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Moncler

Investor Presentation Feb 11, 2020

4110_10-k_2020-02-11_8c7031e0-0475-4419-a73c-c913b5f81461.pdf

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MONCL

FY 2019 Financial Results

REVENUES

EUR 1,627.7M, +13% AT CONSTANT EXCHANGE RATES (+15% REPORTED)

RETAIL REVENUES

EUR 1,256.9M, +13% AT CONSTANT EXCHANGE RATES (+16% REPORTED)

CSSG +7% WITH SOLID RESULTS IN ALL REGIONS

WHOLESALE REVENUES

EUR 370.8M, +10% AT CONSTANT EXCHANGE RATES (+11% REPORTED)

EBIT

EUR 475.4M WITH A MARGIN ON SALES OF 29.2% (29.2% IN FY 2018);

INCLUDING IFRS 16 APPLICATION EUR 491.8M WITH A MARGIN ON SALES OF 30.2%

NET INCOME

EUR $361.5M. +9\%$ COMPARED TO FY 2018, +16% NORMALISING THE ONE-OFF TAX BENEFIT RECORDED IN 2018

INCLUDING IFRS 16 APPLICATION EUR 358.7M WITH A MARGIN ON SALES OF 22.0%

NET FINANCIAL POSITION

EUR 662.6M OF NET CASH VS. EUR 450.1M AS OF 31 DECEMBER 2018

INCLUDING IFRS 16 APPLICATION EUR 23.4M OF NET CASH

(*) Starting from 1 January 2019 IFRS 16 requires companies to recognise in their accounts the right-to-use of leased asset and the related liability corresponding to the obligation to make lease payments. Assets and liabilities arising from leases are measured on a present value basis. Considering that 2019 is the first year of implementation of this accounting principle, in this presentation, results are commented excluding the impacts of the IFRS 16 in order to maintain a homogeneous basis of comparison with the corresponding period in 2018. Results including the impacts of the new IFRS 16 accounting principle have been analysed and compared in the Appendix

(**) Rounded figures (this applies to all pages of this presentation)

In FY 2019 Moncler continued to show outstanding revenue results, surpassing Euro 1.6bn (+13%), with double-digit growth in all regions. Also in Q4 Moncler reached an excellent 13% growth

In FY 2019 Italy recorded a +10% growth, with an important acceleration in Q4 (+21%) driven by the retail channel

EMEA revenues rose by 14% in FY2019, with a strong performance in Q4 (+19%) led by UK, Germany and France

Asia & RoW rose by a good 13% in the year (+9% in Q4), notwithstanding the negative performance in Hong Kong SAR. Mainland China and Korea led the growth

Americas delivered good performances in all markets and both channels. Revenues rose by 11% in FY 2019 (+11% in Q4)

(*) All growth rates are at constant exchange rates, unless otherwise stated

REVENUE ANALYSIS (Eur M)

In FY 2019 Moncler recorded double-digit growth in both distribution channels

Retail continued to deliver excellent results in the year (+13%) driven by solid organic growth and space contribution:

  • 7% Comp Store Sales Growth (CSSG)
  • E-commerce strongly outperformed

Wholesale revenues rose by 10%, reflecting not only the strength of Moncler brand and the very good acceptance of the SS collections, but also the expansion of the airport locations and the e-tailers strong performance

(*) All growth rates are at constant exchange rates, unless otherwise stated

Moncler's retail network reached 209 monobrand stores as of 31 December 2019, compared to 193 at 31 December 2018 (16 new openings)

  • 10 new DOS opened in Q4 2019
  • Around 15 DOS secured for 2020

Wholesale mono-brand stores reached 64 locations at the 31 December 2019, compared to 55 at 31 December 2018 (9 new openings)

• 2 new mono-brand stores opened in Q4 2019

31/12/2018 30/09/2019 31/12/2019
Retail 193 199 209
Italy 20 19 19
Rest of EMEA 55 54 56
Asia & RoW 91 97 104
Americas 27 29 30
31/12/2018 30/09/2019 31/12/2019
Wholesale 55 62 64

