Good evening. This is the Chorus Call conference operator. Welcome and thank you for joining the Moncler First Half twenty nineteen Financial Results Conference Call. As a reminder, all participants are in listen only mode. After the presentation, there will be an opportunity to ask questions.
At this time, I would like to turn the conference over to Ms. Paula Durante. Please go ahead, madam.
Thank you, and good evening, everybody. Thank you for joining our call today on Moncler First half 2019 financial results. First of all, as usual, let me introduce you to the executive team on today's call. Our Chairman and CEO, Mr. Remo Ruffini Luciano Sante, Chief Corporate and Supply Officer and Roberto Ekts, Chief Marketing and Operating Officer.
Before starting the presentation, I need to remind you that this presentation may contain certain statements that are neither reported financial results nor other historical information. Events. By their nature, forward looking statements are subject to risks, uncertainties and other factors that could cause results to differ even materially from those expressed in or implied by the statements, many of which are beyond the ability of Moncler to control or to estimate. Let me also highlight that given the nature of our business, interim results can be influenced by seasonal effects and therefore cannot be taken as a proxy for full year trends or results. In addition, given the later starting of this call, I anticipate that we would make our best efforts to conclude it within 1 hour.
Therefore, I ask all participants to limit to 2 questions at time. Finally, I remind you that the press has been invited to participate in this conference in a listen only mode. Let me now hand over to our Chairman and CEO, Mr. Remo Ruffini.
Good evening, everyone, and welcome to Moncler's first half 2019 Results Conference Call. There are many things I would like to discuss with you tonight, starting from the result that even this semester have been above markets in my own expectation. But in order to make our call focused and productive, I will concentrate on few important points. Our Montclair Genius project continued to give us very positive result and insights. It increases brand
It increases
brand attraction, support traffic in store and online and attract new customers. Half of the Genius customer are new client. They represent an important asset on which we have to leverage in order to make them loyal clients. This is a focus for the organization, not only for the retail, CRM, marketing and digital, but also for design and the merchandising team. We already have evidence that we are moving in the right direction.
We are also starting to think to several ideas on how to leverage the project. It should help us to reinforcing our community, the Moncler community. As our new advertising campaign said, Genius is born crazy. How crazy we were when we decide to create a jacket from a sleeping bag or an Icon product from down jacket or when we first launched our Moncler Genius project, maybe we were a bit crazy, but always with a clear vision and a great rigor in the execution. Few days ago, we had the 1st Montclair Hackathon, a 24 hours innovation marathon that brought together more than 4 50 employees from several nations, divide on a different age, which we are able to design not all innovative, but also actionable project.
I was really impressed by the quality of them. In Moncler, we are learning how to invent our future, how to be extraordinary, how to find new way of working together to encourage the creativity, the talent and the inner genius that is in all of us. I strongly believe that this along with our strong capacity to deliver on goals will make our company and our brand even more unique. Finally, on the result, let me only highlight that 18% growth in revenues in Q2, 9% comp sales stores growth in the semester, all economics result up double digit, representing other very good achievement. But beside the number, what is important in what you don't see, the quality of people that work in Moncler, their energy, passion, commitment, competence, their culture of innovation and ability to work cross function.
I know that there is still a lot to do. The next 6 months are, as usual, very difficult, but I believe the path is clear and well traced. Let me now leave the floor to Roberto Nuciano for some more comments. Thank you very much.
Good evening. Roberto, I will comment the results that we have achieved starting by the breakdown by region. It has been a very good second quarter that has been in acceleration with a plus 18%, bringing the total result of H1 at €770,000,000 which is a +13 percent in acceleration compared to the Q1 that was at plus 10 point 6%. Italy show a very positive trend in the Q2, accelerating strongly from the Q1 and with a strong double digit organic growth in the retail channel. EMEA rose by 15% and had a growth that was double digit in both distribution channel, led by U.
K. In acceleration and Germany and as well as France overperforming. Asia and rest of the world continued to register outstanding results led by the Chinese market and in China, the Japanese market and the Korean markets. Japanese and Korean market accelerating strongly in the second quarter. Americas delivered positive results, positive performance in Q2 in both distribution channels, wholesale and retailer in both markets, main market, which are Canada and the U.
