investor & analyst presentation€¦ · investor & analyst presentationannual report 2015 |...

Investor & Analyst PresentationAnnual Report 2015

March 23rd, 2016

Dr. Cornelius Patt, CEO

Andreas Grandinger, CFO

Investor & Analyst Presentation Annual Report 2015 | page 2

This document includes supplemental financial measures that are or may be non-GAAP financial measures. These supplemental financial measures should not be viewed in isolation as alternatives to measures of zooplus’ financial condition, results of operations or cash flows as presented in accordance with IFRS in its Consolidated Financial Statements. Other companies that report or describe similarly titled financial measures may calculate them differently.

This document contains statements related to our future business and financial performance and future events or developments involving zooplus that may constitute forward-looking statements. We may also make forward-looking statements in other reports, in presentations, in material delivered to stockholders and in press releases. In addition, our representatives may from time to time make oral forward-looking statements. Such statements are based on the current expectations and certain assumptions of zooplus’ management, and are, therefore, subject to certain risks and uncertainties. A variety of factors, many of which are beyond zooplus’ control, affect zooplus’ operations, performance, business strategy and results and could cause the actual results, performance or achievements of zooplus to be materially different from any future results, performance or achievements that may be expressed orimplied by such forward-looking statements or anticipated on the basis of historical trends. Further information about risks anduncertainties affecting zooplus is included throughout our most recent annual and interim reports, which are available on thezooplus website, www.zooplus.de. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results, performance or achievements of zooplus may vary materially from those described in the relevantforward-looking statement as being expected, anticipated, intended, planned, believed, sought, estimated or projected. zooplus neither intends, nor assumes any obligation, to update or revise these forward-looking statements in light of developments whichdiffer from those anticipated.

Due to rounding, numbers presented throughout this and other documents may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures.

Safe Harbor Statement


2015 has been another successful year for zooplus

» Total sales increased by 30% to € 743 m – Absolute growth of € 172 m compared to 2014:

market leader position in online retailing further expanded

» All-time highs for customer loyalty with 94% sales retention– High loyalty of existing customers as major sales driver

» Further significant efficiency and scaling gains in cost structure– Total cost ratio reduced to 28.5% of total sales

» Positive earnings before taxes (EBT) of € 12.7 m– Improved by EUR 3.9 m compared to prior year; EBT on total sales of 1.7% (+ 0.2%p)

» EBITDA improved to € 15.4 m– EBITDA on total sales increased to 2.1% (+0.4%p)

» Positive free-cash-flow of € 13.6 m– Determined by positive EBT development and working capital improvements


194257

336

427

571

743

2010 2011 2012 2013 2014 2015

94%91%

85%79%81%

zooplus strong total sales growth has continued in 2015 and € 172 m in total sales have been added

Total sales 2010 – 2015 (€ m)

+ 63

+ 79

+ 91

+ 33% + 31% + 27% + 34%Total sales growth vs. PY

+ 144

New customer sales (1st year)

Repeat customer sales

Total sales

Retention rate

+ 30%

+ 172


In a large and fragmented niche market zooplus dominates online – and is rapidly catching up with the offline leaders

Market share zooplus and competitors 2015e

~ 50 % market share zooplus online

~ 3.4 % market share online and offlineCAGR: 2011-15: + 30%2015: € 0.7 bn

Total pet supplies market Europe (incl. VAT):

~ € 25 bn (~ € 21 bn net)

CAGR: 2011-15: 2 - 3%

Source: Euromonitor, company information, zooplus estimation; 1 online share of net sales

Net sales 2015e :

~ € 1.5 bn (+7%)

Online: ~ € 0.045 bn(+ 2% vs. PY)

Net sales 2015e:

Online: ~ € 0.02 bn (< 3%)1

Net sales

Other onliners:

Fressnapf

Net sales

~ € 1.0 bn (+6%)

Pets at Home

2015e: n/a


» Net sales € 711 m

» Double-digit sales growth rates in all countries

» D.A.CH region with growth above 20%

» zooplus market share of total market 3.4%

Net sales 2015

HU

Source: zooplus net sales, unaudited data, growth rates compared to 2014; market shares based on extrapolation of Euromonitor 2013 market data, zooplus estimation 2% growth p.a.