MUNICH

OSAKA - NAMBA

KOBE - HYOGO

MILANO - MONCLER HOUSE OF GENIUS

INCOME STATEMENT - IFRS 16 IMPACTS' ANALYSIS ON FY 2019

FY 2019
including IFRS 16
Impacts FY 2019
excluding IFRS 16
Eur m $\%$ Eur m Eur m %
Revenues 1,627.7 100.0% 1,627.7 100.0%
YoY growth $+15%$ $+15%$
Cost of sales (362.4) (22.3%) 0.3 (362.7) (22.3%)
Gross margin 1,265.3 77.7% 0.3 1,265.0 77.7%
Selling expenses (483.2) (29.7%) 15.3 (498.5) (30.6%)
General & Administrative expenses (147.7) (9.1%) O.8 (148.5) (9.1%)
Marketing expenses (113.2) (7.0%) (113.2) (7.0%)
Stock-based compensation (29.4) (1.8%) (29.4) (1.8%)
EBIT 491.8 30.2% 16.4 475.4 29.2%
Net financial result (21.1) (1.3%) (20.2) (0.9) $(0.1\%)$
EBT 470.7 28.9% (3.8) 474.5 29.2%
Taxes (112.0) (6.9%) 1.0 (113.0) (6.9%)
Tax Rate 23.8% 23.8%
Net Income, incl. Non-controlling interests 358.7 22.0% (2.8) 361.5 22.2%
Non-controlling interests (0.0) $(0.0\%)$ (0.0) $(0.0\%)$
Net Income, Group share 358.7 22.0% (2.8) 361.5 22.2%
YoY growth $+8%$ $+9%$
EBITDA ADJ 692.3 42.5% 117.5 574.8 35.3%
YoY growth $+15%$

CONSOLIDATED INCOME STATEMENT

FY 2019
excluding IFRS 16
FY 2018
Eur m $\%$ Eur m %
Revenues 1,627.7 100.0% 1,420.1 100.0%
YoY growth $+15%$ +19%
Cost of sales (362.7) (22.3%) (320.2) (22.6%)
Gross margin 1,265.0 77.7% 1,099.8 77.4%
Selling expenses (498.5) (30.6%) (428.9) (30.2%)
General & Administrative expenses (148.5) (9.1%) (127.8) $(9.0\%)$
Marketing expenses (113.2) (7.0%) (99.5) (7.0%)
Stock-based compensation (*) (29.4) (1.8%) (29.6) (2.1%)
EBIT 475.4 29.2% 414.1 29.2%
Net financial result $(**)$ (0.9) (0.1%) (1.9) $(0.1\%)$
EBT 474.5 29.2% 412.2 29.0%
Taxes (113.0) (6.9%) (79.7) (5.6%)
Tax Rate 23.8% 19.3%
Net Income, including Non-controlling interests 361.5 22.2% 332.5 23.4%
Non-controlling interests (0.0) $(0.0\%)$ (0.1) $(0.0\%)$
Net Income, Group share 361.5 22.2% 332.4 23.4%
YoY growth $+9%$ +33%
EBITDA ADJ 574.8 35.3% 500.2 35.2%
YoY growth $+15%$ $+22%$

11 (*) Non-cash costs related to stock-based compensation plans.
(**) Net financial result includes FX Gain/(Losses): Eur (0.5)m in FY 2019 and Eur (1.3)m in FY 2018

Consolidated capex reached Eur 120.8m in FY 2019 equal to 7.4% of revenues compared to 6.4% in FY 2018

Investments in the distribution network were equal to Eur 75.3m, or 62% of total capex. During the year Moncler opened, relocated and expanded more than 30 locations, among which 5 flagships

