Howard McDonald Managing Director Jason Murray Chief Financial Officer 14 September, 2005
Highlights Record NPAT up 10.4% on a 53 week comparable basis EBITA of $73.1m achieving prospectus forecast of $73.0m Sales up 3.7% on 53 week comparable basis Cashflow from operating activities of $65.8m Inventory stockturn of 4.6 times versus last year of 4.4 times and prospectus forecast of 4.3 times A fully franked final dividend of 6 cents per share bringing the full year dividend to 13.5 cents per share as per our prospectus Strong performances from Womens fashion businesses Successful integration of Dotti
Record Profit after Tax 50 2.5% ahead of prospectus 10.4% ahead of last year 45 40 40.0 40.4 41.6 44.1 $ millions 35 30 25 22.6 20 15 Actual 03 Actual 04 Prospectus 05 Actual 05 Adjusted 05 (52 Weeks) (53 Weeks) (52 Weeks) (52 Weeks) (53 Weeks)
Sales 3.7% ahead of LY 700 650 619.8 632.8 642.5 $ millions 600 550 500 450 442.6 562.2 400 350 300 378.8 FY 2001* FY 2002* FY 2003 FY 2004 Actual FY 2005 *Adjusted historical per prospectus 2004 Adjusted FY 2005 (53 Weeks) (52 Weeks) (53 Weeks)
Segment Sales SALES ($m) FY 2004 (52 Weeks) FY 2005 (52 Weeks) FY 2005 Adjusted (53 Weeks) Change 05 Adjusted Casualwear Just Jeans 242.4 219.4 223.2-7.9% Jay Jays 165.6 180.4 183.0 +10.5% Dotti - 12.0 12.0 - Total 408.0 411.8 418.2 +2.5% Womenswear Portmans 106.9 115.7 117.5 +9.9% Jacqui E 74.8 81.8 83.1 +11.1% Peter Alexander 13.8 16.5 16.6 +20.3% Total 195.5 214.0 217.2 +11.0%
EBITA Summary EBITA ($m) FY 2004 (53 weeks) FY 2005 Actual (52 weeks) FY 2005 Adjusted (53 weeks) Change 05 Adjusted Casualwear 54.4 47.5 49.9-8.3% Womenswear 20.9 25.6 27.0 +29.2% Total 75.3 73.1 76.9 +2.1%
EBITA Margin 13 12 12.1% 11.6% 12.0% 11 10 9 8.7% 8 7 6 6.1% 7.2% 5 FY 2001* FY 2002* Actual FY 2003 *Adjusted historical per prospectus 2004 Actual FY 2004 Actual FY 2005 Adjusted FY 2005 (53 Weeks) (52 Weeks) (53 Weeks)
Inventory Stockturn 5 Industry leading stockturns 4.5 4.4x 4.4x 4.4x 4.4x 4.5x 4.6x 4 3.5 FY 2001* FY 2002* Actual FY 2003 *Adjusted historical per prospectus 2004 Actual FY 2004 Actual FY 2005 Adjusted FY 2005 (53 Weeks) (52 Weeks) (53 Weeks)
Return on Capital Employed 60 55 56.2% 55.0% 57.8% 50 45 40 35 33.5% 34.1% 30 29.6% 25 20 FY 2001* FY 2002* Actual FY 2003 Actual FY 2004 Actual FY 2005 Adjusted FY 2005 (53 Weeks) (52 Weeks) (53 Weeks) *Adjusted historical per prospectus 2004. ROCE defined as EBITA / (Total Assets less cash and non-interest bearing liabilities)
Store Numbers Total VIC TAS NSW ACT QLD NT SA WA NZ Just Jeans 284 56 85 55 17 27 44 Jay Jays 212 43 64 40 16 16 33 Jacqui E 94 25 23 14 6 7 19 Portmans 107 27 35 17 7 9 12 Peter Alexander 5 3 2 - - - - Dotti 25 7 7 5 1 1 4 Total* 727 161 216 131 47 60 112 * Plus 2 group stores
Just Jeans Tough second half has affected results although promising signs beginning to emerge Total sales down 7.9% on comparable 53 week basis. Over half the drop in winter due to lower Levis and jacket sales Closed 6 stores giving a total (after one opening) of 284 stores in Australia and New Zealand Profitability and cashflow remain strong despite marginal decline in EBITA margin New store design developed and due for roll-out in late September Seven7 arrangement restructured to achieve use of Just Group supply chain Denim brand architecture realigned with strong initial response
Just Jeans
Jay Jays Sales growth underpinned by continuing store roll-out and re-alignment of prices and ranges Total sales up 10.5% on 53 week comparable basis with flat second half due to tight trading conditions Opened 26 new stores (and closed 3) giving a total of 212 stores in Australia and New Zealand Double digit EBITA margin Customer offer underpinned by sharp prices (e.g. $39 denim) and strong basics range Jay Jays voted retailer of the year by Lend Lease and Ragtrader Magazine
Jacqui E Outstanding result in Australia and New Zealand Total sales up 11.1% on 53 week comparable basis Opened 7 new stores giving a total of 94 stores in Australia and New Zealand Excellent profitability growth with increased EBITA margin Core demographic (32 year old women) has been the most resilient in terms of spending through the downturn Focussed marketing formula emphasising personal contact and print media New store design successfully enhancing the brand position
Portmans Across-the-board delivery from the Portmans brand Total sales up 9.9% on 53 week comparable basis Opened 13 new stores (and closed 3) giving a total of 107 stores in Australia and New Zealand EBITA margins approaching double digits with more expected in FY2006 Brand relaunched in July 2005 with encouraging results New Zealand business close to efficient economic scale with 12 stores Accessories category growing strongly at high margins
