Insert an action title
# | Insert a Title
Sub-title
Edit Master text styles
PRIVATE EQUITY
INVESTMENT COMMITTEE PAPER
Appendices
GROUP III
Appendix 1 | Store Location per Segment (Europe)
Country Own Stores Franchise/License Concessions
Austria 7 3
Belgium 22 5 N/A
Croatia 2
Cyprus N/A
Czech Republic 1
Denmark 4 7
Finland 1 N/A
France 13 97 N/A
Germany 31 14
Greece 2 N/A
Hungary 1
Iceland 2
Italy 5 8
Latvia 1
Country Own Stores Franchise/License Concessions
Luxembourg 2
Netherlands 9 5 N/A
Norway 4
Poland 3
Portugal N/A
Romania 1
Russia 4
Slovakia 1
Slovenia 1 N/A
Spain 2 33 N/A
Sweden 3
Switzerland 5 N/A
Turkey 2
UK and ROI 99 N/A
3
Country Own Stores Franchise/License Concessions
Australia 16 N/A
Canada N/A
China 5 3
Columbia 2 N/A
Egypt 1
Georgia 1
Hong Kong 5 N/A
India 17 N/A
Indonesia 5 N/A
Iran 2
Israel 1
Kuwait 3
Lebanon 2
Macau 2
Country Own Stores Franchise/License Concessions
Malaysia 4 N/A
Oman 1
Philippines 4
Qatar 1
Saudi Arabia 2
Singapore N/A
South Africa 3
South Korea 4 N/A
Taiwan 2 N/A
Thailand 4 N/A
UAE 7 N/A
USA 20 N/A
Venezuela 3
Estimated values. 35 franchisees location not founded
Capital Structure Value (in millions) %
Non-Current Assets 212,7 38,5%
Current Assets 340,1 61,5%
Non-Current Liabilities 48,3 8,7%
Current Liabilities 132,1 23,9%
Equity 372,4 67,4%
€0 €20 €40 €60 €80 €100 €120 €140
FY2017
Current Liabilities
90,0%
SuperGroup’sDetailed Capital Structure
Capital Structure
Based on SuperGroup’sBalance Sheet we can define the Capital Structure and confirm whether they are supported by debt or not. Indeed, about 67,4% of capital is provided by stockholders amounting to almost £373 million. The 32,6% left is divided into current & non-current liabilities where we visually describe it in the bar above. Observing it, we conclude that almost all current liabilities are related to account payables amounting to approximately 90% of the total with 0£ of borrowings meaning that SuperGroup has room for external financing.
5
Appendix 4 | Shareholder Overview
Ownership Summary Holders by Category
50,03
30,95 8,12
2,27
1,01 0,73 6,89
Investment Advisor Individuals
Insurance Company Sovereign Wealth Fund
Hedge Fund Manager Pension Fun
Other
Individual Outstanding % Nº shares
Julian Dunkerton 26,59% 21.696.788
James Holder 10,91% 8.898.610
Euan Sutherland 0,01% 11.613
Peter Bamford 0,01% 6.000
Andrea Cartwright 0,01% 5.410
Institutional Outstanding % Nº Shares
Standard Life Aberdeen 7,77% 6.340.770
OFI Global Asset Management 6,54% 5.331.880
Old Mutual Plc 5,55% 4.528.367
Orbis Allen Gray Ltd 3,98% 3.246.891
Country %
UK 44,91%
Unknown 30,95%
US 18,70%
Name Position Appointed Remarks
Euan
Sutherland CEO December 2012
Euan has over 20 years’ experience within the retail sector having held roles with Boots, Dixons,
Coca-Cola, Matalan and Mars. Also, CEO of the Co-operative Group and COO at Kingfisher plc.
Nick Wharton CFO June 2015 Previously CEO of Dunelm Group plc between 2010 and 2014 and before that CFO of Halfords Group Plc. In his eight year career at Halfords, he held both finance and strategy roles.
Julian Dunkerton
Founder and Product
and Brand Director February 2010
He has worked mainly in the retail sector for over 30 years. Together with James Holder, Julian established the Superdry clothing brand in 2003. Deep understanding of the Superdry brand.
Nick Tatum Global Retail Director November 2015 Nick worked for Tesco Stores in both the Operations and the Commercial function (covering all new store openings, change plans and trade planning, buying models and structure).
Jon Wragg Global Trading Director April 2014 Multi-channel Director at Asdaresponsible for transforming ShopDirect into a major e-commerce player.working closely with Walmart’s Global e-commerce team. Also,
Paula
Kerrigan Transformation Director August 2015
Over 20 years’ developing retail businesses (UK and internationally). Including spending 9 years growing Kingfisher’s businesses in Taiwan, China, South Korea, Poland and Turkey.
