Prezentacja programu PowerPoint - Monnari

Presentation of MONNARI

TRADE S.A. results for

Q3 2017

Jakość, elegancja i stylDISCLAIMERThis presentation (The Presentation) was prepared by MONNARI TRADE SA(The Company) to present the results for the third quarter of 2017 intendedfor the Company's shareholders, customers and financial analysts.Presentation is neither an offer to sell or the solicitation of an offer topurchase or subscribe for securities or financial instruments as well asPresentation is not any advice or recommendation with respect to thesesecurities or other financial instruments. This Presentation may includeforward-looking statements of the Company, future plans and strategies orplanned events. Bearing in mind that the statements were adopted on thebasis of expectations and projections about future events, they are subject torisks and uncertainties. The Company is not obliged to update or publicannounce any changes, updates and modifications to the content of thePresentation.Neither the Company nor any of its representatives will not be liable for anydamage resulting from the use of this Presentation or any informationcontained therein or otherwise remaining in connection with the Presentation.

Q3 and 9M 2017 Summary

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STORE NETWORK – 30/9/2017 TOTAL REVENUES SALES OF GOODS

area +14.8% YoY Q3 2017 +16.5% YoY Q3 2017 +17.1% YoY

number +8.0% YoY 9M 2017 +8.4% YoY 9M 2017 +8.9% YoY

102115

129

149 150162

salony15,9

18,2

21,2

27,228,4

32,6tys. m2

31.12'12

31.12'13

31.12'14

31.12'15

30.09'16

30.092017 sty

lutmar

kwimaj

czelip

siewrz

paźlis

gru

2016 r.2017 r.

Monthly sales of goods

46,5 mln

54,2 mln

Q3'16

Q4'16

Q1'17

Q2'17

Q3'17

stores

Q3 2017 – major accomplishments

■ Generating revenue exceeding the increase of the

retail space

16.5% YoY vs.

14.8% YoY

■ Number of visitors in the stores opened in the last

12 months greater than the number of visitors in

mature stores+25%

■ Increased gross profit on sales and increased gross

margin

+27.7% YoY+4.64 pp

■ Increase of selling, general and administrative expenses (SG&A) slower than the increase of retail space

+9.8% YoY vs.

+14.8% YoY

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32.6 thousand m2

30/9/2017

■ Closing 4 low-profitability stores (expiry of contracts), expanding 1 store and opening 3 new stores. Plan for the development of a sales network that has not been achieved in full

Q3 2017 – major events

■ Continuing the construction of the central warehouse near the

headquarters;

planned completion of construction: first half of 2018

■ Signing the letter of intent concerning the property located in Łódź at ul.

Piotrkowska 293/305 (current report No. 59/2017)

■ Change of rights in securities – conversion of 500,000 registered shares into bearer shares (current report No. 74/2017)

■ Continuing the buyback of own shares

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Revenue model of the MONNARI TRADE Group

at monnari stores and online

Retail sales of women's clothing and accessories under the following brands:

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Eleganthigh quality

clothingand accessories

for women+30

Strong brandin the

above-popular

segment

Business model

Collectiondesign

Suppliermanagement

Productionmonitoring

Logisticsand storage

Company storemanagement

Brandmanagement

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■ Between 30/9/2016 and 30/9/2017, the average store size increased by 6.3%

to reach 201.2 m2 vs. 189.3 m2 in the preceding year.

Positive changes in the store

network in the 3rd quarter of

2017

■ closing 4 stores due to the expiry

of long-term rental contracts

■ increasing the space

in 1 store

■ opening 1 new store

As of the end of September 2017,

the network consisted of 162 stores (+8.0% YoY)

with a total area of 32.6 thousand m2

(+14.8% YoY)

102

115

129

149 150162

salony

15,9

18,2

21,2

27,228,4

32,6tys. m2

31.12'12

31.12'13

31.12'14

31.12'15

30.09'16

30.092017

Number and area of stores

Development of the sales network – focus on

profitable stores and increase of space

stores

96,4

113,6

138,4

156,5

169,7

0

20

40

60

80

100

120

140

160

180

9M'13

9M'14

9M'15

9M'16

9M'17

Cumulative revenues from

sales+8.4% YoY

43,0 46,5

54,2

Q3'15

Q3'16

Q3'17

0

10

20

30

40

50

60

70

80

Quarterly revenues from

sales [PLN million] +16.5% YoY

Sales in Q3 and for 9M

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Stores operating both in Q3 2016 and in Q3 2017 (LFL) recorded

an increase in sales of 10.1% YoY, with online sales growing by 16.5% YoY.

For 9M, LFL was +5.5%, with +30.5% YoY increase for online sales.

