Benetton vs. Inditex Marco Morelli

Transcription

1 Benetton vs. Inditex Marco Morelli 1

2 INDITEX vs. Benetton (1) INDITEX Benetton Profitability ROI ROCE ROE NET INCOME MARGIN EBITDA MARGIN ROS Profitability ROI ROCE ROE NET INCOME MARGIN EBITDA MARGIN ROS Numerator EBIT 20.7% 20.7% 23.3% 23.6% Total Assets Numerator EBIT 28.7% 29.9% 35.5% 35.2% LTL + Equity Numerator Net Income 24.6% 26.6% 29.8% 29.1% Equity Numerator Net Income 11.9% 12.1% 1% 13.3% 3% 12.3% Net sales Numerator EBITDA 21.4% 21.0% 22.8% 21.8% Net Sales Numerator EBIT 15.6% 15.5% 17.5% 16.6% Net sales Numerator EBIT 7.3% 8.6% 9.0% 7.0% Total Assets Numerator EBIT 10.5% 13.4% 12.7% 12.3% LTL + Equity Numerator Net Income 8.1% 11.2% 10.6% 9.5% Equity Numerator Net Income 5.8% 7.3% 7.2% 6.7% Net sales Numerator EBITDA 15.1% 16.6% 16.0% 13.8% Net Sales Numerator EBIT 10.0% 0% 11.9% 11.7% 94% 9.4% Net sales MILANO FASHION INSTITUTE 2

3 INDITEX vs. Benetton (2) ITEX IND Operating efficiency Days of inventory on hand (DOH) Days of sales outstanding (DSO) Number of days of payables Numerator 360 days Inventory turnover Numerator 360 days Receivables turnover Numerator 360 days Payables turnover netton Be Operating efficiency Days of inventory on hand (DOH) Days of sales outstanding (DSO) Number of days of payables Numerator 360 days Inventory turnover Numerator 360 days Receivables turnover Numerator 360 days Payables turnover MILANO FASHION INSTITUTE 3

4 INDITEX vs. Benetton (3) Liquidity Current ratio Quick ratio Working Capital INDITEX 2009 Data 2008 Data 2007 Data 2006 Data Numerator CA ,943, ,264, ,981, ,149,000 CL 2,304,960 2,390,848 2,458,067 1,885,000 Numerator CA - Inventories ,951, ,209, ,974, ,325,000 CL 2,304,960 2,390,848 2,458,067 1,885,000 CA - CL 1,638, , , ,000 Operating working capital Crediti + Magazzino + Altri crediti - Debiti Commerciali - (746,217 ) (359,061 ) (571,031 ) (497,000 ) Liquidity Current ratio Quick ratio Working Capital Benetton 2009 Data 2008 Data 2007 Data 2006 Data Numerator CA ,334, ,421, ,291, ,285,641 CL 869,864 1,053, ,206 1,103,694 Numerator CA - Inventories ,034, ,062, , ,900 CL 869,864 1,053, ,206 1,103,694 CA - CL 464, , , ,947 Operating working capital Crediti + Magazzino + Altri crediti - Debiti Commerciali - 648, , , ,899 MILANO FASHION INSTITUTE 4

5 INDITEX vs. Benetton (4) Long-term solvency Debt-to-equity ratio Debt-to-equity ratio* Rigidity of debt Fixed asset coverage Interest coverage Average cost of Debt Long-term solvency Debt-to-equity ratio Debt-to-equity ratio* Rigidity of debt Fixed asset coverage Interest coverage Average cost of Debt INDITEX 2009 Data 2008 Data 2007 Data 2006 Data Numerator LTL + CL ,964, ,028, ,888, ,271,000 Equity 5,370,546 4,748,600 4,217,051 3,472,000 Numerator Interest bearing debts , , , ,000 Equity 5,370,546 4,748,600 4,217,051 3,472,000 Numerator LTL , , , ,000 LTL + CL 2,964,891 3,028, ,888,551 2,271, Numerator Equity ,370, ,748, ,217, ,472,000 Fixed Assets 4,391,642 4,512,605 4,124,007 3,594,000 Numerator EBITDA NA ,186, ,148, ,790,000 Interest 21,599 6,544 17,000 Numerator Interest 00% 0.0% - 07% 0.7% 21,599 02% 0.2% 6,544 07% 0.7% 17,000 LTL + CL 2,964,891 3,028,046 2,888,551 2,271,000 Benetton 2009 Data 2008 Data 2007 Data 2006 Data Numerator LTL + CL ,371, ,554, ,276, ,220,386 Equity 1,455,519 1,391,753 1,414,684 1,341,009 Numerator Interest bearing debts , , , ,275 Equity 1,455,519 1,391,753 1,414,684 1,341,009 Numerator LTL , , , ,692 LTL + CL 1,371,967 1,554,801 1,276, ,220,386 Numerator Equity ,455, ,391, ,414, ,341,009 Fixed Assets 1,492,677 1,524,976 1,400,071 1,275,754 Numerator EBITDA , , , ,772 Interest 20,235 41,983 40,025 20,200 Numerator Interest 15% 1.5% 20, % 2.7% 41,983 31% 3.1% 40, % 1.7% 20, LTL + CL 1,371,967 1,554,801 1,276,728 1,220,386 MILANO FASHION INSTITUTE 5

6 DOS: upside e downside Distribution structures Features Financial implications Directly operated stores Single brand stores Strict control from the company Control of merchandise Direct contact with production and customers Control over the brand image High start-up costs High capital commitments (Key money) Rental and store personnel costs Exit costs Capturing of the retail margin Franchises Same store format, with identical store looks but usually small size Lower risk Better understanding of local market (retail presence with ihlocal l partners) Lower financial commitments Lower risk Loss of the retail mark-up (and therefore lower gross margins) Lower operating expenses Third-party retailers (department & specialist stores) Products sold to department stores and specialist stores (broader distribution) Reduced control over products and sales Merchandising risk is allocated to retailers Prevalent in U.S. and Japan No fixed costs No financial commitment Loss of the retail mark-up (lower gross margin) Agents The control of the brand is mostly transferred to the agent No flexibility to manage inventory Potential damages for loss of control over products Increased distance between brand, retailer and final customer No fixed costs and low financial commitments Low inventory risk Low operating expenses Fonte: Rovetta MILANO FASHION INSTITUTE 6

7 Fashion & Luxury insight)(1) MILANO FASHION INSTITUTE 7

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9 Fashion & Luxury insight)(3) MILANO FASHION INSTITUTE 9

10 Fashion & Luxury insight)(2) MILANO FASHION INSTITUTE 10

11 Fashion & Luxury insight)(4) MILANO FASHION INSTITUTE 11

12 Fashion & Luxury insight)(5) MILANO FASHION INSTITUTE 12

13 Fashion & Luxury insight)(4) MILANO FASHION INSTITUTE 13

14 Fashion & Luxury insight)(6) MILANO FASHION INSTITUTE 14