S. Market. If we look if we go on the following chart, which is the revenue breakdown by distribution channel, We see that both channels have been performing very well. You see that retail has been accelerating from a plus 10% from a plus 10% in the first quarter to a plus 20% in the second quarter. This has been strongly pushed by the comp sales rose that rose by 9% in H1.
Online strongly outperformed during this 1st semester and has been growing at more than twice the retail path. Wholesale revenues rose double digit at plus 12%. 2nd quarter has been also 2nd growing on double digit growth with a +10%. This growth has been led by shop in shop openings and airports performance as well as the Monster Genius launch in the different channels. If we look at the monobrand store network evolution, we see that the total retail store is now at 196, which is a 3 net opening.
The 3 net openings have been providing. Basically, we have been opening 5 new stores. We have had one conversion in wholesale, which is a small store that we had in the northern part of Germany and one temporary closure of the Fumichino Airport. We still plan to open our 15 doors this year with a plus with a 6 door opened in that are planned for the Q3 and another 6 store that we plan to open in the last quarter of the year. The Nano Brand Wholesale Store and Shop in the Shop are now at 16, which is a plus 5 new openings in the first semester this year, and we plan another 10 openings, also there balanced 5 in the Q3 and another 5 in the last quarter of the year, bringing the total number at around 70 for the wholesale and €208,000,000 for the retail channel.
I leave the floor to Luciano Santel. Thank you.
Okay. Thank you. Thank you, Roberto, and good evening, everyone, and thank you for attending our call today. As you know, for the first time, we report our financial results under the new IFRS 16 accounting principle, which changes the way companies recognize their lease obligations. However, for the sake of clarity, consistency and continuity in the way we comment our business results, we will still comment H1 results excluding the IFRS 16, providing in the slide at page 8, a reconciliation table that shows the impact of IFRS 16 on our income statement.
The impact on balance sheet and the cash flow statement is reported in separate slides in the appendix of this presentation. So I'm not going to comment Page 8, but I'm more than happy to answer your questions on this topic, if any. So we can move now to Page 9, where again, we report our income statement excluding the IFRS 16 that shows a top line of €570,000,000 with a growth rate of 16% at current FX. And a remarkable, let me say that, gross margin of 76.6%, higher than the 76% we reported same period last year, in part because of 100 channel mix, but also because each distribution channels report a better gross margin than last year. Retail channel particularly, gross margin was better than last year also because our regular stores performed and are still performing better than our outlets.
Selling expense is 37%, slightly higher than last year, but totally in line with our plan. G and A at 12.6 percent substantially in line with the 12.5% we reported last year. And they include all the investments we keep making in our organization. Of course, we are working to make our structure, our organization stronger and stronger for all the projects that we have in our pipeline. Marketing, 7.5%, slightly higher than last year, but only because of a timing effect.
We still expect for the year end the same 7% we reported last year. Stock based compensation 2.28% higher than the 2.5%, but again only because of a timing effect. We expect for the year end this year to spend more or less the same amount we spent last year in the region of €30,000,000 with of course hopefully a lower impact on our revenues. EBIT €94,600,000 with 16.6 percent margin, a little bit lower than the 17.4% we reported last year. But of course with the timing impact of the two items I told you before, it would have been very, very close to the 17% 17.4% we reported year.
Net income, €71,300,000 with the same margin, 12 0.5% than last year. And last but not least, our EBITDA, which is a metric that probably is becoming meaningless in the future under the new IFRS 16, but it is still an important metric for the management team and I believe also for the market. EBITDA, we reported reported under the €43,600,000 with a 25.2 percent margin against the 25.1 percent we reported last year. Let's move now to next page, page 10, where we report the CapEx. CapEx right at the end of June this year, we spent €41,000,000 increasing the amount as compared to last year when we reported €34,500,000 but something important to highlight again.
The allocation of the budget is more and more allocated to our corporate investments. I mean, we still spent €17,000,000 in our retail network, but an increasing number, an increasing amount of our CapEx is allocated in what we call corporate, which includes, as you know, information technology, logistics and the important new e commerce website we implemented in Korea. As you know, the project started last year and the new website in Korea is up and running since June. So it started about 1 month ago. So very, very good results.
