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Festi Investor Presentation 2021
2195_rns_2021-02-25_27164e48-0eb4-47c3-9f33-dd5d40bd5bb9.pdf
Investor Presentation
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Presentation of Q4 2020 results
Eggert Þór Kristófersson, CEO
FESTI
CONSOLIDATED HIGHLIGHTS
| ISK 1,746 m
EBITDA Q4 2020 | 22.8%
Sales margin | 4.25
NIBD/EBITDA |
| --- | --- | --- |
| ISK 2,563 m
Cash and cash equivalents | 33.0%
EBITDA/Sales margin Q4 2020 | 55.5%
Salaries/Sales margin Q4 2020 |
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FESTI
CONSOLIDATED OPERATIONS IN Q4
| Amounts are in ISK million | Q4 2020 | Q4 2019 | Change | % Chg. |
|---|---|---|---|---|
| Sale of goods and services | 23,222 | 21,279 | 1,943 | 9.1% |
| Margin from sales of goods and services | 5,288 | 5,273 | 15 | 0.3% |
| Lease revenue and operating income | 708 | 428 | 280 | 65.5% |
| Salaries and personnel expenses | -2,933 | -2,703 | -230 | 8.5% |
| Other operating expenses | -1,317 | -1,231 | -85 | 6.9% |
| EBITDA | 1,746 | 1,766 | -20 | -1.1% |
| Key Figures | ||||
| EBITDA/Sales margin | 33.0% | 33.5% | -0.5% | -1.4% |
| Salaries/Sales margin | 55.5% | 51.3% | 4.2% | 8.2% |
| Earnings per share | 1.64 | 2.18 | -0.5 | -24.6% |
- Sale of goods and services ISK 23,222 m. increase of 9.1% YoY.
- Margin from sales ISK 5,288 m. increase of 0.3% YoY.
- Number of full-time employees 1.180 increased of 8.4% YoY.
- COVID-19 related cost ISK 152 m. in salaries and other operating expenses.
- EBITDA ISK 1,746 m. in Q4 2020, decrease of 1.1% YoY.
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CONSOLIDATED OPERATIONS IN 2020
| Amounts are in ISK million | 12M 2020 | 12M 2019 | Change | % Chg. |
|---|---|---|---|---|
| Sale of goods and services | 86,260 | 84,991 | 1,268 | 1.5% |
| Margin from sales of goods and services | 20,684 | 20,196 | 488 | 2.4% |
| Lease revenue and operating income | 1,658 | 1,851 | -193 | -10.4% |
| Salaries and personnel expenses | -10,521 | -9,953 | 568 | 5.7% |
| Other operating expenses | -4,765 | -4,489 | 276 | 6.2% |
| EBITDA | 7,057 | 7,605 | -549 | -7.2% |
| Key Figures | ||||
| EBITDA/Sales margin | 34.1% | 37.7% | -3.5% | -9.4% |
| Salaries/Sales margin | 50.9% | 49.3% | 1.6% | 3.2% |
| Earnings per share | 6.95 | 8.49 | -1.53 | -18.1% |
- Sale of goods and services ISK 86,260 m., increase of 1.5% YoY.
- Margin from sales ISK 20,684 m., increase of 2.4% YoY.
- Number of full-time employees 1.145, decrease of 1.1% YoY.
- COVID-19 related cost ISK 394 m. in salaries and other operating expenses.
- EBITDA ISK 7,057 m. in 2020, decrease of 7.2% YoY.
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HIGHLIGHTS Q4
FESTI
- Volatility in USD/ISK and EUR/ISK
- USD/ISK decreased by 7.9% and the difference between highest and lowest exchange rate in Q4 is 12.8%
- EUR/ISK decreased by 3.8% and the difference between the highest and lowest exchange rate in Q4 is 8.7%
- The Q4 2020 average price of diesel fuel was 369.4 USD, compared to an average of 592.7 USD in Q4 2019, a decrease of 37.7%.
- The Q4 2020 average price of gasoline was 407.4 USD, compared to an average of 606.7 USD in Q4 2019, a decrease of 35.2%.
