steinhoff history
TRANSCRIPT
![Page 1: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/1.jpg)
S t e i n h o f f I n t e r n a t i o n a l , M A R K U S J O O S T E
HISTORY AND DEVELOPMENT OF STE INHOFF
![Page 2: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/2.jpg)
WELCOME 2
![Page 3: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/3.jpg)
H I S T O R Y : S T E I N H O F F
3
Authoritarian regimes
1963-1990: Sourcing in the East for the West
Communist regimes Capitalist regimes
City: 2 mill + inhabitants BDR Bundesrepublik Deutschland
DDR Deutsche Demokratische Republik
INVOLVED IN HOUSEHOLD GOODS TRADING S INCE 1963
![Page 4: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/4.jpg)
H I S T O R Y : S T E I N H O F F E U R O P E
4
1989 : FALL OF THE BERL IN WALL
• Huge impact on household goods industry • Presented huge opportunities to Steinhoff
![Page 5: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/5.jpg)
H I S T O R Y : S T E I N H O F F E U R O P E
5
STE INHOFF EUROPE ESTABL ISHED Invests in production and distribution capacity
![Page 6: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/6.jpg)
1 9 9 8 : L I S T I N G O N T H E J S E
Steinhoff Europe
Steinhoff Africa
100%
Manufacturing and sourcing
Manufacturing and sourcing
STEINHOFF INTERNATIONAL HOLDINGS LIMITED
100%
6
![Page 7: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/7.jpg)
C H A I R M A N ’S R E P O R T 1 9 9 8
7
STRATEGY
“The Steinhoff group is an integrated lifestyle supplier that manufactures, markets, warehouses and distributes household goods and timber-related products”
7
![Page 8: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/8.jpg)
C H A I R M A N ’S R E P O R T 1 9 9 8
8
STRATEGY: BUSINESS MODEL
“Our business model is to be a low-cost producer and distributor of furniture. Our marketing thrust is global, catering for the mass middle market in the geographical areas in which we trade” “Logistics is a huge growth area for us with warehousing and distribution networks being key to the future”
8
![Page 9: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/9.jpg)
C H A I R M A N ’S R E P O R T 1 9 9 8
Control over sourcing, distribution and logistics
Control over direct raw materials
Low-cost production and
sourcing in emerging
economies
Sales strategy
Owned retail outlets & strategic
partnerships
Control over third party sourcing
Control over manufacturing
Wholesale partnerships
Brand partnerships
Control over sourcing, distribution and logistics
STRATEGY: BUSINESS MODEL
9
![Page 10: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/10.jpg)
ESTABLISHING THE BASE: 1998 - 2004
![Page 11: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/11.jpg)
1 9 9 8 – 2 0 0 4 E S TA B L I S H I N G T H E B A S E
ESTABLISH A LOW-COST MANUFACTURING BASE
• Invest in manufacturing capacity in Poland – German production largely relocates to Poland
• Cornick group acquisition (presence in Australia and New Zealand)
ENTER UNITED KINGDOM AND AUSTRALIA
• Acquire Relyon • Acquire Sprung Slumber • Acquire manufacturing facilities of Freedom Group in
Australia
11
![Page 12: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/12.jpg)
1 9 9 8 - 2 0 0 4 : E S TA B L I S H I N G T H E B A S E
12
FACILITATE ENTRY INTO LOGISTICS AND RAW MATERIAL SUPPLY
• Acquire Unitrans Limited • Acquire particle board manufacturer PG Bison
ESTABLISH SOURCING OPERATIONS IN ASIA
• Open sourcing office in Shenzhen
12
![Page 13: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/13.jpg)
D E C E M B E R 2 0 0 4
13
x ü
Steinhoff Europe
Steinhoff Africa
Manufacturing and sourcing
Logistic services Retail Manufacturing
and sourcing Logistic services Retail
ü ü ü x
Vertically integrated furniture and household goods business
Vertically integrated furniture and household goods business
STEINHOFF INTERNATIONAL HOLDINGS LIMITED
13
![Page 14: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/14.jpg)
CONSOLIDATION 2005 – 2015
![Page 15: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/15.jpg)
1 9 9 8 - 2 0 1 5
ESTABLISHING THE PILLARS OF OUR BUSINESS
Vertically integrated
Manufacturing and sourcing
Logistics services Retail
15
![Page 16: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/16.jpg)
C O N S O L I D AT I O N : 2 0 0 5 – 2 0 1 5
CONSOLIDATE: UNITED KINGDOM AND PACIFIC RIM
• Acquire the listed retail group Freedom in Australia and
New Zealand • Acquire the listed retail group Homestyle in the UK • Acquire Unitrans UK • Bolster worldwide sourcing operations
16
16