Important to highlight to anticipate that we are spending much more in the second half than what we report for the first half. And we expect for the year end a total CapEx amount in the region of €115,000,000 about €115,000,000 Okay. Let's move now to Page €115,000,000 Okay. Let's move now to page 11, net working capital, which reports a 5.5 percent on revenues, slightly higher than the 4.8 percent that we reported last year. Still, I can say very, very healthy net working capital with very good credit control and very good inventory management.
Nothing to add. Let's move now to page 12, where we see our net financial position that is positive for €395,700,000 and which includes a gross cash of 490,500,000. Of course, important to highlight the impact of the new IFRS 16 that is about it is €562,000,000 which makes the net financial position negative for 160 €6,200,000 We can now move to page 13, where honestly I don't have any comment on balance sheet unless of course you have questions. Last slide with a few comments is at page 14, a cash flow statement, where we report free cash flow of €71,000,000 higher than the €66,000,000 we reported last year and with the net cash flow negative €54,000,000 impacted by the over €100,000,000 dividend distribution and the buyback program we implemented in late January of this year. So I'm done with the presentation and we are now ready to answer your questions.
Thank you.
Excuse me. This is the Chorus Call conference operator. We will now begin the question and answer session. The first question is from Elena Mariani with Morgan Stanley. Please go ahead.
Hi, good evening everybody. So I'm going to limit myself to 2 questions. The first one is on your like for like trend in the second quarter. I calculate high teens like for like in Q2, I hope it's correct. And I guess this is partly due to an easier sales density comp base in the second quarter.
But could you perhaps elaborate a little bit more on the underlying drivers? Was it Genius and Palm Angels attracting a lot of traffic to your stores? Was it more contribution from your springsummer products? Any sort of color would be highly appreciated. And perhaps also a bit of help on how to think about the like for like profile through the rest of the year given the difference in sales density across the different quarters.
And also maybe on current trends as well, what you've been observing in the Q3 so far? And my second question probably is for Mr. Ruffini and Mr. Eggs. I was hoping to get their opinion on this large and big debate we have in the market around the large conglomerates in luxury winning against the mono brands.
This is a very clear trend probably because of the ability to attract talent or to leverage investments across several brands. But Moncler seems to be an exception. Could you tell me your opinion about why Moncler is an exception in your view? And do you see a future also for mono brands in this industry? Thank you.
Good evening, It's Roberto speaking. I will give you some flavor on what happened in terms of like for like for the second quarter. As you rightly mentioned, we have seen an acceleration in Q2 also because Q1, we had a very, very high based on comparison. The second quarter was also high, but not as high as the first one. I think there are many reasons to explain.
It's a mix of these elements that have been showing this acceleration. First of all, very good results for the springsummer sales that we had both in wholesale and also, of course, in retail if we talk about comp. We are going to finish the springsummer collection with the highest sales we have had in the since I joined the company, since the past 4 years. Of course, we have been helped also by having a Genius collection that was present in Q2, while last year we just had the start in June. So this year we benefit from the Genius show launch both in April and in May.
This has clearly helped also driving traffic to the stores. And the third element is the calendar effect of Easter that has been slightly penalizing the month of March and that has helped the results of the month of April. So with the mix of these three elements, you have these three elements combined explain this acceleration of the like for like in Q2. To give you some flavor on the Q3, we are currently in line with the comp that we have had for the 1st semester and with stronger launches in terms of June that are planned for the months to come. So we remain confident.
Honestly, talking about the big group around the world, especially in our industries, I understand they're very strong. But we talk many time here when we make around the table, but we really feel very confident to stay alone. We really feel our strategy is very different than any other company. We feel we are quite unique. And our uniqueness for sure help us to talk with our customer.
Having said that, I don't feel we can have big advantage to go to being part of the big group except maybe some real estate. But I think it's more the good strategy. They have every brand part of this group. We feel, as we say, the uniqueness, we feel that we changed our business model in the last couple of years. And we feel very good honestly.
Thank you very much.
The next question is from Susie Tibali with UBS. Please go ahead.
Hi, thank you for taking my question and congratulations for the amazing results.