0

20

40

60

80

100

120

140

160

180

9M… 9M… 9M… 9M… 9M…Q3'15

Q3'16

Q3'17

0

10

20

30

40

50

60

70

80

Improvement of sales in stores opened in the last

two years

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■ the average number of visitors in new stores in Q3 was higher than the number of visitors

in mature stores by 25%, which validates the changes made in the sales network

■ this has improved the average turnover of a new store in Q3 to the level of 78% of the

turnover of mature stores

■ more cautious discount policy in the sales periods

■ decrease of wholesale sales for 9M by 26% (PLN 8.2 million vs. PLN 11.1 million)

■ no central warehouse – planned completion date: H1 2018

Gross profit margin on sales

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51,1%

55,2%

60,1%

54,1%53,0%52,9%

9M'12

9M'13

9M'14

9M'15

9M'16

9M'17

30,0%

40,0%

50,0%

60,0%

70,0%

Gross margin on sales

YTD2012 2013 2014 2015 2016 2017

Q1Q2Q3Q4 Q3 Q3 Q3 Q3 Q3

48,3%

54,0%

59,5%

50,3%48,1%

52,7%

30,0%

40,0%

50,0%

60,0%

70,0%

Gross margin on sales

■ More cautious discount policy

■ Impact of lower USD exchange rate

■ “Sale-friendly” weather in September

■ Increase of SG&A expenses in Q3’17 (+9.8% YoY) slower than the increase of area

(+16.5% YoY)

■ YoY employment increase by 98 people (1277 people at the end of September 2017 vs.

1179 in 2016)

■ increase of 9M payroll costs by 18.2%

■ increase of 9M rental costs by 6.9%

Increase of SG&A expenses in Q3’17 (+9.8% YoY)

slower than the increase of revenues (16.5% YoY)

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33,6

54,2

16,9

27,8

Q3'13 Q3'14 Q3'15 Q3'16 Q3'17

Przychody ze sprzedaży

SG&A

Rate of increase of SG&A

expenses and revenues from

50,2% 49,5% 49,1%52,2% 51,2%

Q3'13 Q3'14 Q3'15 Q3'16 Q3'17

SG&A expenses

as % of revenues from sales

Revenues from sales

Increase of employment and payroll costs

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■ Payroll costs rise quicker than the retail space due to the growth rate of the average

wage

9M 2017 ch. YoY

%

9M 2017 ch. YoY

%9M 2016 9M 2016

Payroll PLN thousand 32,600 +18.2%

PLN/m2/month 113.022.5%

27,581 110.04

Average employment in

the period

person 1,280 +15.8%

1,105

Average wages

without contributions ZUS

PLN 2,830 2.0%

2,773

Decrease of SG&A expenses per 1 m2 of store area

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Rent PLN thousand 19,752 +7.3%

PLN/m2/month 68.48-6.8%

18,415 73.47EUR thousand 4,640

+10.1%EUR/m2/month 16.09

-4.3%4,215 16.82

Operation PLN thousand 6,146 9.2%

5,630

Marketing PLN thousand 1,019 -11.2%

1,147

TOTAL CH. PLN thousand 26,917 6.9%

PLN/m2/month 93.32-7.1%

25,191 100.50

Average area in the period thousand m2 32.1 +15.1%

27.9 Area at the end of the period thousand m2 32.6

+14.8%28.4

Average PLN/EUR exchange rate 4.2566 -2.6%

4.3688

9M 2017 ch. YoY

%

9M 2017 ch. YoY

%9M 2016 9M 2016

61,3 62,4 52,0

1,4 0,90,7

19,1 18,321,0

58,044,3 52,3

91,992,5 94,6

32,3 28,9 42,8

188,2 189,5188,9

231,7218,4 220,5

0

220,5 218,4231,7

środki pieniężne

pozostałe aktywa obrotowenależności

zapasy

aktywa trwałe

zobow. krótkoterminowe

kapitał własny

31.122016

30.062017

30.092017

30.092017

30.062017

31.122016

Good cash position and absence of long-term

liabilities

■ Absence of long-term liabilities.

■ The debt ratio as of 30/9/2017 was 0.15.

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Assets Liabilities

Fixed assets

Stock

Receivables

Other current assets

Funds

Equity

Short-term liabilities

■ The value of the stock of goods per 1 m2 as of 30/9/2017 was approx. PLN 1,540/m2

in comparison to PLN 2.083/m2 in the preceding year.

Structure of stock

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Share of the collection in stock as of

