Sodexo Sa · EURONEXT:SW
Sodexo Sa — Investor Day (November 2022)
152 slides from Sodexo Sa's investor day presentation, Nov 2, 2022
Slide 1: Capital Markets Day
Capital Markets Day November 2, 2022
Slide 2: Agenda
Agenda 11am My plan for Sodexo - Sophie Bellon 11:30am Benefits & Rewards Services / Q&A 12:50pm Lunch break 1:50pm On-site Services / Q&A 4pm Break 4:30pm Finance 5pm Group Q&A
Slide 3: Capital Markets Day
Capital Markets Day November 2, 2022
Slide 4: My Plan for Sodexo
My Plan for Sodexo Sophie Bellon Chairwoman & Chief Executive Officer
Slide 5: Update on our four immediate priorities
Update on our four immediate priorities
Slide 6: Update on four priorities
Update on four priorities #1 Boost US Growth Accelerate the transformation #2 of our food model Manage our portfolio #3 more actively • Retention in North America > 96%, up 400 bps vs last year • Development up 400 bps Enhance the effectiveness • First-time outsourcing contracts: 44% of signatures #
Slide 7: Update on four priorities
Update on four priorities #1 Boost US Growth Accelerate the transformation #2 of our food model Manage our portfolio #3 more actively Enhance the effectiveness • New generation off-site production units to support #4 advanced models of our organization • Food transformation represents 6% of Corporat
Slide 8: Update on four priorities
Update on four priorities #1 Boost US Growth Accelerate the transformation #2 of our food model Manage our portfolio #3 more actively • Development of convenience business in the US Enhance the effectiveness • Building GPO in Europe #4 of our organization • Divestment from non-core activities and se
Slide 9: Update on four priorities
Update on four priorities #1 Boost US Growth Accelerate the transformation #2 of our food model Manage our portfolio #3 more actively Enhance the effectiveness • Organization simplification #4 of our organization • End-to-end P&L management transferred to Regions (October 1st) • Dedicated governance
Slide 10: Translating into strong performance in Fiscal 2022
Translating into strong performance in Fiscal 2022 Strong Strong Improved revenue retention and margins growth development €21.1bn (+16.9%) 5% (+170 bps) 94.5% retention (+140 bps) 7.5% development (+150 bps) FY2023 guidance: Organic growth of 8 to 10% and UOP margin close to 5.5%, at constant rates
Slide 11: Strong foundations to accelerate our transformation and growth
Strong foundations to accelerate our transformation and growth Leadership Cash generative positions in fast business model growing markets Relevant offers to Recognized meet clients' expertise in evolving demands food services Fantastic teams Differentiating around the mission world who deliver & pu
Slide 12: Our Ambition
Our Ambition Be the world leader in sustainable food and valued experiences at every moment in life: learn, work, heal and play Capital Markets Day – November 2, 2022 © Sodexo. All rights Reserved 12
Slide 13: Operating in attractive growth markets
Operating in attractive growth markets Food is a FM is a €240bn market €380bn market 53% self-operated 51% self-operated North America Europe RoW Modest growth market Competitive but High growth and – focus on value and high potential development potential innovation Source: Sodexo Capital Markets D
Slide 14: Our strategy: Refocus & Accelerate
Our strategy: Refocus & Accelerate Pillar #1 Pillar #2 Pillar #3 Refocus on Food Accelerate the Strengthen our impact services and be more profitable growth as market maker in selective in FM of BRS sustainability Our strategic enablers Tech and data Commercial excellence Supply chain power Capital
Slide 15: Refocus & Accelerate
Refocus & Accelerate Pillar #1 Pillar #2 Pillar #3 Refocus on Food services Accelerate the profitable Strengthen our impact and be more selective in FM growth of BRS as market maker in sustainability Pillar #1: Refocus on food services and be more selective in FM • Acceleration on advanced food mode
Slide 16: Refocus & Accelerate
Refocus & Accelerate Pillar #1 Pillar #2 Pillar #3 Refocus on Food services Accelerate the profitable Strengthen our impact and be more selective in FM growth of BRS as market maker in sustainability Pillar #1: Refocus on food services and be more selective in FM • Acceleration on advanced food mode
Slide 17: Refocus & Accelerate
Refocus & Accelerate Pillar #1 Pillar #2 Pillar #3 Refocus on Food services Accelerate the profitable Strengthen our impact and be more selective in FM growth of BRS as market maker in sustainability Pillar #1: Refocus on food services and be more selective in FM • Acceleration on advanced food mode
Slide 18: Refocus & Accelerate
Refocus & Accelerate Pillar #1 Pillar #2 Pillar #3 Refocus on Food services Accelerate the profitable Strengthen our impact and be more selective in FM growth of BRS as market maker in sustainability Pillar #1: Refocus on food services and be more selective in FM • Acceleration on advanced food mode
Slide 19: Refocus & Accelerate
Refocus & Accelerate Pillar #1 Pillar #2 Pillar #3 Refocus on Food services Accelerate the profitable Strengthen our impact and be more selective in FM growth of BRS as market maker in sustainability Pillar #2: Accelerate the profitable growth of BRS • Clear strategy and a strong plan to deliver gro
Slide 20: Refocus & Accelerate
Refocus & Accelerate Pillar #1 Pillar #2 Pillar #3 Refocus on Food services Accelerate the profitable Strengthen our impact and be more selective in FM growth of BRS as market maker in sustainability Pillar #2: Accelerate the profitable growth of BRS • Clear strategy and a strong plan to deliver gro
Slide 21: Refocus & Accelerate
Refocus & Accelerate Pillar #1 Pillar #2 Pillar #3 Refocus on Food services Accelerate the profitable Strengthen our impact and be more selective in FM growth of BRS as market maker in sustainability Pillar #2: Accelerate the profitable growth of BRS • Clear strategy and a strong plan to deliver gro
Slide 22: Refocus & Accelerate
Refocus & Accelerate Pillar #1 Pillar #2 Pillar #3 Refocus on Food services Accelerate the profitable Strengthen our impact and be more selective in FM growth of BRS as market maker in sustainability Pillar #2: Accelerate the profitable growth of BRS • Clear strategy and a strong plan to deliver gro
Slide 23: Refocus & Accelerate
Refocus & Accelerate Pillar #1 Pillar #2 Pillar #3 Refocus on Food services Accelerate the profitable Strengthen our impact and be more selective in FM growth of BRS as market maker in sustainability Pillar #3: Strengthen our impact as market maker in sustainability • Deep-rooted commitment to DE&I.
