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Description

Financial Analysis
Balance Sheet
€ million
Total funds invested: uses
Operating cash*
Account receivables
Inventory
Account payables
Trade working capital
Other operating current assets/(liabilities)
Operating working capital
Operating fixed assets**
Other operating noncurrent assets/(liabilities)***
Operating fixed capital
Invested capital (excluding goodwill)
Goodwill and similar assets****
Invested capital
Investments
Other financial activities
Other surplus assets/(liabilities)*****
Surplus assets/(liabilities)
Total funds invested
2015
23
133
271
-270
157
-15
142
386
30
416
558
360
918
10
5
25
40
958
2016
26
160
311
-281
216
-30
186
399
40
439
625
370
995
5
4
40
49
1.044
2017
2018
27
194
335
-276
280
-35
245
362
35
397
642
380
1.022
0
5
45
50
1.072
27
178
376
-271
310
-38
272
353
10
363
635
365
1.000
0
6
50
56
1.056
* On sales 2%
**Excluding goodwill and similar assets
***Including guarantee deposits on leases of directly operated stores (DOS) in the retail network
****Brand with indefinite useful life
*****Mainly deferred tax assets
€ million
Total funds invested: sources
Excess cash
Short-term debt
Long-term debt
Net financial position (NFP)
Postretirement benefit liabilities
Other nonoperating provision
Debt equivalents
NFP and debt equivalents
Noncontrolling interests
Shareholders’ equity
Total funds invested
Check (ok = 0)
2015
-38
50
200
212
10
8
18
230
10
718
958
0
2016
-69
100
250
281
10
12
22
303
15
726
1.044
0
2017
-22
60
300
338
12
15
27
365
15
692
1.072
0
2018
-11
40
280
309
12
20
32
341
15
700
1.056
0
Income Statement
€ million
Revenues
Cost of goods sold*
Gross Margin
Product research and development cost
Advertising, marketing and promotion cost
Selling and distribution costs*
General and administrative costs*
Other non-recurring (costs)/revenues*
EBITDA
Depreciation and amortization**
EBITA
Amortization and write-down of goodwill and similar assets
EBIT
Financial income
Financial charges
Net income/(loss) from surplus assets
Income before taxes
Taxes
Net income
Net income to noncontrolling interests
Net group income
* Without depreciation and amortization (D&A) and write-off
** Excluding goodwill and similar assets
2015
2016
1.134
-369
765
-36
-84
-367
-68
-7
203
-85
118
0
118
3
-10
-1
110
-25
85
-5
80
2015
Depreciation, amortization and write-off
Retail
Other*
Other non-recurring**
Total
* Industrial, wholesale, IT, G&A
**Impairment, of which goodwill and similar assets:
Net operating profit less adjusted taxes (NOPAT)
EBITA
Nominal tax rate
Permanent adjustments on nominal tax rate*
Adjusted tax rate
Operating taxes
NOPAT
*Assumption
2017
1.277
-430
847
-39
-86
-405
-75
-15
227
-87
140
0
140
2
-12
1
131
-30
101
-5
96
2016
2018
1.339
-453
886
-43
-92
-445
-89
-3
214
-90
124
0
124
1
-13
-1
111
-20
91
-5
86
2017
1.373
-477
896
-44
-100
-460
-101
-16
175
-81
94
-9
85
2
-15
1
73
-12
61
-5
56
2018
56
21
8
85
57
21
9
87
58
22
10
90
55
26
9
90
0
0
0
9
118
27,5%
-2,5%
25,0%
-30
89
140
27,5%
-2,5%
25,0%
-35
105
124
27,5%
-2,5%
25,0%
-31
93
94
27,5%
-2,5%
25,0%
-24
71
Free cash flow statement
€ million
2015
NOPAT
89
Depreciation and amortization
85
Gross cash flow
174
Trade working capital change*
Other operating current assets and liabilities change
Net capital expenditures
Other noncurrent assets change
Goodwill and similar assets change
Gross investment
Free cash flow
Financial income
Net income/(loss) from equity investments
Surplus asset/(liabilities) change
Nonoperating taxes
Nonoperating cash flow
Cash flow available to investors
Financial charges
Short-term debt change
Long-term debt change
Debt equivalents change
Cash flow to debtholders
Noncontrolling interest change
Equity change
Cash flow to equityholders
Excess cash change
*Here and after cash increase/(decrease) with positive/(negative) sign
Check (OK = 0)
Investments
Retail
Other
Total
2016
2017
2018
105
87
192
-59
15
-100
-10
-10
-164
28
2
1
-9
5
-1
27
-12
50
50
4
92
0
-88
-88
31
93
90
183
-64
5
-53
5
-10
-117
66
1
-1
-1
11
10
76
-13
-40
50
5
2
-5
-120
-125
-47
71
81
152
-30
3
-72
25
6
-68
84
2
1
-6
12
9
92
-15
-20
-20
5
-50
-5
-48
-53
-11
0
0
0
90
20
110
77
23
100
32
21
53
40
32
72
2015
11,1%
9,6%
15,9%
21,1%
10,4%
17,9%
1,24
36,7%
12,5%
43
43
87
-87
2016
13,3%
11,0%
17,8%
23,7%
11,0%
17,8%
1,34
33,5%
12,8%
46
42
83
-79
2017
12,1%
9,2%
14,7%
19,6%
9,3%
16,0%
1,33
31,2%
16,1%
60
48
88
-76
2018
8,0%
7,0%
11,0%
14,7%
6,8%
12,7%
1,36
27,7%
18,8%
71
49
95
-73
2015
2016
2017
2018
Performance analysis
Profitability
ROE*
ROIC with goodwill*
ROIC without goodwill*
Pretax ROIC*
Operating margin (EBITA/Revenues)
EBITDA margin
Revenues/Invested capital*
Fixed assets/revenues
Operating working capital*/revenues
Trade working capital in days (computed using revenues):
– Account receivables*
– Inventory*
– Account payables*
*Using average invested capital (except from the first year)
Growth
Revenue
Gross Margin
