Maisons du Monde: First-quarter 2019 sales

PRESS RELEASE

MAISONS DU MONDE: FIRST-QUARTER 2019 SALES

Solid performance in line with full-year targets

Continued strong momentum in online and international sales

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• Sales up 9.9% to €280m, and up 6.4% at constant perimeter¹
   
• Like-for-like sales growth of 2.4% at constant perimeter², despite unfavorable calendar and base effects and soft market conditions in France
   
• Continued strong momentum across online (+21.6%) and international (+23.5%) activities, accounting for c.26% and c.44% of sales respectively
   
• 4 gross store openings (including 1 for Modani) and 4 closures for relocation
   
• Full-year 2019 guidance confirmed³:
   

• Continued sales growth of around 10%
   
• 35-40 gross store openings, of which two-thirds outside France, and around 10 store closures for relocation
   
• EBITDA margin above 13% of sales

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Nantes, 9 May 2019

Maisons du Monde (Euronext Paris: MDM, ISIN Code: FR0013153541), a European leader in affordable and inspirational decoration and furniture homeware, today announces its first-quarter 2019 sales.

Julie Walbaum, Chief Executive Officer of Maisons du Monde, commented:

“Maisons du Monde turned in a solid sales performance in the first quarter of 2019, even while operating in a soft trading environment in France impacting physical retail. Continued strong double-digit growth in online and international sales, as well as Modani’s sustained performance, demonstrate once again the power of our brand, the resilience of our business model and the strength of our omnichannel and international strategy. Despite a macroeconomic and political environment that remains uncertain in Europe, we are confident that our multi-style offer, differentiated customer experience and broad omnichannel footprint put us on track to achieve our full-year guidance of sales growth of around 10% and EBITDA margin above 13% of sales.”

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Solid first-quarter 2019 sales performance

Maisons du Monde reported total sales of €280.3 million in the first quarter of 2019, up 9.9% compared to the first quarter of 2018 including Modani and up 6.4% at constant perimeter. Like-for-like sales growth stood at 2.4% at constant perimeter in the first quarter of 2019, reflecting a challenging comparable base (LFL growth of 5.1% in Q1 2018), a negative calendar effect (due to the Easter shift to April this year vs. March last year) and soft market conditions in France that impacted in-store traffic. Growth momentum remained strong in online sales (+21.6%) and international business (+23.5%), representing c.26% and c.44% of sales respectively, demonstrating the strength of the Group’s business model and omnichannel and international strategy.

In the first quarter, Maisons du Monde remained focused on the implementation of its business priorities. The Group continued to develop innovations in its offer, including the deployment of its Spring / Summer 2019 decoration collections in January, with six different themes, the launch of its new indoor and outdoor furniture catalogues in March, featuring a broad number of new products across our different styles, as well as the launch of its new BtoB catalogue, showcasing 135 SKUs specifically designed for this market. Moreover, the Group made further progress in enhancing the customer omnichannel experience, with for instance, the ongoing rollout of its “interior design studio”, now available in 87 stores, while it also continued its efforts to strengthen its customer relationships through initiatives such as the launch of an e-catalogue to fuel customer inspiration online as well as the implementation of a new CRM tool for push web notifications.

Furthermore, Maisons du Monde continued to implement its store network development roadmap in the first quarter, with 3 gross store openings, all in France and including two shop-in-shops at the Printemps department stores in Metz and Rennes. Four other stores were closed during the period (of which 3 in France and 1 in Belgium), as part of the Group’s active management of its store portfolio. As at 31 March 2019, Maisons du Monde operated 335 stores in 9 countries, with total sales area of 387,700 sqm.

Modani’s performance also continued to be strong, recording sales of €8.9 million in the first quarter of 2019, up in double-digits compared to the first quarter of 2018. A new showroom was opened in Paramus, New Jersey during the period, bringing the total to 14 across the US as of 31 March 2019.

Full-year 2019 guidance confirmed⁴

Despite continued macroeconomic and political uncertainty in Europe, the solid performance achieved in the first quarter allows Maisons du Monde to confirm its full-year 2019 guidance:

• Continued sales growth of around 10%;
   
• 35-40 gross store openings, of which two thirds outside France (including 5 for Modani), and around 10 store closures for relocation (mainly in France);
   
• EBITDA margin above 13%.

