HORNBACH Baumarkt AG DVFA Analyst Meeting May 24, 2018 Frankfurt/Main Page 1
Financial Calendar 2018 HORNBACH Group June 22, 2018 Financial Update: 1st Quarter of 2018/19 as of May 31, 2018 July 5, 2018 Annual General Meeting HORNBACH Baumarkt July 6, 2018 Annual General Meeting, HORNBACH Holding September 27, 2018 Half-Year Financial Report 2018/19 as of August 31, 2018 DVFA Analyst Meeting HORNBACH Holding December 20, 2018 Financial Update: 3rd Quarter of 2018/19 as of November 30, 2018 Page 2
Financial Year 2017/18 February 28, 2018 Page 3
Since March 28, 2017 Two publicly listed corporations Free Float Hornbach Familien Treuhand GmbH 100% Free Float 62.5% 37.5% HORNBACH Holding AG & Co. KGaA Neustadt/Weinstraße Listed Ordinary Shares 1 (ISIN DE0006083405) c HORNBACH Management AG (General Partner) Management 23.6% 76.4% 100% 100% HORNBACH Baumarkt AG 3 Bornheim Listed Ordinary Shares² (ISIN DE0006084403) HORNBACH Immobilien AG 3 Bornheim Not listed HORNBACH Baustoff Union GmbH 3 Neustadt/Weinstraße Not listed 1 Number of shares: 16,000,000 / Stock market code: HBH 2 Number of shares: 31,807,000 / Stock market code: HBM 3 plus other subsidiary companies in Germany and abroad Page 4
Status: February 28, 2018 DIY retailer with three different business segments 156 megastores in 9 European countries and online shops focused on retail with DIY, garden and home improvement products for private and professional clients (HORNBACH Baumarkt AG subgroup) 29 builders merchant outlets in south-west Germany and France selling construction materials to professional clients (Hornbach Baustoff Union GmbH subgroup) Retail property development for the operating units (Hornbach Immobilien AG subgroup) Sales split FY 2017/18 44% 6% HORNBACH Baumarkt AG [Germany] 50% HORNBACH Baumarkt AG [International] Hornbach Baustoff Union GmbH Page 5
February 28, 2018 156 DIY megastores and garden centers across Europe 2 store openings in Den Haag and Halle (+20,200 sqm) 1 store closed in Hanau (-5,000 sqm) Den Haag, Apr 21, 2017 Halle, Nov 15, 2017 ales area: 1,8 million sqm store size: Ø 11,700 sqm Germany 98 stores 1,052,000 sqm Austria 14 stores 168,900 sqm Czech Republic 10 stores 140,900 sqm Romania 6 stores 86,400 sqm Slovakia 3 stores 46,100 sqm 27 x 2 x Hanau, Oct 27, 2017 Luxembourg 1 stores 12,100 sqm Sweden 5 stores 72,900 sqm Netherlands 13 stores 164,500 sqm Switzerland 6 stores 78,100 sqm Page 6
million Sales growth financial year 2017/18 3,941 2,040 +5.1% +1.5% 4,141 2,071 1,670 1,820 +9.0% +8.3% 229 248 2016/17 2017/18 Hornbach Baustoff Union HORNBACH Baumarkt AG [International] HORNBACH Baumarkt AG [Germany] rounding differences Page 7
Net sales (Europe) in million; growth in % HORNBACH ranks #3 among German DIY Retailers (2017) HORNBACH Baumarkt Subgroup 6,211 5,452 but growth faster than its competitors 3,891 2,610 2,270 1,471 +1.4% +1.4% +4.9% +2.9% +1.5% +0.1% OBI Bauhaus HORNBACH ZEUS/Hagebau Toom/B1 Globus/Hela and is #1 in sales per store ( million) and sales per sqm ( ) 9.5 20.0 24.9 4.8 6.9 16.2 1,274 1,698 2,135 1,108 1,053 1,857 OBI Bauhaus HORNBACH Zeus/Hagebau Toom/B1 Globus/Hela OBI Bauhaus HORNBACH Zeus/Hagebau Toom/B1 Globus/Hela [source: Dähne, HORNBACH] Page 8
Like-for-like Sales* Germany + 1.5% + 3.6% International + 6.1% 2016/17 2017/18 1,051 1,108 999 1,025 Total 896 920 740 764 +5.4% +2.6% +2.7% +3.3% Q 1 Q 2 Q 3 Q 4 * in constant currencies Page 9
Like-for-like Sales + 1.5% 2016/17 2017/18 585 607 546 547 Germany 484 486 402 406 +3.8% +0.3% +0.5% +0.9% Q 1 Q 2 Q 3 Q 4 Page 10
Like-for-like Sales* + 6.1% 2016/17 2017/18 International 501 466 453 477 412 434 338 359 +7.5% +5.3% +5.4% +6.2% Q 1 Q 2 Q 3 Q 4 * in constant currencies Page 11
1998 = 100% Performance and market share in Germany HORNBACH Baumarkt Subgroup 1998: 5% Market share in Germany 2017: 11% Market share in Germany +36% DIY-Branche (D) HORNBACH (D) Like-for-like sales growth in Germany -11% [Source: BHB/GfK DIY-Panel (until 2013), GfK DIY-TSR (since 2014), HORNBACH] Page 12