Slide 24: Refocus & Accelerate
Refocus & Accelerate Pillar #1 Pillar #2 Pillar #3 Refocus on Food services Accelerate the profitable Strengthen our impact and be more selective in FM growth of BRS as market maker in sustainability Pillar #3: Strengthen our impact as market maker in sustainability • Deep-rooted commitment to DE&I.
Slide 25: Refocus & Accelerate
Refocus & Accelerate Pillar #1 Pillar #2 Pillar #3 Refocus on Food services Accelerate the profitable Strengthen our impact and be more selective in FM growth of BRS as market maker in sustainability Pillar #3: Strengthen our impact as market maker in sustainability • Deep-rooted commitment to DE&I.
Slide 26: Strategic enablers
Strategic enablers #1 #2 #3 Tech and Commercial Supply data excellence chain power Capital Markets Day – November 2, 2022 © Sodexo. All rights Reserved 26
Slide 27: Sodexo Leadership Team
Sodexo Leadership Team As of December 1, 2022 Sophie Bellon Chairwoman & Chief Executive Officer Aurélien Sonet CEO Benefits & Rewards Services Anna Notarianni Dedicated operational Group Chief governance for BRS Impact Officer Marc Rolland Group Chief Financial Officer Annick De Vanssay Group Chief
Slide 28: 2025 Targets
2025 Targets Refocus on Strengthen our Accelerate the Food services impact as profitable and be more market maker growth of BRS selective in FM in sustainability FY2023 guidance: Organic growth of 8 to 10% and UOP margin close to 5.5%, at constant rates FY2024-FY2025: Organic growth of 6 to 8%, UOP
Slide 29: Benefits & Rewards Services: an ambitious acceleration and profitability plan
Benefits & Rewards Services: an ambitious acceleration and profitability plan Aurélien Sonet CEO Benefits & Rewards Services Viktoria Otero Del Val SVP Strategy, Product and Customer Experience Suvodeep Das Global Product VP Employee Benefit and Engagement
Slide 30: A solid platform for growth acceleration and improved profitability
A solid platform for growth acceleration and improved profitability
Slide 31: BRS is a strong global leader in employee benefits and engagement
BRS is a strong global leader in employee benefits and engagement Personalized and sustainable employee experience at work and beyond 18% 4,800 employees 82% Revenue 500,000 clients Activity Mix: 82% Employee Benefits 1.7m merchants Meal & Food, Gift, Mobility, €307m €558m Well-being, Remote revenue
Slide 32: A virtuous model, delivering value for every stakeholder
A virtuous model, delivering value for every stakeholder 500,000 Corporate clients Sodexo • Increased engagement • Traceability of data and funds • Tax effective, compliant, secure • Formalization of the economy and flexible employee • Improved effectiveness of compensation boost public property • S
Slide 33: A cash generative business model
A cash generative business model Revenue stream Float Corporate client pre-loads BRS’ cards/digital wallet Sodexo 500,000 Corporate clients Client commissions €19bn+ BRS reimburses Issue volume Corporate client provides merchant net of 4.4m+ its employees with commission Daily transactions pre-paid
Slide 34: A strong growth dynamic
A strong growth dynamic Accelerating Operational Reduced Organic Growth revenue growing exposure to Brazil Q4 FY22 +19.8% double digit 26% of revenue in FY22 FY22 +14.2% in FY22 vs 38% in FY17 Financial revenues €2.8bn Coverage ratio* up 43.7% in operating cash of 121% organically as of August 31, 2
Slide 35: A tech-enabled employee benefit and engagement company
Our digital transformation journey 90% A tech-enabled Digital business volume in FY22 Vs 68% in 2017 employee benefit X6 and engagement Mobile payment transactions in France and Brazil in FY22 vs FY21 company 82% Of all recruitments in IT, Sales & Marketing in FY22 Partnerships ~500 delivery and e-c
Slide 36: Significant investment to build a scalable tech and digital platform
Significant investment to build a highly scalable tech and digital platform ecosystem Top line growth • Client, merchant and consumer portal and app • Sodexo Payment Platform • Digital factory €300 • Data Platform million Operational excellence • Digital Marketing & CRM Capex spend • Customer care i
Slide 37: A proven client-centric culture
A proven client-centric culture FY22 Figures 37 ~ 95% Up 250 bps Client NPS Client retention rate Development rate vs last year Strong sales performance Customer Service of the Year Client wins x3 in Turkey, Israel, In Brazil, Turkey, Spain and Tunisia Romania and Germany vs FY21 Capital Markets Day
Slide 38: Significant untapped market opportunity
Significant untapped market opportunity Employee Benefits: an attractive market still underpenetrated Employee Benefit Issue Volume Key market facts Overall Employee Benefit market represents €1,000bn opportunity €1,000bn Other (Gift, Wellbeing, Mobility…) Addressable Market1 Europe represents ~
Slide 39: Significant untapped market opportunity
Significant untapped market opportunity Accelerating trends are making the market even bigger War for talent & Empowered Local economic great resignation Hybrid working Digitalization consumers support Boost demand for More Innovative Improved digital Increased demands for • Public benefits for impr
Slide 40: A solid platform for growth acceleration and improved profitability