30/09/2016

Share of the collection in stock as of

30/9/2017

value of

goods

30/9/2017

PLN 50.2 million

2018 S/S

0.1%2017 A/W

82.3%2017 S/S

9.7%2016 A/W

5.4%2016 S/S

1.2%until 2015

1.3%

value of

goods

30/09/2016

PLN 59.2 million

2016 A/W

88.5%2016 S/S

7.3%2015 A/W

3.3%2015 S/S

0.5%until 2014

0.3%

Q3 2017 Summary

* for “SG&A expenses” – SG&A/revenues from sales

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profit margin *

Q3 2017 ch. YoY

%

Q3 2017 ch. YoY

ppreported data, PLN million Q3 2016 Q3 2016

Revenues

from sales

54,194 +16.5%

46,508

gross profit on sales28,585

+27.8%52.7%

+4.6 pp22,373 48.1%

SG&A expenses27,751

9.8%51.2%

-3.1 pp25,275 54.3%

EBIT913

-136.5%1.7%

+7.1 pp-2,498 -5.4%

EBITDA2,041

-233.7%3.8%

+7.0 pp-1,526 -3.3%

profit before tax1,011

-189.9%1.9%

+4.3 pp-1,125 -2.4%

income tax358

-561

net profit653

-216.0%1.2%

+2.4 pp-563 -1.2%

9M 2017 Summary

* for “SG&A expenses” – SG&A/revenues from sales

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profit margin *

9M 2017 ch. YoY

%

9M 2017 ch. YoY

ppreported data, PLN million 9M 2016 9M 2016

Revenues

from sales

169,660 8.4%

156,477

gross profit on sales89,668

8.2%52.9%

-0.1 pp82,904 53.0%

SG&A expenses83,729

+13.2%49.4%

+2.1 pp73,969 47.3%

EBIT6,164

-33.0%3.6%

-2.2 pp9,201 5.9%

EBITDA9,607

-19.1%5.7%

-1.9 pp11,871 7.6%

profit before tax5,838

-51.2%3.4%

-4.2 pp11,970 7.6%

income tax1,302

368

net profit4,536

-60.9%2.7%

-4.7 pp11,602 7.4%

Shareholders

■ As of 16/11/2017, the Company had 1,227,913 own shares, amounting to 4.02% of the share

capital and providing 3.49% of votes at the general meeting.

■ Following the conversion of 500.000 registered voting preference shares into ordinary bearer

shares, the total number of votes at the general meeting of Monnari Trade S.A. decreased by

500,000 votes to 35,141,845 (current report No. 74/2017 as of 8 August 2017).

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Percentage of share capital Percentage of the overall number of votes

at the GM

total number of

shares

30.563.089

total number

of votes

at the general

meeting

35.141.845

Data as of 16/11/2017 in accordance with the information available to the Company

Mirosław Misztal

25.89%Fair sp. z o.o.

8.29%Nationale-Nederlanden

PTE S.A.

5.93%other

59.90%

Mirosław Misztal

25.93%Fair sp. z o.o.

14.42%Nationale-Nederlanden

PTE S.A.

5.15%other

54.50%

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MONNARI TRADE at the WSE

symbol / ticker

WSE: MONNARI / MON

Reuters: MONP.WA

Bloomberg: MON PW

ISIN: PLMNRTR00012

WSE sector

Clothing and cosmetics – clothing and

footwear

Market

Basic

Indices

sWIG80 | InvestorMS | WIG |

WIGPoland | WIG-Odzież

closing price – 15/11/2017

PLN 7.48

capitalization – 15/11/2017

PLN 228.6 million

number of issued shares

30,563,089683 514 584 781 894 423 331 114 189 161 295 348 150

XI2016

XII I II III IV V VI VII2017

VIII IX X XI*

0,00

4,00

8,00

12,00

16,00

20,00

średnie obroty dzienne [tys. zł]

kurs zamknięcia dzienny [zł]

Quotes: 2/11/2016–15/11/2017*

Average daily turnover [PLN thousand]

Daily closing price [PLN]

Plans and challenges

■ Actively searching for new service providers,

also in Poland

■ Renegotiating the prices with the existing service providers

■ Active discount policy adapted to the behaviour of the competition

Defending the gross profit on sales

■ New stores opened at the best locations in Poland

■ Increasing the store area for renewed contracts

■ In 2017, planned increase of area by 5–10% vs. 31/12/2016

Extending the network of company stores

■ Weekly promotional campaigns

■ Promotions, cross-promotions, cooperation with external domestic and international brands

■ We do not forget about others

Active marketing campaigns

■ Constructing the central warehouse

■ We are ready to take over new entities

■ We are looking for opportunities to extend our brand portfolio

■ Conservative approach to real property use– maximum increase of value with limited expenditure

Looking for investment opportunities

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Construction of a central warehouse in Łódź

at ul. Dąbrowskiego 4

Planned completion of construction – 1st half of 2018

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Real property at ul. Piotrkowska in Łódź

■ Conservative approach to real property use– maximum increase of value with limited expenditure

■ Achievement of the objectives included in the Letter of Intentconcerning the sale of a part of the share in the real propertywith an area of 10.5 ha, located in Łódź at ul. Piotrkowska293/305 (current report No. 59/2017)

■ Renewal of 19 post-industrial structures entered in the historicregister – the Geyer's Gardens have been incorporated in theCommunal Renewal Programme

■ Multi-purpose facility – the Geyer's Gardens project, inaccordance with the site development plan, will be designed formulti-family residential buildings and commercial buildings– retail and offices

Geyer's Gardens

Staged development of a multi-purpose facility including the restoration of heritage structures and renewal of the urban space of Łódź

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THANK YOU

MONNARI TRADE S.A.

CONTACT FOR INVESTORS

Miłosz Kolbuszewski

Financial Director 664 043 651; [email protected]

Anna Augustyniak-Kala

Director for Organisation and Legal Matters

664 360 871; [email protected]

www.monnaritrade.com

www.emonnari.pl