Investor Relations - PDF document

Investor RelationsFY 2019History1“
Investor RelationsFY 2019History1“Leading Authentic Sports Brand Inspired by the Style, Elegance and Passion of our Italian Heritage”Founded by FILA brothers in Biella, Italy 1911197319912005200720102011First sports apparel market (Tennis)Established FILA KoreaFILA Korea MBOFILA Korea acquired FILA trademark and global assets (USD 400M LBO)FILA Korea IPO (081660:KS)FILA Korea & MiraeAsset Global Investments Consortium acquired Acushnet Holdings Corp. (USD 1.2B LBO)2016FILA Korea became a controlling shareholder of Acushnet Holdings Corp. 2020Vertical demerger of FILA KoreaOp. co and renamed to FILA Holdings Corp.2Group Structure100%100%100%100%15%100%GLBH Holdings(Acquisition Vehicle)FILA Luxembourg(Trademark Owner)FILA Holdings Corp. (Listed Holding Company)Acushnet Holdings Corp.Full Prospect(JV with ANTA)FILA Sport H

K(In-house Sourcing)FILA USA(USA,
K(In-house Sourcing)FILA USA(USA, Canada, Mexico)47 Licensees(Global Royalty)Magnus Holdings 52%FILA Korea(Korea)100%Distribution channel re-structuring processCost-competitiveness through product sourcing strategySuccessful product collaborations with various brands Direct business opportunity in ASEAN regionExpanding into upper channels of distribution in the US: Foot Locker, Finish Line,Shoe Show, Shoe Carnival etc.New product launches reflecting FILA’s heritage in sports and fashion.Expanding D2C (Direct to Consumer) and E-commerce business in the US.Sponsorship with many sports players (Sam Querrey, Ash Barty, Karolina Pliskovaetc.)and tennis opens. Successfully established FILA®as leading high-end lifestyle casual brand in China.Collaborations with Anna Sui, Jason Wu and G

inny Hilfiger etc.Led by Anta, a l
inny Hilfiger etc.Led by Anta, a leading sports apparel company in China, FILA®has been expanding into major markets across China, Hong Kong, Macau and Singapore.Total 47 licensees3FILA –A Leading Authentic Global Sports BrandFILA USAFILA LicenseeFull ProspectFILA KoreaFILA Group Business OverviewNorth America (U.S.A., Canada, Mexico)Footwear based wholesaledistributorApparel and footwear based retail and wholesaledistributorTotal number of stores: 529(as of YE 2019)Multi-category: FILA, FILA KIDS, FILA UNDERWEAR, FILA GOLFJoint venture (15% ownership) with ANTA Sports from 2009.Offering premium sports & lifestyle products in China, Hong Kong, Macau, and SingaporeContributes 3%of its wholesale revenue as Design Service Fee to FILA KoreaTotal 47 licensees in Asia, North America, South America and EMEAR

evenue and profit contribution from li
evenue and profit contribution from licensee partners that operate the FILA branded products globallyDirectIndirect4Acushnet Hold.Magnus HoldingsCo.,Ltd., a wholly-owned subsidiary of FILA KoreaCo.,Ltd., or FILA Korea, owns approximately 52%of Acushnet Holdings Corp. as a controlling shareholder.Acushnet Holdings Corp. designs, develops, manufactures, and distributes golf products worldwide. The company operates through four segments: Titleist Golf Balls, Titleist Golf Clubs, Titleist Golf Gear, and FootJoyGolf Wear. Owned brands: Titleist, FootJoy, Vokey, Scotty Cameron, Pinnacle, Links & Kings, PG Golf, KJUS5Consolidated Financial Summary [Unit: KRW mn]3 months (Oct.-Dec.) ended12 months (Jan.-Dec.) ended20172018Variance(%)2019Variance(%)20172018Variance(%)2019Variance(%)Revenue614,482761,67824.0%789,5573.7%2,530,3242,954,6

