) (2.8)
Net Pension Interest (7.4) (5.7)
Total net non-underlying charges (209.8) (200.9)
Total (loss) / profit before tax (115.3) (118.8)
Financial Year to 30 April 2013 vs Financial Year to 28 April 2012
For definitions see appendix
Preliminary Results 2012/13 20 June 2013 17
POSITIVE FREE CASH FLOW
£ million 12/13 11/12
Underlying profit before tax 94.5 82.1 Businesses exited/to be exited (7.7) (8.5)
Depreciation & amortisation 134.0 138.8
Working capital 94.6 15.8
Taxation (11.8) (26.8)
Capital expenditure (92.4) (101.5)
Property Disposal Proceeds - 70.2
Historical currency hedges (62.6) -
Other 24.6 4.0
Free Cash Flow before restructuring items 173.2 174.1
Net restructuring (19.8) (43.8)
Free Cash Flow 153.4 130.3
• Strongly cash generative
• Closing net funds £42.1 million (net debt £104.0 million last year)
• including £110.2 million restricted funds
Financial Year to 30 April 2013 vs Financial Year to 28 April 2012
For definitions see appendix
Preliminary Results 2012/13 20 June 2013 18
SUMMARY
• Improving profitability in our multi-channel businesses
• UK & Ireland and Northern Europe growing profits substantially
• Improved performances in Italy and Greece
• Restructured PIXmania
• Delivered £45 million of cost reductions
• Further £45 million targeted in year ahead
• Generated £153m of free cash
• Net cash position for first time in 5 years
• Focused on our strategic priorities
• Drive towards improving return on capital employed
• Cautious about the consumer outlook
Financial Year to 30 April 2013 vs Financial Year to 28 April 2012
For definitions see appendix
Preliminary Results 2012/13 20 June 2013 19
Appendices
Appendices
1. Group LFL Sales Trends
2. Group Store Numbers and Space Trends
3. Shares in issue
4. Notes and definitions
Preliminary Results 2012/13 20 June 2013 21
1. GROUP LIKE FOR LIKE SALES TREND
12/13 12/13 12/13 11/12 11/12 11/12 10/11 10/11 10/11
FY H2 H1 FY H2 H1 FY H2 H1
UK & Ireland 7% 10% 3% (4%) 0% (8%) (4%) (7%) 1%
Northern Europe 12% 12% 11% 6% 6% 5% 5% 8% 1%
Southern Europe* (8%) (6%) (9%) (8%) (10%) (5%) (6%) (6%) (5%)
PIXmania* (24%) (31%) (9%) (10%) (7%) (16%) (1%) (4%) 3%
Total Group (Underlying) * 4% 5% 3% (3%) (1%) (5%) (2%) (4%) 1%
* Note: Southern Europe 10/11 restated to exclude PC City Spain.
Pixmania H1 12/13 restated to exclude businesses exited/to be exited.
Preliminary Results 2012/13 20 June 2013 22
2. GROUP - STORES & SPACE TOTAL
Store numbers 12/13 12/13 11/12 11/12 10/11 10/11
FY H1 FY H1 FY H1
UK & Ireland 552 563 596 614 650 661
Northern Europe 319 312 312 309 304 293
Southern Europe 273 272 276 281 281 268
Businesses exited/to be exited 10 28 27 24 58 56
Total Group 1,154 1,175 1,211 1,228 1,293 1,278
Space 000 sq ft 12/13 12/13 11/12 11/12 10/11 10/11
FY H1 FY H1 FY H1
UK & Ireland 7,755 7,877 7,986 8,019 8,194 7,964
Northern Europe 5,084 5,014 5,035 4,885 4,750 4,698
Southern Europe 3,704 3,749 3,858 3,838 3,895 3,693
Businesses exited/to be exited 14 45 43 36 448 442
Total Group 16,557 16,685 16,922 16,778 17,287 16,797
* Note: Comparatives restated to show all Dixons Travel stores under UK & Ireland
Preliminary Results 2012/13 20 June 2013 23
3. SHARES IN ISSUE
Number of shares
12/13 11/12 10/11
FY FY FY
Number of shares in issue 3,629.7m 3,610.4m 3,610.4m
Weighted average number 3,616.5m 3,608.7m 3,606.6m
of shares for basic eps
Weighted average number 3,696.4m 3,620.2m 3,618.9m
of shares for diluted eps
Preliminary Results 2012/13 20 June 2013 24
NOTES & DEFINITIONS
Certain statements made in this announcement are forward looking. Such statements are based on current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from any expected future events or results referred to in these forward looking statements. Unless otherwise required by applicable laws, regulations or accounting standards, we do not undertake any obligation to update or revise any forward looking statements, whether as a result of new information, future developments or otherwise.
CAUTIONARY STATEMENT
1. Underlying results are defined as excluding trading results from businesses exited / to be exited, the amortisation of
acquired intangibles, net restructuring and business impairment charges and other one off non-recurring items, profit
on sale of investments, net fair value remeasurements of financial instruments and, where applicable, discontinued
operations. Businesses exited/ to be exited include the operations of PC City in Spain, Equanet, Webhallen, PLS and
PIXmania closed stores.
2. Like for like sales are calculated based on underlying store and internet sales using constant exchange rates. New
stores are included where they have been open for a full financial year both at the beginning and end of the financial
period. Closed stores are excluded for any period of closure. Customer support agreement sales are excluded from
all UK like for like calculations.
3. UK & Ireland comprises Currys, CurrysDigital, PC World, combined 2-in-1 Currys and PC World, Harrods
concession, DSGi Business, Knowhow , Dixons Travel, Dixons.co.uk as well as the operations in Ireland. Like for
like sales exclude DSGi Business.
4. Northern Europe comprises the Elkjøp Group, and Electroworld in the Czech Republic and Slovakia.
5. Southern Europe comprises Greece (Kotsovolos), Italy (UniEuro and, PC City store in store), and Electro World in
Turkey.
Preliminary Results 2012/13 20 June 2013 25