Dotti Integration of the business well on track Total Dotti sales of $12.0m for first 9 months of operation Chain expanded to 25 stores from the 10 stores originally acquired Will generate profit for the group from Summer 2005 Excellent brand recognition fuelled by PR and advertorials Supply chain still sub-scale although target of 7 times stockturns within reach Store design well accepted and generating strong profits in each new site
Peter Alexander Shift to multi-channel business progressing ahead of plan Total sales up 20% Opened 4 new stores with remarkable success, giving a total of 5 stores in Australia EBITA margin remains the best in the group Active direct customer base has grown to 125,000 40% of direct sales through the internet Concept spaces opened in 2 David Jones stores to complement wholesale range
China Offshore sourcing remains a key strength of our business Dedicated Li & Fung resources for Just Group now 52 people Tariff reduction occurred in January 2005 with net benefit to cost prices despite export taxes and increased freight costs Capture of tariff benefits limited due to market softness and unseasonal weather Appreciation of RMB has not flowed into product costs Overall conditions tight but no threat to supply Dongguan Nanjing Hangzhou Shenzhen Hong Kong Shanghai Ningbo Li & Fung
People Labour market conditions are tight but Just Group is well placed Total staff of 5,500 with around 1/3 holding equity in the company Workplace based training continuously upgraded with new store manual and induction process and emphasis on building skills in head office Six brands offer unique career opportunities in retail Over 1,500 employees attend our annual awards night Hewitt engagement score of 60 (in high performance zone) with top scores for rewarding customer relationships and exceeding customer expectations
Key Operating Metrics for 2005 FY 2004 FY 2005 FY 2005 Adjusted Change 05 Adjusted No. Weeks 53 52 53 Sales ($,000) 619,821 632,785 642,475 +3.7% Gross Profit ($,000) 359,166 363,046 368,637 +2.6% EBITDA ($,000) 94,147 88,815 91,026-3.3% EBITA ($,000) 75,270 73,137 76,861 +2.1% EBIT ($,000) 69,311 68,025 71,749 +3.5% NPAT ($,000) 39,961 41,589 44,129 +10.4% GP (%) 58.0% 57.4% 57.4% - 57bp EBITA Margin (%) 12.1% 11.6% 12.0% -18bp Annualised Stock Turns 4.38x 4.53x 4.60x +0.22x Net Debt ($,000) 81,434 64,979 64,979 -$16,455 Interest Cover (x) 7.81x 10.36x 10.89x +3.08x
Cashflow EBITDA Change in Working Capital* Operating Cashflows Capital Expenditure Operating Cashflows After Capex Interest Paid Income Tax Paid Dividends Paid Surplus Cashflow FY04 ($m) 94.1 1.0 95.1 (25.5) 69.6 (12.3) (16.5) (26.4) 14.4 FY05 ($m) 88.8 0.6 89.4 (19.6) 69.8 (7.0) (24.8) (24.0) 14.0 * Includes inventory, trade creditors, trade debtors, prepayments and income taxes payable.
Balance Sheet Current Assets Cash Inventories Other Total Current Assets 30-Jul-05 ($m) 25.2 59.3 2.8 87.3 Current Liabilities Payables Interest Bearing Liabilities Other Total Current Liabilities 30-Jul-05 ($m) 35.4 0.1 15.5 51.0 Non-Current Assets Property, Plant & Equipment Intangibles Other Total Non-Current Assets Total Assets 47.9 74.3 7.2 129.4 216.7 Net debt $65.0m, down $16.5m in the year and flat in second half despite tight trading conditions Net debt to EBITDA: 0.73x Interest cover: 10.4x Non-Current Liabilities Interest Bearing Liabilities Other Total Non-Current Liabilities Total Liabilities Net Assets Shareholders Funds Contributed Equity Reserves Retained Profits Total Shareholders Funds 90.1 7.1 97.2 148.2 68.4 15.4 1.0 52.0 68.4
Dividends per Share As promised in prospectus Dividend yield of over 6% 100% fully franked 14 6.0 cents 13.5 cents 12 10 8 7.5 cents 6 4 2 0 FY2005 Interim FY2005 Final FY2005 Total Record date October 26 Payment date November 16
Growth Substantial opportunity for growth in sales and profits Increase sales per square metre in the existing estate Expand the footprint of the existing stores Rollout of new stores Leverage the existing infrastructure with acquisitions
Current Trading and Outlook Positive outlook despite subdued retail environment First indicators for summer give cause for confidence Sales for first six weeks of new season ahead of last year Continuing with strong investment in all our brands
Howard McDonald Managing Director Jason Murray Chief Financial Officer 14 September, 2005