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Apresentação 1 q12

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    Apresentação 1 q12 Apresentação 1 q12 Presentation Transcript

    • 1Q12 ResultsConference Call April 26, 2012
    • DISCLAIMER This presentation contains forward-looking statements regarding the prospects of the business, estimates for operating and financial results, and those regarding Cia. Herings growth prospects. These are merely projections and, as such, are based exclusively on the expectations of Cia. Hering management concerning the future of the business and its continued access to capital to fund the Company’s business Plan. Such forward-looking statements depend, substantially, on changes in market conditions, government regulations, competitive pressures, the performance of the Brazilian economy and the industry, among other factors and risks disclosed in Cia. Hering’s filed disclosure documents and are, therefore, subject to change without prior notice.
    • AGENDA Highlights 1Q12 Operating Performance Outlook
    • 1Q12 HIGHLIGHTS  Gross revenue up 15.7%;  Double-digit sales growth for Hering, Hering Kids and PUC brands; with highlight to the performance of Hering Kids (+32.9%;)  EBITDA of R$ 90.0 million, with EBITDA margin of 27.5%;  Net Profit of R$ 70.2 million (+37.6%).  Hering Store Chain:  87 store openings since 1Q11, with a network of 437 stores by the end of 1Q12  Total sales of R$ 244.2 million (+20.5% overall growth and 4.0% SSS growth); 4
    • AGENDA Highlights 1Q12 Operating Performance Outlook
    • SALES PERFORMANCEGross Revenue (R$ million) Domestic Market (R$ million) 391.5 338.5 15.7% 5.5 1Q11 1Q12 4.1 35.1% R$ 254.6 +14.3% R$ 290.9 15.5% R$ 24.2 +32.9% R$ 32.2 386.2 334.4 R$ 26.9 +15.5% R$ 31.1 R$ 20.7 +5.9% R$ 22.0 1Q11 1Q12 Domestic Market Foreign Market TotalGross Sales reached R$ 391.7 million in 1Q12 (+15.7%) and Hering, HeringKids and PUC brands posted double digit sales growth. 6
    • STORES CHAIN EVOLUTION 535 446 16 1 76 15 5 1 78 2 437 350 1Q11 1Q12 Hering Store Hering Kids PUC dzarm. Foreign - Franchised TotalIn the domestic market, the Company ended 1Q12 with 437 Hering Stores, 76 PUC, 5Hering Kids and 1 dzarm. store. 7
    • HERING STORE CHAIN PERFORMANCE Hering Store Chain Performance 1Q11 1Q12 Chg. Number of Stores 350 437 24.9% Franchise 307 390 27.0% Owned 43 47 9.3% (1) Sales (R$ thousand) 202,569 244,152 20.5% Franchise 166,019 205,145 23.6% Owned 36,550 39,007 6.7% Same Store Sales growth (2) 23.4% 4.0% -19.3 p.p Sales Area (m²) 45,439 58,506 28.8% Sales (R$ per m²) 4,495 4,216 -6.2% Check-Outs 2,417,260 2,773,204 14.7% Units 5,237,956 6,031,427 15.1% Units per Check-Out 2.17 2.17 0.4% Average Sales Price (R$) 38.67 40.48 4.7% Average Sales Ticket (R$) 83.80 88.04 5.1% (1) The amounts referred to the sales to final costumers. (sell out concept) (2) Compared to the same period of the previous yearSSS growth continued decelerating to 4.0% in 1Q12 due to slowdown in the market,1Q11 strong comparison basis, and less favorable climate, with warmer days in themonth of march versus the previous year. 8
    • GROSS PROFIT AND EBITDAGross Profit and Gross Margin EBITDA and EBITDA Margin 47.8% 0.0 p.p. 47.8% 46.7% -0.2 p.p. 27.5% 46.5% 26.8% +0.8 p.p. 17.2% 151.9 129.6 90.0 74.3 21.1% 1Q11 1Q12 1Q11 1Q12 Gross Profit % Gross Margin % Cash Gross Margin (R$ million) EBITDA (R$ million) % EBITDA MarginIn spite of no longer suffering from raw material price pressures, the higher levelof discount granted in own stores let to stable gross margin. 9