EBITDA
EBITA
Net group income
Invested capital excluding goodwill
13%
11%
12%
19%
20%
12%
5%
5%
-6%
-11%
-10%
3%
3%
1%
-18%
-24%
-35%
-1%
Financial Health
2015
Leverage:
NFP/EBITDA
NFP/Equity
Coverage:
EBITDA/Interest
EBITA/Interest
FCF/NFP
2016
2017
2018
1,0
0,30
1,2
0,39
1,6
0,49
1,8
0,44
20,3
11,8
18,9
11,7
10%
16,5
9,5
20%
11,7
6,3
27%
2019
28
152
363
-261
282
-45
237
345
30
375
612
350
962
0
5
40
45
1.007
2019
-46
50
240
244
10
18
28
272
15
720
1.007
0
2015
2%
12%
24%
-24%
14%
-1%
13%
34%
3%
37%
49%
32%
81%
1%
0%
2%
4%
84%
2015
2016
2%
13%
24%
-22%
17%
-2%
15%
31%
3%
34%
49%
29%
78%
0%
0%
3%
4%
82%
2016
2017
% on Sales
2%
14%
25%
-21%
21%
-3%
18%
27%
3%
30%
48%
28%
76%
0%
0%
3%
4%
80%
2017
2018
2%
13%
27%
-20%
23%
-3%
20%
26%
1%
26%
46%
27%
73%
0%
0%
4%
4%
77%
2018
2019
2%
11%
26%
-19%
20%
-3%
17%
25%
2%
27%
44%
25%
68%
0%
0%
3%
3%
72%
2019
CAGR
2015-2019
5%
3%
8%
-1%
16%
32%
14%
-3%
0%
-3%
2%
-1%
1%
3%
1%
CAGR
2015-2019
-3%
4%
18%
19%
1%
1%
-5%
8%
20%
22%
1%
1%
% on Sales
-2%
4%
22%
25%
1%
1%
-1%
3%
20%
23%
1%
1%
-3%
4%
17%
17%
1%
1%
5%
0%
5%
4%
0%
22%
20%
1%
63%
84%
24%
1%
57%
82%
27%
1%
52%
80%
25%
1%
51%
77%
19%
1%
51%
72%
4%
11%
0%
1%
2019
2015
1.406
-499
907
-46
-106
-490
-109
-13
143
-82
61
-7
54
1
-12
1
44
-8
36
-5
31
2019
100%
-33%
67%
-3%
-7%
-32%
-6%
-1%
18%
-7%
10%
0%
10%
0%
-1%
0%
10%
-2%
7%
0%
7%
2015
2016
100%
-34%
66%
-3%
-7%
-32%
-6%
-1%
18%
-7%
11%
0%
11%
0%
-1%
0%
10%
-2%
8%
0%
8%
2016
2017
100%
-34%
66%
-3%
-7%
-33%
-7%
0%
16%
-7%
9%
0%
9%
0%
-1%
0%
8%
-1%
7%
0%
6%
2017
2018
100%
-35%
65%
-3%
-7%
-34%
-7%
-1%
13%
-6%
7%
-1%
6%
0%
-1%
0%
5%
-1%
4%
0%
4%
2018
2019
100%
-35%
65%
-3%
-8%
-35%
-8%
-1%
10%
-6%
4%
0%
4%
0%
-1%
0%
3%
-1%
3%
0%
2%
2019
CAGR
2015-2019
6%
8%
4%
6%
6%
7%
13%
17%
-8%
-1%
-15%
-21%
CAGR
2015-2019
56
26
7
89
7
61
27,5%
-2,5%
25,0%
-15
46
10%
0%
0%
0%
-3%
8%
11%
0%
0%
0%
-3%
8%
9%
0%
0%
0%
-2%
7%
7%
0%
0%
0%
-2%
5%
4%
0%
0%
0%
-1%
3%
-15%
0%
0%
0%
-15%
-15%
2019
2015
46
82
128
28
7
-74
-20
8
-51
77
1
1
11
7
20
97
-12
10
-40
-4
-46
-5
-11
-16
35
2016
2017
2018
2019
CAGR
2015-2019
8%
7%
15%
8%
7%
15%
-5%
1%
-8%
-1%
-1%
-13%
2%
% on Sales
7%
7%
14%
-5%
0%
-4%
0%
-1%
-9%
5%
5%
6%
11%
-2%
0%
-5%
2%
0%
-5%
6%
3%
6%
9%
2%
0%
-5%
-1%
1%
-4%
5%
-15%
-1%
-7%
8%
1,8%
10%
6%
1,8%
8%
2%
1,6%
4%
3%
2,3%
5%
3%
2,5%
5%
-19%
15%
-9%
0
39
35
74
Total
278
131
409
2019
4,4%
4,7%
7,3%
9,8%
4,3%
10,2%
1,43
26,2%
18,1%
70
43
96
-69
2019
CAGR 20152019
2%
1%
-18%
-35%
-45%
-4%
2019
1,7
0,34
11,9
5,1
31%
6%
8%
-8%
-15%
-21%
2%
Value Drivers
Profitability
2019
Wholesa
le
Retail
Royalties
Net sales
547
844
Cost of goods sold*
-245
-254
Gross margin
302
590
Selling and distribution cost*
-50
-440
Channel direct margin
252
150
Product research and development cost
Advertising, marketing and promotion cost
General and administrative costs*
Total indirect costs*
Recurring EBITDA
252
150
Nonrecurring revenue/costs*
EBITDA
* Without depreciation and amortization (D&A) and write-off
15
0
15
15
15
Total
R
e
Wholesa
Royaltie
t
le
s
ai
l
Total
1.406 100% # 100% 100%
-499 -44,8% #
-35,5%
907 55,2% # 100% 64,5%
-490 -9,1% #
-34,9%
417 46,1% # 100% 29,7%
-46
-3,3%
-106
-7,5%
-109
-7,8%
-261
-18,6%
156 46,1% # 100,0% 11,1%
-13
143
Growth
2015
Direct operating stores (DOS) sales
DOS (number)
DOS (smq/DOS)
DOS (smq)
DOS (Sales/smq)
Retail Web
Retail Outlet
Retail total
Royalties
Wholesale
Total
Sales (income statement)
2016
2017
2018
2019
615
657
683
691
710
160
175
190
197
212
200
198
195
192
190
32.000 34.650 37.050 37.824 40.280
19,2
19,0
18,4
18,3
17,6
15
25
34
48
51
53
60
65
62
83
683
742
782
801
844
10
12
13
14
15
441
523
544
558
547
1.134 1.277 1.339 1.373 1.406
1.134 1.277 1.339 1.373 1.406
2016
7%
9%
-1%
8%
-1%
67%
13%
9%
20%
19%
13%
2017
4%
9%
-2%
7%
-3%
36%
8%
5%
8%
4%
5%
2018
1%
4%
-2%
2%
-1%
41%
-5%
2%
8%
3%
3%
2019
3%
8%
-1%
6%
-4%
6%
34%
5%
7%
-2%
2%
CAGR
20152019
4%
7%
-1%
6%
-2%
36%
12%
5%
11%
6%
6%
Competitors performance
2015
2016
2017
2018
2019
Kering Group
Gucci
– Sales
3.898
4.378
6.211
8.285
9.628
– EBITDA margin
29,9%
31,5%
36,5%
44,8%
45,4%
– Capex on sales
4,9%
4,2%
4,0%
3,8%
3,5%
Saint Laurent
– Sales
974
1.220
1.501
1.744
2.049
– EBITDA margin
20,4%
24,6%
27,1%
33,9%
34,8%
– Capex on sales
6,5%
4,7%
4,9%
5,1%
4,8%
Bottega Veneta
– Sales
1.286
1.173
1.176
1.109
1.168
– EBITDA margin
31,2%
28,1%
27,7%
35,6%
31,1%
– Capex on sales
3,8%
3,6%
4,3%
6,2%
13,6%
Other Houses*
– Sales
1.708
1.698
1.624
2.109
2.538
– EBITDA margin
10,6%
9,4%
8,9%
18,3%
20,7%
– Capex on sales
5,0%
5,6%
6,1%
6,6%
9,2%
*Brands: Balenciaga, Alexander McQueen, Boucheron, Qeelin
LVMH Fashion and Leather**
– Sales
12.369
12.775
15.472
18.455
22.237
– EBITDA margin
33,1%
34,3%
35,2%
35,6%
40,7%
– Capex on sales
4,5%
4,0%
3,6%
4,5%
5,4%
**Brands: Louis Vuitton, Christian Dior, Fendi, Others (Celine, Berluti, Loewe, Loro Piana, Rimowa)
Hermes
– Sales
4.841
5.202
5.549
5.966
6.867
– EBITDA margin
35,8%
35,8%
35,8%
35,8%
39,0%
– Capex on sales
4,4%
4,1%