- The Q4 2020 average price of USD/ISK was 134.6 compared to 123.5 in Q4 2019, an increase of 9.0%
Exchange rate development
Price development of Mogas 95 and Diesel
FESTI
N1 HIGHLIGHTS Q4
N1
- Revenue was ISK 7,399 m. a decrease of 17.6% YoY
- Sales of grocery and convenience goods decreased by 4% YoY
- 24% decrease in road fuel quantity compared to Q4 2019
- Sales of other goods increased by 2.6% YoY.
- EBITDA was ISK 567 m., decrease of 32.4% YoY.
- Included is revenue of Íslensk Orkumiðlun from June 1st of ISK 1,012 m. and EBITDA of 58 m.
- Business mix ratio between fuel and electricity in energy units (Mega Joules) was 83/17 for 2020
- As a whole, negative impact was significant with the turmoil in global oil markets and COVID-19 restrictions during the quarter.
| Amounts are in ISK million | Q4 2020 | Q4 2019 | Change | %Change |
|---|---|---|---|---|
| Total segment revenue | 7,399 | 8,981 | -1,582 | -17.6% |
| Total operating expenses of segments | -6,832 | -8,142 | 1,310 | -16.1% |
| Segment EBITDA | 567 | 839 | -272 | -32.4% |
| Segment depreciation and amortisation | -594 | -324 | -271 | 83.7% |
| Operating result of segments | -27 | 515 | -542 | -105.2% |
| Financial expenses | -287 | -262 | -25 | 9.6% |
| Income tax expense | 65 | -53 | 118 | -221.6% |
| Profit | -250 | 200 | -450 | -224.6% |
| Segment assets | 28,890 | 15,816 | 13,074 | 82.7% |
| Segment capital expenditure | 910 | 522 | 387 | 74.1% |
| Segment liabilities | 15,371 | 5,494 | 9,877 | 179.8% |
FESTI
KRÓNAN HIGHLIGHTS Q4
KRONAN
- Revenue was ISK 12,134 m., increase of 32.4% YoY
- Sales exceeded expectations
- Margins were in line with expectations
- Increased cost relating to COVID-19 with extra staff and increased in-store activity
- EBITDA ISK 890 m., increase of 41.3% YoY
- New stores in Norðurhella and Austurver opened in October
- Smart online store receiving great feedback from customers
| Amounts are in ISK million | Q4 2020 | Q4 2019 | Change | %Change |
|---|---|---|---|---|
| Total segment revenue | 12,134 | 9,165 | 2,969 | 32.4% |
| Total operating expenses of segments | -11,244 | -8,536 | -2,709 | 31.7% |
| Segment EBITDA | 890 | 630 | 260 | 41.3% |
| Segment depreciation and amortisation | -377 | -333 | -44 | 13.2% |
| Operating result of segments | 513 | 297 | 216 | 72.8% |
| Financial expenses | -116 | -90 | -25 | 28.1% |
| Income tax expense | -79 | -19 | -60 | 322.0% |
| Profit | 318 | 188 | 130 | 69.4% |
| Segment assets | 15,664 | 17,593 | -1,930 | -11.0% |
| Segment capital expenditure | 1,418 | 634 | 784 | 123.7% |
| Segment liabilities | 13,760 | 7,706 | 6,054 | 78.6% |
FESTI
ELKO HIGHLIGHTS Q4
ELKO
- Revenue was ISK 4,240 m., increase of 20.7% YoY
- Sales and margins exceeded expectations
- Congregation ban had a positive impact on sales, more people working from home.
- Cost of operations increased as the result of increased home delivery, personnel cost and COVID-19 restrictions in stores.
- EBITDA was ISK 406 m., increase of 24.1% YoY.