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APPENDICES

Summary of Q1 2019 sales⁵

Summary of Q1 2019 sales at constant perimeter⁶

Key Q1 2019 financial metrics

Evolution of the Maisons du Monde store network⁷

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Key operating metrics

Besides the financial indicators set out in International Financial Reporting Standards (IFRS), Maisons du Monde's management uses several key metrics to evaluate, monitor and manage its business. The non-IFRS operational and statistical information related to Group's operations included in this press release is unaudited and has been taken from internal reporting systems. Although none of these metrics are measures of financial performance under IFRS, the Group believes that they provide important insight into the operations and strength of its business. These metrics may not be comparable to similar terms used by competitors or other companies.

• Sales: Represent the revenue from sales of decorative items and furniture through the Group’s retail stores, websites and BtoB activities. They mainly exclude (i) customer contribution to delivery costs, (ii) revenue for logistics services provided to third parties, and (iii) franchise revenue. The Group uses the concept of “sales” rather than “total revenue” to calculate growth at constant perimeter, like-for-like growth, gross margin, EBITDA margin and EBIT margin.
• Sales growth at constant perimeter: Represents the percentage change in sales from the Group’s retail stores, websites and BtoB activities at constant scope of consolidation between one financial period (n) and the comparable preceding financial period (n-1).
• Like-for-like sales growth: Represents the percentage change in sales from the Group’s retail stores, websites and BtoB activities, net of product returns between one financial period (n) and the comparable preceding financial period (n-1), excluding changes in sales attributable to stores that opened or were closed during either of the comparable periods. Sales attributable to stores that closed temporarily for refurbishment during any of the periods are included.
• Gross margin: Is defined as sales minus cost of sales. Gross margin is also expressed as a percentage of sales.
• EBITDA: Is defined as current operating profit, excluding (i) depreciation, amortization, and allowance for provisions, (ii) the change in the fair value of derivative financial instruments, and (iii) store pre-opening expenses.
• EBIT: Is defined as EBITDA after depreciation, amortization, and allowance for provisions.
• Net debt: Is defined as the Group’s convertible bonds (“OCEANE”), term loan, revolving credit facilities, finance lease debt, deposits and bank borrowings, net of cash and cash equivalents.
• Leverage ratio: Is defined as net debt divided by EBITDA (including Modani on a pro forma basis for the period, excluding the liabilities from the earn-out and the put option).

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Financial calendar⁸

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Disclaimer: Forward Looking Statement

This press release contains certain statements that constitute "forward-looking statements", including but not limited to statements that are predictions of or indicate future events, trends, plans or objectives, based on certain assumptions or which do not directly relate to historical or current facts. Such forward-looking statements are based on management's current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from the future results expressed, forecasted or implied by such forward-looking statements. Accordingly, no representation is made that any of these statements or forecasts will come to pass or that any forecast results will be achieved. Any forward-looking statements included in this press release speak only as of the date hereof and will not give rise to updates or revision. For a more complete list and description of such risks and uncertainties, refer to Maisons du Monde’s filings with the French Autorité des marchés financiers.

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About Maisons du Monde

Maisons du Monde is a creator of inspirational lifestyle universes in the homeware industry, offering distinctive and affordable decoration and furniture collections that showcase multiple styles. The Group develops its business through an integrated and complementary omnichannel approach, leveraging its international network of stores, its websites and its catalogues. The Group was founded in France in 1996 and has expanded profitably across Europe since 2003, reporting sales of €1,111 million and EBITDA of €148 million in 2018. At 31 December 2018, the Group operated 336 stores in 9 countries including France, Italy, Spain, Belgium, Luxembourg, Germany, Switzerland, the United States and the United Kingdom, and derived 40% of its sales outside France. The Group has also built a successful complementary and comprehensive ecommerce platform, whose sales grew by over 30% per year on average between 2010 and 2018. This platform, which accounted for 23% of the Group's sales in 2018, is available in the countries where it operates stores plus Austria, the Netherlands and Portugal. In 2018, the Group acquired a majority stake in Modani, a furniture chain present in the United States through its stores and ecommerce business. Modani, founded in 2017, is an aspirational lifestyle brand, offering high-quality proprietary modern, contemporary and mid-century furniture at affordable price points, with a nationwide presence through a network of 13 showrooms.

corporate.maisonsdumonde.com

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Contacts

¹ Excluding Modani.

² Excluding Modani and on a same-store basis.

³ Including Modani and before the application of the IFRS 16 standard.

⁴ Including Modani and before the application of the IFRS 16 standard.

⁵ Including Modani.

⁶ Excluding Modani.

⁷ Excluding Modani and franchise stores.

⁸ Indicative timetable.

Attachment

• 2019_05_09_MDM_1Q19_Press_Release_VUS_FINAL