3,9%
4,2%
3,8%
Salvatore Ferragamo
– Sales
1.430
1.438
1.393
1.347
1.369
– EBITDA margin
22,5%
22,2%
17,5%
15,5%
15,7%
– Capex on sales
4,7%
3,8%
4,3%
4,7%
4,2%
Prada*
– Sales
3.552
3.548
3.184
2.990
3.142
– EBITDA margin
26,7%
22,4%
20,2%
18,8%
17,0%
– Capex on sales
10,2%
11,1%
7,1%
7,8%
7,4%
* 2017, 11 months
Brunello Cucinelli
– Sales
414
456
512
553
575
– EBITDA margin
17,5%
16,7%
17,2%
17,1%
17,2%
– Capex on sales
7,1%
6,8%
4,8%
4,3%
4,8%
Tod’s
– Sales
1.037
1.004
963
940
918
– EBITDA margin
19,3%
19,8%
15,0%
10,9%
7,0%
– Capex on sales
4,5%
3,4%
3,7%
4,4%
4,7%
Moncler
– Sales
880
1.040
1.194
1.420
1.628
– EBITDA margin
33,3%
33,8%
32,3%
32,2%
32,8%
– Capex on sales
5,7%
4,8%
4,2%
3,5%
3,1%
Burberry
– Sales
2.895
2.886
3.171
3.136
3.122
– EBITDA margin
22,2%
21,1%
21,0%
21,2%
19,6%
– Capex on sales
5,7%
4,8%
4,2%
3,5%
3,1%
Ralph Lauren
– Sales
6.833
6.640
5.966
5.544
5.661
– EBITDA margin
17,7%
14,9%
14,8%
15,3%
15,4%
– Capex on sales
5,1%
5,6%
4,3%
2,6%
3,1%
Summary
EBITDA margin
Gucci
LVMH Fashion
Hermes
Saint Laurent
Moncler
Bottega Veneta
Other Kering
Burberry
Ralph Lauren
Brunello Cucinelli
Prada
Ferragamo
Tod’s
Average
Median
29,9%
33,1%
35,8%
20,4%
33,3%
31,2%
10,6%
22,2%
17,7%
17,5%
26,7%
22,5%
19,3%
24,6%
22,5%
31,5%
34,3%
35,8%
24,6%
33,8%
28,1%
9,4%
21,1%
14,9%
16,7%
22,4%
22,2%
19,8%
24,2%
22,4%
36,5%
35,2%
35,8%
27,1%
32,3%
27,7%
8,9%
21,0%
14,8%
17,2%
20,2%
17,5%
15,0%
23,8%
21,0%
44,8%
35,6%
35,8%
33,9%
32,2%
35,6%
18,3%
21,2%
15,3%
17,1%
18,8%
15,5%
10,9%
25,8%
21,2%
45,4%
40,7%
39,0%
34,8%
32,8%
31,1%
20,7%
19,6%
15,4%
17,2%
17,0%
15,7%
7,0%
25,9%
20,7%
Capex on sales
Gucci
LVMH Fashion
Hermes
Saint Laurent
Moncler
Bottega Veneta
Other Kering
Burberry
Ralph Lauren
Brunello Cucinelli
Prada
Ferragamo
Tod’s
Average
Median
4,9%
4,5%
4,4%
6,5%
5,7%
3,8%
5,0%
5,7%
5,1%
7,1%
10,2%
4,7%
4,5%
5,6%
5,0%
4,2%
4,0%
4,1%
4,7%
4,8%
3,6%
5,6%
4,8%
5,6%
6,8%
11,1%
3,8%
3,4%
5,1%
4,7%
4,0%
3,6%
3,9%
4,9%
4,2%
4,3%
6,1%
4,2%
4,3%
4,8%
7,1%
4,3%
3,7%
4,6%
4,3%
3,8%
4,5%
4,2%
5,1%
3,5%
6,2%
6,6%
3,5%
2,6%
4,3%
7,8%
4,7%
4,4%
4,7%
4,4%
3,5%
5,4%
3,8%
4,8%
3,1%
13,6%
9,2%
3,1%
3,1%
4,8%
7,4%
4,2%
4,7%
5,4%
4,7%
2016
2017
2018
2019
CAGR
2015-2019
12%
42%
33%
16%
25%
25%
23%
16%
18%
20%
-9%
0%
-6%
5%
-2%
-1%
-4%
30%
20%
10%
3%
21%
19%
20%
16%
7%
7%
8%
15%
9%
1%
-3%
-3%
2%
-1%
0%
-10%
-6%
5%
-3%
10%
12%
8%
4%
9%
-3%
-4%
-2%
-2%
-3%
18%
15%
19%
15%
17%
0%
10%
-1%
0%
2%
-3%
-10%
-7%
2%
-5%
Luxury Goods: Market size (in million €) and growth
Forecast data
Luxury Fashion
Growth
Luxury Leather Goods
Growth
Total
Growth
Source: Statista, last update: 2019-10
2019
99.978
34.193
134.171
2020
2021
2022
2023
102.854
2,9%
36.322
6,2%
139.176
3,7%
105.268
2,3%
38.022
4,7%
143.290
3,0%
107.465
2,1%
39.463
3,8%
146.928
2,5%
109.675
2,1%
40.782
3,3%
150.457
2,4%
CAGR
2015-2019
2,3%
4,5%
2,9%
Financial Projections
Scenario:
“Following the market”
2019
Value drivers
General
Inflation rate (weighted)
Retail
Existing store
Stores number
Closures
Smq/store
Smq
Sales/smq
Growth rate
Sales
Sales growth
Renovation capex/smq
Store to be renovated (%)
DOS renovation capex
Renovation capex/sales
Depreciation years
Renovation capex depreciation
New stores
New stores per year
New stores (cumulative)
Smq/store
New smq
New smq (cumulative)
Sales/smq year 1
Growth rate
Sales
Growth capex/smq
DOS new stores capex
Depreciation years
Growth capex depreciation
Other retail
Retail Web
Growth rate
Retail Outlet
Growth rate
2021
2022
1,5%
2,0%
2,0%
207
5
190
39.330
18,2
3,0%
714
0,6%
5,0
5%
9,8
1,4%
10
1
203
4
190
38.570
18,7
3,0%
721
1,0%
5,1
5%
9,8
1,4%
10
2
200
3
190
38.000
19,2
2,5%
728
1,0%
5,2
7,5%
14,8
2,0%
10
3
5
5
180
900
900
17,0
8
8,5
7,7
10,0
0,8
5
10
180
900
1.800
17,5
3,0%
24
8,7
7,8
10,0
1,5
5
15
180
900
2.700
18,0
3,0%
41
8,8
8,0
10,0
2,3
51
6%
83
34%
56
10,0%
91
10,0%
62
10,0%
99
8,0%
68
10,0%
105
6,0%
30,1%
440
440
40.280
10,9
30,0%
446
446
40.230
11,1
30,0%
457
457
40.370
11,3
30,0%
469
469
40.700
11,5
844
869
3,0%
-261
905
4,2%
-272
941
4,0%
-282
212
190
40.280
17,6
-3,5%
710
50%
2020
17,6
Retail direct costs and margin
CoGS/Retail sales
Retail fixed direct cost (before D&A)
– DOS costs
– DOS smq
– DOS fixed cost per sqm
Retail sales
Growth
Cost of good sold*
-254
Gross margin
590
Selling and distribution costs*
-440
Channel margin
150
On sales
17,8%
* Without depreciation and amortization (D&A) and write-off
Wholesale
Sales
Growth rate
CoGS/Wholesale sales
Cost of good sold
Wholesale fixed direct cost
– Growth on wholesale fixed cost/Growth vs sales
– Growth
Channel margin
On sales
Royalties
Royalties
Growth rate
Indirect costs
Total sales
Growth rate
Product research and development cost
– Growth on cost/Growth on sales
– Growth
Advertising, marketing and promotion cost
– Growth on cost/Growth on sales
– Growth
General and administrative costs
– Growth on cost/Growth on sales
– Growth
Other non-recurring costs/(revenues)
608
-446
162
18,7%
634
-457
177
19,6%