4316.8%3,450,42216.8%Gross Profit30
4316.8%3,450,42216.8%Gross Profit304,045367,38520.8%394,6167.4%1,240,5301,467,53718.3%1,729,70717.9%G.P. %49.5%48.2%(1.2%)p50.0%1.7%p49.0%49.7%0.6%p50.1%0.5%pO. Profit51,45382,60360.5%85,0743.0%217,466357,10264.2%470,67631.8%O.P. %8.4%10.8%2.5%p10.8%(0.1%)p8.6%12.1%3.5%p13.6%1.6%pNet Profit15,1283,873(74.4%)51,5121,230.0%108,110210,05094.3%338,14461.0%6ConsolidatedFinancialSummary(4Q2019&FY2019)FILAConsolidatedFinancial(WithAcushnet)FILAGroup(WithoutAcushnet)(Unit:KRWmn)371,730 355,726 16.3%14.5%4Q 20184Q 2019RevenueOPM1,157,060 1,490,470 15.1%17.5%FY 2018FY 2019RevenueOPM761,678 789,557 10.8%10.8%4Q 20184Q 2019RevenueOPM2,954,643 3,450,422 12.1%13.6%FY 2018FY 2019RevenueOPMFILA USAFILA LicenseeFull ProspectFILA KoreaFILA Group Business OverviewNorth America (U.S.A.,

Canada, Mexico)Footwear based whol
Canada, Mexico)Footwear based wholesaledistributorApparel and footwear based retail and wholesaledistributorTotal number of stores: 529(as of YE 2019)Multi-category: FILA, FILA KIDS, FILA UNDERWEAR, FILA GOLFJoint venture (15% ownership) with ANTA Sports from 2009.Offering premium sports & lifestyle products in China, Hong Kong, Macau, and SingaporeContributes 3%of its wholesale revenue as Design Service Fee to FILA KoreaTotal 47 licensees in Asia, North America, South America and EMEARevenue and profit contribution from licensee partners that operate the FILA branded products globallyDirectIndirect7Acushnet Hold.Magnus HoldingsCo.,Ltd., a wholly-owned subsidiary of FILA KoreaCo.,Ltd., or FILA Korea, owns approximately 52%of Acushnet Holdings Corp. as a controlling shareholder.Acushnet Holdings Corp. designs

, develops, manufactures, and distribute
, develops, manufactures, and distributes golf products worldwide. The company operates through four segments: Titleist Golf Balls, Titleist Golf Clubs, Titleist Golf Gear, and FootJoyGolf Wear. Owned brands: Titleist, FootJoy, Vokey, Scotty Cameron, Pinnacle, Links & Kings, PG Golf, KJUSFILA Korea Domestic Financial Summary8*DSF (Design Service Fee) from Full prospect (JV with Anta Sports) is includedFull Prospect Design Service Fee Income Summary3 months (Oct.-Dec.) ended12 months (Jan.-Dec.) ended[Unit: USD K]20172018Variance(%)2019Variance(%)20172018Variance(%)2019Variance(%)Design Service Fee Income3,901 7,325 87.8%11,470 56.6%10,68621,24898.8%33,15056.0%3 months (Oct.-Dec.) ended12 months (Jan.-Dec.) ended[Unit: KRW mn]20172018Variance(%)2019Variance(%)20172018Variance(%)2019Variance(%)Revenue101,835132,22229.8%162,59423.0

%342,462499,91346.0%612,23622.5%Gr
%342,462499,91346.0%612,23622.5%Gross Profit59,58479,72833.8%107,09334.3%195,485297,36952.1%385,36529.6%G.P. %58.5%60.3%1.8%p65.9%5.6%p57.1%59.5%2.4%p62.9%3.5%pO. Profit4,28514,764244.5%30,474106.4%1,41556,4543,889.8%112,22498.8%O.P. %4.2%11.2%7.0%p18.7%7.6%p0.4%11.3%10.9%p18.3%7.0%pNet Profit(28,915)11,331N/A31,867181.2%(33,729)59,872N/A108,12180.6%FILA Domestic Products9FILA USAFILA KoreaFILA Group Business OverviewNorth America (U.S.A., Canada, Mexico)Footwear based wholesaledistributorApparel and footwear based retail and wholesaledistributorTotal number of stores: 529 (as of YE 2019)Multi-category: FILA, FILA KIDS, FILA UNDERWEAR, FILA GOLF10FILA LicenseeFull ProspectJoint venture (15% ownership) with ANTA Sports from 2009.Offering premium sports & lifestyle products in China, Hon