Investments related to infrastructure reached Eur 45.6m, compared to Eur 32.6m in FY 2018, including the reinforcement of the IT platform, the automation and expansion of the logistics centre in Italy and the launch of the ecommerce in Korea

NET CAPEX ANALYSIS (Eur M)

  • Infrastructure
  • Distribution $\sim$

As of 31 December 2019, net working capital reached Eur 128.2m, equal to 7.9% of revenues versus 7.3% as of 31 December 2018

Inventory was equal to Eur 208.9m compared to Eur 173.1 million as of 31 December 2018 and largely includes raw materials and finished products for current and forthcoming collections

NET WORKING CAPITAL ANALYSIS (Eur M)

  • Inventory $\mathcal{C}^{\mathcal{A}}$
  • Accounts payable

At 31 December 2019. Moncler's net financial position reached Eur 662.6m of net cash

Also in 2019 the Group recorded a strong cash generation with Eur 212.5m of net cash flow after the payment of Eur 101.7m of dividends and Eur 15.1m of shares' buyback

Under IFRS 16 application, net financial position at 31 December 2019 is equal to Eur 23.4m of cash

For FY 2019 Moncler's BoD proposed a dividend per share of Eur 0.55, equal to total dividends of Eur 138.8m(*) (38% pay-out ratio)

NET FINANCIAL POSITION (Eur M)

  • Long-term borrowings, net
  • Short-term borrowings, net
  • Cash and cash equivalents

14 (*) Considering 252,309,721 shares, equal to total shares issued at 31 December 2019 net of treasury shares

31/12/2019
excluding IFRS 16
31/12/2018
Eur m Eur m
Intangible Assets 442.2 424.4
Tangible Assets 212.9 177.0
Other Non-current Assets/(Liabilities) 65.8 35.9
Total Non-current Assets/(Liabilities) 721.0 637.2
Net Working Capital 128.2 103.2
Other Current Assets/(Liabilities) (161.7) (108.2)
Total Current Assets/(Liabilities) (33.6) (5.0)
Invested Capital 687.4 632.2
Net Debt/(Net Cash) (662.6) (450.1)
Pension and Other Provisions 17.1 13.4
Shareholders' Equity 1,332.9 1,068.9
Total Sources 687.4 632.2
FY 2019
excluding IFRS 16
FY 2018
Eur m Eur m
EBITDA Adjusted 574.8 500.2
Change in Net Working Capital (25.0) (13.6)
Change in other curr./non-curr. assets/(liabilities) 24.9 48.4
Capex, net (120.8) (91.5)
Operating Cash Flow 453.9 443.6
Net financial result (0.9) (1.9)
Taxes (113.0) (79.7)
Free Cash Flow 340.0 362.0
Dividends paid (101.7) (70.5)
Changes in equity and other changes (25.7) (146.3)
Net Cash Flow 212.5 145.2
Net Financial Position - Beginning of Period 450.1 304.9
Net Financial Position - End of Period 662.6 450.1
Change in Net Financial Position 212.5 145.2

APPENDIX

FY 2019 INCOME STATEMENT - IFRS 16 IMPACTS' ANALYSIS

FY 2019
including IFRS 16
Impacts FY 2019
excluding IFRS 16
Eur m $\%$ Eur m Eur m %
Revenues 1,627.7 100.0% 1,627.7 100.0%
YoY growth $+15%$ $+15%$
Cost of sales (362.4) (22.3%) 0.3 (362.7) (22.3%)
Gross margin 1,265.3 77.7% 0.3 1,265.0 77.7%
Selling expenses (483.2) (29.7%) 15.3 (498.5) (30.6%)
General & Administrative expenses (147.7) (9.1%) 0.8 (148.5) (9.1%)
Marketing expenses (113.2) (7.0%) (113.2) (7.0%)
Stock-based compensation (29.4) (1.8%) (29.4) (1.8%)
EBIT 491.8 30.2% 16.4 475.4 29.2%
Net financial result (21.1) (1.3%) (20.2) (0.9) $(0.1\%)$
EBT 470.7 28.9% (3.8) 474.5 29.2%
Taxes (112.0) (6.9%) 1.0 (113.0) (6.9%)
Tax Rate 23.8% 23.8%
Net Income, incl. Non-controlling interests 358.7 22.0% (2.8) 361.5 22.2%
Non-controlling interests (0.0) $(0.0\%)$ (0.0) $(0.0\%)$
Net Income, Group share 358.7 22.0% (2.8) 361.5 22.2%
YoY growth $+8%$ $+9%$
EBITDA ADJ 692.3 42.5% 117.5 574.8 35.3%
YoY growth $+15%$