EBITDA* HORNBACH Holding Group HORNBACH Baumarkt Group EBITDA Margin EBITDA Margin 6.5% 6.3% 4.7% 4.7% 254 263 +3.3% +5.2% 174 183 2016/17 2017/18 2016/17 2017/18 *based on International Financial Reporting Standards (IFRS) Page 13
EBIT* HORNBACH Holding Group HORNBACH Baumarkt Group EBIT Margin 4.0% 3.9% EBIT Margin 2.6% 2.6% 157 161 +2.8% +5.1% 98 102 2016/17 2017/18 2016/17 2017/18 *based on International Financial Reporting Standards (IFRS) Page 14
EBIT Breakdown HORNBACH Group Operating Breakdown Geographical Breakdown 97.5 102.5 58.0 56.7 2016/17 2017/18 105.9 119.2 51.0 41.7 4.2 3.6 HBM HBU HI Germany International HBM: HBU: HI: HORNBACH Baumarkt Subgroup HORNBACH Baustoff Union Subgroup HORNBACH Immobilien Subgroup EBIT vs. Sales Breakdown FY 2017/18 EBIT 74% Germany 26% International Sales 44% Germany 56% International Page 15
EBIT adjusted HORNBACH Group 2016/17 2017/18 EBIT 156.8 +2.8% 161.2 Non-operating Earnings -3.4-2.7 Non-operating Expenses +6.4 +7.2 EBIT adjusted I 159.8 165.6 +3.7% ICR-costs* +53.9 +61.1 EBIT adjusted II 213.7 +6.1% 226.7 * ICR = Interconnected Retail rounding differences Page 16
EBIT Breakdown HORNBACH Baumarkt Subgroup Operating Breakdown Geographical Breakdown 2016/17 2017/18 41.1 40.4 67.3 74.3 12.2 3.9 85.4 98.5 Retail Real Estate Germany International EBIT 4% Sales 47% 53% EBIT vs. Sales Breakdown FY 2017/18 Germany 96% International Germany International Page 17
EBIT adjusted HORNBACH Baumarkt Subgroup 2016/17 2017/18 EBIT 97.5 +5.1% 102.5 Non-operating Earnings 0.0-0.2 Non-operating Expenses +5.3 +7.8 EBIT adjusted I 102.8 +7.0% 110.0 ICR-costs* +53.9 +61.1 EBIT adjusted II 156.7 +9.2% 171.1 * ICR = Interconnected Retail rounding differences Page 18
Earnings before taxes and Group net income HORNBACH Holding Group HORNBACH Baumarkt Subgroup Group net income in % of net sales Group net income in % of net Sales 2.3% 2.3% 1.4% 1.5% tax ratio 30.9% 27.2% tax ratio 33.3% 27.5% +1.2% +6.5% +2.0% +11.0% 130 132 90 96 79 81 53 59 2016/17 2017/18 2016/17 2017/18 Earnings before taxes Group net income Earnings before taxes Group net income Page 19
Earnings per share, dividend* and payout ratio HORNBACH Holding Group HORNBACH Baumarkt Subgroup Payout ratio 31.0% 29.4% Payout ratio 41.0% 37.0% 4.84 5.11 1.50 1.50 1.66 1.84 0.68 0.68 2016/17 2017/18 2016/17 2017/18 Earnings per share Dividend Earnings per share Dividend *proposed dividend Page 20
Gross Margin HORNBACH Group HORNBACH Baumarkt AG Subgroup 36.6 37.3 37.0 36.6 36.6 37.4 38.0 37.7 37.2 37.3 3,369 3,572 3,755 3,941 4,141 3,152 3,357 3,535 3,710 3,891 1,234 1,334 1,390 1,442 1,514 1,178 1,277 1,331 1,381 1,450 2013/14 2014/15 2015/16 2016/17 2017/18 2013/14 2014/15 2015/16 2016/17 2017/18 Sales HORNBACH Holding Gross profit Sales HORNBACH Baumarkt Gross profit Page 21
million Capital Expenditures FY 2017/18 HORNBACH Group HORNBACH Holding Group HORNBACH Baumarkt Subgroup 179 148 157 129 2016/17 2017/18 2016/17 2017/18 plant and office equipment intangible assets plant and office equipment intangible assets Olomouc Page 22
February 28, 2018 Property ownership and hidden reserves No. of stores Sales area in % 11 4 43 8% 2% 28% 53 33% 45 29% Property HI Operating Leases Others Property HBM Finance Lease FY 2017/18 ( million) Book value Yield value (x13) Hidden reserves (x13) Baumarkt Subgroup 611 917 306 Immobilien Subgroup 418 793 375 HORNBACH Group 1.029 1.710 681 Page 23
Group Balance Sheet Structure (IFRS) HORNBACH Group Total Assets 2,648 2,668 Total Equity and liabilities 2,668 2,648 190 Liquid funds 164 Inventories, accounts receivable and other assets 791 800 512 Current liabilities 526 693 Non-current liabilities 724 1,667 Non-current assets 1,704 Shareholders equity 1,463 1,398 54.8% 52.8% February 28, 2017 February 28, 2018 February 28, 2018 February 28, 2017 rounding differences Page 24