67 m

Total market 2015

Net sales zooplus

DK, SE, FI, NO

D,A,CH

PL, CZ, SK, HU, RO, SI, HR, BG, TR, GR

ES, PT

zooplus is the online market leader in all geographies of Europe – with the widest possible base for further growth

NL, BE, LU

+30%

+43%

+33%

+40%

+32%

+50%

+23%

+25%

42 m

84 m

236 m68 m

119 m

38 m

57 m711 m

zooplusmarket share

5.3%

1.6%

2.8%

2.6%

2.1%

4.1%

5.5%

3.0%

3.4%

21 bn

Size of total marketoffline and online (net sales)


94%

Customer loyalty – the winning factor of the business model – has further improved in 2015

Retention rates – Cohort analysis (Net sales in € m)

90 86 85 86 89

55 46 45 44 46

100

62 56 55 56

125

87 79 78

135

105 95

174145

202

2011 2012 2013 2014 2015

100%

84% 98%

62%90%

70%

Ø 79%

Ø 85%

<=2009<=2009<=2009

2010 a+1 2010 a+2 2010 a+3

2011 a

2011 a+1 2011 a+2

2012 a

2012 a+1

Ø 91%

2013 a

2014 a

91%

+ 3 %p

2015 a

2013 a+1

2012 a+2

2011 a+3

2010 a+4

<=2009

78%

99%

99%

101%

83%

Ø 94%

Reading example: 2011 a+1= sales of 2011’s new customers in 2012

2014 a+1

2013 a+2

2012 a+3

2011 a+4

2010 a+5

<=2009

90%

99%

102%

104%

104%

245

319

407

543

711


Further performance drivers have been improved in 2015

Active customers (m)

1.92.5 2.7

3.34.0

2011 2012 2013 2014 2015

New customers (m)

1.2 1.6 1.4 1.8 2.0

2011 2012 2013 2014 2015

Orders (m)

5.0 6.3 7.710.0

12.7

2011 2012 2013 2014 2015

Net sales per account (€)

126 128151 162 177

2011 2012 2013 2014 2015


Markets continue to be price competitive – zooplus well prepared to defend its strategic position

Gross margin

2014 2015

» Continued focus on sustainable dog/cat food customers for higher life-time-value

» Margin reduction impacted by higher food share and exchange rate effects

» Ongoing price competition in the markets

» zooplus will defend its high customer retention

- 1.0 %p

31.2 % 30.2 %

In % of total sales

2015

2014 2015

Product mix 1

1 Share of food on sales

+ 3 %p

77 %80 %


Additional efficiency gains and scaling effects lead to a further reduction of the cost ratio in 2015

Gross margin & cost structure (total sales)

4.8% 4.5% 3.7% 3.4%

7.0%4.8%

4.0% 4.4%

22.9%

21.7%20.2% 19.3%

5.8%

2.5%

1.7% 1.4%

2011 2013 2014 2015

40.5%

29.6%

IT/Admin/Payment (incl. depreciation & interest)

Advertising/Marketing

Logistics Personnel

in % of total sales

28.5%

31.2% 30.2%34.5%Gross

margin

…

33.5%

201538.9%

» Extremely efficient marketing and new customer acquisition

» Further cost reduction in logistics

» Scaling effects in personnel

» Depreciation impacted by one-off of € 1.8 m for capitalized own work in connection with IT migration


Unit economics will further improve in logistics

19.3%17.3%

13.3% 13.3%14.8%

21.9%

zoopluslogistics

all-in

zoopluslogistics

only variable

PL CZ DE ES

Logistics costs1 2015

1 Inbound & outbound logistics, line haul, distribution, packagingas a percentage of total sales

best-in-class

20.2% 18.1% 13.8% 14.1% 15.0% 23.9%2014 in % of total sales


In 2015 the profitable growth path has been successfully continued - free cash flow is positive

Total sales (€ m)

2014 2015

EBITDA (€ m) Free cash flow (€ m)

+ 30 % + 5.5 + 15.5

711

31

28

543

Other income

Net sales

743

571

2014 2015

15.4

9.9

2014 2015

1.5%

12.7

8.8

2014 2015

13.6

-1.9

EBT (€ m)

+ 3.9

1.7% 2.1% 1.7%of total

sales


zooplus total sales and profitability by quarter – first half always weaker than second half

170 174187

211

Q1 2015 Q2 2015 Q3 2015 Q4 2015

Total sales by quarter (€ m)

1.6 2.1

5.5

3.5

Q1 2015 Q2 2015 Q3 2015 Q4 2015

EBT by quarter (€ m)

H1: 3.6 H2: 9.0


EBT-margin of repeat customer business of around 4% significantly higher than overall EBT-margin

Net sales & EBT distribution 2015 (€ m) - unaudited

Net sales

% oftotal z+

EBT EBT-margin

202 28% - 5 - 3%

Net sales

% oftotal z+

EBT EBT-margin

509 72% 18 + 4%

New customers(sales in the year of acquisition)

Repeat customers(consecutive year’s sales)