g Kong, Macau, and SingaporeContri
g Kong, Macau, and SingaporeContributes 3%of its wholesale revenue as Design Service Fee to FILA KoreaTotal 47 licensees in Asia, North America, South America and EMEARevenue and profit contribution from licensee partners that operate the FILA branded products globallyDirectIndirectAcushnet Hold.Magnus HoldingsCo.,Ltd., a wholly-owned subsidiary of FILA KoreaCo.,Ltd., or FILA Korea, owns approximately 52%of Acushnet Holdings Corp. as a controlling shareholder.Acushnet Holdings Corp. designs, develops, manufactures, and distributes golf products worldwide. The company operates through four segments: Titleist Golf Balls, Titleist Golf Clubs, Titleist Golf Gear, and FootJoyGolf Wear. Owned brands: Titleist, FootJoy, Vokey, Scotty Cameron, Pinnacle, Links & Kings, PG Golf, KJUSFILA USA Consolidated Financial Summary113 months (Oct.

-Dec.) ended12 months (Jan.-Dec.) e
-Dec.) ended12 months (Jan.-Dec.) ended[Unit: USDK]20172018Variance(%)2019Variance(%)20172018Variance(%)2019Variance(%)Revenue92,526169,60483.3%107,978(36.3%)304,665452,54748.5%536,58918.6%Gross Profit29,16656,02292.1%27,997(50.0%)91,906145,19858.0%169,67716.9%G.P. %31.5%33.0%1.5%p25.9%(7.1%)p30.2%32.1%1.9%p31.6%(0.5%)pO. Profit6,42217,054165.6%(582)N/A9,24734,085268.6%32,310(5.2%)O.P. %6.9%10.1%3.1%(0.5%)N/A3.0%7.5%4.5%p6.0%(1.5%)pNet Profit(529)11,836N/A(944)N/A1,13623,2621,947.2%21,368(8.1%)FILA USA Products12FILA LicenseeFILA Group Business OverviewNorth America (U.S.A., Canada, Mexico)Footwear based wholesaledistributorApparel and footwear based retail and wholesaledistributorTotal number of stores: 529 (as of YE 2019)Multi-category: FILA, FILA KIDS, FILA UNDERWEAR, FILA GOL

FJoint venture (15% ownership) wit
FJoint venture (15% ownership) with ANTA Sports from 2009.Offering premium sports & lifestyle products in China, Hong Kong, Macau, and SingaporeContributes 3%of its wholesale revenue as Design Service Fee to FILA KoreaTotal 47 licensees in Asia, North America, South America and EMEARevenue and profit contribution from licensee partners that operate the FILA branded products globallyIndirect13FILA USAFILA KoreaFull ProspectDirectAcushnet Hold.Magnus HoldingsCo.,Ltd., a wholly-owned subsidiary of FILA KoreaCo.,Ltd., or FILA Korea, owns approximately 52%of Acushnet Holdings Corp. as a controlling shareholder.Acushnet Holdings Corp. designs, develops, manufactures, and distributes golf products worldwide. The company operates through four segments: Titleist Golf Balls, Titleist Golf Clubs, Titleist Golf Gear, and FootJoyGolf Wear.

