Arcos Dorados Holdings Inc. · NYSE:ARCO
Arcos Dorados — Q1 2024 Earnings Presentation
30 slides from Arcos Dorados's earnings presentation, May 15, 2024
Slide 1: 1Q24 Results
Arcos Dorados 1Q24 Results May 15, 2024
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements that represent our beliefs, projections and predictions about future events or our future performance. Forward-looking statements can be identified by terminology such as “may,” “will,” “would,” “could,” “should,” “expect,” “intend,” “
Slide 3: Agenda
Agenda 1 Key 4 Balance Sheet Highlights & Growth 2 Sales & 5 Recipe for Profitability the Future 3 Digital, Delivery 6 Wrap Up & Drive-thru 3
Slide 4: Key Highlights
1 Key Highlights 1st Quarter 2024
Slide 5: First Quarter 2024 Key Highlights
First Quarter 2024 Key Highlights 1Q 2024 Systemwide Systemwide Comparable Sales grew 2.2x blended inflation, excluding Argentina Total Revenue Comparable Sales • Up 2.2x inflation in Brazil and 3.1x blended inflation in NOLAD. • 12th consecutive quarter of consolidated guest traffic growth. $1.1b 3
Slide 6: Sales & Profitability
2 Sales & Profitability Divisional Sales Performance
Slide 7: First Quarter 2024 Brazil Division Sales Performance
First Quarter 2024 Brazil Division BRAZIL 9.4%* Sales Performance ($million) 14.4% 20.0% 374.2 448.9 428.1 1Q23 1Q24 1Q24 (as reported) (in constant currency) • Comps were up 2.2x inflation in the 1Q24, with positive volume and average check growth. • Digital channels generated 65% of sales, with 26
Slide 8: First Quarter 2024 North Latin American Division Sales Performance
First Quarter 2024 North Latin American Division Sales Performance NOLAD 8.0%* ($million) 11.0% 16.8% 259.3 302.7 287.8 1Q23 1Q24 1Q24 (as reported) (in constant currency) • Comps up 3.1x blended inflation in the 1Q24. • Volume growth responsible for almost all the comparable sales growth, helped by
Slide 9: First Quarter 2024 South Latin American Division Sales Performance
First Quarter 2024 South Latin American Division SLAD Sales Performance ($million) 103.0%* 106.8% (7.7)% 357.3 329.7 738.9 1Q23 1Q24 1Q24 (as reported) (in constant currency) • Comparable sales grew at 1.8x blended inflation, excluding Argentina. • Above inflation comparable sales growth with positi
Slide 10: Market Share is as Strong as Ever
Market Share is as Strong as Ever QSR Visit Share McDonald’s Brand Health Latin America Arcos Dorados Top of Favorite Mind Brand 2.5x Main 1.5x Main Competitor Competitor +1.1pp YoY McDonald’s Brand Health +0.8pp Brazil Division YoY Top of Brand Favorite (0.6)pp YoY Mind Attributes Brand 4.0x Main P
Slide 11: Consolidated Adjusted EBITDA Growth & Margin Bridge
First Quarter 2024 Consolidated Adjusted EBITDA Growth & Margin Bridge 1Q24 – Adj. EBITDA Margin Performance 1Q24 – Consolidated 10.1% (% of total revenue) Adj. EBITDA margin ($million) 1Q23 Occupancy Franchised Other 1Q24 1.6% Adjusted Payroll & & Other Restaurants Operating Adjusted EBITDA Food &
Slide 12: Divisional Profitability – Benefitting from Diversification
First Quarter 2024 Divisional Profitability – Benefitting from Diversification BRAZIL 16.8%* NOLAD 9.4%* SLAD 7.5%* ($million) ($million) ($million) 21.0% 30.6% 26.9% 14.3% (39.2)% 20.7% 59.5 75.4 71.9 23.7 28.6 27.1 40.7 24.7 53.1 1Q23 1Q24 1Q24 1Q23 1Q24 1Q24 1Q23 1Q24 1Q24 (as (in constant (as (i
Slide 13: Digital, Delivery & Drive-thru
3 Digital, Delivery & Drive-thru 3D’s Strategy
Slide 14: Total Digital Sales up 30%
Total Digital Sales up 30%¹ Driving Frequency with Data and Guest Experience Total Digital Sales Penetration 47% 55% >120 m Mobile APP 1Q 2023 1Q 2024 Downloads Identified Sales Penetration ~85 m ~19 m Unique Registered Average Monthly 18% 22% Users Active Users 1Q 2023 1Q 2024 ¹Mobile App, Delivery
Slide 15: Delivery & Drive-thru: Leveraging the Free-standing Portfolio