Hugo Adams Director Marketing November 2016 Previously, he was responsible for International Business Development and Global Marketing at Dyson, with focus being on the global expansion of the Dyson brand.
Andrea Cartwright
Director Human
Resources November 2012
Transformed the perception of the HR function across Supergroup: doubling headcount and taking the Supergroup into 15 different employment jurisdictions around the world.
Simon Callander
Group General Counsel
and Company Secretary 2 May 2017
Previously Simon worked as General Counsel of Addleshaw Goddard and General Counsel and Partnership Secretary of Olswang.
7
Appendix 6 | Company’s Board
Name Position Appointed Remarks
Peter Bamford Chairman 29 January 2010
Peter is also Deputy Chairman and Senior Independent Director of Spire Healthcare Group Plc. Previously, he was Director of Vodafone Group Plc, Non-Executive Director of Rentokil Initial Plc and Chairman of Six Degrees Holding Limited.
Euan Sutherland CEO 1 December
2012
He is also currently a Non-Executive Director of Britvic Plc. Euan previously served as Group Chief Executive Officer of the Co-operative Group and Group Chief Operating Officer at Kingfisher Plc.
Nick Wharton CFO 24 June 2015 Previously he was Chief Executive Officer of Dunelm Group Plc and even before he was Chief Financial Officer of Halfords Group Plc.
Julian Dunkerton Founder and Product
and Brand Director 3 February 2010
He has worked mainly in the retail sector for over 30 years. He founded the Cult retail chain and turning it into a successful retail chain.
Keith Edelman Senior Independent
Non-Executive Director 4 February 2010
Keith Edelman is also Non-Executive Chairman of Revolution Bars Group Plc. He was previously Non-Executive Chairman of Goal Soccer Centers Plc, Non-Executive Director of Safestore Holdings Plc, Chairman of Beale Plc, Managing Director of Arsenal Holdings Plc.
Penelope Hughes Independent
Non-Executive Director 1 April 2015
Penelope is also the Non-Executive Chairman of The Gym Group plc and a Non-Executive Director of The Royal Bank of Scotland Group Plc. Previously she was Non-Executive Director of The Gap Inc and Next Plc and President of Coca-Cola in UK.
Martin Powell Independent
Non-Executive Director
1 December 2012
Martin is also a Non-Executive Director of Computacenter Plc. Prior to that Minnow spent 35 years with Deloitte.
Steve Sunnucks Independent
Non-Executive Director 1 March 2016
Sunnucks worked as global president for Gap and has also held executive positions at New Look and worked at Burton Group Plc, J. Sainsbury Plc, and Marks and Spencer Plc.
Beatrice Lafon Independent Non-Executive Director
14 September 2016
Beatrice was the CEO of Claire’s Stores Inc. and was the President of The European Division of Claire’s Stores Inc.
Simon Callander Group General Counsel
and Company Secretary 2 May 2017
Previously Simon worked as General Counsel of Addleshaw Goddard and General Counsel and Partnership Secretary of Olswang.
Appendix 7 | Demand Analysis
–
Recent Promotion Strategy
This is the most recent marketing plan implemented by Supergroup.
Objectives:
• Aspirational, engaging creative
• Fully integrated campaign
• Drive footfall instore and online
• Attract new customers to the brand
• Drive sales of key categories
This has being achieved through:
• Events (Brand Activation)
o 149 million reach, 23 million engagements • Influencers
o Creating their stories with Superdry’s product
o They have creative control • Social Media Strategy
BRINGING SUPERDRY TO LIFE
Online interactions to drive sales (Instagram/Snapchat)
Partnerships with Social Networks Social Ready
9
Appendix 8 | Balance Sheet
