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Safilo Group Interim / Quarterly Report 2021
4328_iss_2021-05-11_c12b8067-7906-42ad-9822-dbb0c5023222.pdf
Interim / Quarterly Report
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Q1 2021 Trading Update
May 11, 2021
Q1 2021 Trading Update
May 11, 2021
DISCLAIMER
This presentation may contain forward looking statements based on current expectations and projects of the Group in relation to future events. Due to their specific nature, these statements are subject to inherent risks and uncertainties, as they depend on certain circumstances and facts, most of which being beyond the control of the Group. Therefore actual results could differ, even to a significant extent, with respect to those reported in the statements.
"2021 represents a fresh start for our Group, after two years of significant business turnarounds to establish a stronger and more resilient business model, with a diversified brand portfolio and a supply chain right-sized to market reality.
We are pleased about this very positive start to the year, which saw our Q1 2021 sales and economic results exceed the first quarter of 2019.
These results are particularly relevant for us as they were achieved in a health and business environment which remained in the meantime tough in a number of countries and distribution channels, representing a first, encouraging testimony of the growth the Group can aim for thanks to its new business levers."
Angelo Trocchia, CEO
NET SALES €251.4M
Strong recovery of own and licensed brands
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ADJUSTED1 EBITDA €25.8M ADJUSTED1 EBITDA MARGIN 10.3%
GROUP NET DEBT € 223.9M
vs FY 2020
substantially in line
New brands in the portfolio effectively compensating the licenses terminated at the end of 2020
United States and online business remaining our strongholds, above our expectations
Significant improvement in profitability driven by sales rebound, cost discipline and now leaner overheads cost structure
Solid financial profile, in line with Dec. 2020
Q1 2021 SALES PERFORMANCE
OUR Q1 2021 NET SALES PERFORMANCE
NET SALES AT € 251.4M
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EFFECTIVE PORTFOLIO REBALANCE
New business compensating terminated licenses
- +++Blenders/Privé Revaux/Levi's/DavidBeckham/Missoni/Ports/ Isabel Marant
- --Licenses terminated at the end of 2020
STRONG GROWTH OF CORE OWN/LICENSED BRANDS
+++Smith and ++Carrera
++Hugo Boss/Tommy Hilfiger/Kate Spade/Jimmy Choo
Prescription frames strong across all geographies and brands ✓
Strong US D2C channel offsetting soft sunglass business in Europe
Online sales boosted by Blenders, Smith and internet pure players (IPP) ✓
OUR Q1 2021 TOTAL ONLINE BUSINESS
MORE THAN 3 TIMES BIGGER THAN IN Q1 '19, OUR ONLINE BUSINESS SURGED +164% VS Q1 '20 THANKS TO OUR DIGITAL TRANSFORMATION STRATEGY
OUR Q1 2021 NET SALES PERFORMANCE
NORTH AMERICA AT €119.1M
EUROPE AT €101.5M
ASIA & PACIFIC AT €13.0M
'20/vs '19
✓ China & Australia confirming H2 '20 growth trajectories
REST OF THE WORLD AT €17.8M
