Global Growth Opportunities
Disclaimer This document is of a purely informative nature and does not constitute an offer to sell, exchange or buy, or the solicitation of an offer to buy, securities issued by any of the companies mentioned herein. This document contains forward-looking statements. All statements other than statements of historical fact included herein, including, without limitation, those regarding our financial position, business strategy, management plans and objectives for future operations are forward-looking statements. Any such forward-looking statements are subject to risk and uncertainty and thus could differ materially from actual results. Some of these risks include, amongst others, ongoing competitive pressure in the sector, consumer tastes and spending trends, economic, political, regulatory and trade conditions in the markets where the Inditex Group is present or in the countries where the Group’s products are manufactured or distributed.
The risks and uncertainties that could affect the forward-looking statements are difficult to predict. The company assumes no obligation to publicly revise or update its forward-looking statements in the case of unexpected changes, events or circumstances that could affect them. Given the uncertainties of forward-looking statements, we caution readers not to place undue reliance on these statements. For a discussion of these and other factors that may affect forward looking statements and the Inditex Group’s business, financial conditions and results of operations, see the documents and information communicated by the company to the Comisión Nacional del Mercado de Valores (the Spanish Securities Commission). The contents of this disclaimer should be taken into account by all persons or entities.
2
Highlights Global fashion retailer
6,300 stores / Online / Mobile
Sales €15.9 bn (FY12)
Cash flow €3.3 bn (FY12)
Market cap. €72bn
8 independent concepts
Unique business model 3
Global fashion retailer
5 continents
86 markets
Northern and southern hemisphere
4
Business Model
Flexible, integrated business model
Design
Manufacturing & Sourcing
Store
Distribution & Logistics
6
Customer driven
Compelling mix of latest fashions and quality at affordable prices
Unique product strategy 36,000 new designs per year delivery to stores 2-6 times per week
Customer interaction daily in-store feedback allows constant modification of collections
Attractive stores in prime locations
7
Distribution and logistics
Central distribution
Shipment to all stores worldwide twice a week
Orders to stores in 24-48 hours
8
Retail experience
Latest fashion trends
Fresh items twice a week
Prime locations
Direct communication No traditional advertising
9
Strong growth
Net Sales (â‚Ź billion)
15.9 13.8 12.5
11.1 10.4 9.4 8.2
2006
2007
2008
2009
2010
2011
2012
10
Global opportunity
Business model avoids the main fixed costs associated with international expansion Central inventory position No local distribution centers per market
No advertisement when entering a new market Lean head office per market servicing all formats Online sales
11
Global sales platform
Store sales (%) Americas
Europe ex-Spain
Spain
Asia & RoW
1H13
1H12
Europe ex-Spain
45%
44%
Asia & RoW
22%
20%
Spain
19%
22%
Americas
14%
14%
Store sales: Includes sales in OMS and franchises
12
Multi-concept strategy
Market segmentation through distinctive concepts
Independent management teams
All share same business model
A global presence
Zara 1975
Pull&Bear Massimo Dutti 1991
Bershka 1998
Stradivarius 1999
Oysho 2001
Zara Home 2003
Uterqüe 2008
13
Global online sales From 29 Oct 2007
Zara Home
Europe: Austria, Belgium, Denmark, France, Germany, Greece, Ireland, Italy, Luxembourg, Monaco, Netherlands, Portugal, Spain, Sweden, UK, Switzerland, Norway, Finland, Poland
2 Sept 2010
Zara
Spain, Portugal, France, Germany, Italy, UK
4 Nov 2010
Zara
Netherlands, Belgium, Luxembourg, Austria, Ireland
3 March 2011
Zara
Switzerland, Monaco, Sweden, Denmark, Norway
From 6 Sept 2011
Massimo Dutti, Bershka, Pull&Bear, Stradivarius, Oysho, Uterq端e
Europe
7 Sept 2011
Zara
United States
20 Oct 2011
Zara
Japan
7 March 2012
Zara
Poland
5 Sep 2012
Zara
China
Oct. 2012
Massimo Dutti, Zara Home
United States
6 March 2013
Zara
Canada
28 Aug 2013
Zara
Russian Federation
1 October 2013
Massimo Dutti, Bershka, Stradivarius, Oysho
Russian Federation
Progressive roll-out
All Concepts
Globally
Inditex Concepts
Multi-concept approach
16
Operating autonomy, central support
Arteixo (La Coru単a)
Tordera (Barcelona)
Inditex
Massimo Dutti
Zara
Bershka
Zara Home
Oysho Uterq端e
Nar坦n (La Coru単a) Pull&Bear
Sallent (Barcelona) Stradivarius
17
Multi-concept strategy Age Target
