Geox S p A : 1Q 24 Financial Results

1Q 24 Financial Results

May 14th 2024

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Disclaimer

FIGURES ARE REPORTED UNDER IAS/IFRS. CERTAIN STATEMENTS MADE IN THIS PRESENTATION ARE FORWARD LOOKING STATEMENT. SUCH STATEMENTS ARE BASED ON CURRENT EXPECTATIONS AND ARE SUBJECT TO A NUMBER OF RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM ANY EXPECTED FUTURE RESULTS IN FORWARD LOOKING STATEMENTS.

THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN INVITATION TO UNDERWRITE, SUBSCRIBE FOR OR OTHERWISE ACQUIRE OR DISPOSE OF ANY GEOX S.P.A. SHARES. ANY REFERENCE TO PAST PERFORMANCE IS NOT A GUIDE TO FUTURE PERFORMANCE.

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Today's presenters

Enrico Mistron	Andrea Maldi	Luca Amadini
CEO	CFO	IR Manager

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Executive Summary

Business Overview

Financial Results

1Q 24

Current Trading

The result in the first quarter of 2024 was primarily driven by the Wholesale channel negative performance. This outcome was accentuated by the exceptionally strong comparison base realized in the first quarter of the previous year.

NET SALES amount to €193.6 m (-13.5% vs LY or -11.7% c.Fx);

NFP (ante IFRS16) at Mar '24 amounts to -€134.9m vs -€93.1 at Dec'23 (Bank debt -€136.8m vs -€90.1m at Dec'23 - Fair Value of Hedging instruments €1.9m vs -€3m at Dec'23);

NET WORKING CAPITAL amounts to €163m or 23.6% as % of Net Sales (€116.7m or 16.2% at Dec'23).

DOS B&M + Digital (W19) LFL YTD: +5.1% vs 2023

WHS (end of April) YTD: -16,5% vs 2023

Franchising (end of April) YTD: -8,2% vs 2023

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B&M Distribution network evolution

The network rationalization substantially completed in FY23 still have residual effects on 1Q24 sales

						- 20 Net Closures
	Distribution	768	717
	agreements	114	655	635	637
			108
				120	121	123
	Franchising	304	294
				280	263	261
	DOS	350	315	255	251	253
			FY21	FY22	FY23	3m24	FY24E

Footprint at 31 Mar.'24 reduced by 20 doors in respect to 31 Dec.'23

• The negative perimeter effect amounts to -€4.6 million out of which mainly due to FY23 closures.
• #17 Franchisee net closures mainly in European countries.

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Net sales by channel

Wholesale experienced a decline in performance compared to the highly positive results achieved last year.

€m

(21.6%)	(21.4%)	(2.6%)	41.9%	(13.5%)
(19.7%) c.Fx	(19.6%) c.Fx	(0.9%) c.Fx	42.1% c.Fx	(11.7%)c.Fx

NET SALES BREAKDOWN

WHOLESALE 55% | FRANCHISING 8% | DOS B&M 28 % | DOS Digital 9%

WHOLESALE: (21.6%) YoY

Double digit decrease mainly driven by:

• Negative double digit SS24 initial order intake
• In season re-orders in line with previous year

FRANCHISING: (21.4%) YoY

• Sales affected by negative perimeter (-€1.4 mln) and LFL performance -2.5%

DOS B&M: (2.6%) YoY

• Negative by 2.6% vs LY driven by last year perimeter reduction effect amounting to -€4.6m(-60 DOS ) mainly related to FY23 closures only partially offset by positive LFL performance (€4.1m or 4.4%).

