2019/20 annual results corporate presentation · international housewares retail company limited 2...

1International Housewares Retail Company Limited2019/20 Annual Results

2019/20 Annual Results

Corporate Presentation

29 July 2020


Stock code: 1373

International Housewares Retail Company Limited2019/20 Annual Results

Disclaimer

2

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information contained in this presentation and these materials has not been independently verified and is subject to verification, completion and change without notice. The information contained in this presentation and these materials is only current as of the date of this presentation and these materials. None of the Company and

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of this presentation or these materials or any information in any of them, and none of them is under any obligation, legal or otherwise, to update or keep current this presentation or these materials or any information in any of them.

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inaccuracy or error in respect of, this presentation or these materials or otherwise.


Stock code: 1373


Agenda

3

Business Highlights

Financial Performance

Business Review by Market

Outlook and Strategies


Business Highlights


Stock code: 1373


5

Results Highlights

Profit attributable to equity holder up

26.8% to HK$150.9M

Singapore turnaround,

contribution profit to the Group

Hong Kong sales growth 8.1%

Group gross profit increased by 9.6% to

HK$1.18B

Group revenue grew 8.2% to HK$2.54B

Proposed final dividend 11HK

cents/share


Stock code: 1373


Physical Store Retail Network

6

FY2017 FY2018 FY2019 FY2020

Hong Kong 290 290 305 312

Singapore 57 48 44 49

Macau 8 8 7 8

Number of directly-owned stores

270 stores

6 stores

31 stores

49 stores in Singapore

8 stores in Macau

9 licence stores in

four jurisdictions

66 Overseas Stores 312 Stores in Hong Kong

5 stores


Financial Performance


Stock code: 1373


For the year FY2020 FY2019

Turnover (HK$’000) 2,542,384 2,350,351

Gross Profit (HK$’000) 1,184,161 1,080,654

Net profit (HK$’000) 156,064 118,271

Profit attributable to equity holders (HK$’000) 150,927 119,052

Key ratios

Gross Margin 46.6% 46.0%

Operating Margin 7.8% 5.9%

Net margin 6.1% 5.0%

Total Dividend

Interim dividend (HK cents) 5.5 5.3

Final dividend (HK cents) 11.0 9.0

Total Dividend (HK cents) 16.5 14.3

Financial Performance – FY2020

8


Stock code: 1373


As at 30-Apr FY2020 FY2019

Cash and cash equivalents (HK$’000) 362,737 369,703

Inventory Turnover (1) (days) 84 81

Trade Payable Turnover (2) (days) 41 46

9

Notes:

1. Inventory turnover = (Opening Inventory + closing inventory) / 2 / Cost of sales x 365

2. Trade payables turnover = (Opening trade payable + Closing trade payables) / 2 / Cost of sales x 365

Financial Performance – FY2020


Business Review by Market


Stock code: 1373


Revenue Breakdown

Revenue breakdown

11

Macau

Singapore

Hong Kong

88.1%

10.2%

% to Group’s Revenue

1.7%

HK$’000FY20

1,941,285 2,071,443

2,239,162

248,841 237,715

258,87939,976

41,193

44,343

FY2018 FY2019 FY2020

Hong Kong Singapore Macau

2,350,3512,203,102

2,542,384


Stock code: 1373


FY 2020 FY 2019

Number of stores at 30-April 312 305

Sales growth 8.1% 6.7%

Net margin 6.0% 5.6%

CSSG 4.6% 4.8%

Hong Kong – 1st Market – Strategic Focus

Revenue growth driven by CSSG and new store openings

Strong international sourcing ability amid supply chain interruptions caused by COVID-19

Further integration of JHCeshop, Easy Buy, Jfun and social media apps to prepare for growing online

shopping population

Diversify product offerings, e.g. allying with global brand FMCG trader for smooth supplies

Private label: Matsusho electrical appliances and gadgets, digiMomo mobile phone accessories, EZ

cook value cookware and Pole Bear thermo products

Creating distinctive brand image for ELLA and $Mart

Shaping JHC towards convenience GMS chain

Set up protective mask production line in Hong Kong under the brand name of “SMILE 365”