    • NET PROFIT AND CAPEXNet Profit (R$ million) Capex (R$ million) +3.1 p.p. 21.5% 7.4 18.4% 5.9 0.7 25.6% 0.6 1.5 37.6% 0.2 0.3 3.8 70.2 51.0 4.0 2.3 1Q11 1Q12 1Q11 1Q12 Net Income (R$ million) % Net Margin Industry IT Others StoresNet profit growth due to better operating performance, adjustment to present value,increase in financial income, and constitution of grants for investment. 10
    • CASH FLOW Cash Flow - Consolidated (R$ thousand) 1Q11 1Q12 Chg. EBITDA 74,306 89,975 15,669 No cash items 365 946 581 Current Income tax and Social Contribution (14,939) (19,220) (4,281) Working Capital Capex (17,938) (14,643) 3,295 Decrease in trade accounts receivable 17,559 44,090 26,531 (Increase) in inventories (13,781) (24,618) (10,837) Increase (decrease) in accounts payable to suppliers (12,818) 4,857 17,675 Increase (decrease) in taxes payable 2,512 (33,681) (36,193) Others (11,410) (5,291) 6,119 CapEx (5,870) (7,373) (1,503) Free Cash Flow 35,924 49,685 13,761 Reconciliation from accounting Cash flow to adjusted Cash flow (R$ thousand) 1Q11 1Q12 Chg. DFC - Cash provided by operating activities 45,804 71,410 25,606 Adjustment – Financial items allocated to operating cash (4,010) (14,352) (10,342) Unrealized exchange and monetary variation (1,348) (1,050) 298 Financial Result (3,922) (14,101) (10,179) Interest paid on loans 1,260 799 (461) DFC - Cash flows from investing activities (5,870) (7,373) (1,503) Free Cash Flow 35,924 49,685 13,761* Dividend distribution: R$106.2 million have been destined to a proposed account to be distributed upon GeneralShareholders’ Meeting approval on April 26th, 2012.Increase of R$ 13.8 million in free cash flow, mostly due to EBITDA growth, andlower investments and working capital needs. 11
    • INDEBTEDNESSNet Debt (R$ million) Short Term x Long Term 4.6 3.5 0.1 Long -0.7 -0.2 -0.2 -0.4 -0.6 Short Term 201.3 Term 184.6 71% 29% 11.0 -33.4 -25.1 -61.9 -165.9 -229.8 2005 2006 2007 2008 2009 2010 2011 1Q12 Gross Debt = R$ 30.3 million Net Debt/ EBITDA* * LTM EBITDADue to the increased operating cash flow, Cia. Hering increased its net cashposition by R$ 63.9 million in 1Q12 and reduced its debt by R$ 4.6 million. 12
    • AGENDA Highlights 1Q12 Operating Performance Outlook
    • OUTLOOK Positive perspectives mainly for second half of 2012, although challenges related marketslowdown and climate factors may repeat in the short run. Hering Brand still with high growth potential, despite not in the same pace of recent past:  Stores opening (guidance of 75 in 2012) and SSS growth in Hering Store chain  Improvement in product mix offering  Visual merchandising actions  Increase in stores traffic  Multibrand retail channel: continuous market share increase in existing clients through distribution specialization. Children’s market :  Share increase in the multibrand channel with Hering Kids and PUC brands  Expansion of the Hering Kids format – opening of 20 stores in 2012  Continuous adjustments in PUC chain, with discontinuation / relocation of a few other operations. Maintenance of the dzarm. Strategy, investing in the brand though the opening of more flagshipstores and marketing. Re-launch of the webstores. 14
    • INVESTOR RELATIONS TEAM Fabio Hering – CEO Frederico Oldani – CFO and IRO Patrícia Salem – IR Manager I Tel. +55 (11) 3371-4867 E-mail: ri@hering.com.br Website: www.ciahering.com.br/ri