West 49 Inc. 2009 AGM Presentation

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Management's presentation at the West 49 Inc. Annual Meeting of Shareholders on June 17, 2009.

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West 49 Inc. 2009 AGM Presentation

  1. 1. Annual General Meeting June 17, 2009
  2. 2. <ul><li>President & CEO </li></ul>Sam Baio
  3. 3. Forward-Looking Statements Certain statements in this presentation are forward-looking and are subject to important risks, uncertainties and assumptions concerning future conditions that may ultimately prove to be inaccurate and may differ materially from actual future events or results. Forward-looking statements are based on estimates made by management of West 49 Inc. based on current information. These are not formal forecasts or projections of future results and have not been derived from any pro forma financial statements now have been audited or reviewed by any third party. You are reminded not t place undue reliance on these forward-looking statements, which speak only as of the date hereof. West 49 Inc. shall undertake no obligation to release publicly any revisions to these forward-looking statements to reflect events or circumstance that occur after the date hereof or to the occurrence of unanticipated events.
  4. 4. FY 2009 in Review <ul><li>Volatile Canadian $ </li></ul><ul><li>Cross-border shopping </li></ul><ul><li>Minimum wage increases </li></ul><ul><li>Troubling economy </li></ul>Challenging year
  5. 5. FY 2009 in Review <ul><li>Best brands on Earth, lowest prices ever </li></ul><ul><li>Platinum Club sales incentive program </li></ul><ul><li>Ontario no-tax event </li></ul>Primary objective: defend market share
  6. 6. FY 2009 in Review Defended market share Grew comparable store sales Impacted margins
  7. 7. FY 2009 in Review <ul><li>Shut down Duke’s Northshore </li></ul><ul><li>Centralized all functions for the Off The Wall banner into our Burlington head office </li></ul>Decisive action
  8. 8. A Strong Start to FY 2010 <ul><li>Continued top line growth </li></ul><ul><li>Higher gross margin </li></ul><ul><li>Benefited from focus on expense management </li></ul><ul><li>Narrowed loss from a year ago </li></ul>First quarter progress
  9. 9. <ul><li>CFO & Corporate Secretary </li></ul>Rhonda Biddix
  10. 10. Financial Review — FY 2009 <ul><li>Goodwill & intangible asset impairment charge = $12M </li></ul><ul><li>Impairment related to Duke’s Northshore = $0.9M </li></ul>Results impacted by non-cash items
  11. 11. Financial Review — FY 2009 <ul><li>Net Sales </li></ul>FY 2009 = $210.4M FY 2008 = $204.9M Comparable Store Sales Gross Margin Consolidated = -0.4% West 49 banner = +0.1% FY 2009 = $46.8M FY 2008 = $52.4M
  12. 12. Financial Review — FY 2009 <ul><li>Normalized EBITDA </li></ul>FY 2009 = $3.4M FY 2008 = $8.8M Normalized Net Income (Loss) Income (Loss) Per Share, Normalized FY 2009 = ($2.6M) FY 2008 = $1.5M FY 2009 = ($0.04) FY 2008 = $0.02
  13. 13. Financial Review — Q1 2010 <ul><li>Net Sales </li></ul>Q1 2010 = + $40.8M Q1 2009 = + $38.9M Comparable Store Sales Consolidated = +2.9% West 49 banner = +7.7% + 4.9%
  14. 14. Financial Review — Q1 2010 <ul><li>Gross Margin </li></ul><ul><li>Improved product margins </li></ul><ul><li>Improved focus on inventory and merchandising </li></ul>Q1 2010 = + $7.4M Q1 2009 = + $4.8M Gross Margin Rate* Q1 2010 = + 18.1% Q1 2009 = + 12.3% * As a rate to net sales + $2.6M + 580 bps
  15. 15. Financial Review — Q1 2010 <ul><li>EBITDA (Loss) </li></ul>Q1 2010 = ($2.2M) Q1 2009 = ($4.3M) Net Income (Loss) Income (Loss) per Share Q1 2010 = ($2.6M) Q1 2009 = ($4.2M) Q1 2010 = ($0.04) Q1 2009 = ($0.07)
  16. 16. <ul><li>President & CEO </li></ul>Sam Baio
  17. 17. Our Outlook <ul><li>Recession / recovery??? </li></ul><ul><li>Our efforts are just beginning to pay off </li></ul>Better positioned for BACK-TO-SCHOOL and HOLIDAY selling seasons
  18. 18. We will be THE retail destination of choice for Canadian tweens & teens seeking to fulfill their action sports lifestyles needs. Vision
  19. 19. Attractive Target Market <ul><li>Spend $4.9 billion / year </li></ul><ul><ul><li>½ on clothing, footwear & accessories </li></ul></ul><ul><li>Account for 76% of action sports participants </li></ul>Canadian tweens and teens
  20. 20. Source: Global Habbo Youth Survey – Brand Update 2009 Top Brands for Canadian Youth Clothing Shoes Ugg 10. Nike 10. Etnies 9. Billabong 9. C1Rca 8. Garage 8. Airwalk 7. Aeropostale 7. Puma 6. Bluenotes 6. Vans 5. Stitches 5. Adidas 4. DC 4. Converse 3. West 49 3. DC 2. Hollister 2. Nike 1. American Eagle 1.
  21. 21. Unique Promotions
  22. 22. Growing our core business MAXIMIZE RETURNS from existing stores OPEN NEW STORES in new & existing markets
  23. 23. Thank you
  24. 24. Annual General Meeting June 17, 2009
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