A solid platform for growth acceleration and improved profitability Key assets with clients, Strong financial performance consumers, merchants in FY22 and talents Attractive, proven, Global footprint resilient business model Great range of Positive megatrends and still digital employee benefit
Slide 41: Our strategy to accelerate growth and improve profitability
Our strategy to accelerate growth and improve profitability
Slide 42: Our 2025 strategic roadmap
Our 2025 strategic roadmap An ambitious plan to accelerate and consolidate our leadership position CSR EMBEDDED IN EVERYTHING WE DO 03. DIVERSIFY into adjacencies 02. AUGMENT Boost Multi-benefit Strengthen Rewards Employee Benefit & & Recognition offer Development Engagement Platform in UK and the U
Slide 43: Bringing value to client experience
Bringing value to client experience 01 From a generalist benefit provider to a tech-enabled, trusted HR partner CORE OUR PRIORITIES CASE STUDY 2025 AMBITION Retain clients • Depth of relationship • Enriched benefit range • Advisory role Brazil case study New clients Taking advantage of • Focus on ac
Slide 44: Digital consumer experience
Digital consumer experience 01 Empowered by a best-in-class consumer app CORE OUR PRIORITIES CASE STUDY 2025 AMBITION • Seamless UX • Continuous innovation in payment options • Personalized promotions, discounts and cashback Chile case study • CSR (donation, anti-food waste) Encouraging the use of b
Slide 45: Digital merchant experience
Digital merchant experience 01 From traffic booster to trusted business partner CORE OUR PRIORITIES CASE STUDY 2025 AMBITION #1 • Optimized processes • Merchants Portal, App and Top of mind Employee 65% Payment Acceptance layer Benefits company for of restaurant Merchants in Brazil* merchants taking
Slide 46: Increase penetration of the SMEs segment
Increase penetration of the SMEs segment 01 Bringing employee benefits and engagement to SMEs CORE OUR PRIORITIES CASE STUDY 2025 AMBITION SMEs selling journey • 80% • First order in less than 10 min of contracts with SMEs • Simplified pricing, digital registration and beneficiary • 20% of total Iss
Slide 47: Invest in Branding & Marketing
Invest in Branding & Marketing 01 Unleash the full value of our digital assets CORE Digital Marketing OUR PRIORITIES CASE STUDY 2025 AMBITION • Content Management System and enhanced 1 digital analytics capabilities marketing • Marketing orchestration qualified lead • Best-in-class traffic and every
Slide 48: Video: Benefits & Rewards Services
VIDEO BENEFITS & REWARDS SERVICES 48
Slide 49: Our product vision
Our product vision Capital Markets Day 2022 © Sodexo 2022. All rights Reserved 49
Slide 50: Augment our employee benefit and engagement platform
Augment our employee benefit and engagement platform 02 Expanding our offer programmatically with in-house development and partners AUGMENT CORE 2025 AM BI TI O N BRS most advanced countries Brazil France Belgium Turkey Mexico Romania CZ India Spain Italy Meal & Food Gift
Slide 51: Augment our employee benefit and engagement platform
Augment our employee benefit and engagement platform 02 Boosting user experience AUGMENT CORE 2025 AM BI TI O N Rewards & Employee Intuitive super-app for recognition engagement employee benefits 40% of operating revenue • State-of-the-art reward • Integrated employee • Full suite of employee growth
Slide 52: A fully integrated employee benefits platform in France
02 AUGMENT CORE CASE STUDY A fully integrated employee 2025 AM BI TI O N benefits platform in France • The leader in gift combining all formats (wallet, card & paper) • +30% in gift revenue +50% 700k 6m 60k 4.8 consolidated revenue Active mobile Consumers Clients App Store rating in France app users
Slide 53: Foundational enablers
Foundational enablers Foundational All levers mobilized to support growth enablers #1 OPERATIONAL EFFICIENCY #2 COMPETENCIES #3 GOVERNANCE • Reinforcing performance management • Reducing processing costs • Growing competencies in product, system tech and data • Optimizing and automating internal • T
Slide 54: Continued investments in tech
Continued investments in tech 2025 AM BI TI O N Boosting our One-Platform Ecosystem and leveraging scale 2025 AM BI TI O N Close to 10% of revenues in • Expand multi-country solutions to boost top-line growth technology capex • Enrich and mutualize our payment spend platform • Leverage our mature da
Slide 55: Embedding sustainability to deliver a bold CSR roadmap
Embedding sustainability to CSR EMBEDDED IN EVERYTHING WE DO 2025 AM BI TI O N deliver a bold CSR roadmap Be a trusted partner… …for individuals …communities …and the environment Our 2022 achievements... Spend with suppliers Women in Business volume Commitment Net Zero 86% who sign the Sodexo 44% ma
Slide 56: Economic context favorable to continued performance
Economic context favorable to continued performance and successful delivery of our outlook
Slide 57: Favorable environment for benefits
Favorable environment for benefits Adding to our performance and delivery success Inflation Interest rate increases increases face values to protect flow into revenues consumer purchasing and profits power Capital Markets Day 2022 © Sodexo 2022. All rights Reserved 57
Slide 58: 2025 Outlook
