| Apresentação do Roadshow                         Conference Call                                  1Q12                  ...
Important DisclaimerStatements regarding the Company’s future business prospects and operating income projections are mere...
1Q12 HighlightsNet               Net Revenue increased by 16.4% in 1Q12, reaching R$161.4 millionRevenueGross Profit   Gro...
Company GrowthGross Revenues – (R$ million)The Company’s Gross Revenues amounted to R$208.8 million in the first quarter o...
Gross Revenues Breakdown by Brandand Channel – Domestic MarketGross Revenues by brand – Domestic Market (R$ million)      ...
Distribution Channel Expansion Owned Stores and Franchises Expansion                                                      ...
Gross Profit and EBITDA Gross Profit (R$ million)                             EBITDA (R$ million)                         ...
Net IncomeNet Income (R$ million)                                                        16.1                             ...
Cash GenerationOperating Cash Generation (R$ thousand)                                                                    ...
Capital Expenditure (CAPEX) andIndebtednessCAPEX (R$ million)                                                      Indebte...
ContactsCFO and IR OfficerThiago BorgesIR ManagerDaniel MaiaPhone: +55 11 2132-4300ri@arezzoco.com.brwww.arezzoco.com.br  ...
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03 31-2012 - 1 q12 - conference call presentation

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03 31-2012 - 1 q12 - conference call presentation

  1. 1. | Apresentação do Roadshow Conference Call 1Q12 1
  2. 2. Important DisclaimerStatements regarding the Company’s future business prospects and operating income projections are mere estimatesand projections and, as such, are subject to several risks and uncertainties, including, but not limited to, marketconditions, domestic and international economic performance in general and in the Company’s operating sector. Suchrisks and uncertainties cannot be controlled or sufficiently forecast by the Company’s management and may significantlyaffect its perspectives, estimates and projections. Statements regarding future perspectives, projections and estimates donot represent and may not be construed as a performance guarantee. Operating information contained herein, as well asinformation not directly derived from financial statements, has not been subject to audit or special review by theCompanys independent auditors, may involve assumptions and estimates adopted by the management and be subject tochanges. 2
  3. 3. 1Q12 HighlightsNet Net Revenue increased by 16.4% in 1Q12, reaching R$161.4 millionRevenueGross Profit Gross Profit reached R$ 67.2 million, 19.0% growth and 41.6% marginNon- Contract termination with supply agent generated R$8 million non-recurring expense in 1Q12.recurring Projected payback period for the deal is shorter than 3 years due to better terms with new CompanyExpense EBITDA in 1Q12 totaled R$ 14.7 million. Excluding the non-recurring effect, EBITDA would be R$EBITDA 22.7 million, with 14.0% margin. Net Profit in 1Q12 was R$10.9 million. Excluding the non-recurring effect, Net Profit would beNet Profit R$ 16.1 million, with 10.0% margin 3
  4. 4. Company GrowthGross Revenues – (R$ million)The Company’s Gross Revenues amounted to R$208.8 million in the first quarter of 2012, a19.7% in 1Q12 comparing to 1Q11 4