majority of Safilo's brands
Q1 2021 ECONOMIC AND FINANCIAL PERFOMANCE
KEY DRIVERS OF OUR Q1 ECONOMIC PERFORMANCE
1) POSITIVE OPERATING LEVERAGE
2) NOW LEANER OVERHEADS & CONTINUED STRUCTURAL SAVINGS
3) NON-RECURRING COSTS, MAINLY DUE TO THE ANNOUNCED CLOSURE OF THE ORMOZ PRODUCTION PLANT IN SLOVENIA
OUR Q1 2021 ECONOMIC PERFORMANCE
OUR Q1 2021 ECONOMIC PERFORMANCE
STRUCTURAL SAVINGS ACHIEVED IN RECENT YEARS
OUR FINANCIAL PERFORMANCE AS AT MARCH 31, 2021
GROUP NET DEBT € 223.9M (€ 181.3M pre-IFRS 16)
IMPROVED ECONOMIC PERFORMANCE
CONTINUED STRICT CONTROL ON NET WORKING CAPITAL
BUSINESS EVOLUTIONS AFTER Q1 2021
FURTHER ACTIONS OF OUR INDUSTRIAL PLAN
IN LINE WITH THE BUSINESS OBJECTIVE OF IMPROVING THE EFFICIENCY OF THE GROUP MANUFACTURING FOOTPRINT, TO ENABLE GROSS MARGIN RECOVERY AND THE GROUP ECONOMIC & FINANCIAL SOLIDITY
REALIGNING OUR MANUFACTURING CAPACITY TO THE CURRENT AND FUTURE PRODUCTION NEEDS
March 11, 2021
Intended closure of Ormož production site, in Slovenia
April 14, 2021
Agreement signed with Slovenian Trade Unions and Work Council, providing for a number of social measures to minimize the impact
FURTHER ACTIONS OF OUR BRANDS PORTFOLIO STRATEGY
NEW 5-YEAR GLOBAL LICENSING AGREEMENT WITH
Global fashion brand founded in 1995 by Dean & Dan Caten, renowned for its uniqueness and creativity
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- An important brand addition and a significant opportunity to grow in the fashion luxury segment
- First optical and sunglass collections both for men and women – hitting the market in January 2022, for the new spring/summer season
BUSINESS UPDATE IN RELATION TO THE COVID-19 PANDEMIC
In the month of April, sales trends remained strong, still driven by outstanding growth in the United States, in the online business and by the progress of a number of emerging countries.
Retail restrictions and the uncertainties surrounding stores re-openings in some countries instead prevented a material rebound in Europe.
Based on the current visibility on the order book, we expect our total net sales for the second quarter of 2021 to normalize compared to the exceptional Covid-19 related decline recorded in the second quarter of last year, aiming to slightly surpass Q2 2019, at constant exchange rates.
Q1 2021 Trading Update
May 11, 2021
Q1 2021 Trading Update
May 11, 2021
Appendices
Q1 2021 APPENDICES
1In Q1 2021, , the adjusted economic results excludes non-recurring costs for Euro 16.2 million (Euro 4.6 million at the gross profit level, and Euro 12.4 million at the EBITDA level), mainly due to the announced closure, starting from June 2021, of the Ormoz production plant in Slovenia.
In Q1 2020, the adjusted economic results excluded non-recurring costs for Euro 2.7 million (Euro 2.4 million at the EBITDA level), due to restructuring expenses related to the ongoing cost saving program.
2 Blenders' Q1 2021 pro-forma performance is calculated compared to the same period of 2020. Blenders was not yet included in Safilo Group's perimeter in Q1 2020. Safilo consolidated Blenders from June 1 st 2020.