ASSETS 2010 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Cash and equivalents 29 55 86 68 101 65 17 34 82 114 186 302
Accounts receivable 16 46 54 70 80 112 140 169 193 213 230 243
Inventory 21 73 78 108 113 157 199 239 275 303 327 345
Other current assets 0 1 0 20 1 5 5 5 5 5 5 5
Current assets 67 174 218 266 295 340 361 447 555 635 748 895
Intangible assets 1 42 47 52 52 54 1.752 1.755 1.755 1.754 1.751 1.746
Tangible assets 23 64 70 72 95 121 173 206 220 219 207 180
Other long term assets 50 34 31 29 32 38 38 38 38 38 38 38
Long term assets 74 139 148 154 179 213 1.962 1.998 2.013 2.011 1.996 1.964
Total assets 141 314 366 420 474 553 2.323 2.445 2.567 2.646 2.744 2.859
LIABILITIES & EQUITY 2010 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Accounts payable 22 49 59 80 90 119 165 191 211 226 239 247
Short term debt 1 0 0 0 0 0 0 0 0 0 0 0
Other current liabilities 1 8 14 13 14 13 13 13 13 13 13 13
Current liabilities 24 57 73 93 104 132 178 204 224 239 252 260
Long term debt 0 0 0 0 0 0 809 848 873 834 795 755
Other long term liabilities 17 32 32 32 35 48 48 48 48 48 48 48
Long term liabilities 17 32 32 32 35 48 857 896 921 882 843 804
Subscribed capital 4 4 4 4 4 4 200 200 200 200 200 200
Other equity 96 220 257 291 331 368 1.087 1.145 1.222 1.324 1.449 1.596
Equity 100 224 261 295 335 372 1.287 1.345 1.422 1.524 1.649 1.796
Appendix 9 | Income Statement
INCOME STATEMENT 2010 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Operating revenue 140 366 436 493 606 764 992 1.192 1.366 1.507 1.625 1.716
Sales revenue 139 360 431 487 598 752 979 1.179 1.352 1.493 1.610 1.700
Other operating revenue 1 5 5 6 9 12 12 13 14 14 15 16
Cost of goods sold (COGS) 66 150 174 190 230 299 382 460 527 582 628 663
Gross profit on sales 73 210 257 296 368 453 597 719 825 911 982 1.037
gross profit margin on sales 52,6% 58,3% 59,7% 60,9% 61,6% 60,2% 61,0% 61,0% 61,0% 61,0% 61,0% 61,0%
Operating expenses (OPEX) 47 145 178 212 272 339 456 548 618 670 711 735
Employee costs 15 54 64 67 84 107 144 172 191 204 214 218
Other operating expenses 32 91 114 145 188 232 312 376 427 466 497 518
EBITDA 27 70 84 91 104 126 154 185 220 255 286 318
EBITDA margin 19,1% 19,2% 19,2% 18,4% 17,2% 16,5% 15,5% 15,5% 16,1% 16,9% 17,6% 18,5%
Amortization 4 18 22 27 32 37 45 55 64 71 78 83
EBIT (Operating profit) 23 52 62 64 72 89 109 130 157 184 209 234
EBIT margin 16,1% 14,2% 14,1% 13,0% 11,9% 11,7% 11,0% 10,9% 11,5% 12,2% 12,8% 13,6%
Financial income 0,0 0,3 0,6 0,4 0,0 0,2 0,0 0,1 0,3 0,5 0,8 1,2
Financial expenses 0,2 0,0 0,1 1,1 0,7 2,6 53,5 56,3 58,3 53,3 50,5 47,8
of which interest cost (cash interest) 0,2 0,0 0,0 0,6 0,10 0,00 53,45 56,28 58,25 53,27 50,55 47,82
non-deductible shareholder pik 68 74 82 90 99 109
Total revenue 140 366 436 493 606 764 992 1.193 1.366 1.508 1.626 1.717
Total costs 118 314 374 430 534 677 1.004 1.193 1.349 1.467 1.566 1.639
Earnings before taxes 22 52 62 63 72 87 -12 -1 17 41 60 79
Income tax -50 13 15 15 15 18 12 16 21 28 34 41
Net income 72 39 47 48 57 69 -24 -17 -5 12 25 38
11
Appendix 10 | Trading Comps & Through-Cycle Comps Behaviour
Company Mkt Cap (GBP) EV/EBITDA EV/EBIT
Fast Retailing £ 31.288.461.494,83 20,6x 25,3x
Mr Price £ 3.941.838.231,20 12,4x 20,0x
Inditex £ 80.469.498.728,78 16,0x 20,2x
H&M £ 25.330.703.187,75 8,7x 11,9x
Ted Baker £ 1.204.834.819,50 16,2x 21,6x
A&F £ 877.709.206,82 2,6x 35,6x
Next £ 6.607.046.031,75 8,0x 9,3x
AVERAGE 12,1x 20,5x
MEDIAN 12,4x 20,2x
0,0x 5,0x 10,0x 15,0x 20,0x 25,0x 30,0x 35,0x 40,0x Fast Retailing
Mr Price Inditex H&M Ted Baker A&F Next EV/EBITDA EV/EBIT E V /E BITDA M ed ian 1 2 ,4 x
FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017
Urban Outfitters Inc 15,1x 5,5x 10,6x 9,2x 8,8x 11,4x 7,8x — 5,0x 5,7x
H&M 10,0x 13,0x 13,3x 14,1x 13,4x 16,8x 16,7x 15,7x 13,9x 8,7x