So can I ask one more thing on the like for like actually? So Q2 was really strong and I was wondering if there was any because
you
because you have been very clear in flagging since I would say at least 6 months ago that Q1 sorry H1 last year obviously the like for like was amazing and so you cannot reasonably expect to have the same level of leverage and that was very clear. But still if I look at the selling costs specifically, I can see that they in H1, they were growing faster than the pace of the retail sales. So I was wondering if there was any sort of something to keep in mind like any phasing or was it on the rent, on the personnel or anything that you can comment on that would be very helpful. Thank you.
Good evening, Susie. Regarding the like for like and the growth per category, as you know, the spring summer is less dependent on the outerwear. We have the other category that are usually, especially for the men, working much better. The cut and sew, what we call the T shirt and the Polo are clearly categories that are performing and that are helping also to increase the unit per transaction that we have. The good performance, we have honored the Sprig summer, and we always say that we see room during the Q2 to further grow in the future has been is part of the explanation of the growth of this category.
The fact that we have also now put in the best sellers in the cut and sew, I saw the T shirt and the polo in auto replenishment spring summer collection and has helped overall the like for like?
Hi, Susie. About your second question on selling expenses, I mean, as you stated, last year our selling expenses were particularly good, particularly low. And this was because our top line growth was driven mostly by a very strong retail organic growth, which made our stores productivity to be particularly, particularly strong. So the main difference is on productivity. But again, this year is okay.
Last year was unusually very, very strong. Another impact, which is minor but important to highlight is that in our selling expenses, we report also the impact of D and A, depreciation and amortization of all our construction costs. And this year, the impact is higher than last year because of the important CapEx we have reported over the past few years. So this is the explanation. But again, 37% is not in line with our plan.
And again, 36.2%. You may remember that if you look back at first half of twenty seventeen, last year was lower than the year before, which is honestly quite unusual.
Thank you. And so for the rest of the year, can we expect is there anything that we have to keep in mind? Or can we just expect sort of in line with last year for H2?
In line with the last year, I think.
In terms
of percentage of sales, yes.
Yes. I think it's a good guess.
Okay. Thank you.
The next question is from Janet Kloppenburg with J. K. Research. Please go ahead.
Good evening, everyone, and congratulations on a great quarter and great half. I was just wondering if you could give us a little bit more of the metrics of the like for like. It sounds like the UPTs were up nicely. I was wondering about AUR trends. And also, overall, as we look forward, what pricing might look like?
Do you anticipate that there will be a lift in your average selling price as we go into the fall season? And secondly, I was wondering if you could talk a little bit about the U. S. Market. You had a nice gain there, but the smallest of all the regions, and I think it's been volatile.
Perhaps you could give us an outlook for the region, both on a wholesale and retail basis looking forward? Thank you.
Okay. Thank you for your question. I don't know if I correctly understood your first question regarding the like for like and the different metrics that we have. But basically, we have seen positive metrics on all elements. The The of the conversion rates.
Sorry, there are some noises. I don't know.
No, I think now it's back to normal. Average selling price has been in line with the result of the first H1 of last year. This is explained by the fact that having a much higher level of non outerwear, we are happy to have these results in terms of fabric selling price that is increased. And basically, that is the unit per transaction that has been driving a higher comp. We are now overall for the first H1 at 141 coming from 1.04 in 2015.
So year after year semester after semester, we have consistently increased our average transaction. Usually, the UPT sorry, the UPT usually, the UPT is going slightly down in the 2nd semester, having more sales driven by your higher selling price from the outerwear and a little bit less of the other category. But we expect here also for the full year an increase compared to last year. Regarding the result of the American market, as you know, there is some turmoil on this market regarding especially the American department store. There, we have had some positive results driven by the fact that we have started conversion of Bloomingdale's and we had the 1st conversion in June this year with 2 new openings ground floor that are planned for the second half of the year.
So this is kicking out a little bit, especially during the second semester. We'll see some business shifting from wholesale into retail business, where we think we believe that we can probably provide better result by managing that directly. We have 2 other openings with Bloomingdale for this year and we're currently actively working with all trends through in the Canadian market to drive some conversion during the 1st semester 2020. The results on the wholesale has been also the the Chapter 11. So here we have had some discussion internally and took the right measure to protect our sales and our investments.
So in terms of credits, we are fully covered. But this has been resulted in especially in the month of June in some delays in the delivery of the fall winter season, both with them and with we can recover these results in July August.
So does the impact of that change your outlook for the wholesale business in its entirety for the second half of the year?
