B05 big bang treasury transformation

www.pwc.comTreasury Hot TopicBig-Bang Treasury TransformationPierre Parlongue, CelioSuzanne Hosmans, CelioDidier Vandenhaute, PwC

Agenda1. Celio at a glance2 Issues and objectives2.3. What did we accomplish4. L Lessons l learned d PwC Conference Treasury Hot Topic 2

Celio at a GlanceA fast growing retail company February 2011PwC 3

Celio is a fast-growing international clothing retailer fast- 866Quick facts 775 €1 bn 672Annual turnover Double digit g g growth 572 > 1.000# stores Openings: 130/year 405Staff Approx 3.500 365 321 270Treasury staff 3 FTE 226# bank 150 170 42relationships 70 34 6# b k accounts bank t >750 750 ■ Most of our owned stores are located in Western Europe and India whereas clothes are mainly purchased in Asia ■A Approximately 200 affiliates are also present i i t l ffili t l t in Middle East, Asia and Africa PwC Conference Treasury Hot Topic 4

Acquisition of Jennyfer in 2005AcquisitionA i iti 2005Annual turnover € 280 Mio# stores 380# bank relationships 20# bank accounts > 250 PwC Conference Treasury Hot Topic 5

Issues and ObjectivesThe Treasurer and CFO points of view February 2011PwC 6

Main objective: centralized cash collection in Belgium • Retail activitiesConsiderations • Family-owned group • No external rating • 42 bank relationships (of which 38 local) Key issues • Disconnection Banks vs Celio presence/needs • High banking costs & limited visibility • LT financing of the g p g group Priorities • Efficiencies • Mutually beneficial relationships PwC Conference Treasury Hot Topic 7

Many stakeholders - shared objectives CFO Cash collection Treasury companies p Group Treasurer FO/MO/BO PwC Treasury T accounting Banks Project coordinator IT PMO Banking & Cash Accounting IT- Interfaces Systems IT-Hardware Organisation i i Legal IT Documentation AP/AR System vendor Finance Di t Fi Directors Security S it Authorisers Stores Documentation Regulatory Retail Service Bureau Local country reps PwC Conference Treasury Hot Topic 8

Main issues related to treasury activities ■ Bottle neck riskNew protocols not supported ■ Rejected payments after deadline ■ Few economies of scaleDecentralised BRM ■ Out of market bank fees ■ No priority status and no reciprocity ■ Staff inefficienciesDecentralised treasury activities ■ Lack of visibility and poor cash forecasting ■ Multiple Treasury systems ■ Simultaneous borrowing and lendingNo automated cash concentration ■ Loss of value days ■ I ffi i t control on outgoing flows Inefficient t l t i flMultiple payment processes / systems ■ Heavy approval procedures ■ High dependency towards banksNo formal treasury policy / processes ■ Heterogeneous treasury risk managementFew treasury / risk management ■ Wide use of Excel; poor informationtools ■ Few support to treasury activity growth PwC Conference Treasury Hot Topic 9

Many blocking factors Commercial Accounting A ti system Reconciliation entries TMS TMS Com 1000+ entity 1 tool 1 ERP1 Generator 1 1 2 1 40+ banks stores Commercial TMS Com Reconciliation Accounting A ti system ERP2 ERP3 3 … tool 2 Entries entity 2 Generator 2Stores network Accounting Treasury Security IT People impact P l i t PwC Conference Treasury Hot Topic 10

What did we accomplishSweat sweat sweat… February 2011PwC 11

3 phases covering 3 streams Strategy & organisational design g Bank & CM restructuring Treasury and CM systems Implement 1. Construct organisation 2. Bank(s) Select 3. System(s) 1. Organisational and functional requirements 2. Banking selection 3. System selection Analyse and Design 1. Policies and Procedures 2. Banking design 3. System Design PwC Conference Treasury Hot Topic 12

Treasury system architecture Local ERPs Payment FIN Factory tool processing MT 94x SWIFT MT 94x MT 10xReconciliation MT 94x Converter Tool T TMS FileAct processingTreasury ERP Service Local entities TMS SWIFT Banks Bureau PwC Conference Treasury Hot Topic 13

Cost - benefit review PwC Conference Treasury Hot Topic 14

More balanced bank relationship PwC Conference Treasury Hot Topic 15

Key lessons learnedEvery project is different, but… February 2011PwC 16

Analysis Selection Implementation DesignIssues (1/3) No innovative solutions Analysis Finance No budget & design support at danger issues Garbage out - garbage in February 2011PwC 17

Analysis Selection Implementation DesignIssues (2/3) Difficult to compare Selectio n issues Difficult Hard price landing negotiation February 2011PwC 18

Analysis Selection Implementation DesignIssues (3/3) Cross C complexity Expectation No priority not met status Implementation Issues Don’t Availability sweat the of small stuff resources Migration of new bank February 2011PwC 19

We would be delighted to hear and answer yourquestions! February 2011PwC 20

ThankTh k you! !© 2011 PricewaterhouseCoopers. All rights reserved. “PricewaterhouseCoopers” refers to thenetwork of member firms of PricewaterhouseCoopers International Limited, each of which is aseparate and independent legal entity.

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B05 big bang treasury transformation

by PwC Belgium on Mar 03, 2011

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