Sales Breakdown
Zara Massimo Dutti Pull&Bear
NonZara
Bershka
Zara
Stradivarius
Oysho Zara Home Uterq端e 0
10
20
30
40+
18
Zara
Latest fashions for women, men and children
Headquarters in Arteixo (A Coruña)
FY12 Sales: €10.5 bn
FY12 EBIT: €2.2 bn
1H13 Stores: 1,936
19
Massimo Dutti
Elegant design with excellent quality for men, women and children
Headquarters and distribution centre in Tordera (Barcelona)
FY12 Sales: €1.1 bn
FY12 EBIT: €197 m
1H13 Stores: 634
20
Pull&Bear
Casual fashion and sport styles for young men and women (14 to 28)
Headquarters and distribution centre in Narón (A Coruña)
FY12 Sales: €1.1 bn
FY12 EBIT: €182 m
1H13 Stores: 825
21
Bershka
Latest fashions for young women and men (13 to 23)
Headquarters and distribution centre in Tordera (Barcelona)
FY12 Sales: €1.5 bn
FY12 EBIT: €240 m
1H13 Stores: 910
22
Stradivarius
Urban fashion at attractive prices for young women (18 to 35)
Headquarters and distribution centre in Sallent (Barcelona)
FY12 Sales: €961 m
FY12 EBIT: €208 m
1H13 Stores: 816
23
Oysho
Latest trends in women’s loungewear, lingerie and undergarments
Headquarters and distribution centre in Tordera (Barcelona)
FY12 Sales: €314 m
FY12 EBIT: €26 m
1H13 Stores: 533
24
Zara Home
Textiles for bed, bath and table complemented by decorative items
Headquarters in Arteixo (A Coruña)
FY12 Sales: €350 m
FY12 EBIT: €41 m
1H13 Stores: 363
25
Uterqüe
Premium accessories (bags, shoes, costume jewellery)
Headquarters and distribution centre in Tordera (Barcelona)
FY12 Sales: €74 m
1H13 Stores: 87
26
Financial Summary
Highlights
Billion â‚Ź
FY2012
% 12/11
Net sales
15.9
16%
Gross profit
9.5
16%
EBITDA
3.9
20%
Net income
2.4
22%
28
Outlook
Outlook
Global growth opportunities
Continued optimisation of retail base
Global online sales
Outlook FY2013
30
Global growth opportunities
Global presence
Flexible business model
Latest fashions at the right time at affordable prices
Multi-concept / Multi-channel
Profitable expansion of the business remains a key priority
31
Global growth opportunities
Growth in Europe Significant growth opportunities in Western and Eastern Europe All concepts Online sales in 20 markets.
32
Global growth opportunities
Growth in Asia: Leverage strategic presence Strong growth opportunities Presence in all key markets Multi-concept & online sales expansion. Zara online in China and Japan.
33
Global growth opportunities
Growth in the Americas Attractive growth markets Multi-concept expansion: Massimo Dutti in US and Canada, Stradivarius in Mexico, Zara Home in Brazil Online sales: US and Canada for Zara, Massimo Dutti and Zara Home
34
Global growth opportunities ď‚„
Australia and South Africa
ď‚„
Ongoing expansion
35
Continued optimisation of retail base
Enlargement of flagships
Rollout of new store image
Larger new stores
36
Enlargement of flagships 2012-2014
New York Fifth Avenue
Beijing The Place
London Brompton Road
Moscow Europeinski
Paris Opera
Milan Via Torino
Madrid Serrano
Amsterdam Kalverstraat
Barcelona Paseo de Gracia
Paris Champs Elysees 37
Rollout of new store image 2012-2014
London Parkhouse
Shanghai W. Nanjing Road
Paris Faubourg St. Honoré
Tokyo Ginza
Zurich Bahnhofstrasse
Hong Kong Queen’s Road
Munich Neuhauser Strasse
Taipei Q Square
Vienna Haas Haus
London Regent Street 38
Larger new stores
Continued optimisation of retail base
Increased product visibility
Stronger visual merchandising
Enhanced in-store experience
Larger new stores
39
FY2013: Outlook
Space growth in line with LT targets
Capital Expenditure c. 1.25 billion €
Store opening programme
Zara
Range
110
115
Pull & Bear
40
45
Massimo Dutti
45
50
Bershka
75
80
Stradivarius
95
100
Oysho
35
40
Zara Home
35
40
5
10
440
480
Uterqüe Total openings
40
Global online sales expansion
Zara: Europe, Asia, Americas
Concepts: Europe, US
Progressive rollout in all markets
41
Zara: Russian Federation online sales ď‚„
28th August 2013
42
Dividend increase 22%
FY2012 dividend proposal 2.20 € per share payable: 2 May: 1.10 € ordinary 4 November: 0.80 € ordinary + 0.30 € bonus
1.4 billion € to be distributed to shareholders
43
Global Growth Opportunities
Corporate social responsibility Ranked among the top in the most significant global sustainablity indices
DJ Sustainability Index, FTSE4Good, Newsweek Green Rankings Supply Chain Code of Conduct for External Manufacturers and Suppliers Internal & External audit teams
Clear to Wear
Safe to Wear
Community Investment
Environmental Strategic Plan
Product Health & Safety
2011-2015 Energy & Water Management
Programmes
Chemical & Toxin Control
Community Development
Natural Resources & Biodiversity
Emergencies
Universities Network
For&From
Sponsorship & Patronage
Waste management
Cluster Model 45