![Page 17: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/17.jpg)
CONSOLIDATE: EUROPE
• Convert interests of various retail participation agreements
• Investment in: • Poco (2008) • Conforama (2011)
• Continued investment in store footprint
CONSOLIDATE: AFRICA
• Acquisition of JD Group
C O N S O L I D AT I O N : 2 0 0 5 – 2 0 1 5
17
![Page 18: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/18.jpg)
C O N S O L I D AT I O N : 2 0 0 5 – 2 0 1 5
Control over sourcing, distribution and logistics
Control over direct raw materials
Low-cost production and
sourcing in emerging
economies
Sales strategy
Owned retail outlets & strategic
partnerships
Control over third party sourcing
Control over manufacturing
Wholesale partnerships
Brand partnerships
Control over sourcing, distribution and logistics
✔
✔
✔
✔
✔ ✔ ✔
✔
✔
SUCCESSFULLY INTEGRATED RETAIL ONTO LOW-COST SUPPLY CHAIN
18
![Page 19: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/19.jpg)
STEINHOFF TODAY
![Page 20: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/20.jpg)
RETAILER RETAIL BRANDS
EUROPE Conforama, POCO, ABRA, LIPO, Emmezeta
UK Harveys, Bensons for Beds, Cargo
ASIA PACIFIC Freedom, Snooze, POCO
AFRICA JD furniture brands, POCO, Incredible Connection, HiFi Corp, Pennypinchers, Timbercity, Hardware Warehouse, The tile house
2 261 RETAIL
OUTLETS
I N T E G R A T E D R E T A I L – H O U S E H O L D G O O D S
24 RETAIL
BRANDS
+/-
3.1m M2 RETAIL
SPACE
20 countries
+/-
50 000 employees
HOUSEHOLD GOODS
20
![Page 21: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/21.jpg)
S T E I N H O F F G R O U P S U P P L Y C H A I N
21
Integrated retail business and group procurement initiatives continue to benefit from the enlarged European retail network
PURCHASING POWER
> €4 bn
MANUFACTURING, SOURCING AND LOGISTICS
![Page 22: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/22.jpg)
USING THE BEST RAW MATERIALS AND LATEST PRODCUTION TECHNOLOGY
21 FACTORIES MAKING BEDS/MATTRESSES, UPHOLSTERED FURNITURE AND BATHROOM AND KITCHEN FURNITURE
S T E I N H O F F G R O U P S U P P L Y C H A I N
22
![Page 23: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/23.jpg)
ROUTING AND TRANSPORT METHODS ARE OPTIMISED FOR EFFICIENCIES
>85 000+ TEUS OF PRODUCT SHIPPED AND DELIVERED IN EUROPE
S T E I N H O F F G R O U P S U P P L Y C H A I N
23
![Page 24: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/24.jpg)
CUTTING EDGE TECHNOLOGY IS USED THROUGHOUT
MORE THAN 1 000 000 M2 WAREHOUSE SPACE IN EUROPE
S T E I N H O F F G R O U P S U P P L Y C H A I N
24
![Page 25: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/25.jpg)
S E G M E N TA L R E V E N U E D E V E L O P M E N T
1998 2015
86%
13% Retail activities
Manufacturing, sourcing,
logistics and corporate
services
100%
REVENUE PER SEGMENT (HOUSEHOLD GOODS)
25
![Page 26: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/26.jpg)
2015 EXPANDING DISCOUNT PRODUCT
RANGE
![Page 27: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/27.jpg)
S T E I N H O F F G R O U P O V E R V I E W
27
STEINHOFF – PRE PEPKOR
• Leading European and Southern African retail company
• Focused on the value-conscious consumer
• Household goods market segment
• Revenue of R117 billion in FY14
RETAIL
MANUFACTURING, SOURCING AND LOGISTICS & CORPORATE
PROPERTIES
Gross revenue R104 bn
Gross revenue R33 bn
Gross revenue R3 bn
![Page 28: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/28.jpg)
P e p k o r E n h a n c e s S t e i n h o f f ’ s g r o w t h t r a j e c t o r y
• Complementary discount retail footprints and opportunity to leverage Steinhoff’s experience in multiple European markets
• Profitable expansion of the Pepco business model within Steinhoff’s existing European discount formats, thereby:
• Diversifying product mix with faster moving, less cyclical products
• Increasing per square metre sales densities on existing overhead base
Further Accelerate Growth Across Europe
• Combined supply chain and logistics functions, increasing profitability • Greater buying power and economies of scale
• Substantial operational and supply chain overlap and cost saving opportunities in:
• Eastern Europe, Australia and Africa 28
![Page 29: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/29.jpg)
2 261 RETAIL
OUTLETS
2 0 1 5 S T E I N H O F F R E T A I L
1 679 stores
UK
Germany Poland
Switzerland
France Portugal
Spain Italy
Croatia
South Arica, Botswana, Zambia, Namibia, Zimbabwe, Nigeria, Mozambique, Malawi, Angola, Lesotho
Australia New Zealand
homehomehome
THE NATION’S STORE, WHERE YOUR MONEY BUYS YOU MORE!