- New store in Akureyri opened end of November.
| Amounts are in ISK million | Q4 2020 | Q4 2019 | Change | %Change |
|---|---|---|---|---|
| Total segment revenue | 4,240 | 3,514 | 726 | 20.7% |
| Total operating expenses of segments | -3,834 | -3,187 | -647 | 20.3% |
| Segment EBITDA | 406 | 327 | 79 | 24.1% |
| Segment depreciation and amortisation | -119 | -69 | -49 | 71.6% |
| Operating result of segments | 287 | 258 | 29 | 11.3% |
| Financial expenses | -43 | -24 | -19 | 79.4% |
| Income tax expense | -49 | -36 | -13 | 36.7% |
| Profit | 195 | 198 | -3 | -1.6% |
| Segment assets | 4,971 | 6,165 | -1,194 | -19.4% |
| Segment capital expenditure | 314 | 126 | 188 | 149.6% |
| Segment liabilities | 3,753 | 4,356 | -603 | -13.8% |
FESTI
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
| Amounts are in ISK million | 31.12.2020 | 31.12.2019 | Change | % Chg. |
|---|---|---|---|---|
| Goodwill | 14,668 | 14,070 | 598 | 4.2% |
| Other Intangible assets | 4,971 | 4,650 | 321 | 6.9% |
| Property and equipment | 32,297 | 31,434 | 864 | 2.7% |
| Leased assets | 5,420 | 3,862 | 1,557 | 40.3% |
| Investment properties | 7,467 | 7,354 | 113 | 1.5% |
| Shares in associates | 2,150 | 1,952 | 197 | 10.1% |
| Securities | 13 | 109 | -96 | -88.3% |
| Long-term receivables | 272 | 272 | 0 | -0.1% |
| Non-current assets | 67,258 | 63,704 | 3,554 | 5.6% |
| Inventories | 7,668 | 7,678 | -10 | -0.1% |
| Trade receivables | 4,924 | 3,756 | 1,167 | 31.1% |
| Other short-term receivables | 952 | 737 | 215 | 29.2% |
| Cash and cash equivalents | 2,563 | 5,369 | -2,806 | -52.3% |
| Current assets | 16,107 | 17,540 | -1,433 | -8.2% |
| Total assets | 83,365 | 81,244 | 2,120 | 2.6% |
- Strong balance sheet
- Increase in goodwill and other intangible assets because of purchase of shares in Íslensk orkumíðlun and purchase of Krónan Hallveigarstigur
- Increase in leased assets because of new and renewed leases
- Increase in trade receivables because of new contract with credit card acquirer
- Decrease in cash because of repayment of long-term loans, investments, dividend payment and buy-back of own shares.
Current ratio
Inventory turnover
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CONSOLIDATED STATEMENT OF FINANCIAL POSITION
| Amounts are in ISK million | 31.12.2020 | 31.12.2019 | Change | % Chg. |
|---|---|---|---|---|
| Equity | 29,784 | 28,688 | 1,095 | 3.8% |
| Payable to credit institutions | 29,075 | 29,942 | -868 | -2.9% |
| Lease liabilities | 5,181 | 3,586 | 1,595 | 44.5% |
| Deferred tax liabilities | 4,664 | 4,271 | 393 | 9.2% |
| Non-current liabilities | 38,919 | 37,799 | 1,120 | 3.0% |
| Payable to credit institutions | 3,474 | 3,438 | 36 | 1.0% |
| Lease liabilities | 430 | 378 | 52 | 13.9% |
| Trade payables | 7,019 | 6,803 | 216 | 3.2% |
| Other short-term liabilities | 3,739 | 4,138 | -399 | -9.6% |
| Current liabilities | 14,662 | 14,757 | -95 | -0.6% |
| Total equity and liabilities | 83,365 | 81,244 | 2,120 | 2.6% |
- Equity ratio of 35.7%
- Net interest bearing liabilities without lease liabilities is ISK 29,986 m., increase of 7% YoY.
- Current capital structure is in line with company strategy and well within the covenant agreements with credit institutions.
Equity ratio
Net interest bearing liabilities without lease liabilities / EBITDA
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CONSOLIDATED STATEMENT OF CASH FLOWS Q4
| Amounts are in ISK million | Q4 2020 | Q4 2019 | Change | % Chg. |
|---|---|---|---|---|
| Cash at the beginning of the period | 4,991 | 6,839 | -1,848 | -27.0% |
| Cash flows from operating activities | 18 | 1,279 | -1,261 | -98.6% |
| Investing activities | -979 | -865 | -113 | 13.1% |
| Financing activities | -1,455 | -1,888 | 433 | -22.9% |
| FX difference on cash | -12 | 4 | -17 | -378.9% |
| Cash at the end of the period | 2,563 | 5,369 | -2,806 | -52.3% |
- Decrease in cash from operating activities YoY, ISK 1,261 m.