2025 Outlook Revenue growth Increased acceleration profitability With a targeted With a targeted UOP margin low double digit growth of above 30% in FY2025 for FY2024 and FY2025 Reminder of FY2023 guidance – Organic Growth: 12 to 15% - UOP Margin: around 30% Capital Markets Day 2022 © Sodexo 2022. Al
Slide 59: Q&A Benefits & Rewards Services
Q&A Benefits & Rewards Services
Slide 60: Capital Markets Day
Capital Markets Day November 2, 2022
Slide 61: Overview of On-site Services strategy
Overview of On-site Services strategy Alexandra Serizay Chief Tech & Services Officer
Slide 62: Food and FM is a €620bn market globally
Food and FM is a €620bn market globally, with attractive growth and profitability drivers FOOD FM Outsourced Outsourced 47% 49% Global €240bn 53% €380bn 51% market size Self-operated Self-operated Consumer driven growth Asset driven growth Growth and Demographic trends Total Asset Cost Optimization
Slide 63: Market structures and growth perspectives vary per zone
Market structures and growth perspectives vary per zone North America Europe ROW 52% 48% €88bn 50% 50% €64bn 40% 60% €88bn FOOD market size FM market size 51% 49% €148bn 50% 50% €120bn 45% 55% €112bn Outsourced Self-operated Outsourced Self-operated Outsourced Self-operated Total outsourced market e
Slide 64: Sodexo FY22 OSS revenues by zone
Sodexo has different portfolio features per zone & leading positions in Europe & Rest of the World North America Europe ROW €8.8bn €7.8bn €3.7bn Sodexo FY22 OSS revenues… FM FM FM 26% … by service 50% 50% 51% 49% 74% Food Food Food … by 9% 8% 24% 10% environment 6% 2% 32% Work Learn 27% 57% 35% 90%
Slide 65: Consumer behaviors are changing fast
Consumer behaviors are changing fast with strong disruption in Work and Learn Consumers want more… Work Heal Learn Play Services adapted to hybrid models …Flexibility Working from home stabilizing at ~2 days/week for white collars (50% of Work consumers) Work from Hybrid education home in universiti
Slide 66: We are continuously upgrading our existing offer
We are continuously upgrading our existing offer… Upgrade of our existing offers... Enhanced on-site experience... Restaurant and Branded offers Digital Experience Grab & Go Services Flexibility Personalization Relevant and consistent CSR Digital From <30% in 2022 to 50% From 1.2M digital active of
Slide 67: Complement our offer with advanced food models
… and also complement our offer with advanced food models to meet consumer new expectations Enhanced on-site experience... Complemented by Advanced food model Restaurant and Convenience Aggregation On-Site Food Delivery Grab & Go Services From <2% to 10% of food revenues from advanced food distribut
Slide 68: Unique FM value-added services
Unique FM value-added services to complement food experience Enhanced on-site food experience High experience FM services High-value services • Space Optimization Services: Design & Space management • Healthcare technology management consultancy • Smart Building Services • Smart Services: Dynamic Cl
Slide 69: Optimization in both Food and FM
Optimization in both Food and FM Offsite production Command centers • Optimize food production investing in high- • Optimize FM services by investing in end innovative culinary units with high quality mutualized high-end expertise centers standards and reduced food waste • Enhance client experience
Slide 70: Better Tomorrow targets the value chain ambition
Better Tomorrow targets the value chain ambition: having a positive impact is the core of the way we serve Our offers Our ecosystem Our production to our clients Employees trained Carbon footprint reduction Food waste reduction on sustainable practices (vs. 2017) Planet - 27% - 34% 20% 100% - 41.5%
Slide 71: To be a leader in sustainable food and valued experiences
To be a leader in “sustainable food and valued experiences, at every moment of life – work, heal, learn and play” Purpose Create a better everyday for everyone to build a better life for all Sustainable food and valued experiences, Vision at every moment of life: learn, work, heal and play Capital M
Slide 72: Our differentiated strategic posture by zone
Our differentiated strategic posture by zone North America Europe Rest of World ► Protect market share ► Gain market share on with a focus on ► Secure leading position growing and profitable retention on fast growing markets market pools (Work ► Refocus on food and be and focus growth on and Heal) m
Slide 73: North America: Targeting new opportunities to drive growth
North America Targeting new opportunities to drive growth Sarosh Mistry President North America
Slide 74: At a glance – North America
At a glance – North America Segment mix: 2,000 clients 35% Heal 32% Learn 10,000 sites 24% Work (incl. Entegra & Convenience) 9% Play 123,000 employees Service mix 26% 74% Well positioned to Grow our business and Gain market share Food FM Capital Markets Day 2022 © Sodexo 2022. All rights Reserved 7
Slide 75: North America Financial overview
North America Financial overview Key figures Financials recovering from Covid (in million €) • Return to strong growth in FY22 Revenue UOP & UOP margin • UOP Margin improving +10.9% -7.8% +3.7% -20.0% • FY22 Revenue back to 89% of pre- pandemic levels (Q4FY2022 at 96%) 9 572 8 629 8 828 6.6% 6.2% 5.