659
-469
189
20,1%
252
46,1%
563
3,0%
44,8%
-252
-52
100%
3,0%
260
46,1%
580
3,0%
44,8%
-260
-53
100%
3,0%
267
46,1%
595
2,5%
44,8%
-266
-54
100%
2,5%
274
46,1%
15
7%
16
5,0%
17
5,0%
17
5,0%
1.406
2,4%
46
1.448
3,0%
47
100%
3,0%
110
110%
3,3%
111
75%
2,3%
12
1.502
3,7%
49
100%
3,7%
114
110%
4,1%
115
75%
2,8%
12
1.554
3,4%
51
100%
3,4%
118
110%
3,8%
118
75%
2,6%
12
547
-2%
44,8%
-245
-50
106
109
13
Capex and D&A
Retail fixed assets
Existing retail fixed assets D&A
Retail capex
Capex retail D&A
220
56
39
181
55
17
2
145
50
18
4
117
45
23
6
Other fixed assets
Existing other fixed assets D&A
Other capex
Other capex/sales
Other D&A years
Other D&A on capex
125
26
35
2,5%
132
25
36
2,5%
8
5
137
23
38
2,5%
8
9
140
22
39
2,5%
8
14
Total capex
Total capex/sales
74
5,3%
54
3,7%
55
3,7%
62
4,0%
28
2%
152
29
2%
152
30
2%
151
31
2%
149
Trade working capital
Operating cash
Operating cash on sales
Account receivables
Account receivables on wholesale sales
Inventory
Cost of good sold
Inventory on cost of good sold
Account payables
Operating costs
Account payables on operating costs
Other assets
Other operating current assets/(liabilities)
Other operating noncurrent assets/(liabilities)
Goodwill and similar assets
Surplus assets/(liabilities)
Net income/(loss) from surplus assets
Net financial position and debt equivalents
Excess (cash)/new debt
Short term debt
ST debt reimbursement
Long term debt
Existing long term debt reimbursement
Average return on cash
Average cost of debt
NFP/EBITDA (target from 2020)
28%
363
26%
376
25%
383
499
513
532
549
73%
261
1.250
21%
72%
269
1.279
21%
71%
277
1.319
21%
70%
285
1.359
21%
-45
30
350
45
1
-40
30
350
45
1
-35
30
350
45
1
-30
30
350
45
1
-46
50
plug
0
plug
0
1,7
plug
0
50
220
20
1,0%
3,0%
2,0
190
30
1,0%
3,0%
1,75
150
40
1,0%
3,0%
1,5
10
18
9
20
8
18
7
16
18%
15
5
-5
63%
25,0%
25,0%
25,0%
5
100%
50%
0
5
100%
50%
0
5
100%
50%
0
240
Postretirement benefit liabilities
Other nonoperating provision
Equity and taxes
Tax rate on income
Noncontrolling interests
Net income/(loss) to noncontrolling interests
Dividends on net income to noncontrolling interest*
Dividends on net group income*
Capital increase
*Previous year
27%
368
Income statement
€ million
2019
Revenues
1.406
Cost of goods sold
-499
Gross Margin
907
Product research and development cost
-46
Advertising, marketing and promotion cost
-106
Selling and distribution costs
-490
General and administrative costs
-109
Other costs
-13
EBITDA
143
Depreciation and amortization
-82
EBITA
61
Amortization and write-down of goodwill and similar assets -7
EBIT
54
Financial income
1
Financial charges
-12
Net income/(loss) from surplus assets
1
Income before taxes
44
2020
1.448
-513
935
-47
-110
-498
-111
-12
157
-86
71
0
71
0
-9
1
64
2021
1.502
-532
971
-49
-114
-510
-115
-12
171
-86
86
0
86
0
-7
1
80
2022
1.554
-549
1.005
-51
-118
-524
-118
-12
182
-87
95
0
95
1
-6
1
91
Taxes
Net income
Net income to noncontrolling interests
Net group income
EBITA
Adjusted tax rate
Operating taxes
NOPAT
-8
36
-5
31
-16
48
-5
43
-20
60
-5
55
-23
68
-5
63
61
25,0%
-15
46
71
25,0%
-18
53
86
25,0%
-21
64
95
25,0%
-24
71
Balance Sheet
€ million
2019
2020
2021
2022
Total funds invested: uses
Operating cash*
Account receivables
Inventory
Account payables
Trade working capital
Other operating current assets/(liabilities)
Operating working capital
Operating fixed assets**
Other operating noncurrent assets/(liabilities)***
Operating fixed capital
Invested capital (excluding goodwill)
Goodwill and similar assets****
Invested capital
Surplus assets/(liabilities)
Total funds invested
28
152
363
-261
282
-45
237
345
30
375
612
350
962
45
1.007
29
152
368
-269
281
-40
241
312
30
342
583
350
933
45
978
30
151
376
-277
280
-35
245
282
30
312
557
350
907
45
952
31
149
383
-285
277
-30
247
257
30
287
534
350
884
45
929
Total funds invested: sources
Excess (cash)/new debt to be raised
Short-term debt
Long-term debt
Net financial position (NFP)
Postretirement benefit liabilities
Other nonoperating provision
Debt equivalents
NFP and debt equivalents
Noncontrolling interests
Shareholders’ equity
Total funds invested
Check (ok = 0)
-46
50
240
244
10
18
28
272
15
720
1.007
0,0%
-33
0
220
187
9
20
29
216
15
747
978
0,0%
-60
0
190
130
8
18
26
156
15
781
952
0,0%
-76
0
150
74
7
16
23
97
15
817
929
0,0%
Free cash flow statement
€ million
NOPAT
Depreciation and amortization
Gross cash flow
Trade working capital change*
Other operating current assets and liabilities change
Net capital expenditures
Other noncurrent assets change
Goodwill and similar assets change
Gross investment
Free cash flow
2019
46
82
128
28
7
-74
-20
8
-51
77
2020
53
86
139
1
-5
-54
0
0
-57
82
2021
64
86
150
1
-5
-55
0
0
-60
90
2022
71
87
158
3
-5
-62
0
0
-64
95
Financial income
Net income/(loss) from surplus assets
Surplus asset/(liabilities) change
Nonoperating taxes
Nonoperating cash flow*
Cash flow available to investors
Financial charges