Owned brands: Titleist, FootJoy,
Owned brands: Titleist, FootJoy, Vokey, Scotty Cameron, Pinnacle, Links & Kings, PG Golf, KJUSFILA Global Royalty Summary143 months (Oct.-Dec.) ended12 months (Jan.-Dec.) ended[Unit: USDK]20172018Variance(%)2019Variance(%)20172018Variance(%)2019Variance(%)Asia2,6153,692 41.2%4,849 31.3%11,01714,22829.1%17,903 25.8%North America1,6202,063 27.3%2,730 32.3%6,1927,34218.6%7,982 8.7%South America501813 62.3%1,931 137.5%1,7542,94167.7%4,781 62.6%EMEA4,2588,488 99.3%8,887 4.7%16,02326,75167.0%39,186 46.5%Category388284 (26.9%)467 64.7%1,6541,616(2.3%)1,881 16.4%Total (Int_Adj)9,47815,432 62.8%18,951 22.8%36,95453,24144.1%72,137 35.5%15Global License Structure (47 licensees)Global License BusinessLicense period is 5 years (10 years for master licensees)Based on the wholesale revenue from each licensee

On average, 6-7% of FILA’s wh
On average, 6-7% of FILA’s wholesale revenue generated from each licenseeEach licensee has minimum guaranteed royalty (MGR) based on the forecasted revenueSemi-annual Global Collaboration Meetings (GCM) held to set broad, global strategic guidelines among all licenseesFILA Luxembourg (Trademark owner)EMEASouth AmericaAsiaGlobal Product9regional licensees13 regional licensees1 master licensee12 category licensee North America1master licensees11 regional licenseesGeneral LicenseConditions16Consolidated Balance Sheet (K-IFRS)YE 2019YE 2018YE 2017Assets3,770,2493,304,3403,078,924Current Assets1,586,8101,337,8781,154,081Cash and cash equivalents232,032149,001107,696Trade and other receivables521,047473,864387,342Inventories735,481632,237578,367Other current assets98,25082,77680,676Non-current As

sets2,183,4391,966,4621,924,843Prope
sets2,183,4391,966,4621,924,843Property and equipment439,052310,716323,527Intangible assets1,547,9231,491,9481,440,427Other non-current assets196,464163,797160,889Liabilities1,969,3061,797,8461,844,594Current Liabilities867,356672,316694,581Trade and other payables413,004405,997330,386Borrowings236,394174,426212,671Bonds63,568-69,558Other current liabilities154,38991,89381,966Non-current Liabilities1,101,9501,125,5301,150,014Borrowings611,690746,950855,614Bonds-61,175-Other non-current liabilities490,259317,405294,400Total Equity1,800,9441,506,4941,234,330Consolidated Balance Sheet (K-IFRS)(KRW mn)17Appendix –Financial SummaryI. FILA Korea (unit: KRW mn)3 months (Oct.-Dec.) ended12 months (Jan.-Dec.) ended20172018Variance(%)2019Variance(%)20172018Variance(%)2019Variance(%)Revenue101,835132,22229.8%162,594

23.0%342,462499,91346.0%612,23622.
23.0%342,462499,91346.0%612,23622.5%Gross Profit59,58479,72833.8%107,09334.3%195,485297,36952.1%385,36529.6%G.P. %58.5%60.3%1.8%p65.9%5.6%p57.1%59.5%2.4%p62.9%3.5%pO. Profit4,28514,764244.5%30,474106.4%1,41556,4543,889.8%112,22498.8%O.P. %4.2%11.2%7.0%p18.7%7.6%p0.4%11.3%10.9%p18.3%7.0%pNet Profit(28,915)11,331N/A31,867181.2%(33,729)59,872N/A108,12180.6%I-a. Full Prospect Design Service Fee Income3 months (Oct.-Dec.) ended12 months (Jan.-Dec.) ended20172018Variance(%)2019Variance(%)20172018Variance(%)2019Variance(%)Design Service Fee Income3,901 7,325 87.8%11,470 56.6%10,68621,24898.8%33,15056.0%◆4Q Revenue (approx. +KRW 30.4bn)-Increase in revenue mainly from FILA and FILA KIDS segment-Increase in Design Service Fee Income contributed by Full Prospect (YoY approx. +56.6%)◆4Q Operating Profit (approx. +K