Slide 76: Strong market opportunity
Strong market opportunity Strong foundation to grow in €236 billion Food and FM services market #2 in North America North America market overview 236 Our ambition (in billion € FY22) looking ahead 11 50 (5%) • Consolidate our #2 position (21%) • Widen the gap with Aramark 115 Self-operated (49%) • C
Slide 77: Strong positions in Heal and Work
Strong positions in Heal and Work Heal Work • Gradual return to office even though hybrid working has grown • Strong commercial momentum • Food services being used to encourage employees back • Positive net new development in FY22 including recent award of Ardent contract • We are responding accordi
Slide 78: Strong growth potential in Learn and Play
Strong growth potential in Learn and Play Learn Play • Strong uptick in University meal plan and School volumes • Sharp recovery in FY22 • Campus and retail sales recovering – all sites reopened • Post-covid, strong demand for sports, leisure & tourism • Focused on executing against our priorities:
Slide 79: How we are moving ahead
How we are moving ahead Future market growth OSS market growth drivers North America foodservice market (in billion €) 185 Inflation and 160 Play 154 supply constraints Learn 108 Heal Low unemployment Work Post COVID recovery 2019 2021 2023 2025 Market progressively OSS value proposition for Peak CO
Slide 80: How we are moving ahead
How we are moving ahead Our three strategic priorities 1 2 3 Deliver technology innovation to Deploy advanced food models Invest in sales and marketing improve operational efficiency and to grow market share capabilities to drive net new growth customer satisfaction to drive retention and margin Cap
Slide 81: How we are moving ahead
How we are moving ahead Technology innovations to deliver operational efficiency and consumer / client satisfaction • Kiwibot Consumer / • Eat > Now Client-facing • Everyday App • SKU rationalization • AI-based recruiting and Operational labor management • DRIVE – integrated food management process
Slide 82: How we are moving ahead
How we are moving ahead Advanced food models • InReach launched in 2022 Convenience • >$0.5bn business revenue by 2025; above average margin Offsite • Launched in Boston production • Rapid scale-up • In place across University Virtual brands accounts • Delivers more choice to Aggregation employees r
Slide 83: How we are moving ahead
How we are moving ahead Investing in Sales and Marketing Centralized demand New approach generation and sales to sales and analytics (MSDC) Number of qualified leads Average deal size is 21% are up 53% YOY FY22 higher than FY19 vs FY21 Improved Upskilled Sales and Digital Marketing Marketing Teams D
Slide 84: How we are moving ahead
How we are moving ahead Addressing the people challenge Time to hire improved 10% YOY Centralized Healthcare benefits management for employees of HR and data Enhanced recognition New EVP and benefits programs Capital Markets Day 2022 © Sodexo 2022. All rights Reserved 84
Slide 85: Conclusion
Conclusion Poised for Growth Our strategic priorities… Capitalize on Market Drivers… …To deliver: Deliver technology innovation to improve operational efficiency Inflation and Low • +96% retention and customer satisfaction to drive unemployment retention and margin lead to a need for • Continued net
Slide 86: Europe: Transform to maintain leadership, drive profitability and cash generation
Europe Transform to maintain leadership, drive profitability and cash generation Sunil Nayak President Europe
Slide 87: At a glance – Europe
At a glance – Europe Segment mix: 21 countries 57% Work 9,000 clients 27% Heal 10% Learn 6% Play 13,000 sites Service mix 117,000 employees 40% women senior leaders 50% 50% Overall balance: 54% women and 46% men Food FM Capital Markets Day 2022 © Sodexo 2022. All rights Reserved 87
Slide 88: Financial overview
Financial overview Key figures Resilient & Growing (in million €) • FY22 revenue at 95% of pre-pandemic levels Revenue UOP & UOP margin • Resilient portfolio during crisis +5.6% -4.4% -26.1% -2.9% thanks to a balanced portfolio between Food and FM • 13% Organic Growth in FY22 8 129 7 698 7 774 5.4%
Slide 89: Large Food and FM market estimated to grow 2% to 5%
Large Food and FM market estimated to grow 2% to 5% Market Leader in Outsourced Food & FM Europe Total Market: Europe Food Market: Europe Total Market: €184bn Large market with growth €184bn €64bn potential in Food and FM Play • Estimated to grow France 5% 2% to 5% 18% Learn Others • 50% of food mar
Slide 90: Priority 1: Leveraging the simplified organization
Priority 1: Leveraging the simplified organization to empower decisions and responsiveness at the local level Mutualize Empower Innovate and Test Invest and Scale Resources decision-making Capital Markets Day 2022 © Sodexo 2022. All rights Reserved 90
Slide 91: Priority 2: Drive operational efficiency
Priority 2: Drive operational efficiency by leveraging scale and expertise Operational New Production Model 7 FM Command Data & Digital Improvements in France Centers • Supply Chain Food and Logistics Dynamic network of Wando • Inflation Management Platform remote solutions • FM Reporting & order •
Slide 92: Priority 3: Accelerate and scale our Food Transformation
Priority 3: Accelerate and scale our Food Transformation across targeted countries and cities Brand & Offers Digital Platforms Advanced Food Models Capital Markets Day 2022 © Sodexo 2022. All rights Reserved 92
Slide 93: Priority 4: Be selective in the geographies and sectors
Priority 4: Be selective in the geographies and sectors we target for growth with differentiated value propositions Learn Building stronger, healthier Work learning communities, Delivering outstanding & elevating student responsible workplace performance, well-being experiences for clients and and p
Slide 94: Priority 5: Embed sustainability to be a game changer