Following the Government housing plans to further expand physical store network

12


Stock code: 1373


Singapore – 2nd Market – Optimistic

Strong sales growth driven by CSSG, no. of tickets & new store opening

Full-year profit for the first time in 6 years

Attracting traffic by in-shop “Must Buy Corner” selling snack & FMCG – big contributor to sales growth

Strategic partnership with local branded snacks & FMCG trader, securing value stock supplies

Recruiting and retaining local talents for business expansion

Tapped into the Group’s PRC supply chain to add operation efficiency and sourcing power

Seeking potential locations for new store opening to grow sales and profits

Stepping up online channels development – enhancing “Jfun” app; launching “EasyBuy”; setting up self-

operated eshop with linkage to our existing eshops on Q0010 and Lazada; and achieving an overall

integrated e-platform with all these components

Start to sell cash/gift vouchers to add repeat buy and enlarge customer base

13

For the year FY2020 FY 2019

Number of stores 49 44

% of sales to group’s revenue 10.2% 10.1%

CSSG 9.8% 6.1%


Outlook and Strategies


Stock code: 1373


Focusing in Hong Kong, Singapore & Macau1

15

Keeping leading position in Hong Kong

Optimistic about the business

development & profitability in Singapore

Seeking right locations for store

opening in the profitable Macau market

Transforming ourselves to convenience

GMS chain

In-depth integration of physical stores

and e-platform (eshop, Easy Buy, Jfun

and social media) to further strengthen

O2O platform and to shape our

business strategies.


Stock code: 1373


Simple ◆ Fast Retailing : 123 by Ella2

16

Store re-fit, fresher, cozier &

younger look

Widening product categories &

price range

Bringing in value international

branded beauty & personal

FMCG items

Expanding sourcing network

In-store promotion plan to

drive sales

Highly differentiated from JHC

to tap into younger segment


Stock code: 1373


New Product Category & New Retail Brand

17

Brand position - great price, convenience and wide-variety

Distinctive store format – a good mix of direct import FMCG, mainly on food and personal care

products

Big growth potential, seeking right locations for new store opening

Benefited from Group’s extensive sourcing network and Group’s volume purchase hence competitive

price

Strategic partnership with international FMCG trader to secure smooth supplier

2


Stock code: 1373


Reinforce leading position and sustainable growth

3.1

18

Create brand

consistency across

different categories

Add new value to

regular top selling

items

set up production

line in Hong Kong

to produce

protective mask

Provide stable local

mask supply to

meet customer

demand

Activate digital

content strategies

via social media

apps

Space saving &

multifunctional

design for tiny home

Provide everyone

should have digital

items

Start with basic and

move to tech items

Complimentary to

int’l brand offering

Based on our local

knowledge on

customer trends

Private Label Development ◆ Continuous Efforts on House Brand Building


Stock code: 1373


Easy Buy

• In-store shopping iPanel,

• Wide variety of products for

customers’ orders

• Solution for limited space;

reduce stockholding


3.2

19

JHC Omni-Channel Retailing

J Fun App

• Customer loyalty

• Gain points for purchase

at store, eshop or Ipanal

• Push promotion message

Social media

• Create brand content;

post promotion message;

publicizing house brand

products

Physical Retail Store

Network

• JHC - Iconic brand of

housewares convenience

store

• Over 300 stores in HK

JHCeshop

• Wide variety of products

under different

categories for online

buying

• Home delivery / store

pick-up


Stock code: 1373



3.3

20

In-house Protective Face Mask Production

Shortage of protective face masks in

the earlier stage of Covid-19

prompted the decision

Set up and operated by experienced

factory manager

Put in production in July 20

Aim at provide stable supply to meet

on-going customer demand


Stock code: 1373


Network Expansion Plan and CAPEX

Planned store expansion & estimated capital expenditures

21

Store expansion (Net increase in number of stores)

Actual at

30 Apr 20

Net increase

FY21

Net increase

FY22

Hong Kong (incl. 123 by Ella) 312 12 12

Macau 8 2 2

Singapore 49 5 5

Total: 369 19 19

Estimated capital expenditureHK$ million

FY21 FY22

New store openings (incl. relocations) 20 21

Ongoing renovations of existing stores 20 21

ERP system & logistics improvement 10 10


Q & A


Thank You!

2019/20 annual results corporate presentation · international housewares retail company limited 2...

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