Inditex 9,2x 8,0x 11,1x 10,6x 11,9x 15,3x 16,6x 18,8x 18,9x 17,5x
Next PLC 5,4x 4,5x 6,1x 5,9x 6,8x 8,4x 11,7x 12,2x 11,2x 6,8x
Fast Retailing 9,7x 8,0x 6,6x 9,2x 10,8x 19,1x 19,4x 24,0x 22,1x 13,3x
Mr Price Group 5,3x 6,0x 14,5x 9,5x 12,5x 13,2x 14,4x 19,6x 12,0x 12,7x
Guess? Inc 9,2x 3,2x 7,6x 7,4x 4,5x 5,5x 6,1x 5,4x 5,9x 7,4x
Hanesbrands 7,0x 11,5x 9,2x 7,7x 9,2x 14,0x 19,4x 19,8x 13,0x 12,1x
Ralph Lauren Corp 7,0x 5,1x 8,6x 10,8x 12,1x 10,6x 9,4x 8,1x 8,6x 27,5x Abercrombie & Fitch 7,0x 1,3x 5,6x 7,2x 7,5x 5,7x 7,3x 4,7x 5,3x 2,6x
Ted Baker PLC 7,2x 6,3x 7,7x 8,9x 10,1x 13,5x 18,5x 17,0x 18,9x 16,2x
PVH 7,2x 4,6x 6,7x 17,0x 11,4x 12,4x 16,1x 15,7x 8,5x 8,6x
HUGO BOSS AG 10,0x 6,1x 8,0x 10,8x 8,8x 10,8x 12,8x 12,3x 9,1x 9,5x
AVERAGE 8,4x 6,4x 8,9x 9,9x 9,8x 12,1x 13,6x 14,4x 11,7x 11,4x
MEDIAN 7,2x 6,0x 8,0x 9,2x 10,1x 12,4x 14,4x 15,7x 11,2x 9,5x
Appendix 11 | Transaction Comps Multiples
Year Country Target Company Bidder Company Seller Company Reported EBITDA
(mil)
Reported EBITDA Multiple
2016 India Madura Garments Lifestyle Retail
Company Limited Aditya Birla Fashion and Retail Ltd Aditya Birla Nuvo Limited 57,8592 17,5x
2015 USA Sheplers, Inc. Boot Barn Holdings, Inc. Gryphon Investors 9,2404 14,6x
2015 Spain El Ganso LVMH's L Capital 70 13,0x
2017 United Kingdom Burberry Group Plc Groupe Bruxelles Lambert SA 671,8985 12,7x
2015 United Kingdom The Net-A-Porter Group Limited YOOX Net-A-Porter Group (YNAP) Compagnie Financiere Richemont
SA 58 12,4x
2015 Japan Nice Claup Co., Ltd. Pal Co., Ltd. 2,0194 11,9x
2015 United Kingdom Phase Eight (Fashion & Designs)
Limited Foschini Limited TowerBrook Capital Partners L.P. 26,5903 10,8x
2014 USA Jos. A. Bank Clothiers, Inc. Tailored Brands, Inc. 115,0825 9,4x
2016 United Kingdom GO Outdoors Limited JD Sports Fashion Plc 3i Group Plc; YFM Equity Partners
Limited 18,4186 9,2x
2015 United Kingdom New Look Group Limited Brait Private Equity Apax Partners LLP; Permira
Advisers LLP 287,5495 9,0x
2014 Netherlands Gerzon Holding B.V. LS Travel Retail Benelux 8,144 9,0x
2015 USA ANN INC. Ascena Retail Group, Inc 197,6804 8,9x
AVERAGE 11,5x
MEDIAN 11,3x
13
Appendix 12 | Deeper Analysis on Risks
Currency Risk Purchase Power Capacity / Inflation in USA
£1 = 1,36€
£1 = 1,13€
Due to the speculation related with Brexit Process, the Pound devaluated around
17% compared to Euro and around 11% compared to Dollar. That means that
there were devaluations compared to the two most strong currencies in the world
resulting in lossesthatdo not dependon thebusiness itselfbut is still ahuge risk
that could affect the company.
£ -
€
£ - $
£1 = 1,49$£1 = 1,33$
2 years
Disposable Income per Capita
USA Inflation Rate
Appendix 13 | Exit Strategies
+
–
IPO
• Access to equity capital markets
• Participation in future value growth (in case of partial exit)
• Management incentive systems
• Total exit also possible, depending on market conditions at IPO
• Share as acquisition currency
• PR-effect
• Depend on market conditions
• Execution risk likely to be higher
• Not a complete exit (Exposure to fluctuations)
• Long and expensive process.
Strategic Sale
• Clear/rapid exit strategy
• Potential realization of synergy premium
• Relatively low execution risk
• Likely full cash on exit
• No participation in future upside
• Potential resistance from management (replacement risk)
• Confidential business information disclosure to competitors during negotiation
Secondary Buyout
• Clear/rapid exit strategy
• Strong interest from financial buyers expected
• Relatively low execution risk
• Valuation assisted in case of attractive debt markets
• These kind of deals tend to be done faster and with less failure in the M&A process
• No participation in future upside