Priority 5: Embed sustainability to be a game changer Expand our impact Today 40% of client sites deployed Waste Watch 58% of ingredients plant based 400 sites with Ecolabeling app Capital Markets Day 2022 © Sodexo 2022. All rights Reserved 94
Slide 95: Leveraging People and Purpose
Leveraging People and Purpose 67% Employee Engagement Rate 89% Employee Retention Sodexo’s To create a better everyday for Purpose everyone to build a better life for all. Sodexo’s Employee Value Belong Act Thrive Proposition Capital Markets Day – November 2, 2022 © Sodexo. All rights Reserved 95
Slide 96: Conclusion: Laser focused on our priorities
Conclusion: Laser focused on our priorities Empower Local Drive Operational Decision Making Efficiency Scale Our Target Select Advanced Food Geographies and Models Segments Embed Sustainability Into What We Do Laser focus to execute on our priorities to achieve our objectives of enhancing margin and
Slide 97: Rest of the World: Driving growth in dynamic markets
Rest of the World (RoW) Driving growth in dynamic markets Johnpaul Dimech President APMEA, Brazil & Latin America
Slide 98: Rest of the World Market Landscape
Rest of the World Market Landscape: Our Food Excellence Ambition Revenue Mix 21 countries Heal 8% 2,012 clients Learn Work 2% E&R 34% 4,207 sites Work Corporate 177,000 employees 56% Service Mix LATAM BRAZIL APMEA Ranked #1 Fragmented market with Local Traditional food players investing in Tech Disr
Slide 99: Rest of the World ID Card
Rest of the World ID Card Top 5 countries Corporate E&R Work 68% 16% BRAZIL Heal 16% Top 5 AUSTRALIA Corporate E&R Work 5% 95% countries Corporate E&R Work 36% 44% CHILE Heal 12% Work Corporate 82% of 79% CHINA revenue Heal 9% Corporate E&R Work 70% 11% INDIA Heal 12% Capital Markets Day – November
Slide 100: Our Performance
Our Performance Significant Profitability Improvement: Focused development and retention actions (in million €) Revenue UOP & UOP margin +7.1% +8.8% +57.3% +3.3% 3 661 • Strong revenue growth even during the pandemic 3 366 3.1% 4.5% 4.3% • Margins maintained 3 143 during pandemic 151 156 • Strong mi
Slide 101: What We Have Done
What We Have Done Boosting capability and agility Invest Invest Simplify Simplify Simple & agile organization Food Capabilities Streamlined our footprint Countries empowered • Food Tech Co 37 countries to make decisions • Off-site food production units 21 countries today • DRIVE Efficiency Program
Slide 102: Looking Ahead at the Rest of the World
Looking Ahead at the Rest of the World Diverse, Dynamic, Developing 62% of the world’s 7.4% estimated GDP <35 years median age: Young competitive workforce population resides in this zone CAGR from 2022 - 2027 & growing middle class Outsourcing rate of 40% in a market growing at >10% pa Total Mkt Si
Slide 103: Achieving Food Excellence, Leveraging FM Expertise for Growth
Achieving Food Excellence, Leveraging FM Expertise for Growth Focus on our “Big 5”: Brazil, Australia, Chile, China, India KEY FOCUS Work Heal BRAZIL Build IFM offers Energy & to cater to new ways of working Manufacturing Resources Hospitals IFM KEY FOCUS AUSTRALIA Work Reinforce our leadership in E
Slide 104: Strategic Priorities to Reinforce our Leadership Position
Strategic Priorities to Reinforce our Leadership Position Investing in key enablers 1. Digital enabled restaurants 2. Smart retail 3. Offers & brands 4. On-site production technology 5. Centralised food production units (CPUs) Accelerating Food 1. Access new sectors Transformation 2. Build capabilit
Slide 105: In a Nutshell… Accelerate our Growth & Deliver Higher Profitability
In a Nutshell… Accelerate our Growth & Deliver Higher Profitability To elevate our Learn, Work, Heal and Play Achieving food Invest in key enablers Focus on our “Big 5” environments excellence, leveraging to enhance our core and reinforce our to reinvent the FM expertise for growth capabilities mark
Slide 106: Tech & Data, a key enabler
Tech & Data, a key enabler Alexandra Serizay Chief Tech & Services Officer
Slide 107: Tech & Data, a key enabler to execute our strategy
Tech & Data, a key enabler to execute our strategy Average €500M annual spending in Tech & Data To drive value to our clients & consumers with our ecosystem of partners Client sales More intimate consumer Operational & retention relationship efficiency Capital Markets Day – November 2, 2022 © Sodexo
Slide 108: Enhance efficiency on site & clients relationship
Enhance efficiency on site & clients relationship Customer Site Performance satisfaction Benchmark Analyse & understand Compare and analyse performance services, clients or sites Robert Site Manager Sodexo Footfall Forecast Health & wellbeing Carbon footprint Estimate & analyse Analyse consumer’s ha
Slide 109: Enhance efficiency on site & clients relationship
Enhance efficiency on site & clients relationship Customer Site Performance satisfaction Benchmark Analyse & understand Compare and analyse performance services, clients or sites 90% Illustrative Accuracy Avg. 30% improvement vs Robert site managers Site Manager Sodexo (especially in volatile po
Slide 110: Enhance efficiency on site & clients relationship
Enhance efficiency on site & clients relationship Customer Site Performance Illustrative satisfaction Benchmark Analyse & understand Compare and analyse performance services, clients or sites Robert Site Manager Sodexo NLP asset: Automatized qualification of qualitative Footfall Forecast Health & we
Slide 111: Enhance efficiency on site & clients relationship
Enhance efficiency on site & clients relationship Customer Site Performance satisfaction Benchmark Illustrative Analyse & understand Compare and analyse performance services, clients or sites Robert Site Manager Sodexo Footfall Forecast Health & wellbeing Carbon footprint Estimate & analyse Analyse
Slide 112: Enhance efficiency on site & clients relationship
Enhance efficiency on site & clients relationship Customer Site Performance satisfaction Benchmark Analyse & understand Compare and analyse performance services, clients or sites Robert Site Manager Sodexo Footfall Forecast Health & wellbeing Carbon footprint Estimate & analyse Analyse consumer’s ha