And for the second half, what we have is 1 shift, which is the store that is in New York on the 59th Avenue. So it's a shift of part of the business that are going to have a positive impact on the retail revenues and the 2 openings that are foreseen in the last quarter of the year. So I think that we are going to see positive impact for the North American market more on the first half of next year with already some probably some acceleration towards the end of the year. But it remains a market with much higher volatility than the other one. And also, the political tension with China are not helping to drive tourism in the U.
S. So it has become more local market than in the past, and we are benefiting less from the traffic from especially from the Chinese.
Thanks so much.
The next question is from Anne Laure Bismuth with HSBC. Please go ahead.
Yes. Hi. Good evening. Anlour Bismuth from HSBC. I have two questions.
So the first one is on the contribution from new space in Q2. Is it fair to assume that it was around 2%, 3% based on the comment you made on the like for like performance for H1 and also for Q2? And also is it fair to how should we think about the space contribution for the full year? I know that in the past you mentioned a high single digit contribution, but could it be a bit below given the low contribution from new spacing that we saw in H1? And the second question is about the performance in Hong Kong.
Can have you been impacted by the protest in June? And if you can give us some comments about the situation there? Thank you very much.
Yes. Hi, Alor. This is Luciano. I mean, the space contribution I mean, for the first half, space contribution was about 6%, I mean, a little bit lower than what as you correctly stated, we normally plan and we anticipated for the year end. Honestly, I believe that we will improve the space contribution in the second half of the year.
And so we still maintain our indication for the year end of a high single digit Space contribution.
Maybe add some flavor to what Luciano just commented. As you know, we on purpose plan our expansion, refurbishments, relocation of stores and opening of stores usually on the 3rd Q4 because it's where we think we have the better start having the full fallwinter collection in place. So if I look at this year, we have had roughly 30% of the openings during the first half of the year. We'll have 2 third of the opening and the relocation during the 3rd and the 4th quarter of the year. Some of these openings or relocation are major.
I'm thinking about the flagship store of Munich Maximilianstrasse that is going to open in November this year. Some other relocation on the very important store on the Japanese market with Lissetan and Matsuiya where we finally had find an agreement with them to double the space or Kobe Daimaru or ZAKADEMO still in Japan. We did we have another one where we are finally going to get the ground floor in Hong Kong, in Sogou. So I think these positive news and elements are comforting us on the fact that we can achieve the result that Luciano just explained. Regarding Hong Kong, we have had an acceleration of the sales on our Hong Kong market in the Q2 of this year.
And I must say that with the opening of the Sogou ground floor, so we are confident for the result of the year end a small impact on the traffic, a small slowdown in traffic linked with the political protest that we have seen lately, but overall, a positive growth on the Q2 for Hong Kong.
The next question is from John Guy with MainFirst. Please go ahead.
Good evening. Thank you very much for taking my questions. One for Roberto, please, just to start with in terms of e commerce engagement and thinking about what you've done on social media. Certainly looking at some of our metrics, you had a very, very strong uptick in terms of Instagram engagement. Google Trends were very supportive as well.
So what have you been doing to drive besides obviously Genius? Is there anything else that you can point to in particular where you think you've had an exceptional success in driving social media and traffic either through your e commerce platform or certainly into stores via that particular channel. And Remo, if I could ask you a question just with regards to not necessarily being part of a larger group in the future, but whether or not you believe there are some other brands out there that you find interesting, whether it's especially in dyeing or outerwear or where they do something maybe slightly better or equivalent to your expertise? I'm thinking of Stane Island as one example. Are these the types of brands that if you are looking to potentially leverage the kind of expertise and know how that you have already could make strategic sense?
Thank you.
Good evening, John. First on the ecommerce As you know, social media is in a way, it's a battle of content. You need to have something to say on a regular basis, almost on a daily basis. So we have changed the way we are getting prepared. We are leveraging much more on each launches.
We go on the behind the scene. I think also that the new campaign featuring Will Smith is also going to give us some additional visibility and acceleration on that matter. And finally, we have been really shifting now the media spend that we have where we have an increase of plus 50% on the digital media investment. And on top, we brought in house now a Chief Digital Officer that is also technically helping us to improve and we are learning every day on this. The impact has been very good on Instagram, which is the focus we are having on the social media.
