Nine Months 2018 OVS SpA Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Andrea Bonfa - Banca Akros S.p.A., Research Division - Analyst : I got a few questions I'd like to ask if I may. One -- the first one is that you tried to explain to us the sales EBITDA bridge. And you were explaining -- you were supposed to explain EUR 20 million. You were mentioning EUR 30 million from the -- negative from the like-for-like and the EUR 14 million markdown of August, which comes to EUR 44 million negative. But you said we're actually minus EUR 20 million. So there are still EUR 24 million missing in terms of positive contribution. But you were also mentioning that the new openings were offset by the closure. So if you can finally explain the EUR 20 million, again? Sorry. And the second question is that -- is a more generic. I'm looking at your CapEx breakdown, and it seems to us that you are reducing the investment in the new openings but the refurbishing and maintenance of the other commercial projects are growing up strongly. So is that the case that your business is changing that despite the fact you reduced the investment in new openings, still the CapEx will remain important or structured in lowering your potential free cash flow generation? Also because in this number, there is not the vendor financing, so it means that the refurbishment component is actually much higher. The third one is on the disposal of the headquarter. So the proceeds of the disposal are in the net debt, but you didn't mention the cost of the rents. Is that possible that you closed the deal at the end of the period so we need to expect an increase in rents in the last -- from the last quarter, from the fourth quarter of the year? And finally is on a [figure]. As I mentioned also to Nicola and Andrea, I think, for us, it would be extremely important to be able to reconstruct your sales and EBITDA and net financial position bridge. So it would be definitely helpful if you can provide for those figure for the last couple of years on a quarterly basis. So -- because for us, it's very difficult to reconcile the number that you provide to us during the conference call.

Question: Andrea Bonfa - Banca Akros S.p.A., Research Division - Analyst : No, Stefano -- sorry if I interrupt you. Everything is clear. But I think we should consider the markdown as a negative sales effect. So you got to EUR 20 million like-for-like, which is negative. And on top of that, if I understood correctly, you got the EUR 14 million markdown on the entire amount without the prior written consent of Thomson Reuters. 'Thomson Reuters' and the Thomson Reuters logo are registered trademarks of Thomson Reuters and its affiliated companies. DECEMBER 13, 2018 / 2:00PM, OVS.MI - Nine Months 2018 OVS SpA Earnings Call of your sales. And that makes a negative sales of EUR 44 million. But we still need to get to the EUR 20 million. So there are EUR 20 million positive sales, which don't explain, unless you are telling me that the new openings were EUR 20 million positive with 0 contribution at EBITDA level. So again, it would be helpful if we could see all these bridges written in the presentation so at least we can figure out all the values at the end. But I don't want to bother all the attendants of the conference call. So again, we need something written in the presentation to understand all these numbers and to make them square.

Question: Andrea Bonfa - Banca Akros S.p.A., Research Division - Analyst : No, on the CapEx, if I'm looking at your presentation, you have EUR 38 million of refurbishment, maintenance and other commercial products on the existing network, which is almost nearly 60% of the total. So it seems that despite the fact that you are reducing the openings, the amount of CapEx on the existing structure is -- remains important. And I think that this number do not include the vendor financing, which means that the actual amount or refurbishment cost is higher. So it seems to me that the structural amount of CapEx maybe is higher than what it used to be in the past. I just want to have your opinion.