Short-term debt change
Long-term debt change
Debt equivalents change
Cash flow to debtholders
Noncontrolling interest change
Equity change
Cash flow to equityholders
Excess cash change
*Before excess cash change
Check (OK = 0)
1
1
11
7
20
97
-12
10
-40
-4
-46
-5
-11
-16
35
0
1
0
2
3
85
-9
-50
-20
1
-78
-5
-16
-21
-13
0
1
0
1
3
93
-7
0
-30
-3
-40
-5
-21
-26
27
1
1
0
1
3
97
-6
0
-40
-3
-49
-5
-28
-33
16
2019
4,4%
4,7%
7,3%
2020
5,8%
5,6%
8,9%
2021
7,2%
7,0%
11,3%
2022
7,9%
8,0%
13,1%
2019
2020
2021
2022
0,0%
Profitability
ROE*
ROIC with goodwill*
ROIC without goodwill*
Growth
Revenue
Gross Margin
EBITDA
EBITA
Net group income
Invested capital excluding goodwill
3%
3%
10%
16%
38%
-5%
4%
4%
9%
21%
29%
-4%
3%
4%
6%
11%
15%
-4%
Financial Health
2019
Leverage:
NFP/EBITDA
Target
1,7
NFP/Equity
0,34
Coverage:
EBITDA/Interest
EBITA/Interest
FCF/NFP
Debt service coverage ratio (1)
Debt service coverage ratio (2)
11,9
5,1
31%
2020
2021
2022
1,2
2,0
OK
0,25
0,8
1,8
OK
0,17
0,4
1,5
OK
0,09
18,1
8,2
44%
3,0
3,8
25,9
13,0
70%
2,5
2,9
32,0
16,7
128%
2,1
2,3
2023
2024
2,0%
2,0%
198
2
190
37.620
19,6
2,5%
739
1,5%
5,3
7,5%
15,0
2,0%
10
5
196
2
190
37.240
20,1
2,5%
750
1,5%
5,4
10%
20,2
2,7%
10
7
5
20
180
900
3.600
18,6
3,0%
59
9,0
8,1
10,0
3,2
5
25
180
900
4.500
19,1
3,0%
77
9,2
8,3
10,0
4,0
75
10,0%
110
5,0%
82
10,0%
115
5,0%
30,0%
485
485
41.220
11,8
30,0%
501
501
41.740
12,0
982
4,3%
-295
1025
4,4%
-307
CAGR
CAGR 20152019-2024
2019
2,7%
-2,1%

10,0%
35,8%
6,8%
11,9%
0,7%
5,9%
4,0%
3,7%
3,9%
687
-485
202
20,6%
717
-501
216
21,1%
4,0%
2,6%
7,6%
610
2,5%
44,8%
-273
-56
100%
2,5%
281
46,1%
625
2,5%
44,8%
-280
-57
100%
2,5%
288
46,1%
2,7%
18
5,0%
19
5,0%
5,0%
10,7%
1.610
3,6%
53
100%
3,6%
123
110%
4,0%
121
75%
2,7%
12
1.669
3,7%
55
100%
3,7%
128
110%
4,0%
124
75%
2,7%
12
3,5%
5,5%
3,5%
6,3%
3,8%
6,0%
2,6%
7,5%
5,5%
2,7%
2,7%
Total
20202024
92
40
23
8
79
30
28
11
141
20
40
2,5%
8
19
140
18
42
2,5%
8
24
63
3,9%
70
4,2%
304
32
2%
152
33
2%
156
3,6%
220
109
30
108
195
71
0,6%
25%
397
25%
411
568
587
70%
295
1.405
21%
70%
305
1.452
21%
-25
30
350
45
1
-20
30
350
45
1
plug
0
plug
0
90
60
1,0%
3,0%
1,5
0
90
1,0%
3,0%
1,5
6
15
5
15
25,0%
25,0%
5
100%
50%
0
5
100%
50%
0
2023
1.610
-568
1.042
-53
-123
-541
-121
-12
193
-87
106
0
106
1
-5
1
103
2024
1.669
-587
1.081
-55
-128
-558
-124
-12
205
-83
122
0
122
1
-3
1
121
2,5%
3,2%
2019
100%
-35%
65%
-3%
-8%
-35%
-8%
-1%
10%
-6%
4%
0%
4%
0%
-1%
0%
3%
2020
100%
-35%
65%
-3%
-8%
-34%
-8%
-1%
11%
-6%
5%
0%
5%
0%
-1%
0%
4%
2021
2022
% on Sales
100%
100%
-35%
-35%
65%
65%
-3%
-3%
-8%
-8%
-34%
-34%
-8%
-8%
-1%
-1%
11%
12%
-6%
-6%
6%
6%
0%
0%
6%
6%
0%
0%
0%
0%
0%
0%
5%
6%
2023
100%
-35%
65%
-3%
-8%
-34%
-7%
-1%
12%
-5%
7%
0%
7%
0%
0%
0%
6%
2024
100%
-35%
65%
-3%
-8%
-33%
-7%
-1%
12%
-5%
7%
0%
7%
0%
0%
0%
7%
CAGR
2019-2024
3%
3%
4%
3%
4%
3%
3%
-2%
7%
0%
15%
18%
14%
-26
77
-5
72
-30
90
-5
85
-1%
3%
0%
2%
-1%
3%
0%
3%
-1%
4%
0%
4%
-1%
4%
0%
4%
-2%
5%
0%
4%
-2%
5%
0%
5%
106
25,0%
-26
79
122
25,0%
-30
91
4%
5%
6%
6%
7%
7%
11%
3%
4%
4%
5%
5%
5%
11%
2023
2024
2019
2020
2021
2022
2023
2024
32
152
397
-295
287
-25
262
233
30
263
525
350
875
45
920
33
156
411
-305
296
-20
276
220
30
250
526
350
876
45
921
2%
11%
26%
-19%
20%
-3%
17%
25%
2%
27%
44%
25%
68%
3%
72%
2%
11%
25%
-19%
19%
-3%
17%
22%
2%
24%
40%
24%
64%
3%
68%
2%
10%
25%
-18%
19%
-2%
16%
19%
2%
21%
37%
23%
60%
3%
63%
2%
10%
25%
-18%
18%
-2%
16%
17%
2%
18%
34%
23%
57%
3%
60%
2%
9%
25%
-18%
18%
-2%
16%
14%
2%
16%
33%
22%
54%
3%
57%
2%
9%
25%
-18%
18%
-1%
17%
13%
2%
15%
31%
21%
52%
3%
55%
-64
0
90
26
6
15
21
47
15
858
920
0,0%
-21
0
0
-21
5
15
20
-1
15
907
921
0,0%
-3%
4%
17%
17%
1%
1%
2%
19%
1%
51%
72%
-2%
0%
15%
13%
1%
1%
2%
15%
1%
52%
68%
-4%
0%
13%
9%
1%
1%
2%
10%
1%
52%
63%
-5%
0%
10%
5%
0%
1%
1%
6%
1%
53%
60%
-4%
0%
6%
2%
0%
1%
1%
3%
1%
53%
57%
-1%
0%
0%
-1%
0%
1%
1%
0%
1%
54%
55%
2023
79
87
167
-10
-5
-63
0
0
-78
88
2024
91
83
174
-9
-5
-70
0
0
-84
90
2019
3%
6%
9%
2%
0%
-5%
-1%
1%
-4%
5%
2020
4%
6%
10%
0%
0%
-4%
0%
0%
-4%
6%
2021
4%
6%
10%
0%
0%
-4%
0%
0%
-4%
6%
2022
5%
6%
10%
0%
0%
-4%
0%
0%
-4%
6%
2023
5%
5%
10%
-1%
0%
-4%
0%
0%
-5%
5%
2.024
5%
5%
10%
-1%
0%
-4%
0%
0%
-5%
5%
14%
15%
CAGR
2019-2024
4%
1%
3%
3%
1%
-15%
3%
-9%
0%
-8%
-3%
0%
-2%
0%
-2%
-161%
-7%
-134%
5%
-2%
CAGR
2019-2024
15%
0%
6%
10%
3%
1
1
0
1
2
91
-5
0
-60
-2
-67
-5
-32
-37
-12
1
1
0
0
2
92
-3
0
-90
-1
-94
-5
-36
-41
-43
2023
8,6%
9,0%
15,0%
2024
9,7%
10,4%
17,4%
2023
2024
4%
4%
6%
11%
14%
-2%
2023
4%
4%
6%
15%
18%
0%
2024
0,1
1,5
OK
0,03
-0,1
1,5
OK
-0,02
42,9
23,5
337%
1,4
1,4
75,9
45,0
-426%
1,0
1,0
CAGR
2019-2024
3%
4%
7%
15%
22%
-3%
CAGR
2019-2022
3%
Scenarios Summary
Scenario
2019*
Sales smq 2024
Sales smq CAGR 19-24
Sales 2024
17,6
Following the
market
Rediscovering the
growing path
20,1
23,6
Continuing
declining
16,6
-2%
3%
6%
-1%
1.406
1.669
2.139
1.376
Sales CAGR 19-24
6%
3%
9%
0%
EBITDA 2024
143
205
349
105
EBITDA margin 2024
10%
12%
16%
8%
EBITDA CAGR 19-24
-8%
7%
20%
-6%
Free cash flow 2024
77
90
165
38