Total zooplus

EBT zooplus 2015: € 12.7 m

» Further efficiency gains especially from continued built-up of pan-European logistics

» Scaling effects in IT/Admin and personnel

» Strategic advantages from size (purchasing power / private label)

Outlook:


Countries with optimized supply chains show EBT-margins for repeat customers higher than average zooplus margin

Net sales

% oftotal z+

EBT EBT-margin

125 17% - 3 - 3%

77 11% - 2 - 3%

202 28% - 5 - 3%

Net sales

% oftotal z+

EBT EBT-margin

367 52% 14 + 4%

142 20% 4 + 3%

509 72% 18 + 4%

New customers(sales in the year of acquisition)

Repeat customers(consecutive year’s sales)

Direct / optimized supply chain 1

Indirect / intermediate

stage supply chain 2

Totalzooplus

EBT zooplus 2015: € 12.7 m1 DE, AT, CH, NL, BE, PL, CZ, FR2 Other countriesSource: zooplus data (unaudited)

Net sales & EBT distribution 2015 (€ m) - unaudited


Logistics capacity will be doubled in the next three years, product quality and efficiency will further improve

2013

Q1/2015

Fulfillment center (FC) Potential FC under investigation

2009

» FC in Chalon-sur-Saône started in Q1/2015

» Capacity increase in other existing fulfillment centers

» Overall capacity increase by 40% since beginning of 2015

» All FCs operated by partners; no capex for zooplus

» Orderrouting and packing algorithms intellectual property of zooplus

» New capacity to be added in 2016; locations still under review

2000/2011

Q1/2015


zooplus logistics structure is tailor-made for heavy and bulky products in inbound and outbound logistics

zoopluslogistics

Source: zooplusChalon-sur-Saone, France Chalon-sur-Saone, France

Tilburg, Netherlands Tilburg, Netherlands


Current guidance for net sales and EBT in 2016

2016e

2015

EBT (€ m)

14 - 18

12.7

Guidance

Net sales (€ m)

> 875 > 23 %

711 + 31 %

1 corresponds to total sales (net sales + other income) of € 743 m in 2015 and > € 900 m in 2016;from 2016 on zooplus follows industry practice and reports net sales as leading top-line indicatorcompared to total sales (net sales + other income) in the past.

1

1


Continued focus on retention and strong sales growth drives future profitability

Strong sales growth means:

» Increased distance towards competition / better strategic position

» Better purchasing terms in all areas (COGS & other services)

» More efficiency gains

» More scale in overhead

Strong impact on future profitability

Retention Sales growth

Cost structure Profitability


zooplus shareholder structure is very much focused on growth and mid-term value creation

March 2016

Capital Research 12.68%

Ruane, Cunniff& Goldfarb

10.01%

Management 5.00%

Others 45.44%

Maxburg Beteili-gungen GmbH & Co. KG 13.67%

Deutsche Asset & Wealth6.91%

Source: information from notification of voting rights and company information; data as of March 22nd, 2016

No. of shares: 6,995,182

Market cap: ~ € 800 m

Jan 2nd, 2015: € 66.70

Mar 22nd, 2016: € 113.95

Delta: + 71%

Financial calendar 2016:

April 21st:Preliminary sales Q1 2016

May 19th:Q1 report 2016

July 21st:Preliminary sales Q2 2016

August 18th:H1 report 2016

Pelham Capital 3.22%

Norges Bank 3.07%


zooplus: Annual Report 2015

Q & A


Back-up: Key Financials


Key Financials 2015

P&Lin € m

2015 2014 ∆∆∆∆ abs ∆∆∆∆%p

Total sales 742.7 570.9

abs. 171.8

∆ in % 30.1%

COGS518.2

69.8%393.0

68.8%125.2

1.0%p

Logistics143.2

19.3%115.1

20.2%28.1

-0.9%p

Payment7.8

1.0%6.9

1.2%0.9

-0.2%p

Customer acquisition10.8

1.4%9.9

1.7%0.9

-0.3%p

Personnel25.0

3.4%21.2

3.7%3.8

-0.3%p

G&A22.3

3.0%14.9

2.6%7.4

0.4%p

EBITDA15.42.1%

9.91.7%

5.50.4%p

I&DA2.8

0.4%1.1

0.2%1.7

0.2%p

EBT12.71.7%

8.81.5%

3.90.2%p

EPS in EUR (basic) 1.13 0.83

Balance Sheet

Total Assets 165.3 138.6 26.7

Equity (Ratio in %)93.2

56.4%86.2

62.2%7.0

Cash Flow

Free Cash Flow 13.6 -1.9 15.4


Profit & Loss 2015

in € m2015 2014

abs % abs %

Sales 711.3 95.8% 543.1 95.1%

Other income 31.3 4.2% 27.8 4.9%

Total sales 742.7 100.0% 570.9 100.0%

Cost of materials -518.2 -69.8% -393.0 -68.8%

Personnel costs -25.0 -3.4% -21.2 -3.7%

Depreciation -2.6 -0.3% -0.7 -0.1%

Other expenses -184.0 -24.8% -146.8 -25.7%

thereof logistics / fulfillment (-143.2) -19.3% (-115.1) -20.2%

thereof marketing (-10.8) -1.4% (-9.9) -1.7%

thereof payment (-7.8) -1.0% (-6.9) -1.2%

thereof other costs (-22.3) -3.0% (-14.9) -2.6%

Earnings before interest and taxes (EBIT) 12.8 1.7% 9.2 1.6%

Financial income 0.0 0.0% 0.0 0.0%

Financial expenses -0.2 0.0% -0.4 -0.1%

Earnings before taxes (EBT) 12.7 1.7% 8.8 1.5%

Taxes on income -4.7 -0.6% -3.5 -0.6%

Consolidated net result 7.9 1.1% 5.2 0.9%

Differences from currency translation -0.2 -0.0% 0.0 0.0%

Hedge reserve -1.5 -0.2% 1.6 0.3%

Items that may be relclassified subsequently to profit or loss -1.7 -0.2% 1.6 0.3%

Comprehensive income 6.3 0.8% 6.8 1.2%

Earnings per share in €

basic 1.13 - 0.83 -

diluted 1.11 - 0.80 -


Balance Sheet as of Dec. 31st, 2015

Assets Equity and Liabilities

in € m Dec. 31st, 2015 Dec. 31st, 2014 ∆∆∆∆ abs

A. Non-current assets

I. PP&E 1.4 0.8 0.6

II. Intangible assets 8.0 8.6 -0.6

III. Other financial assets 0.0 0.0 0.0

IV. Deferred tax assets 1.8 4.2 -2.4

Total non-current assets 11.3 13.6 -2.3

B. Current assets

I. Inventories 74.5 65.0 9.5

II. Advance payments 1.4 0.5 0.9

III. Accounts receivable 13.6 12.1 1.5

IV. Other current assets 18.3 13.1 5.2

V.Derivative financialinstruments

0.6 2.3 -1.7

VI. Cash and cash equivalents 45.5 32.0 13.5

Total current assets 154.0 125.0 29.0

165.3 138.6 26.7

in € m Dec. 31st, 2015 Dec. 31st, 2014 ∆∆∆∆ abs

A. Equity

I. Capital subscribed 7.0 7.0 0.0

II. Capital reserves 92.8 92.0 0.8

III. Other reserves 0.0 1.7 -1.7

IV. Profit and Loss carried forward -6.5 -14.5 7.9

Total equity 93.2 86.2 7.0

B. Non-current liabilities 1.8 1.2 0.6

C. Current liabilities

I. Accounts payable 35.3 23.4 11.9

IIDerivative financialinstruments

0.5 0.0 0.5

III. Other current liabilities 23.4 20.1 3.3

IV. Tax liabilites 0.7 2.0 -1.3

V. Provisions 8.4 4.1 4.3

VI. Deferred income 2.0 1.5 0.5

Total current liabilities 70.3 51.1 19.2

165.3 138.6 26.7


Cash Flow 2015

EBT 12.7 8.8

Cash flow from operating activities 16.2 2.8

Cash flow from investing activities -2.7 -4.7

Free cash flow 13.6 -1.9

Cash flow from financing activities 0.0 28.1

Net change of cash and cash equivalents 13.6 26.3

Cash on hand, bank deposits 45.5 32.0

in € m 2015 2014


Key Financials Q4 2015

P&Lin € m

Q4 2015 Q4 2014 ∆∆∆∆ abs ∆∆∆∆%p

Total sales 211.4 167.5

∆ abs. 43.9

∆ in % 26.2%

COGS145.5

68.8%117.0

69.8%28.5

-1.0%p

Logistics41.0

19.4%33.2

19.8%7.8

-0.4%p

Payment2.3

1.1%2.0

1.2%0.3

-0.1%p

Customer acquisition3.2

1.5%2.8

1.7%0.4

-0.2%p

Personnel6.9

3.2%5.6

3.3%1.3

-0.1%p

G&A7.0

3.3%3.9

2.3%3.1

1.0%p

EBITDA5.6

2.6%3.0

1.8%2.6

0.8%p

I&DA2.0

1.0%0.3

0.2%1.7

0.8%p

EBT3.5

1.7%2.7

1.6%0.8

0.1%p

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