DOS Digital: 41.9% YoY

• Impressive 41.9% increase vs LY thanks to the new Marketplace doors opened and positive LFL performance in line with trend of the last quarters of the previous year (+25.3% in Q423 )

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Net sales by region

Negative performance in all geographies

€m

(13.2%)	(10.3%)	(20.8%)	(17.9%)	(13.5%)
(13.2%) c.Fx	(10.6%) c.Fx	(20.0%) c.Fx	(10.7%) c.Fx	(11.7%) c.Fx

NET SALES BREAKDOWN

ITALY 29% | EUROPE 43% | NORAM 3% | ROW 25%

ITALY: (13.2%) YoY

• Wholesale and franchising double digit negative.
• DOS, both B&M and Online, delivered positive performance in terms of L4L (+3.8%) only partially offset by negative perimeter effect.

EUROPE: (10.3%) YoY

• Wholesale and franchising double digit negative mainly driven by DACH area weak performance.
• DOS positive thanks to B&M L4L coupled with new Online doors opening.

NORAM: (20.8%) YoY

• Wholesale double digit negative.
• DOS shows high single digit positive LFL performance overshadowed by the negative perimeter effect mainly related to the rationalization of the Canada doors largely completed by the end of FY23.

ROW: (17.9%) YoY

• RoW delivered negative performance. Specifically, the MEA regions experienced significant repercussions due to the adverse impacts of geopolitical conflicts within those territories.

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Net sales by product

€m

(14.0%)	(8.5%)	(13.5%)
(12.5%) c.Fx	(3.6%) c.Fx	(11.7%) c.Fx

NET SALES

BREAKDOWN

FOOTWEAR

90%

_______

APPAREL

10%

• Apparel in line with footwear business trend decreased by 8.5% influenced by the low performance of the wholesale channel.

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Financials - Working capital & Bank Net Debt

Operating Working Capital

33.2%		Operating Working Capital		as % of sales
18.5%	18.3%	23.6%
16.2%
			10.5%
177.5				163.0
			142.0
112.4	116.7
77.1

2020	2021	2022	31 mar 23	2023	31 mar 24
		31 Dec 22	31 Mar 23	31 Dec 23	31 Mar 24	∆ vs Dec23
Operating Working capital	77.1	142.0		116.7		163.0	46.3
Inventories		290.2	252.9		276.0		234.8	(41.2)
Trade Receivables		84.0	142.3		72.1		115.8	43.7
Trade Payables		(297.1)	(253.3)		(231.3)		(187.7)	43.7
as % of LTM Net sales		10.5%	18.3%		16.2%		23.6%

• • yearly average
• Net debt ante IFRS16, excluding derivatives accounting

Bank Net Debt*

FY22 FY23 FY24

180

160

140

120

100

80

60

40

20

-

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

• Bank Debt* as of 31 Mar'24 amounts to -€136.8 million, (-€90.1m at Dec '23).
• The fair value of derivatives amounts to €1.9 million positive (€3 million negative at Dec'23) resulting in NFP ante IFRS16 equals to -€ 134.9 million (-€93.1m at Dec'23).
• Bank Debt at 31 Mar '24 increased by €46.7 million in respect to 31 Dec'23. The increase mainly relates to seasonal Operating Working Capital absorption coherent with 1Q23.
• OWC represents 23.6% of LTM Net sales as at 31 Mar '24.

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Outlook

Givingthe uncertain short-term geopolitical and macroeconomic scenario that still characterizes our main reference market and

Considering the followings

• Weak FW 24 order intake with in-seasonre-order in line with previous year;
• DOS (B&M + Digital) (week 19, 2024): LFL YTD positive mid-single digit vs previous year;
• DOS (B&M + Digital) is assumed to continue in delivering positive LFL vs FY23 with no further heavy rationalization actions in B&M and increasing number of new marketplaces agreements during FY24

Management confirms operating margin's increase vs FY23, by 50 bps (full-year), and redefines the full-year 2024 revenue target as a mid-single digit reduction compared to FY2023

PLEASE WOULD YOU CONSIDER VERY HIGH

FORECAST UNCERTAINTY DUE TO GEO-POLITICAL

SITUATION AND VARYING INFLATIONARY

ENVIRONMENT

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