Result update presentation Q2 FY16 [Company Update]

8/20/2019 Result update presentation Q2 FY16 [Company Update]

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KDDL Limited

ETHOS LimitedResult Update Presentation

Q2 FY16


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This presentation and the accompanying slides (the “Presentation”), which has been prepared by KDDL Limited (the “Company”),

solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securities, and shall not form the basis or be relied on in connection with any contract or binding commitment whatsoever. Nooffering of securities of the Company will be made except by means of a statutory offering document containing detailed information about the Company.

This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Company makes no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth,accuracy, completeness, fairness and reasonableness of the contents of this Presentation. This Presentation may not be all inclusiveand may not contain all of the information that you may consider material. Any liability in respect of the contents of, or any

omission from, this Presentation is expressly excluded.

Certain matters discussed in this Presentation may contain statements regarding the Company’s market opportunity and business prospects that are individually and collectively forward-looking statements. Such forward-looking statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and assumptions that are difficult to predict. Theserisks and uncertainties include, but are not limited to, the performance of the Indian economy and of the economies of variousinternational markets, the performance of the industry in India and world-wide, competition, the company’s ability to successfully implement its strategy, the Company’s future levels of growth and expansion, technological implementation, changes and advancements, changes in revenue, income or cash flows, the Company’s market preferences and its exposure to market risks, as

well as other risks. The Company’s actual results, levels of activity, performance or achievements could differ materially and adversely from results expressed in or implied by this Presentation. The Company assumes no obligation to update any forward-looking information contained in this Presentation. Any forward-looking statements and projections made by third parties included in this Presentation are not adopted by the Company and the Company is not responsible for such third party statements and

projections.

Safe Harbor

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Continue to Grow Sustainably - H1 FY16 Consolidated

3

15%Revenue

Rs. 211 Crs

4%EBITDARs.17 Crs

38%Cash PATRs. 12 Crs

22%PAT after MIRs. 7 Crs

1.9xPAT after MI Margin3.2%


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Performance Highlights - H1 FY16 Ethos

4

26%Revenue

Rs. 148 Crs

41%EBITDARs. 6 Crs

43 bpsEBITDA Margin4.0%

77%Cash PATRs. 2 Crs

18%Same Store

Billing Growth

28%Revenue from Online

Lead Generation


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Strong Performance by Ethos in an “Off -Season”

5

118

148

163

H1

H2

FY15 FY16

1

2

5

H1

H2

FY16FY15

Revenue (Rs. Crs) Cash PAT (Rs. Crs)

(58%)

(42%)

(18%)

(82%)

-0.7

0.1

3.1

H1

H2

FY16FY15

PAT (Rs. Crs)

(-31%)

(131%)


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Focus onOnline

Presence

RationalizeStore Presence

MinimizeInvestment

Reduce Front-End Cost like

Manpower andRental

expenses

OperatingLeverage

Playing Out

ImproveReturn On

CapitalEmployed

Expandcatchment

area of offlinestore, leading

to higherrevenue

MaximizeReach

Asset Light Model In Ethos...

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148

118

92

72

+26%

H1 FY16H1 FY15H1 FY14H1 FY13

Growing Revenue (Rs.Crs)

H1 FY16

-90 bps

13.5%

15.4%

H1 FY15

12.6%

H1 FY14H1 FY13

15.0%

Reducing Front-end Rent & ManpowerCost as % of Revenue

Improving EBITDA Margin (%)

4.0%3.6%

2.8%

3.5%

H1 FY15H1 FY13 H1 FY14

+43 bps

H1 FY16

... Improving Returns

6.0

4.2

2.6 2.6

H1 FY14H1 FY13 H1 FY16

H1 FY15

+41%

Improving EBITDA (Rs.Crs)

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47

30

6

16

H1 FY15H1 FY13

+56%

H1 FY14 H1 FY16

+560 bps

H1 FY15 H1 FY16H1 FY14H1 FY13

23%

15%

8%

28%

3,527

2,575

1,314

413

H1 FY13 H1 FY14 H1 FY15

+37%

H1 FY16

Online Billing (Rs. Crs) Online – as % of Ethos Revenue

Visitors on website (‘000)

... With Growing Online Sales

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... & Focus towards Investing in Advertising...

9

…with ETHOS co-branding


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TRUST CAMPAIGN across channels...

10

… To Reinforce our “ETHOS”

… to Educate consumers about Watches

… to Create Awareness about unscrupulous activities


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Pan-India Presence with Offline Store Network...