But if I'm looking also on the e commerce side, we have seen an acceleration compared to last year, where we have seen higher conversion rates, lower bounce rates, so people are staying longer on our website and we have had less returns. So overall, all the metrics on the e commerce are positive. We think also that the experience and the knowledge and the know how we are currently acquiring with the launch of the current market are going to have further positive impact on the culture and the know how internally in Moncler regarding both social media and e commerce. But it's clearly a very strong focus that the company has now. And I think referring to what Remo was saying at the beginning, the
success of Genius is also driving, obviously, first time traffic into store, but also on having engaged and maybe bought something via Genius, they're coming back and the loyalty is also being driven now towards your some of your mainline collection. So you're getting almost a double benefit, if you like, in terms of driving that.
I think you're completely right. I think the purpose of we always say that for us, Genius is the 1st digitally native project of the company. It has been thought to be at the same time something that is containing developing content for the communication, but not only for the brand, but also for the store. They have something to say now on the weekly basis. They are we have really accelerated the number of events we do in store, the appointments we have that are driven by our client advisor.
And clearly, this is helping to improve further the metrics of the store, the traffic, the conversion, but also the loyalty that continues to improve.
Thank you very much.
Hi, John. Yes, I think there is few company interested in the market. I don't see many, especially in the reasonable size. The one you mentioned, for example, Stonana, I think is a very good brand. But I always say this especially in the last 12 months, 15 months, I always say it, I really feel Moncler is like in a start up company.
We really changed the model of business. We really changed the approach basically in every area in this company, starting for supply chain, go to the marketing, then retail. I really feel a lot of energy in this brand and we really feel that we have many things to do. We really feel we can build 1 of the modern company in this market. And we want to really be very concentrated and we really feel good honestly to continue to develop these new ideas, this new way to work to improve energy for sure and the people in the company must to improve energy also to our customers.
We feel we are quite unique in the luxury world. We want to continue to develop this idea. Having said that, at the moment, we don't see anything honestly interesting for us, but their doors are open. We will also watch around the market.
Okay. Grazie Mine. Thank you very much.
The next question is from Paula Carboni with Equita SIM. Please go ahead.
Yes. Hello. Good afternoon, everybody. I have very short questions. One is in terms of nationalities, if you can provide us a bit of color on what you have seen specifically in Q2?
And secondly, in terms of current trading, you mentioned for July a trend similar to the H1 in terms of comps, so something similar to plus 9%. I just want to be sure I correctly understood. And if so, I just wanted to elaborate in case you have seen any slowdown in the last few weeks compared to the strength of Q2? Thank you very much.
Good evening, Paola. One point regarding nationalities. They are pretty balanced. As we say, Chinese, they remain our number one nationality. We have seen a slowdown in Chinese on the American market, but at the same time, the Mainland China is which is the bulk of our Chinese customer is continuing to be performing very well, higher than the average of Moncler in H1.
We have seen also an acceleration of the Chinese in Europe in especially on the Italian markets and in England, a slowdown on the French market because as you know, when we have this type of event that like the one of the yellow vest, even now the market is quieter since a couple of months, it usually takes between 3 to 5, 6 months for the Chinese to go Chinese traffic or Chinese travelers to go back to normal. So at the end, it's something that is balanced. The Japanese market continued to perform very well. We have seen an acceleration for the South Korean market. And the lockup markets in Europe are performing very well.
So I see something that is very balanced and still a very strong demand from the Chinese market. Regarding the current trading, honestly, the big part of the year is in front of us. We could see a trend that is not slowing down. But as we usually say, the mountain starts from September to the peak is in September to the end of the year. So we are confident, but there is still a lot to do till the end of the year.
Yes, sorry. Just a follow-up. I forgot another question. Actually, on Genius, I wanted you to comment if possible on how the June launch performed, which was the first chance to compare with last year basically to annualize this Genius project. So if you can elaborate a bit on what you've seen in June of 'twenty?
So Paolo, you're not following the rules of the two questions. But still, I will be I'm pleased to answer your third question regarding Genius. I think it will be a mistake to compare year on year the different launches because each launch has a different target. And we know that when we launch our Couture collection with Perpaolo that we are not expecting the sales that we have with Iroche when we sell fragment. So I will comment more on the fact that if the latest launch has been successful or not, and we have had 2 lately, One is the one of Simon Rochard, where we had the launch in an event both in Paris and Seoul in Korea.