Delivery & Drive-thru: Leveraging the Free-standing Portfolio Systemwide Off-Premise Sales1 >18% of systemwide sales 1Q23 2Q23 3Q23 4Q23 1Q24 >25% of systemwide sales ¹Delivery and Drive-thru 15 2In US dollars versus 1Q 2023
Slide 16: Loyalty Program
Loyalty Program Over 8 million registered members and growing fast Registered Members +Frequency (million) Compared to Non-Loyalty +90 Day Active Customers 3.2 8.2 Dec 2023 Jan 2024 Feb 2024 Mar 2024 Apr 2024 16
Slide 17: Balance Sheet & Growth
4 Balance Sheet & Growth Capital Structure & Investments
Slide 18: Healthy Balance Sheet & Cash Flows to Support Future Growth
Healthy Balance Sheet & Cash Flows to Support Future Growth Key Debt Metrics Cash Flow from Operating Activities ($million) ($million) Leverage Ratio 1.4x 1.0x 1.0x 1.2x BB+ 578 Stable 472 379 370 658 279 674 304 728 247 740 162 Ba2 339.7 343.1 Positive 2021 2022 2023 1Q24 1Q23 1Q24 Total Debt Cash
Slide 19: Restaurant Portfolio
Restaurant Portfolio Latin America’s Most Modernized Footprint 1Q 2024 Quarter-end Restaurant Footprint Store Type Total Dessert Division McCafé Freestanding In Store MS & FC Restaurants Centers BRAZIL 589 91 461 1,141 108 2,011 NOLAD 406 48 193 647 19 518 SLAD 247 125 221 593 199 726 TOTAL 1,242 26
Slide 20: Recipe for the Future
5 Recipe for the Future ESG Platform
Slide 21: 10th Annual Social Impact and Sustainable Development Report
10th Annual Social Impact and Sustainable Development Report Youth Commitment Diversity and Sustainable Climate Circular Opportunity to Families Inclusion Sourcing Change Economy +559,000 +9 M USD 56% of people who 76% of purchases 30.9% renewable 90.5% of primary instances of raised and donated wor
Slide 22: Wrap Up
6 Wrap Up Closing Remarks
Slide 23: Closing Remarks – Enhancing Shareholder Value
Closing Remarks – Enhancing Shareholder Value Diversified Business Model Strong Sales Growth • Operating across a vast and diverse • Sales rose above local inflation in nearly geographic footprint. all markets. • Generating cash flow from increasingly • Guest volumes grew across the business stable
Slide 24: Supplemental Information
7 Supplemental . Information
Slide 25: Consolidated Net Income Growth & Margin Bridge
First Quarter 2024 Consolidated Net Income Growth & Margin Bridge 1Q24 – Net Income Margin Performance 1Q24 – Net Income 2.6% (% of total revenue) margin Net Interest Other Net Income ($million) 1Q23 Operating Expense & Gain / (Loss) Foreign Non- attributable to 1Q24 Net Depreciation Charges Other f
Slide 26: Net Debt to Net Income
Net Debt to Net Income Key Debt Metrics ($million) Leverage Ratio 8.3x 2.6x 2.7x 3.4x 578 481 379 370 658 279 674 304 728 247 740 162 2021 2022 2023 1Q24 Total Debt Cash & Equivalents Net Debt • Total financial debt includes short-term debt, long-term debt, accrued interest payable and derivatives i
Slide 27: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation For Three-Months March 31, 2024 2023 Adjusted EBITDA Reconciliation Net income attributable to Arcos Dorados Holdings Inc. 28.5 37.4 Net income attributable to non-controlling interests 0.3 0.2 Income tax expense, net 19.0 21.0 Other non-operating income (expenses), ne
Slide 28: Definitions
Definitions In analyzing business trends, management considers a variety of performance and financial measures which are considered to be non-GAAP including: Adjusted EBITDA, Constant Currency basis, Systemwide sales, and Systemwide comparable sales growth. Adjusted EBITDA: In addition to financial
Slide 29: Questions & Answers
Questions & Answers
Slide 30: Thank you!
IR Contacts www.arcosdorados.com/ir Thank Dan Schleiniger you! Vice President Investor Relations daniel.schleiniger@mcd.com.uy Leticia Santiago Senior Manager Investor Relations leticia.santiago@br.mcd.com Follow us on
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