Map for Illustration purpose only

LudhianaChandigarh

GurgaonNew Delhi

AhmedabadBhopal

Nagpur

Mumbai

Hyderabad

Bengaluru Chennai

Amritsar

SuratVadodara

India’s Largest retail chain of Luxury

Watches with 41 stores

Presence across Metros, Tier I, Tier IIcities

Store Selection Criteria :Reputed /Pedigree Mall atPremium location where otherPremium brands present andhaving better facilitymanagement

3 Duty Paid Retail Outlets atDomestic Terminals

3 Duty Free Retail Outlets atInternational Terminals

11

Thane


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Consolidated – Profit & Loss StatementRs.Crs Q2 FY16 Q2 FY15 YoY % H1 FY16 H1 FY15 YoY% FY15

Revenue 110 98 12% 211 183 15% 412

Cost of Goods Sold 66 54 123 102 240

Employee Expenses 16 15 31 28 58

Other Expenses 19 19 39 37 75

EBITDA 9.6 11.1 (13%) 17.4 16.7 4% 39.0

EBITDA Margin 8.7% 11.2% 8.3% 9.1% 9.5%

Other Income 3.1 0.9 4.1 1.8 2.0

Interest 3.9 4.3 8.0 8.1 15.3

Depreciation 2.9 3.0 5.7 6.0 11.8

PBT 5.9 4.7 7.7 4.4 13.9

Tax 0.4 1.6 0.8 1.5 5.0

PAT After MI 5.3 3.0 77% 6.6 3.0 122% 8.8

PAT after MI Margin 4.8% 3.0% 3.2% 1.6% 2.1%

Cash PAT 8.2 6.0 37% 12.4 9.0 38% 20.6

Cash PAT Margin 7.4% 6.1% 5.9% 4.9% 5.0%

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Rs. Crs Sep-15 Mar-15

Shareholder’s Fund

Share capital 10 9

Reserves & Surplus 79 42

Minority Interest 32 25

Non-current liabilities

Long term borrowings 30 36

Deferred Tax Liabilities 2 3

Long Term Provisions 6 5

Current liabilities

Short term borrowings 62 71

Trade Payables 82 86

Other current liabilities 45 41

Total Liabil ities 347 318

Non-current assets

Fixed assets 74 77Long-term loans and advs. 1 1

Other non current assets 19 17

Current assets

Inventories 188 169

Trade receivables 21 25

Cash and bank balances 28 13

Short-term loans and advs. 17 17Total Assets 347 318

Consolidated – Balance Sheet

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Profit & Loss Statement - EthosRs.Crs Q2 FY16 Q2 FY15 YoY % H1 FY16 H1 FY15 YoY% FY15

Revenue 79 63 25% 148 118 26% 281

Cost of Goods Sold 59 46 110 87 209

Employee Expenses 5 4 10 8 17

Other Expenses 11 10 23 20 41

EBITDA 4.0 3.6 10% 6.0 4.2 41% 14.3

EBITDA Margin 5.0% 5.7% 4.0% 3.6% 5.1%

Other Income 0.0 0.1 0.1 0.1 0.1

Interest 2.1 1.9 4.0 3.6 7.1

Depreciation 0.9 1.0 1.8 1.8 3.8

PBT 1.0 0.8 0.2 -1.1 3.5

Tax 0.3 0.3 0.1 -0.4 1.2

PAT 0.7 0.5 29% 0.1 -0.7 117% 2.4

PAT Margin 0.8% 0.8% 0.1% -0.6% 0.8%

Cash PAT 1.6 1.5 9% 1.9 1.1 77% 6.1

Cash PAT Margin 2.0% 2.3% 1.3% 0.9% 2.2%

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Rs. Crs Sep-15 Mar-15

Shareholder’s Fund

Share capital 31 31

Reserves & Surplus 24 20

Non-current liabilities

Long term borrowings 8 8

Long Term Provisions 1 1

Current liabilities

Short term borrowings 49 46

Trade Payables 71 70

Other current liabilities 24 12

Total Liabil ities 209 189

Non-current assets

Fixed assets 13 14

Long-term loans and advs. 13 11Deferred Tax Asset 1 1

Current assets

Inventories 166 147

Trade receivables 2 3

Cash and bank balances 6 5

Short-term loans and advs. 8 7

Total Assets 209 189

Ethos – Balance Sheet

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Company Overview


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StableManufacturing Business

Leading supplier of premiumwatch components - watchdials and watch hands

Caters to demand frominternational brands inSwitzerland & India

Engaged in manufacturing ofof High Precision StampingParts & Precision

CAGR of 13% over FY11 –FY15

ScalableRetail Business -ETHOS

India’s Largest Retail Chain of

Luxury Watch Studios

Authorized retailer of over 60luxury watch brands, rangingfrom Rs. 5,000 to more thanRs.20,00,000

41 premium watch boutiquesacross country

CAGR of 33% over FY11 -FY15

80% subsidiary of KDDL Ltd

Business Overview

71%29%

17*Figures updated as on date


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Stable Manufacturing Performance

96111

127

FY13 FY14 FY15

CAGR + 15%

Revenue (Rs.Crs)

12

2125

13%

19%20%

-2%

3%

8%

13%

18%

23%

-

5

10

15

20

25

30

FY13 FY14 FY15

CAGR + 44%

EBITDA (Rs.Crs)

18

96

111

127


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Scaling-Up Retail Performance

19

90

127157

184213

17

36

68

FY11 FY12 FY13 FY14 FY15

Offline Online

17.1%17.9%

17.3%17.9%

16.1%

9.2%

8.8%

9.6%

8.9%

9.6%

7.0%

7.5%

8.0%

8.5%

9.0%

9.5%

10.0%

12.0%

14.0%

16.0%

18.0%

FY11 FY12 FY13 FY14 FY15

Front End expenses as % of SalesEBITDA Margin before Central Expenses

Increasing Online Revenue... ... Improved Absorption of Fixed Expenses

Rs. Crs


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Documents

Result update presentation Q2 FY16 [Company Update]