FY 2019 BALANCE SHEET STATEMENT- IFRS 16 IMPACTS' ANALYSIS

31/12/2019
including IFRS 16
Impacts 31/12/2019
excluding IFRS 16
Eur m Eur m Eur m
Intangible Assets 435.0 (7.2) 442.2
Tangible Assets 212.9 212.9
Other Non-current Assets/(Liabilities) 90.7 24.8 65.8
Right-of-use Assets 593.6 593.6
Total Non-current Assets 1,332.2 611.2 721.0
Net Working Capital 128.2 128.2
Other Current Assets/(Liabilities) (160.2) 1.5 (161.7)
Total Current Assets (32.1) 1.5 (33.6)
Invested Capital 1,300.1 612.7 687.4
Net Debt/(Net Cash) (662.6) (662.6)
Lease Liabilities 639.2 639.2
Pension and Other Provisions 17.1 17.1
Shareholders' Equity 1,306.4 (26.5) 1,332.9
Total Sources 1,300.1 612.7 687.4

FY 2019 CASH FLOW STATEMENT - IFRS 16 IMPACTS' ANALYSIS

FY 2019
including IFRS 16
Impacts FY 2019
excluding IFRS 16
Eur m Eur m Eur m
EBITDA Adjusted 692.3 117.5 574.8
IFRS 16 rents (117.5) (117.5)
Change in Net Working Capital (25.0) (25.0)
Change in other curr./non-curr. assets/(liabilities) 24.9 24.9
Capex, net (120.8) (120.8)
Operating Cash Flow 453.9 453.9
Net financial result (0.9) (0.9)
Taxes (113.0) (113.0)
Free Cash Flow 340.0 $\overline{\phantom{0}}$ 340.0
Dividends paid (101.7) (101.7)
Changes in equity and other changes (25.7) (25.7)
IFRS 16 impacts of the period (120.7) (120.7)
First time adoption IFRS 16 (518.5) (518.5)
Net Cash Flow (426.7) (639.2) 212.5
Net Financial Position - Beginning of Period 450.1 450.1
Net Financial Position - End of Period 23.4 (639.2) 662.6
Change in Net Financial Position (426.7) (639.2) 212.5