- Effect from increased trade receivables at end of 2020 has onetime negative impact of ISK 1,100 m. on cash from operating activities.
- Capex was ISK 1,258 m., increase of ISK 497 m. YoY with two new stores opened for Krónan and one for ELKO.
- Buy back of own shares ISK 600 m.
- Repayment of loans from credit institutions ISK 748 m.
- Decrease in cash in Q4 2020 was ISK 2,428 m
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CONSOLIDATED STATEMENT OF CASH FLOWS 12M
| Amounts are in ISK million | 12M 2020 | 12M 2019 | Change | % Chg. |
|---|---|---|---|---|
| Cash at the beginning of the year | 5,369 | 4,267 | 1,102 | 25.8% |
| Cash flows from operating activities | 4,387 | 5,556 | -1,170 | -21.1% |
| Investing activities | -3,414 | 478 | -3,891 | -814.6% |
| Financing activities | -3,800 | -4,961 | 1,161 | -23.4% |
| FX difference on cash | 21 | 29 | -8 | -26.3% |
| Cash at the end of the year | 2,563 | 5,369 | -2,806 | -52.3% |
- Cash from operating activities was ISK 4,387 m., a decrease of ISK 1,170 m. YoY.
- Effect from increased trade receivables at end of 2020 has onetime negative impact of ISK 1,100 m. on cash from operating activities.
- Capex in 12M 2020 was ISK 3,842 m. an increase of ISK 1,585 m YoY.
- Three new stores for Krónan, 1 for ELKO and 1 for N1 opened.
- Dividend payment ISK 648 m, purchase of own shares ISK 1,144 m and repayment of loans from credit institutions ISK 1,615 m.
- Decrease of cash in 2020 was ISK 2,806 m.
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FESTI
OPERATING SEGMENTS OF THE GROUP – Q4 2020
| Amounts are in ISK million | N1 | Króan | Elko | Other | Total |
|---|---|---|---|---|---|
| Total segment revenue | 7.399 | 12.134 | 4.240 | 1.704 | 25.477 |
| Total operating expenses of segments | -6.832 | -11.244 | -3.834 | -967 | -22.878 |
| Segment EBITDA | 567 | 890 | 406 | 737 | 2.599 |
| Segment depreciation and amortisation | -594 | -377 | -119 | 64 | -1.026 |
| Fair value changes of investment properties | 0 | 0 | 0 | 181 | 181 |
| Operating result of segments | -27 | 513 | 287 | 981 | 1.754 |
| Financial expenses | -287 | -116 | -43 | -472 | -918 |
| Share of profit from associates | 0 | 0 | 0 | 30 | 30 |
| Income tax expense | 65 | -79 | -49 | -97 | -161 |
| Profit | -250 | 318 | 195 | 442 | 705 |
| Segment assets | 28.890 | 15.664 | 4.971 | 33.840 | 83.365 |
| Segment capital expenditure | 910 | 1.418 | 314 | 1.201 | 3.842 |
| Segment liabilities | 15.371 | 13.760 | 3.753 | 20.697 | 53.581 |
Segment EBITDA
Segment Assets
FESTI
OPERATING SEGMENTS OF THE GROUP – 12M 2020
| Amounts are in ISK million | N1 | Krónan | Elko | Other | Total |
|---|---|---|---|---|---|
| Total segment revenue | 31,099 | 43,115 | 13,112 | 6,693 | 94,020 |
| Total operating expenses of segments | -28,131 | -40,048 | -11,945 | -3,500 | -83,624 |
| Segment EBITDA | 2,969 | 3,067 | 1,168 | 3,193 | 10,396 |
| Segment depreciation and amortisation | -2,317 | -1,464 | -383 | -1,029 | -5,192 |
| Fair value changes of investment properties | 0 | 0 | 0 | 240 | 240 |
| Operating result of segments | 652 | 1,603 | 785 | 2,404 | 5,444 |
| Financial expenses | -926 | -462 | -103 | -2,029 | -3,520 |
| Share of profit from associates | 0 | 0 | 0 | 268 | 268 |
| Income tax expense | 54 | -239 | -138 | -72 | -394 |
| Profit | -220 | 903 | 543 | 572 | 1,797 |
| Segment assets | 28,890 | 15,664 | 4,971 | 33,840 | 83,365 |
| Segment capital expenditure | 910 | 1,418 | 314 | 1,201 | 3,842 |
| Segment liabilities | 15,371 | 13,760 | 3,753 | 20,697 | 53,581 |
Segment EBITDA
Segment Assets
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REAL ESTATE OPERATIONS OF THE GROUP
| Properties, key figures | Q4 2020 | Q4 2019 |