RW 15.7bn)-Resulted from increase in r
RW 15.7bn)-Resulted from increase in revenue-Resulted from similar SG&A expense compared to 4Q'18 (cost leverage effects)◆4Q Net Profit (approx. +KRW 20.5bn)-Resulted from increase in revenue and operating profit18Appendix –Financial SummaryII-a. FUSA Sales Breakdown (Disruptor vs. Ex-Disruptor)(%)1Q 20182Q 20183Q 20184Q 20181Q 20192Q 20193Q 20194Q 2019Disruptor2%-4% 7%-9%20%-22%18%-20%28%-30%23%-26%15%-17%14%~16%Ex-Disruptor96%-98%91%-93%78%-80%80%-82%70%-72%74%-77%83%-85%84%~86%II. FILA USA Consolidated(unit: USD '000)3 months (Oct.-Dec.) ended12 months (Jan.-Dec.) ended20172018Variance(%)2019Variance(%)20172018Variance(%)2019Variance(%)Revenue92,526169,60483.3%107,978(36.3%)304,665452,54748.5%536,58918.6%Gross Profit29,16656,02292.1%27,997(50.0%)91,906145,19858.0%169,67716.9%G.P. %3

1.5%33.0%1.5%p25.9%(7.1%)p30.2%32.
1.5%33.0%1.5%p25.9%(7.1%)p30.2%32.1%1.9%p31.6%(0.5%)pO. Profit6,42217,054165.6%(582)N/A9,24734,085268.6%32,310(5.2%)O.P. %6.9%10.1%3.1%(0.5%)N/A3.0%7.5%4.5%p6.0%(1.5%)pNet Profit(529)11,836N/A(944)N/A1,13623,2621,947.2%21,368(8.1%)◆4Q Revenue (approx. -USD 61.6M)-Decrease in revenue due to overall inventory issues from retail market disruption which caused order delay and cancellation-Resulted from increased return and markdown from the customers ◆4Q Gross Profit (approx. -USD 28.0M)-Resulted from decrease in revenue-Lower sales proportion of higher margin distribution channels compared to 4Q'18◆4Q Operating Profit (approx. -USD 17.6M)-Resulted from decrease in revenue and gross profit-Resulted from similar fixed costs despite of revenue decrease compared to 4Q'18 (adverse cost leverage effects)19Appendix –Financial SummaryIII.

Global Royalty(unit: USD '000)3 month
Global Royalty(unit: USD '000)3 months (Oct.-Dec.) ended12 months (Jan.-Dec.) ended20172018Variance(%)2019Variance(%)20172018Variance(%)2019Variance(%)Asia2,6153,692 41.2%4,849 31.3%11,01714,22829.1%17,903 25.8%North America1,6202,063 27.3%2,730 32.3%6,1927,34218.6%7,982 8.7%South America501813 62.3%1,931 137.5%1,7542,94167.7%4,781 62.6%EMEA4,2588,488 99.3%8,887 4.7%16,02326,75167.0%39,186 46.5%Category388284 (26.9%)467 64.7%1,6541,616(2.3%)1,881 16.4%Total (Int_Adj)9,47815,432 62.8%18,951 22.8%36,95453,24144.1%72,137 35.5%◆4Q Asia (approx. +USD 1.2M)-Increase in revenue mainly from Japan & Philippines region◆4Q EMEA (approx. +USD 0.4M)-Increase in revenue mainly from Europe regions◆4Q South America (approx. +USD 1.1M)-Increase in revenue from Uruguay 20Appendix –Financial SummaryIV. Consolidated