And the other one with a very strong launch that we had the month before with Pan Minjals. And I must say that if we think about Pan Minjals, which was the volume driver, we have had results that have been above expectations. So strong results with a target again completely different if we see this 2 late Genius launch, something much more sophisticated for Simon Rocha, more in line with what we had in the past or seen what we had in the past with Gamrouge and something very energetic, younger generation, very successful. We have seen a crowd that we usually didn't see in Montclair since many years. And with a strong performance, both on the outerwear and in the cotton swine, where most of the items regarding palmitches have been sold out within the first week.
So we are confident about the further launches that are foreseen for this year. And we will continue now with an agenda that is really full and will bring back all the collection of the spring, summer and fall of the fall winter season in November this year on 7th, where we will have this year not 2, but 3 House of Genius, 1 in Monte Sandor in Japan another one for the first time with in Galeries Lafayette on the Champs Elysees and the third one here in Galleria in Milano, where we'll then in the year after, we will open our flagship store. And this will be reinforced also by around 10 shop in the shop, in department store and in wholesale partners supported with the e commerce. So again, very strong energy that is expected this year. And what will change, we have slightly changed the timing of the House of Genius last year.
They were October to December. This year, we'll bring them from the 7th November until the end of January. So, even more on the peak season for us.
Okay. Thank you very much.
The next question is from Melanie Fluke with JPMorgan. Please go ahead.
Yes, good evening. Thank you for taking my questions. I have a first question. Actually, sorry, it's just a clarification. You're mentioning Space growth in H1 was 6%, but you've given the like for like at 9%, so that implies the calculation at 4%.
So I'm just trying to clarify that this 6% relates to the TruSpace growth and that the 4 includes is just not exactly the same, still the same story because of the outlets, etcetera, included in it. But I'm just trying to understand what we are talking about when you talk about 6 against 4, whether we had the wrong grounding and the like for like and in the total organic retail sales. That's my first question. Actually, the second question I have is when I look at your D and A, as you rightly pointed out, it's going up due to the CapEx spend of the previous years. And also the non recurring the former non recurring charge is going up, which is your long term incentive plan.
How should we think about those lines moving forward? Have you sort of reached we should expect it to grow more in line with sales? So that continues to weigh on the profitability and you compensate it elsewhere. Thank you.
Hi, Melanie. About the Space growth contribution, I mean, the 4%, I mean, is the difference between the retail growth and the comp. But of course, you know that the comp is related only to regular stores. Outlets are performing less well, still fairly well, but less than regular stores. And so the real space control contribution is what I said.
It is 6%, which again is lower than what we normally plan for the year end. And we still plan to do better in the second half. And so we still maintain the high single digit. So this is the explanation. About your second question, I mean the D and A are higher.
The impact of D and A is higher in the first half and it will be higher in the second half and in the year end than last year and last year was higher than the year before. I mean this is something that is totally incorporated in our plans because as I said before and as you correctly stated, our CapEx the CapEx, I mean, we made over the past few years are having an impact on our D and A, which is growing. Of course, not materially, honestly, but of course, talking about the selling expenses that incorporate the DNA of all of the investments that we made in our retail network, Of course, in that specific item, there is an impact that is not a big impact. But when I answered the question before, I highlighted this small impact. About the stock based compensation, I mean, the timing in this item is very particular.
But I mean to make the long story short, as I said, we expect for this year to spend exactly the same about €30,000,000 which is the same amount we spent last year. Of course, the impact of the €30,000,000 this year on our expected sales is awfully lower and again lower than last year and probably lower than 2%. I'm not sure if I answered your question, but Yes,
you did. Thank you.
Okay. Thank you.
Gentlemen, there are no more questions registered at this time.
Perfect. So we thank you everyone for participating to this late call. And I just could give you a quick reminder, Q3 2019 interim management statement will be released on October 24. And our quiet period will start on September 25. Yes, I don't have much more to say.
Just say if you have follow-up question, we are ready tonight or tomorrow anytime. And for sure, we wish you a very nice summer break. Thank you to everybody. Bye.
Ladies and gentlemen, thank you for joining.