2019 QUARTERLY REVENUE BREAKDOWN BY REGION AND CHANNEL

Q1 YoY growth Q 2 YoY growth Q 3 YoY growth Q4 YoY growth
Eur m 2019 2018 Rep. ex FX 2019 2018 Rep. ex FX 2019 2018 Rep. ex FX 2019 2018 Rep. ex FX
Italy 45.8 43.3 +6% +6% 22.7 20.1 +13% +13% 62.1 59.5 $+4%$ $+4%$ 54.4 45.0 $+21%$ $+21%$
EMEA (excl. Italy) 108.1 96.5 +12% $+12\%$ 60.8 50.4 +21% $+21%$ 133.5 125.5 +6% $+7\%$ 161.2 135.2 +19% +19%
Asia & RoW 171.1 146.4 +17% $+12\%$ 78.2 64.0 $+22\%$ $+22%$ 153.7 128.7 +19% +15% 312.2 277.1 $+13%$ +9%
Americas 53.5 45.8 +17% +9% 30.0 27.0 +11% +6% 75.7 65.4 +16% +10% 104.7 90.2 +16% $+11\%$
Total Revenues 378.5 332.0 +14% +11% 191.7 161.5 +19% +18% 425.0 379.1 +12% +10% 632.4 547.5 +16% +13%
Q1 YoY growth Q 2 YoY growth Q3 YoY growth Q4 YoY growth
Eur m 2019 2018 Rep. ex FX 2019 2018 Rep. ex FX 2019 2018 Rep. ex FX 2019 2018 Rep. ex FX
Retail 291.4 256.2 $+14%$ +10% 145.6 120.6 +21% +20% 253.4 220.4 $+15%$ $+12%$ 566.5 489.2 +16% +13%
Wholesale .87 75.8 $+15%$ $+13%$ 46.1 40.9 +13% +10% 171.7 158.7 +8% +6% 65.9 58.2 +13% +10%
Total Revenues 378.5 332.0 +14% +11% 191.7 161.5 +19% +18% 425.0 379.1 +12% +10% 632.4 547.5 +16% +13%

2019 QUARTERLY REVENUE BREAKDOWN BY REGION AND CHANNEL - YTD

Q1 YoY growth H1 YoY growth 9M YoY growth FY YoY growth
Eur m 2019 2018 Rep. ex FX 2019 2018 Rep. ex FX 2019 2018 Rep. ex FX 2019 2018 Rep. ex FX
Italy 45.8 43.3 +6% +6% 68.5 63.3 +8% +8% 130.6 122.8 +6% +6% 185.0 167.8 +10% +10%
EMEA (excl. Italy) 108.1 96.5 $+12%$ $+12%$ 168.9 147.0 +15% +15% 302.4 272.5 $+11\%$ $+11\%$ 463.5 407.6 +14% +14%
Asia & RoW 171.1 146.4 $+17%$ $+12\%$ 249.3 210.4 +18% +15% 403.1 339.1 +19% +15% 715.2 616.1 +16% +13%
Americas 53.5 45.8 $+17\%$ +9% 83.6 72.8 +15% +8% 159.3 138.3 +15% +10% 263.9 228.5 +16% +11%
Total Revenues 378.5 332.0 +14% +11% 570.2 493.5 +16% +13% 995.3 872.7 +14% +12% 1.627.7 1.420.1 +15% +13%
Q1 YoY growth H1 YoY growth 9M YoY growth FY YoY growth
Eur m 2019 2018 Rep. ex FX 2019 2018 Rep. ex FX 2019 2018 Rep. ex FX 2019 2018 Rep. ex FX
Retail 291.4 256.2 +14% +10% 437.1 376.8 +16% +13% 690.4 597.3 +16% $+13%$ 1.256.9 1.086.5 +16% +13%
Wholesale 87.i 75.8 $+15%$ $+13%$ 133.2 116.7 $+14%$ $+12%$ 304.9 275.4 $+11%$ +9% 370.8 333.6 $+11\%$ $+10%$
Total Revenues 378.5 332.0 +14% +11% 570.2 493.5 +16% +13% 995.3 872.7 +14% +12% 1.627.7 1.420.1 +15% +13%