Financial (unit: KRW mn)3 months (O
Financial (unit: KRW mn)3 months (Oct.-Dec.) ended12 months (Jan.-Dec.) ended20172018Variance(%)2019Variance(%)20172018Variance(%)2019Variance(%)Revenue614,482761,67824.0%789,5573.7%2,530,3242,954,64316.8%3,450,42216.8%Gross Profit304,045367,38520.8%394,6167.4%1,240,5301,467,53718.3%1,729,70717.9%G.P. %49.5%48.2%(1.2%)p50.0%1.7%p49.0%49.7%0.6%p50.1%0.5%pO. Profit51,45382,60360.5%85,0743.0%217,466357,10264.2%470,67631.8%O.P. %8.4%10.8%2.5%p10.8%(0.1%)p8.6%12.1%3.5%p13.6%1.6%pNet Profit15,1283,873(74.4%)51,5121,230.0%108,110210,05094.3%338,14461.0%◆4Q Revenue (approx. +KRW 27.9bn)-Increase in revenue contribution from Acushnet Holdings Corp. (approx. +KRW 43.9bn)-Decrease in revenue from FILA Group (approx. -KRW 16.0bn)◆4Q Operating Profit (approx. +KRW 2.5bn)-Increase in operating profit from Acushnet Hold

ings Corp. (approx. +KRW 10.3bn)-Decre
ings Corp. (approx. +KRW 10.3bn)-Decrease in operating profit from FILA Group (approx. -KRW 9.0bn)◆4Q Net Profit (approx. +KRW 47.6bn)-Increase in net profit contribution from FILA Group (approx. +KRW 29.0bn)-Increase in net profit from Acushnet Holdings Corp. (approx. +KRW 8.5bn)-Other consolidating adjustments (approx. +KRW10.0bn)1) Non-recurring accounting adjustments (Increase in Deferred Tax Liability and Tax Expenses) were recognized in 4Q’18 resulted from EU tax regime changes. (No actual tax payouts -accounting adjustments)2) Impairment of goodwill (created from Acushnet business combination) recognized in 4Q‘18Disclaimer21Thisdocumentincludesinformationprovidedforthepurposeofhelpingtounderstandthebusiness,strategies,andfinancialsituationofFILAKOREALtd.(hereinafterreferredtoas“FILA”)anditsgroupcompanies.Itwasnotcreatedtosolic

itinvestorstobuyorsellFILA'sstock
itinvestorstobuyorsellFILA'sstock.Theusesofthisdocumentareadvisedtomaketheirowninvestmentdecisionsandresponsibility.Thisdocumenthasbeenpreparedforpresentation,illustrationanddiscussionpurposeonlyandisnotlegallybinding.Investmentinvolvesrisk.Pastperformancefiguresarenotindicativeoffutureperformance.Pleasecarefullyreadthroughthedocumentsandseekindependentprofessionaladvicebeforeyoumakeanyinvestmentdecision.FILAhasmadeeveryefforttoensuretheaccuracyoftheinformationcontainedinthisdocument.However,FILAdoesnotguaranteetheappropriateness,accuracy,usefulnessoranyothermatterwhatsoeverregardingtheinformation.Regardlessofthereason,FILAassumesnoresponsibility,whatsoever,foranylossordamagesresultingfromchanges,suspensionordeletionofinformationcontainedonthedocument,orfromtheunautho

rizedalterationofsaidinformationby
rizedalterationofsaidinformationbyathirdparty,orfordamageresultingfromthedownloadingortheuseofthedata.Theinformationdescribedinthisdocumentmaycontainforward-lookingstatementsconcerningthefutureperformanceexcludingthepastandpresentfact.Theseforward-lookingstatementscontainrisksanduncertainties,anddonotguaranteefutureperformance.Pleasenotethatforward-lookingstatementsmaydifferfromactualresultsdependingonchangesineconomicstatus,markettrendsandtaxandtheothersystems.Pleasenotethatthisdocumentmaybediscontinuedorterminatedandthatthecontentsmaybealteredwithoutadvancenotice.Inaddition,thisdocumentmaynotbereadilyaccessibleatcertaintimesduetointernalorexternalcircumstances.ItshouldberecognizedinadvancethatFILAassumesnoresponsibilityforanytrouble,loss,ordamagecausedthereby