  5. 5. Gross Revenues Breakdown by Brandand Channel – Domestic MarketGross Revenues by brand – Domestic Market (R$ million) Gross Revenues by channel – Domestic Market (R$ million) 201.3 201.3 22.3% 22.3% 8.0 3.5 164.6 164.6 44.5 4.1 36.7% 63.1 1.8 65.5% 26.9 46.1 17.5% 55.7 47.4 13.8% 130.2 10.2% 114.4 88.5 97.6 1Q11 1Q12 1Q11 1Q12 Arezzo Schutz Others¹ Franchise Multi-brand Owned Stores Others² 1Q11 1Q12 SSS Sell-out (Owned Stores) 11.0% 12.1% SSS Sell-in (Franchises) 9.0% 6.5% Strong Gross Revenue growth, especially in the Schutz brand that increased by 36.7% in 1Q12 comparing to 1Q11. The Owned Stores channel recorded 65.5% growth in 1Q12 comparing to 1Q11 mainly due to Sales area growth and its SSS of 12.1% ¹ Other: Alexandre Birman’s and Anacapri’’s Gross Revenue: growth of 95.7%. ² Other: Growth of 97.0%. 5
  6. 6. Distribution Channel Expansion Owned Stores and Franchises Expansion 21.6 23.2% 14.6% 17.6 . 15.2% . 15.3 13.3 338 296 +42 46 267 29 238 22 +29 14 +29 267 292 224 245 1Q09 1Q10 1Q11 1Q12 Franchises Owned Stores Area Sales area expansion of 23.2% year-over-year, ending 1Q12 with a 338 monobrand storesNote: area given in thousand of square meter (sq m)¹ Includes 5 outlets with total area of 1,334 sq m² Domestic Market 6
  7. 7. Gross Profit and EBITDA Gross Profit (R$ million) EBITDA (R$ million) 22.7 9.3% 8.0¹ 19.0% 67.2 20.7 56.4 -29.3% 14.7 1Q11 1Q12 1Q11 1Q12 Expansion of 0.9 p.p. in gross margin, due to channel mix. Excluding the non-recurring effect EBITDA would be R$ 22.7 with 14.0% margin¹ Non-recurring expense 7
  8. 8. Net IncomeNet Income (R$ million) 16.1 9.5% 5.3¹ 14.7 -26.3% 10.9 1Q11 1Q12Company´s Net Income totaled R$ 10.9 million, with 6.7% margin. Excluding non-recurringimpact in 1Q12, Net Income would have reached R$ 16.1 million with 10.0% margin¹ Non-recurring expense 8
  9. 9. Cash GenerationOperating Cash Generation (R$ thousand) Growth or Cash flows from operating activies 1Q11 1Q12 spread Income before income taxes 21,321 15,636 (5,685) Depreciation and amortization 879 1,417 538 Others (1,868) (4,129) (2,261) Decrease (increase) in current assets / liabilities (12,068) 9,975 22,043 - Trade accounts reveivable (18,366) 5,994 24,360 Inventories (15,723) (8,579) 7,144 Suppliers 22,157 18,840 (3,317) Change in other current assets and liabilities (136) (6,280) (6,144) Change in other non current assets and liabilities (263) (700) (437) Tax and contributions (2,366) - 2,366 Net cash generated by operating activities 5,635 22,199 16,564 Net cash generated from operating activities totaled R$ 22.2 million, due to a lower of working capital need for accounts receivable and inventories in 1Q12 comparing to 1Q11 9
  10. 10. Capital Expenditure (CAPEX) andIndebtednessCAPEX (R$ million) Indebtedness (R$ million) 17.3 Indebtedness 1Q11 4Q11 1Q12 0.2 Cash 187,293 173,550 166,741 3.6 Total indebtedness 33,586 38,659 30,844 Short term 12,813 20,885 14,059 As % of total debt 38.1% 54.0% 45.6% Long term 20,773 17,774 16,785 3.7 13.6 As % of total debt 61.9% 46.0% 54.4% 0.2 Net debt (153,707) (134,891) (135,897) 1.3 2.2 EBITDA LTM 98,930 117,729 111,662 Net debt /EBITDA LTM -1.6x -1.1x -1.2x 1Q11 1Q12 Stores Corporate Others¹Arezzo&Co invested R$ 17.3 million in 1Q12, of which R$ 13.6 million in stores, including theopening of 2 new stores. About 70% of investments in stores are related to 8 future openings.Company’s indebtedness policy remained conservative.¹ Other: Decreased of 5.9% in 1Q12 compared to 1Q11. 10
  11. 11. ContactsCFO and IR OfficerThiago BorgesIR ManagerDaniel MaiaPhone: +55 11 2132-4300ri@arezzoco.com.brwww.arezzoco.com.br 11
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