|---|---|---|
| NOI* | ISK 665 m | ISK 734 m |
| NOI ratio | 85% | 77% |
| Utization ratio | 97% | 97% |
| LTV** | 61% | 64% |
| Number of Festi's properties | 93 | 90 |
| Total square meters | 106 thousand m² | 112 thousand m² |
| Own use | 85% | 83% |
| Leased to third parties | 15% | 17% |
- Net operating income
** Loan-to-value ratio
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SHARE PRICE DEVELOPMENT
| Shareholders (10 largest) | % |
|---|---|
| Lifeyrissjóður verslunarmanna | 11,5 |
| Lifeyrissjóður starfsmanna rikisins A-, B- og S-deild | 10,5 |
| Gildi - lífeyrissjóður | 10,1 |
| Stefnir - ÍS 5, ÍS 15 | 6,8 |
| Stapi lífeyrissjóður | 6,7 |
| Birta lífeyrissjóður | 5,9 |
| Almenni lífeyrissjóðurinn | 4,9 |
| Frjálsi lífeyrissjóðurinn | 3,6 |
| Festa - lífeyrissjóður | 3,5 |
| Brú Lífeyrissjóður starfsmanna sveitafélaga | 3,2 |
| Market information | |
| --- | --- |
| Issued shares | 323 m. |
| Market cap at the end of dec 2020 | ISK 57.391 M |
| Market cap at the end of dec 2019 | ISK 42.680 M |
| Number of shareholders | 880 |
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FESTI
POSITION AND OUTLOOK
POSITION AND OUTLOOK FOR 2021
Financial forecast
- EBITDA guidance is updated, in range of ISK 7,500 – 7,900 m. for 2021.
Assumptions:
- Uncertainties related to COVID-19, the ongoing congregation ban and further social restrictions.
- Increased activity in seafood sector due to capelin quotas.
- Tourism expected to start again from mid year and gradually increase.
- Turmoil in the oil market and ISK exchange rate can lead to fluctuations of gross margin and working capital.
- Devaluation of ISK will have negative effect on margins
Highlights:
- Krónan sales up 32,4% YoY.
- ELKO sales up 20,7% YoY.
- Cost from COVID-19 restrictions was ISK 394 m.
- Ongoing work on decreasing operating expenses.
Investments:
- Investments are expected ISK 2,800 m. in 2021
- Thereof ISK 2,000 in maintenance CAPEX
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FESTI
DISCLAIMER
- All information in this presentation is based on sources which Festi hf. considers reliable at the time of publication, but it cannot be guaranteed that the information is infallible.
- All information in this presentation is owned by Festi hf. It is not permitted to copy, change or distribute in any way information from this presentation, in part or in its entirety.
- This presentation is only intended for information purposes and is not part of, or a basis for, any decisions made by the recipient. Recipients should not interpret information in this presentation as a promise or as instructions. Festi hf. is not obliged to provide recipients of this presentation with further information about the company or to make changes or corrections to the presentation if information upon which it is based changes.
- The company's future outlook is dependent on a number of risks and uncertainties which may have the effect that the actual result in the future is considerably different to the scenario described in this presentation. This includes factors such as exchange rates, the global price of fuel, the availability of funding, new legislation coming into effect and the impact of regulators, etc.
- Festi hf. wishes to point out that recipients of the presentation should not rely on statements contained within in the future since they are only applicable on the date of publication of the presentation. All statements concerning the company's future prospects are entirely valid with respect to this proviso.
- By receiving this presentation the recipient agrees that they are bound by the above provisos and limitations.
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