Slide 113: Enhance efficiency on site & clients relationship
Enhance efficiency on site & clients relationship Customer Site Performance satisfaction Benchmark Analyse & understand Compare and analyse performance services, clients or sites Robert Site Manager Sodexo Footfall Forecast Health & wellbeing Carbon footprint Estimate & analyse Analyse consumer’s ha
Slide 114: Enhance efficiency on site & clients relationship
Enhance efficiency on site & clients relationship Benefits Customer Site Performance satisfaction Benchmark Operational gains, Analyse & understand Compare and analyse Food & labor costs performance services, clients or sites and waste reduction commitments Clients relationship, for new wins & Rober
Slide 115: Improve customer satisfaction & drive additional revenue
Improve customer satisfaction & drive additional revenue Sodexo app Sodexo app Sarah Order meal University student Personalized Delivery or offer Take away Evaluate order Sodexo Data & AI Factory Capital Markets Day – November 2, 2022 © Sodexo. All rights Reserved 115
Slide 116: Improve customer satisfaction & drive additional revenue
Improve customer satisfaction & drive additional revenue Sodexo app Sodexo app Everyday New consumer facing app Sarah Order meal University student Personalized Delivery or offer Take away Evaluate Everyday has been trending on food and beverage apps order Average rating is 4.8 out of 5, sector best
Slide 117: Improve customer satisfaction & drive additional revenue
Improve customer satisfaction & drive additional revenue Sodexo app Sodexo app Take away offers Connected fridge, autonomous stores & restaurants Sarah Order meal University student Personalized Delivery or offer Take away Evaluate order Sodexo Data & AI Factory Capital Markets Day – November 2, 202
Slide 118: Improve customer satisfaction & drive additional revenue
Improve customer satisfaction & drive additional revenue Sodexo app Sodexo app KiwiBots Autonomous Meal delivery Sarah Order meal University student Personalized Delivery or offer Take away Evaluate order Sodexo Data & AI Factory Capital Markets Day – November 2, 2022 © Sodexo. All rights Reserved 1
Slide 119: Improve customer satisfaction & drive additional revenue
Improve customer satisfaction & drive additional revenue Sodexo app Sodexo app Sarah Order meal University student Personalized Delivery or offer Take away Evaluate order Sodexo Data & AI Factory Capital Markets Day – November 2, 2022 © Sodexo. All rights Reserved 119
Slide 120: Improve customer satisfaction & drive additional revenue
Improve customer satisfaction & drive additional revenue Sodexo app Sodexo app Personalized offer / content Sarah Order meal University student Personalized Delivery or offer Take away Evaluate order Sodexo Data & AI Factory Capital Markets Day – November 2, 2022 © Sodexo. All rights Reserved 120
Slide 121: Improve customer satisfaction & drive additional revenue
Improve customer satisfaction & drive additional revenue Consumer behaviour Benefits Share of wallet - Where to Focus & Why Better knowledge of consumer behaviors & expectations More consumer satisfaction through personalized offers Direct increase of share of wallet +15 – 20% retail sales by FY25 C
Slide 122: Optimize our product portfolio in a volatile supply chain environment
Optimize our product portfolio in a volatile supply chain environment Current context James Bounce back from Hyperinflation Supply chain Geopolitics context Food buyer Sodexo Covid with disruption increased demand and volumes Capital Markets Day – November 2, 2022 © Sodexo. All rights Reserved 122
Slide 123: Optimize our product portfolio in a volatile supply chain environment
Optimize our product portfolio in a volatile supply chain environment Quickly identifying the best product swap opportunities James Food buyer Sodexo Capital Markets Day – November 2, 2022 © Sodexo. All rights Reserved 123
Slide 124: Optimize our product portfolio in a volatile supply chain environment
Optimize our product portfolio in a volatile supply chain environment How it works? James Food buyer Sodexo Capital Markets Day – November 2, 2022 © Sodexo. All rights Reserved 124
Slide 125: Optimize our product portfolio in a volatile supply chain environment
Optimize our product portfolio in a volatile supply chain environment Going further on carbon footprint impact → ability to measure and manage the carbon footprint of our products, James recipes, and menus Food buyer Sodexo → consumer facing label to provide information and potentially nudge behavio
Slide 126: Optimize our product portfolio in a volatile supply chain environment
Optimize our product portfolio in a volatile supply chain environment Benefits 2% to 5% direct cost Better reactivity to Negotiating power James Food buyer Sodexo savings on deployed external events such increased with categories as inflation & shortage suppliers Capital Markets Day – November 2, 20
Slide 127: Conclusion On-Site Services
Conclusion On-Site Services
Slide 128: Q&A On-Site Services
Q&A On-Site Services
Slide 129: Capital Markets Day
Capital Markets Day November 2, 2022
Slide 130: A financial framework to deliver performance
A financial framework to deliver performance Marc Rolland Group Chief Financial Officer
Slide 131: Agenda
Agenda 1. Strong finish to Fiscal 2022 2. Mid-term guidance • Group • Benefits & Rewards Services 3. Capex Focus 4. Free Cash Flow & financing 5. Disciplined approach to investments 131
Slide 132: Strong finish to Fiscal 2022
Strong finish to Fiscal 2022 Strong finish to Fiscal 2022 Mid-term guidance Focus capex Free cash Flow & financing Strong recovery in revenues and profitability and positive net new business Group Net profit back up to pre-Covid levels Strong cashflow - Restored balance sheet – Debt ratios at bottom
Slide 133: Solid Balance sheet