2019 HALF-YEARLY CONSOLIDATED INCOME STATEMENT

H1 2019
excluding IFRS 16
H1 2018 H 2 2019
excluding IFRS 16
H 2 2018
Eur m % Eur m % Eur m % Eur m %
Revenues 570.2 100.0% 493.5 100.0% 1,057.5 100.0% 926.6 100.0%
YoY growth $+16%$ $+21%$ $+14%$ $+18%$
Cost of sales (133.2) (23.4%) (118.6) (24.0%) (229.5) (21.7%) (201.6) (21.8%)
Gross margin 437.0 76.6% 374.9 76.0% 828.0 78.3% 724.9 78.2%
Selling expenses (211.3) (37.0%) (178.5) (36.2%) (287.3) (27.2%) (250.4) (27.0%)
General & Administrative expenses (72.0) (12.6%) (61.9) (12.5%) (76.5) (7.2%) (65.9) (7.1%)
Marketing expenses (42.9) (7.5%) (36.3) (7.3%) (70.3) (6.6%) (63.2) (6.8%)
Stock-based compensation (16.3) (2.9%) (12.5) (2.5%) (13.1) (1.2%) (17.1) (1.8%)
EBIT 94.6 16.6% 85.7 17.4% 380.8 36.0% 328.4 35.4%
Net financial result (0.7) (0.1%) (0.9) (0.2%) (0.2) $(0.0\%)$ (1.0) $(0.1\%)$
EBT 93.9 16.5% 84.8 17.2% 380.7 36.0% 327.4 35.3%
Taxes (22.5) $(4.0\%)$ (23.1) (4.7%) (90.5) (8.6%) (56.6) (6.1%)
Tax Rate 24.0% 27.3% 23.8% 17.3%
Net Income, incl. Non-control. interests 71.3 12.5% 61.7 12.5% 290.2 27.4% 270.8 29.2%
Non-controlling interests (0.0) $(0.0\%)$ (0.1) $(0.0\%)$ (0.0) $(0.0\%)$ O.O 0.0%
Net Income, Group share 71.3 12.5% 61.6 12.5% 290.2 27.4% 270.8 29.2%
YoY growth $+16%$ $+47%$ $+7%$ +30%
EBITDA ADJ 143.6 25.2% 123.9 25.1% 431.2 40.8% 376.3 40.6%
YoY growth $+16%$ +28% $+15%$ +20% $M_{\rm B}$

SHAREHOLDING STRUCTURE, UPCOMING EVENTS, IR CONTACTS

SHAREHOLDING

  • Ruffini Partecipazioni S.r.l. 22.5%
  • 5.2% BlackRock Inc.
  • 3.0% Morgan Stanley Asia Limited
  • Treasury Shares 2.2% a a
  • $\mathcal{C}^{\mathcal{A}}$ 67.1% Market

Source: Consob, Moncler Last update: 7 February 2020 2020 Upcoming Events

16 March 2020 Extraordinary Shareholders' Meeting 22 April 2020 Annual Shareholders' Meeting 22 April 2020 Q1 2020 Interim Management Statement

Investor Relations Team [email protected] Paola Durante Investor Relations and Strategic Planning Director [email protected] Alice Poggioli Investor Relations Manager [email protected] Carlotta Fiorani Investor Relations

[email protected]

This presentation is being furnished to you solely for your information and may not be reproduced or redistributed to any other person.

This presentation might contain certain forward-looking statements that reflect the Company's management's current views with respect to future events and financial and operational performance of the Company and its subsidiaries. These forward-looking statements are based on Moncler's current expectations and projections about future events. Because these forward-looking statements are subject to risks and uncertainties, actual future results or performance may differ materially from those expressed in or implied by these statements due to any number of different factors, many of which are beyond the ability of Moncler to control or estimate. You are cautioned not to place undue reliance on the forward-looking statements contained herein, which are made only as of the date of this presentation. Moncler does not undertake any obligation to publicly release any updates or revisions to any forward-looking statements to reflect events or circumstances after the date of this presentation.

Any reference to past performance or trends or activities of Moncler shall not be taken as a representation or indication that such performance, trends or activities will continue in the future.

This presentation does not constitute an offer to sell or the solicitation of an offer to buy the Group's securities, nor shall the document form the basis of or be relied on in connection with any contract or investment decision relating thereto, or constitute a recommendation regarding the securities of Moncler.

Moncler's securities referred to in this document have not been and will not be registered under the U.S. Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

Luciano Santel, the Manager in charge of preparing the corporate accounting documents, declares that, pursuant to art. 154-bis, paragraph 2, of the Legislative Decree no. 58 of February 24, 1998, the accounting information contained herein correspond to document results, books and accounting records.

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