| (Euro million) |
change % 2021 2020 vs |
change % 2021 2019 vs |
||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Q1 2021 |
% | Q1 2020 |
% | Q1 2019 |
% | current forex |
constant forex |
current forex |
constant forex |
|
| Europe | 101 5 |
40 4 |
107 7 |
48 7 |
124 6 |
50 4 |
8% -5 |
0% -5 |
5% 18 - |
8% 17 - |
| North America |
119 1 |
47 4 |
84 4 |
38 2 |
88 9 |
36 0 |
1% +41 |
8% +53 |
0% +34 |
8% +41 |
| Pacific Asia |
13 0 |
5 2 |
14 9 |
6 7 |
17 7 |
7 2 |
13 0% - |
10 8% - |
26 8% - |
25 3% - |
| of the world Rest |
17 8 |
7 1 |
14 1 |
6 4 |
16 1 |
6 5 |
+26 6% |
+40 6% |
+10 7% |
+26 5% |
| Total | 251 4 |
100 0 |
221 1 |
100 0 |
247 3 |
100 0 |
+13 7% |
+20 0% |
+1 7% |
+6 0% |
| in millions) (Euro |
Q1 2021 |
Q1 2020 |
Q1 2019 |
Change % 2021 vs 2020 |
Change % 2021 vs 2019 |
|---|---|---|---|---|---|
| Net sales |
251 4 |
221 1 |
247 3 |
+13 7% |
+1 7% |
| Gross profit % sales net on |
126 6 50 4% |
109 4 49 5% |
130 2 52 7% |
+15 7% |
2 8% - |
| EBITDA sales % net on |
13 4 3% 5 |
3 4 1 5% |
18 9 6% 7 |
+293 1% |
29 0% - |
| Adjusted1 EBITDA % sales net on |
25 8 10 3% |
5 8 2 6% |
20 0 8 1% |
+342 8% |
+29 4% |
| IFRS 16 impact on EBITDA |
2 9 |
3 1 |
3 4 |
EXCHANGE RATES
| Currency | of As |
(Appreciation)/De preciation |
for Average |
(Appreciation)/De preciation |
||||
|---|---|---|---|---|---|---|---|---|
| Code | March 31 , |
December 31 , |
% | March 31 , |
March 31 |
, % |
||
| 2021 | 2020 | 2021 | 2020 | |||||
| Dollar US |
USD | 1 1725 |
1 2271 |
-4 4% |
1 2049 |
1 1027 |
9 3% |
|
| Dollar Hong-Kong |
HKD | 9 1153 |
9 5142 |
2% -4 |
9 3465 |
8 5686 |
1% 9 |
|
| Swiss Franc |
CHF | 1 1070 |
1 0802 |
2 5% |
1 0913 |
1 0668 |
2 3% |
|
| Canadian Dollar |
CAD | 1 4782 |
1 5633 |
4% -5 |
1 5258 |
1 4819 |
0% 3 |
|
| Japanese Yen |
YEN | 129 9100 |
126 4900 |
2 7% |
127 8057 |
120 0973 |
6 4% |
|
| British Pound |
GBP | 0 8521 |
0 8990 |
2% -5 |
0 8739 |
0 8623 |
4% 1 |
|
| Swedish Krown |
SEK | 10 2383 |
10 0343 |
2 0% |
10 1202 |
10 6689 |
-5 1% |
|
| Australian Dollar |
AUD | 5412 1 |
5896 1 |
-3 0% |
5597 1 |
6791 1 |
1% -7 |
|
| South-African Rand |
ZAR | 17 3484 |
18 0219 |
-3 7% |
18 0302 |
16 9479 |
6 4% |
|
| Ruble Russian |
RUB | 88 3175 |
91 4671 |
-3 4% |
89 6675 |
73 8205 |
21 5% |
|
| Brasilian Real |
BRL | 6 7409 |
6 3735 |
8% 5 |
6 5990 |
4 9167 |
2% 34 |
|
| Indian Rupee |
INR | 85 8130 |
89 6605 |
-4 3% |
87 8484 |
79 9096 |
9 9% |
|
| Singapore Dollar |
SGD | 1 5768 |
1 6218 |
8% -2 |
1 6054 |
1 5281 |
1% 5 |
|
| Malaysian Ringgit |
MYR | 4 8618 |
4 9340 |
-1 5% |
4 8997 |
4 6094 |
6 3% |
|
| Chinese Renminbi |
CNY | 7 6812 |
8 0225 |
3% -4 |
7 8080 |
7 6956 |
5% 1 |
|
| Korean Won |
KRW | 1 324 1900 , |
1 336 0000 , |
-0 9% |
1 343 2116 , |
1 316 2813 , |
2 0% |
|
| Mexican Peso |
MXN | 24 0506 |
24 4160 |
5% -1 |
24 5272 |
22 0918 |
0% 11 |
|
| Turkish Lira |
TRY | 9 7250 |
9 1131 |
6 7% |
8 91558 |
6 74284 |
32 2% |
|
| Dirham UAE |
AED | 4 3060 |
4 5065 |
-4 4% |
4 4248 |
4 04952 |
9 3% |