Solid Balance sheet Strong finish to Fiscal 2022 Mid-term guidance Focus capex Free cash Flow & financing Net debt: €1.3bn Solid Balance sheet Net debt ratio Net debt/EBITDA €5.7bn €0.2bn Staying in the range 1x - 2x €4.5bn 1.0x 2.1 2x €2.8bn 1.7 €5.5bn Net debt ratio €1.7bn 1.0 1.0 1x Gross 0.9 Gro
Slide 134: Back in line with financial KPI targets
Back in line with financial KPI targets Strong finish to Fiscal 2022 Mid-term guidance Focus capex Free cash Flow & financing Cash conversion Net debt ratio Group ROCE Gearing Dividend* Group target level 100% 1-2x >>15% <50% ~50% Pay-out ratio Cash conversion Net debt ratio Group ROCE Gearing Divid
Slide 135: Fiscal 2023 and Mid-term Group guidance
Fiscal 2023 and Mid-term Group guidance Strong finish to Fiscal 2022 Mid-term guidance Focus capex Free cash Flow & financing Fiscal 2023 guidance Fiscal 2025 guidance Organic Growth 8% to 10% 6% to 8% for FY 2024 & FY 2025 UOP Margin Close to 5.5% Above 6% (at constant rates) in FY 2025 Capital Mar
Slide 136: Group: Components of organic growth from Fiscal 2022 to 2025
Group: Components of organic growth Strong finish to Fiscal 2022 Mid-term guidance Focus capex Free cash Flow & financing from Fiscal 2022 to 2025 Entegra BRS 5 056 Inflation / Volume 8 to 10% in FY23, Cross Selling then 6 to 8% in FY24, FY25 Net New business Net New Cross Selling Inflation / Entegr
Slide 137: Group: Components to move UOP margin above 6% in Fiscal 2025
Group: Components to move UOP margin Strong finish to Fiscal 2022 Mid-term guidance Focus capex Free cash Flow & financing above 6% in Fiscal 2025 Investment, BRS Growth inflation, savings Entegra Operational efficiency >6.0% 5% UOP margin Operational Net New Investments Entegra BRS UOP margin FY 20
Slide 138: Fiscal 2023 and Mid-term BRS guidance
Fiscal 2023 and Mid-term BRS guidance Strong finish to Fiscal 2022 Mid-term guidance Focus capex Free cash Flow & financing Fiscal 2023 guidance Fiscal 2025 guidance Organic Growth 12% to 15% Low double digit for FY 2024 & FY 2025 UOP Margin Around 30% > 30% (at constant rates) for FY 2025 Capital M
Slide 139: BRS: Components of organic growth from Fiscal 2022 to 2025
BRS: Components of organic growth Strong finish to Fiscal 2022 Mid-term guidance Focus capex Free cash Flow & financing from Fiscal 2022 to 2025 Financial Revenue Face Value 12-15% for FY 2023, then low double digit growth for FY2024 & FY2025 Portfolio growth Portfolio… Face… Financial… Organic grow
Slide 140: BRS: Components of UOP margin: > 30% in Fiscal 2025
BRS: Components of UOP margin: Strong finish to Fiscal 2022 Mid-term guidance Focus capex Free cash Flow & financing > 30% in Fiscal 2025 Financial revenue Investment Face Value and inflation Portfolio growth > 30.0% 28.6% UOP margin Portfolio growth Face value Financial revenue Investments UOP marg
Slide 141: Group capex still below Fiscal 2016 & 2019 levels but planned to rise
Group capex still below Fiscal 2016 & 2019 Strong finish to Fiscal 2022 Mid-term guidance Focus capex Free cash Flow & financing levels but planned to rise Group Gross Capex OSS Gross Capex BRS Gross Capex 2,8% 10,0% 9,1% 2,5% 2,5% 2,5% 2,5% 2,3% 2,0% 6,6% 2,3% 4,2% In million euros 515 550 478 482
Slide 142: Growth capex by destination
Growth capex by destination: strong focus Strong finish to Fiscal 2022 Mid-term guidance Focus capex Free cash Flow & financing on clients & increasing in IT/DATA BRS Gross Capex breakdown OSS Gross Capex breakdown in Fiscal 2022 in Fiscal 2022 Others Others 7% 12% IT/Data 16% Development 26% IT/Dat
Slide 143: Gross capex by region: clear focus on North America
Gross capex by region: clear focus on Strong finish to Fiscal 2022 Mid-term guidance Focus capex Free cash Flow & financing North America North America Europe Rest of the World 3,0% In million euros 3,6% 2,4% 2,4% 2,4% 2,4% 2,1% 2,0% 2,0% 1,8% 1,5% 1,7% 233 211 197 182 187 135 113 60 53 2016 2019 20
Slide 144: Both OSS and BRS have strong cash-flow models
Both OSS and BRS have strong Strong finish to Fiscal 2022 Mid-term guidance Focus capex Free cash Flow & financing cash-flow models In million euros Group FCF Cash conversion 1100 x5 BRS 1000 900 262% 800 212% 195% 162% * 700 143% 600 88% 184% 500 400 2016 2017 2018 2019 2020 2021 2022 300 200 100 O
Slide 145: Strong recovery of ROCE
Strong recovery of ROCE Strong finish to Fiscal 2022 Mid-term guidance Focus capex Free cash Flow & financing 18,7% 18,3% • ROCE back >15% 17,2% in Fiscal 2022 • BRS capital employed is negative 9,9% 8,6% • ROCE threshold for organic and M&A investment decisions 2018 2019 2020 2021 2022 Capital Mark
Slide 146: M&A focus
M&A focus Strong finish to Fiscal 2022 Mid-term guidance Focus capex Free cash Flow & financing OSS BRS Food Market Share BRS Core transformation in OSS GPO HTM BRS Near Core Capital Markets Day 2022 © Sodexo 2022. All rights Reserved 146
Slide 147: Financial policy
Financial policy Strong finish to fFiscal Mid-term guidance Focus capex Free cash Flow & financing 2022 Regular growth in the dividend: Net debt / EBITDA a pay-out ratio of around 50% between 1x to 2x of Underlying Net Income Maintain a BBB+ Maintain Group ROCE Focused M&A rating well above 15% with
Slide 148: Conclusion: Disciplined and robust financial framework
Conclusion: Disciplined and robust Conclusion financial framework Robust existing financial Disciplined approach to Strong cash model with framework to ensure investment and cash/debt negative working capital independence management in both OSS and BRS Cash model supports capex need and Focused M&A
Slide 149: Q&A Sophie Bellon & Marc Rolland
Q&A Sophie Bellon & Marc Rolland
Slide 150: Conclusion
Sodexo Capital Markets Day Conclusion , Sophie Bellon * sode.o
Slide 151: Sustainable and profitable growth
Sustainable and profitable growth Refocus on Strengthen our Accelerate the Food services impact as profitable and be more market maker growth of BRS selective in FM in sustainability Underpinned by Tech & Data, Commercial Excellence and Supply Chain power FY2023 guidance: Organic growth of 8 to 10%
Slide 152: Capital Markets Day
Capital Markets Day November 2, 2022