ROIC 2024
7%
17%
29%
5%
NFP/EBITDA 24
1,7
-0,1
-0,1
0,4
*CAGR 2015-2019
Cost of capital
WACC – normalised to exclude the IFRS 16 effect on debt
Valuation date
2019/12/31
Risk free rate (Rf)
Equity risk premium (MRP)
Beta levered (β)
Cost of equity (Ke)
Credit spread
Cost of debt (Kd)
Tax rate
D/EV
E/EV
WACC
2,5%
5,5%
0,90
7,5%
1,56%
4,06%
24%
2,8%
97,2%
7,3%
Normalized risk free rate
Normalized MRP
Rating class: Ba3
Normalized cost
0,1
3,1%
Industry median
Industry median
Risk free rate
as of
2019/12/31
IRS 10y
IRS 30y
Italian gov bond 10Y
Italian gov bond 30Y
0,20%
0,62%
1,35%
2,45%
Beta calculation
Unlevered Beta (βu)
Debt Beta (βd)
Capital structure (D/E)
Levered Beta
Avg 1m
0,13%
0,55%
1,33%
2,42%
Avg 3m
0,06%
0,47%
1,15%
2,22%
Avg 6m
-0,01%
0,43%
1,24%
2,30%
Avg 12m
0,26%
0,77%
1,90%
2,92%
Avg 60m
Avg 120m
0,69%
1,24%
1,94%
2,96%
1,56%
2,05%
3,17%
4,03%
Debt
(book value)
Total capital
(EV)
457
(817)
(4.172)
5.198
6.728
(623)
217
(1.222)
434
399
660
308
2.603
8.139
65.276
78.531
216.936
9.487
8.476
7.525
3.619
1.762
40.235
8.307
0,88 Comparable listed companies
0,10 Rating class: Ba3
2,9% Industry average
0,90
Comparable listed companies analysis

Stock price
Brunello Cucinelli
Burberry Group
Hermes
Kering
LVMH
Moncler
Prada
Ralph Laurent
Salvatore Ferragamo
Tod’s**
Average
Median
* S&P when available or assumption
** Beta not significant
31,6
22,1
666,2
585,2
414,2
40,1
3,2
117,2
18,8
41,2
Number of
shares out
68,0
405,9
104,2
125,0
503,4
252,3
2.558,8
74,6
168,6
33,1
Equity
(market
value)
2.146
8.950
69.444
73.160
208.495
10.110
8.239
8.747
3.162
1.364
39.382
8.848
Equity
(minority
interest)
(0)
5
5
173
1.712
0
20
23
(1)
194
4,9
Cost of debt
Rating class
Aaa/AAA
Credit
Spread
Beta Debt
0,6%
0,000
Average cumulative default rates (Europe), years
1
2
0%
0%
3
4
5
6
0%
0%
0%
0%
Aa2/AA
0,8%
0,000
A1/A+
1,0%
0,000
A2/A
1,1%
0,000
A3/A-
1,2%
0,000
Baa2/BBB
1,6%
0,100
Ba1/BB+
2,0%
0,200
Ba2/BB
2,4%
0,300
B1/B+
3,5%
0,400
B2/B
4,2%
0,500
B3/B-
5,1%
0,600
Caa/CCC
8,2%
0,800
Ca2/CC
8,6%
0,900
C2/C
11,3%
1,000
D2/D
15,1%
1,100
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
1%
1%
0%
1%
2%
3%
4%
5%
2%
5%
8%
11%
12%
14%
25%
34%
38%
42%
43%
43%
Source: Damodaran (2020), S&P Global (2019), Duff & Phelps (2016, for Beta)
Debt/
Equity
21,3%
-9,1%
-6,0%
7,1%
3,2%
-6,2%
2,6%
-14,0%
13,6%
29,2%
4,2%
2,9%
Europe), years
7
0%
Debt/ EV
17,6%
-10,0%
-6,4%
6,6%
3,1%
-6,6%
2,6%
-16,2%
12,0%
22,6%
2,5%
2,8%
Beta levered
Debt Rating*
MSCI 60m/m
0,82
0,74
0,61
1,06
0,96
0,80
1,17
0,84
1,03
0,25
0,89
0,84
BBB
A
AA
AA+
A
BBB
AABBB
Beta debt
0,10
0,00
0,00
0,00
0,00
0,00
0,10
0,00
0,00
0,10
0,03
0,00
Beta
unlevered
0,70
0,81
0,65
0,99
0,93
0,86
1,15
0,98
0,91
0,22
0,82
0,88
Beta levered Beta levered Beta levered
MSCI 24m/w MSCI 24m/w LIND 60m/m
0,69
0,58
0,61
1,00
0,97
0,96
1,05
1,11
0,93
0,31
0,88
0,96
0,69
0,58
0,61
1,00
0,97
0,96
1,05
1,11
0,93
0,31
0,88
0,96
0,46
1,57
0,69
1,22
1,20
0,61
0,81
0,91
0,59
0,48
0,90
0,81
0%
0%
1%
5%
14%
44%
Beta levered
LIND 24m/w
0,36
1,05
0,78
1,22
1,23
0,78
1,11
0,96
0,86
0,35
0,93
0,96
Valuation
Scenario:
“Following the market”
DCF (FCF and WACC)
2019
Free cash flow
WACC
g
Continuing value
Enterprise value
EV/EBITDA2019
EV/EBITDA2020
PV(FCF)
PV(CV)
EV
Surplus assets
Net financial position and debt equivalents
Noncontrolling interests
Equity value
P/E
Number of share (mln)
Value per share
Noncontrolling interest
Net income to noncontrolling interests
P/E comparables
(Discount)/premium
P/E non controlling interest
Noncontrolling interest value
2020
2021
2022
2023
82
7,3%
90
7,3%
95
7,3%
88
7,3%
1.703
11,9
10,8
1.746
1.784
1.821
1.866
361
1.342
1.703
TRUE
45
-272
-124
1.353
44
10,0
135
21%
79%
7,3%
5
31
20%
25
124
DCF (EP and WACC)
2019
NOPAT
Invested capital (excluding goodwill)
ROIC
WACC
EP
Continuing value
Goodwill
Enterprise value
2020
2021
2023
53
583
8,7%
7,3%
8,3
64
557
11,0%
7,3%
21,3
71
534
12,8%
7,3%
30,6
79
525
14,9%
7,3%
40,2
1.091
1.703
TRUE
1.163
1.746
TRUE
1.227
1.784
TRUE
1.287
1.821
TRUE
1.341
1.866
TRUE
2024
1.669
2025
1.702
2%
12,3%
209
2026
612
7,3%
Continuing value of EV (DCF)
Revenues
Perpetual growth rate
EBITDA margin
EBITDA
CAPEX:
Retail
– sqm
– renovation capex/sqm
– yearly store renovation
Retail capex normalized
2022
12,3%
205
41.740,0
5,4
41.740,0
5,5
10,0%
23,0
Other capex on sales
Other capex on sales
Total capex
Total capex/sales
Depreciation and amortization
EBITA
Taxes rate
Taxes
NOPAT
g NOPAT
Invested capital (IC)
g IC on g Sales
g IC
IC change
FCF
g
WACC
CV (DCF)
EV/EBITDA
EV/Sales
2,5%
83,3
122
25,0%
-30
91
526
2,5%
42,6
65,6
3,9%
65,6
143
25,0%
-36
107
17,9%
531
50%
1,0%
5
102
2,0%
110
2,0%
536
50%
1,0%
5
104
2,1%
7,3%
1.913
9,2
1,1
Continuing value of EV (Value drivers)
NOPAT
g
Invested capital (excluding goodwill)
Net investment
ROIC
RONIC
IR
WACC
CV
2024
91
526
17,4%
2025
107
2,0%
531
5
20,5%
2026
110
2,0%
536
5
20,7%
40,9%
4,9%
7,3%
1.913
TRUE
Continuing value of EV (Economic Profit)
NOPAT