4 222 stores
471 stores
29
![Page 30: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/30.jpg)
Australia 471 Stores c.558 000m2
Europe 1 679 Stores c.2.5 million m2
Rest of Africa 265 Stores c.105 000m2
South Africa(1) 3 957 Stores c.1.9 million m2
Asia Factories and Sourcing Offices
Combined group retail presence
Combined group manufacturing and sourcing presence
Note: (1) Includes Botswana, Lesotho, Namibia and Swaziland.
6 000+ STORES (5 MILLION SQUARE METERS)
THE COMBINED GROUP IS STRONGLY POSITIONED TO TAKE ADVANTAGE OF THE MARKET OPPORTUNITY
S T E I N H O F F / P E P K O R – T R A N S A C T I O N R A T I O N A L E
30
![Page 31: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/31.jpg)
2015 results HIGHLIGHTS
![Page 32: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/32.jpg)
F I N A N C I A L P E R F O R M A N C E
Segmental information
NET REVENUE OPERATING PROFIT
FY15 €m
FY14 €m
FY15 €m
FY14 €m
Integrated retail – Household goods 7 623 7 119 956 858
Integrated retail – General merchandise (3 months) 888 - 120 -
Integrated retail – Automotive 1 309 1 198 39 36
Total operations (EURO) 9 820 8 317 1 115 894
Translation rate EUR:ZAR 13.7347 14.1106 13.7347 14.1106
FY15 Rm
FY14 Rm
FY15 Rm
FY14 Rm
Integrated retail – Household goods 104 696 100 449 13 134 12 110
Integrated retail – General merchandise (3 months) 12 199 - 1 645 -
Integrated retail – Automotive 17 973 16 915 536 512
Total operations (ZAR) 134 868 117 364 15 315 12 622
![Page 33: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/33.jpg)
F I N A N C I A L P E R F O R M A N C E
Equity – shares issued during FY15
2,100
3,652
350 220 11
926 45
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
Jun-14 ABB & Rights issue
Convertible bonds
Share incentive scheme
Pepkor vendor consideration
PSG vendor consideration
Jun-15
No
of s
ha
res
(m)
WANOS – 2 737m shares increased by 38% (FY14: 1 977m shares)
33
![Page 34: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/34.jpg)
F I N A N C I A L P E R F O R M A N C E
FY15 Rm
FY14 Rm
Cash generated from operating activities 20 286 16 141 Investing activities (21 124) (16 684) Asset expansion capex (3 229) (3 070) Asset replacement capex (1 495) (1 807) Net investment in subsidiaries (13 366) (4 518) Other investments and loans (3 034) (7 289) Financing activities 23 630 6 513 Increase in cash and cash equivalents 22 792 5 970
Cash flow summary
34
![Page 35: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/35.jpg)
C A P I T A L S T R U C T U R E
Net debt
44,071
30,227
26,142
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
50,000
FY13 FY14 Pro forma*
FY15
NET DEBT (Rm)
*Pro forma as announced post rights issue in July 2014
35
![Page 36: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/36.jpg)
Y E A R U N D E R R E V I E W
Financial highlights
REVENUE INCREASED*
15% HEADLINE EARNINGS INCREASED*
36%
DILUTED HEADLINE EARNINGS PER SHARE INCREASED*
1%
NET CASH INFLOW FROM OPERATIONS INCREASED
26%
WEIGHTED AVERAGE NUMBER OF SHARES INCREASED
38% NET ASSET VALUE PER SHARE INCREASED
22%
DIVIDEND INCREASED
10%
* From continuing operations 36
![Page 37: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/37.jpg)
STRATEGIC OUTLOOK
![Page 38: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/38.jpg)
S T E I N H O F F B U S I N E S S M O D E L
38
The environment shaping Steinhoff’s strategy Steinhoff’s strategy
![Page 39: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/39.jpg)
F R A N K F U R T L I S T I N G
39
European prospectus • Issued at the end of November 2015
PRIMARY EUROPEAN LISTING IN FRANKFURT • Aligned to the majority of Steinhoff’s geographic
locations
• Approximately 75% of Steinhoff’s operating profit
is earned outside of Africa, largely in Europe.
• Reporting currency change to Euro
• Secondary listing on Johannesburg Stock Exchange
Listing date 7 December 2015 No capital raising at listing
39
![Page 40: Steinhoff history](https://reader031.vdocuments.us/reader031/viewer/2022013013/5880a07d1a28abd8158b6819/html5/thumbnails/40.jpg)
THANK YOU