Group Balance Sheet Structure (IFRS) HORNBACH Baumarkt Subgroup Total Assets 1,960 1,998 Total Equity and liabilities 1,998 1,960 113 Liquid funds 102 Current liabilities 453 446 715 Inventories, accounts receivable and other assets 722 Non-current liabilities 496 503 Non-current assets 1,132 1,173 Shareholders equity 1,049 1,011 52.5% 51.6% February 28, 2017 February 28, 2018 February 28, 2018 February 28, 2017 rounding differences Page 25
million Cash Flow Statement HORNBACH Group HORNBACH Group HORNBACH Baumarkt AG Subgroup 2016/17 2017/18 2016/17 2017/18 Cash flow from operating activities 178.7 182.2 115.2 134.1 of which: funds from operations 199.2 200.1 144.3 145.3 of which: change in working capital -20.5-17.9-29.1-11.2 Cash flow from investing activities -198.3-108.8-185.4-96.2 Cash flow from financing activities -140.4-98.0-100.1-47.7 Cash-effective change in cash and cash equivalents -160.0-24.6-170.4-9.8 Change in cash and cash equivalents due to changes in exchange rates 0.3-1.4 0.4-1.1 Cash and cash equivalents at March 1 349.7 190.1 283.0 113.0 Cash and cash equivalents end of February 190.1 164.1 113.0 102.1 rounding differences Page 26
February 28, 2018 Net debt and Liquidity HORNBACH Holding Group HORNBACH Baumarkt Subgroup Liquidity Net debt million 2016/17 2017/18 2016/17 2017/18 Financial Debt 696 624* 453 424* Cash 190 164 113 102 Net Debt 506 460 340 322 * incl. 174 million Finance Lease HORNBACH Holding Group HORNBACH Baumarkt Subgroup million 2016/17 2017/18 2016/17 2017/18 unused Creditlines 373 482 321 418 Cash 190 164 113 102 Short-term investment 30 0 30 0 Free Liquidity 593 646 464 520 Page 27
Employees* HORNBACH Group HORNBACH Holding Group HORNBACH Baumarkt Subgroup 18,835 19,614 18,002 18,721 7,726 8,234 7,693 8,201 11,109 11,380 10,309 10,520 February 28, 2017 February 28, 2018 February 28, 2017 February 28, 2018 Germany International Germany International * incl. Passive employees Page 28
Highlights Financial Year 2017/18 HORNBACH Group Pleasing like-for-like sales growth Total like-for-like +3.6 % International + 6.1 % Germany + 1.5 % Store openings in Den Hague (Netherlands) and Halle (Germany) Start of the webshops in Slovakia, Sweden and Romania Further expansion of multichannel retail EBIT 161.2 million (+ 2.8 %), group net income 95.7 million (+ 6.5 %) Stable dividends Strong Balance Sheet with high equity ratio (54.8 %) Page 29
New Store Openings and Outlook 2018/19 Boras (Q3) Sales and earnings forecast HORNBACH Group for FY 2018/19 HORNBACH Holding HORNBACH Baumarkt Zwolle (Q1) Affoltern (Q1) Sales 2018/19 Sales to increase in a medium single-digit percentage range Sales 2017/18 4,141 million 3,891 million Adjusted EBIT 2018/19 Adjusted EBIT 2017/18 On previous year s level 166 million 110 milion Capex 2018/19 160-180 million 150-170 million Capex 2017/18 148 million 129 million Page 30
Store Opening Affoltern April 2018 DISCLAIMER This presentation is to be read in the context of the audited financial data of the HORNBACH Holding Group and the disclosures made in the notes to the consolidated financial statements contained in the annual report. It contains statements relating to the future based on assumptions and estimates made by HORNBACH s Board of Management. Forward-looking statements are only valid at the time at which they are made. Although we assume that the expectations reflected in these forecast statements are realistic, the company can provide no guarantee that these expectations will turn out to be accurate. The assumptions may involve risks and uncertainties which could result in actual events differing significantly from the forecast statements. Such factors include those discussed in the Risk Report and Outlook of the annual report. We do not assume any obligation to update the forward-looking statements contained in this presentation. Page 31