g
Invested capital (excluding goodwill)
Net investment
ROIC
RONIC
WACC
Economic profit
CV of EP in N+1
Delta EP da N+2
CV of Delta EP da N+2
CV of EP (goodwill)
CV
2024
91
526
17,4%
2025
107
2,0%
531
5
20,5%
2026
110
2,0%
536
5
20,7%
40,9%
68,89
109,65
7,3%
938
1,76
449
1.387
1.913
TRUE
2024
90
2%
1.913
1.913
2024
91
526
17,4%
7,3%
52,6
1.387
1.387
You can start from here in your case studies
Insert this one as an INPUT variable (equal to g in perpetuity) in your case study
Valuation: Multiples
Sales
Multiple (raw)
Enterprise Value
Multiple regression on EBITDA margin
Enterprise Value
Intercept
EBITDA margin and coefficient
Multiple regression on SALES Growth
Enterprise Value
Intercept
SALES Growth and coefficient
Multiple regr on EBITDA margin and SALES growth
Enterprise Value
Intercept
SALES Growth coefficient
EBITDA margin coefficient
EBITDA
Multiple (raw)
Enterprise Value (EBITDA)
Multiple regression on SALES Growth
Enterprise Value
Intercept
SALES Growth and coefficient
2019
1.406
4,0
5.691
1,0
1.424
-1,46
10,2%
0,07
3,8%
-1,71
3,8%
10,2%
24,3
2,6
3.700
66,7
1,1
1.556
20,620
19,876
143
16,8
2.405
14,3
2.045
9,31
3,8%
EBITA
Multiple (raw)
Enterprise Value (EBITDA)
130,0
61
19,4
1.186
Net Income
Multiple (raw)
Equity value
Adjusted EBITA*
Multiple (raw)
Enterprise Value (EBITDA)
*EBITDA*(1 – AdjD&A on EBITDA)
31
30,9
958
Adjusted Net Income
Multiple (raw)
Equity value
Comparable listed companies multiples
€ mln
Equity
(market
value)
Equity
(minority
interest)
NFP
Total capital
(book value)
(EV)
as of
as of
as of
as of
2019/12/31 2019/12/31 2019/12/31 2019/12/31
Brunello Cucinelli
Burberry Group
Hermes
Kering
LVMH
Moncler
Prada
Ralph Lauren
Salvatore Ferragamo
Tod’s
2.146
8.950
69.444
73.160
208.495
10.110
8.239
8.747
3.162
(0)
5
5
173
1.712
0
20
23
457
(817)
(4.172)
5.198
6.728
(623)
217
(1.222)
434
2.603
8.139
65.276
78.531
216.936
9.487
8.476
7.525
3.619
Market multiples
EV/Sales
2019
4,3
3,0
9,5
5,0
4,0
5,9
2,6
1,2
2,6
EV/EBITDA
2019
26,3
13,3
24,4
16,0
17,8
17,8
15,9
8,6
16,8
Average
Median
IFG
43.606
8.950
215
5
689
217
44.510
8.476
4,2
4,0
17,4
16,8
Regression Analysis
EV/Sales
2019
Brunello Cucinelli
Burberry Group
Hermes
Kering
LVMH
Moncler
Prada
Ralph Lauren
Salvatore Ferragamo
Tod’s
4,3
3,0
9,5
5,0
4,0
5,9
2,6
1,2
2,6
Average
Median
4,2
4,0
EBITDA
margin
2019
16%
22%
39%
31%
23%
33%
17%
14%
16%
EV/Sales vs EBITDA margin
10,0
9,0
y = 24,327x – 1,4615
R² = 0,8125
8,0
7,0
6,0
5,0
4,0
3,0
2,0
23%
22%
1,0
0%
EV/Sales
2019
Brunello Cucinelli
Burberry Group
Hermes
Kering
LVMH
Moncler
Prada
Ralph Lauren
Salvatore Ferragamo
Tod’s
4,3
3,0
9,5
5,0
4,0
5,9
2,6
1,2
2,6
Average
Median
4,2
4,0
5%
10%
20%
EV/Sales vs Sales Growth
Sales CAGR
2019-2022
7,8%
3,4%
8,2%
7,5%
7,3%
10,8%
4,7%
2,3%
4,1%
15%
9,5
8,5
7,5
y = 66,656x + 0,0718
R² = 0,5685
6,5
5,5
4,5
3,5
6,2%
7,3%
2,5
1,5
0,0%
2,0%
4,0%
6,0%
MULTIPLE REGRESSION (EV/Sales vs EBITDA margin and SALES Growth)
EV/Sales
2019
Brunello Cucinelli
Burberry Group
Hermes
Kering
LVMH
4,3
3,0
9,5
5,0
4,0
Sales CAGR
2019-2022
8%
3%
8%
7%
7%
EBITDA
margin
2019
16%
22%
39%
31%
23%
SUMMARY OUTPUT
Regression Statistics
Multiple R
0,92
R Square
0,84
Adjusted R Square
0,79
Moncler
Prada
Ralph Lauren
Salvatore Ferragamo
Tod’s
Average
Median
5,9
2,6
1,2
2,6
4,2
4,0
11%
5%
2%
4%
6%
7%
33%
17%
14%
16%
0%
21%
20%
Standard Error
1,12
Observations
9
ANOVA
df
Regression
2
Residual
6
Total
8
Coefficients
Intercept
-1,71
X Variable 1
20,62
X Variable 2
19,88
EV/EBITDA vs Sales Growth
EV/EBITDA Sales CAGR
2019
2019-2022
28,0
Brunello Cucinelli
Burberry Group
Hermes
Kering
LVMH
Moncler
Prada
Ralph Lauren
Salvatore Ferragamo
Tod’s
26,3
13,3
24,4
16,0
17,8
17,8
15,9
8,6
16,8
Average
Median
17,4
16,8
8%
3%
8%
7%
7%
11%
5%
2%
4%
26,0
y = 130x + 9,3055
R² = 0,4471
24,0
22,0
20,0
18,0
16,0
14,0
12,0
6%
7%
10,0
8,0
0%
EV/Ebitda
2019
Brunello Cucinelli
Burberry Group
Hermes
Kering
LVMH
Moncler
Prada
Ralph Lauren
Salvatore Ferragamo
Tod’s
26,3
13,3
24,4
16,0
17,8
17,8
15,9
8,6
16,8
Average
Median
17,4
16,8
EBITDA
margin
2019
16%
22%
39%
31%
23%
33%
17%
14%
16%
4%
6%
EV/Ebitda vs Ebitda margin
28,0
26,0
24,0
22,0
20,0
18,0
16,0
14,0
12,0
23%
22%
10,0
8,0
12%
EBITDA
Margin
Brunello Cucinelli
2%
16%
Sales
Growth
8%
17%
22%
27%
Ebitda margin vs Sales Growth
Burberry Group
Hermes
Kering
LVMH
Moncler
Prada
Ralph Lauren
Salvatore Ferragamo
Tod’s
22%
39%
31%
23%
33%
17%
14%
16%
0%
3%
8%
7%
7%
11%
5%
2%
4%
0%
0,2
0,2
6%
6%
36%
y = 2,8458x + 0,0508
R² = 0,6772
31%
26%
21%
16%
11%
Average
Median
6%
0%
2%
4%
6%
98
19,4
1.907
D&A on EBITDA IFG 2019
D&A on EBITDA Comparables 2019
D&A on EBITDA IFG CV
62%
17%
31%
61
30,9
1.897
Tax rate
18%
Market multiples
EV/EBITA
2019
31,5
18,4
28,0
16,6
18,8
19,4
27,1
10,7
24,2
Sales
P/E 2019
40,0
28,3
45,4
30,9
28,6
28,6
32,3
19,4
35,7
2018
553
2.733
5.966
13.665
46.826
1.420
3.142
6.182
1.347
2019
609
2.720
6.872
15.802
53.594
1.621
3.205
6.283
1.377
2020
653
2.694
7.399
16.853
57.467
1.768
3.283
6.336
1.410
EBITDA (before IFRS 16)
2021
704
2.832
8.070
18.373
61.983
2.000
3.466
6.523
1.480
2022
763
3.010
8.716
19.615
66.237
2.203
3.680
6.733
1.553
Sales CAGR
2019-2022
8%
3%
8%
7%
7%
11%
5%
2%
4%
2018
95
578
2.308
4.447
11.702
466
533
945
209
2019
99
612
2.680
4.918
12.197
534
533
873
215
21,6
19,4
32,1
30,9
9.093
3.142
1.373
10.231
3.205
1.406
10.874
3.283
1.448
11.714
3.466
1.502
12.501
3.680
1.554
6%
7%
3%
2.365
578
175,0
2.518
612
143,0
EV/Sales vs EBITDA margin
SUMMARY OUTPUT
Regression Statistics
Multiple R
0,90
R Square
0,81
Adjusted R Square
0,79
Standard Error
1,12
Observations
9
ANOVA
df
20%
25%
30%
35%
40%
SS
MS
F
Regression
1
38,02
38,02
Residual
7
8,77
1,25
Total
8
46,79
Significance F
30,33
0,00
45%
Coefficients Standard Error
t Stat
P-value
Lower 95%
Intercept
-1,46
1,10
-1,33
0,23
-4,06
X Variable 1
24,33
4,42
5,51
0,00
13,88
EV/Sales vs Sales Growth
SUMMARY OUTPUT
Regression Statistics
Multiple R
0,75
R Square
0,57
Adjusted R Square
0,51
Standard Error
1,70
Observations
9
ANOVA
df
6,0%
8,0%
10,0%
SS
MS
F
Regression
1
26,60
26,60
Residual
7
20,19
2,88
Total
8
46,79
Significance F
9,22
0,02
12,0%
Coefficients Standard Error
Intercept
X Variable 1
t Stat
P-value
Lower 95%
0,07
1,48
0,05
0,96
-3,44
66,66
21,95
3,04
0,02
14,75
SS
MS
F
39,29
19,64
7,50
1,25
Significance F
15,72
0,00
46,79
Standard Error
t Stat
P-value
Lower 95%
Upper 95%
Lower 95.0% Upper 95.0%
1,12
-1,52
0,18
-4,46
1,04
-4,46
1,04
20,43
1,01
0,35
-29,38
70,62
-29,38
70,62
6,24
3,19
0,02
4,61
35,14
4,61
35,14
EV/EBITDA vs Sales Growth
SUMMARY OUTPUT
Regression Statistics
Multiple R
0,67
R Square
0,45
Adjusted R Square
0,37
Standard Error
4,23
Observations
9,00
ANOVA
df
6%
8%
10%
SS
MS
1
101,18
101,18
Residual
7
125,10
17,87
Total
8
226,28
Coefficients Standard Error
X Variable 1
EV/Ebitda vs Ebitda margin
y = 21,674x + 12,349
R² = 0,1334
32%
Ebitda margin vs Sales Growth
37%
Significance F
5,66
0,05
12%
Intercept
27%
F
Regression
42%
t Stat
P-value
Lower 95%
9,31
3,69
2,52
0,04
0,58
130,00
54,64
2,38
0,05
0,81
6%
8%
10%
12%
EBITDA (before IFRS 16)
EBITA
EBITDA
margin
2019
16%
22%
39%
31%
23%
33%
17%
14%
16%
2018
70
472
2.091
3.944
9.963
414
324
664
153
2019
83
443
2.329
4.730
11.517
488
312
706
150
Net Income
2020
89
410
2.439
4.959
12.193
519
334
731
159
EBIT margin
2019
14%
16%
34%
30%
21%
30%
10%
11%
11%
2018
51
294
1405
3715
6354
332
205
163
88
D&A/EBITDA
2019
54
317
1.530
2.367
7.284
353
255
452
89
2018
27%
18%
9%
11%
15%
11%
39%
30%
27%
2019
17%
28%
13%
4%
6%
9%
41%
19%
30%
23%
22%
10%
Upper 95%
2.010
472
85,0
2.307
488
54,0
Lower 95.0% Upper 95.0%
1,14
-4,06
1,14
34,77
13,88
34,77
Upper 95%
Lower 95.0% Upper 95.0%
3,58
-3,44
3,58
118,56
14,75
118,56
2.425,8
518,6
0,0
20%
16%
4%
1.401
294
56,0
1.411
353
31,0
21%
18%
51%
18%
17%
62%
Upper 95%
Lower 95.0% Upper 95.0%
18,03
0,58
18,03
259,20
0,81
259,20
Valuation
DCF (FCF and WACC)
2019
EV
Scenario
Following the market
Rediscovering the brand growth path
Continuing declining
EV
EV/EBITDA 2019
EV/EBITDA 2020
Surplus assets
Net financial position and debt equivalents
Noncontrolling interests
Equity value
P/E
Number of share (mln)
Value per share
1.703
3.249
707
1.841
50,0%
25,0%
25,0%
1.703
3.249
707
1.968
50,0%
30,0%
20,0%
1.703
3.249
707
1.714
12,9
11,7
13,8
12,5
12,0
10,9
45
-272
-124
1.490
48,1
10,0
149
45
-272
-124
1.617
29,3
10,0
162
45
-272
-124
1.363
18,8
10,0
136
50,0%
20,0%
30,0%
Multiples
EV/Sales (Regr)
EV/EBITDA
EV/EBITDA (Regr on GROWTH)
EV/EBITA
EV/EBITA Adj
1,0
16,8
14,3
19,4
1.424
2.405
2.045
1.186
1.897
Moody’s rating methodology
Italian Fashion Brand
Rating class:
Baa3
Factor
Scale
Business profile
Profitability and efficiency
Leverage and coverage
Financial policy
Total
Weight
Sub factor
15% Revenue
27,5% Brand position
Diversity of distribution channels
Diversity of product category
10% EBIT margin
32,5% Debt/EBITDA
FFO/Net debt
EBITA/Interest expense
15%
100%
Weight
15%
12,5%
7,5%
7,5%
10,0%
12,5%
7,5%
12,5%
15%
100%
Last year
1,4
4%
1,7
31%
5,1
Apparel
Factor
Scale
Business profile
Profitability and efficiency
Leverage and coverage
Financial policy
Total
Weight
Sub factor
15% Revenue
27,5% Brand position
Diversity of distribution channels
Diversity of product category
10% EBIT margin
32,5% Debt/EBITDA
FFO/Net debt
EBITA/Interest expence
15%
100%
Weight
15%
12,5%
7,5%
7,5%
10,0%
12,5%
7,5%
12,5%
15%
100%
$ mln
IFG
Avg 3 years
2017-2019
Scorecard-Indicator Outcome
Score
2020
15
9
3
9
15
9
12
9
9
6%
5%
26%
7,0
44%
8,2
Aaa
1
>50
Aa
3
30 -50
A
6
10 -30
>=25%
=90%
>=20
20-25%
0.5-1
65-90%
12-20
16-20%
1-2
50-65%
7-12
Weighted
2,25
1,125
0,225
0,675
1,5
1,125
0,9
1,125
1,35
10,275
Baa
Ba
9
12
5-10
2-5
Judgement: see below
Judgement: see below
Judgement: see below
12-16%
8-12%
2-3
3-4.5
35-50%
20-35%
4-7
2.25-4
Judgement: see below
Aaa
Aa1
Aa2
Aa3
A1
A2
A3
Baa1
Baa2
Baa3
Ba1
Ba2
Ba3
B1
B2
B3
Caa1
Caa2
Caa3
Ca
C
20.5
B
15
0.5-2
Caa
18
0.25-0.5
Ca
20

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