Wendy's Company (the) · NASDAQ:WEN
Wendy's Company (the) — The Wendy's Company — Q2 2023 Earnings Presentation
26 slides from Wendy's Company (the)'s earnings presentation, Aug 9, 2023
Slide 1: Second Quarter 2023 Conference Call
Second Quarter 2023 Conference Call August 9, 2023 © Quality Is Our Recipe, LLC
Slide 2: Kelsey Freed, Director – Investor Relations
Kelsey Freed Director – Investor Relations © Quality Is Our Recipe, LLC
Slide 3: Forward-Looking Statements and Non-GAAP Financial Measures
This presentation, and certain information that management may discuss in connection with this presentation, contains certain statements that are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Reform Act”). For all such forward-looking s
Slide 4: Agenda
Agenda Business Update Q2 Financial Results 2023 & Long-Term Outlook IR Calendar Q&A THE WENDY'S COMPANY | 4
Slide 5: Todd Penegor, President & Chief Executive Officer
Todd Penegor President & Chief Executive Officer © Quality Is Our Recipe, LLC
Slide 6: CEO Business Update
CEO Business Update ▪ Strong Global SRS growth of 5.1% in line with our expectations ▪ Maintained digital momentum with global digital sales mix of >12% ▪ Over 200 bps year-over-year expansion in US Company-operated restaurant margin ▪ 80 global restaurant openings year-to-date through Q2 ▪ Committe
Slide 7: Delivering Meaningful Global Growth
DIGITAL ACCELERATION SRS FOOTPRINT MOMENTUM EXPANSION Delivering Meaningful GLOBAL GROWTH Restaurant Good Economic Model Done Right THE WENDY'S COMPANY | 7
Slide 8: Focused Approach to Driving SRS Momentum Delivered Strong Q2 Results
Focused Approach to Driving SRS Momentum Delivered Strong Q2 Results and Builds Confidence in 2H Performance Strong Ownable Breakfast Late Night Operations Platforms Ghost Pepper Improved Ranch, Q2 2023 Record high US Double digit sales customer Strawberry breakfast sales growth vs. Q1 satisfaction
Slide 9: Global Digital Business Sustained Strong Momentum Throughout Q2
Global Digital Business Sustained Strong Momentum Throughout Q2 ▪ Maintained digital momentum with global digital sales mix of >12% ▪ International achieved >17% digital sales mix driven by continued strong adoption of digital channels ▪ U.S. digital sales mix held ~steady vs. prior quarter while di
Slide 10: Continued Progress Towards Global Net Unit Growth Goals
First UK Drive-Thru Location Continued Progress Towards Global Net Unit Growth Goals • 80 global restaurant openings year-to-date through Q2 • Continued development progress gained across key international growth markets • FZ interest in suite of development programs resulted in new agreements • Exp
Slide 11: Gunther Plosch, Chief Financial Officer
Gunther Plosch Chief Financial Officer © Quality Is Our Recipe, LLC
Slide 12: Second Quarter Financial Results
Second Quarter Financial Results $ Mils (except per share amounts) 2022 2023 B/(W) Global Systemwide Sales Growth 5.6% 6.9% 2-Yr 12.5% Global System SRS 3.7% 5.1% 2-Yr 8.8% US Company Restaurant Margin 15.0% UPDATE 17.3% 230 bps G&A $61.6 $62.7 (1.8)% Adjusted EBITDA1 $132.9 $144.5 8.7% Adjusted EPS
Slide 13: Reaffirming Strong 2023 & Long-Term Outlook
Reaffirming Strong 2023 & Long-Term Outlook 2023 Outlook Global Systemwide Sales Growth: 6% to 8% Adjusted EBITDA: $530M to $540M Adjusted EPS: $0.95 to $1.00 Capital Expenditures: $75M to $85M Free Cash Flow: $265M to $275M 2024 and 2025 Outlook Global Systemwide Sales Growth: Free Cash Flow Growth
Slide 14: Expect to Continue Strong Sales & Adj. EBITDA Track Record
Expect to Continue Strong Sales & Adj. EBITDA Track Record THE WENDY'S COMPANY | 14
Slide 15: Free Cash Flow Conversion Remains Best in Class
Free Cash Flow Conversion Remains Best in Class FCF Conversion: FCF Conversion: 131% >120% FCF Conversion: FCF Conversion: 161% 120% FCF Conversion: 154% *2020 free cash flow excludes the $18.3M tax effected payment related to the settlement of the Financial Institutions Case in Q1 2020. If this pay
Slide 16: Capital Allocation Policy Remains Unchanged
Capital Allocation Policy Remains Unchanged 1 Continue to Invest in the Business for Growth 2 Sustain an Attractive Dividend Quarterly dividend rate held at $0.25 per share Expect $1 per share dividend for FY 20231 3 Utilize Excess Cash to Repurchase Shares and/or Reduce Debt $500M Share Repurchase
Slide 17: Kelsey Freed, Director – Investor Relations
Kelsey Freed Director – Investor Relations © Quality Is Our Recipe, LLC
Slide 18: Investor Relations Calendar
Investor Relations Calendar • August 16: Conference Call with Truist • August 23 - 24: NDR with Stifel (Toronto & Montreal) • September 11: Conference Call with Wedbush • September 27: NDR with Bernstein (Chicago) • November 2: Q3 2023 Earnings Release & Conference Call THE WENDY'S COMPANY | 18
Slide 19: Q&A
Q&A
Slide 20: Appendix
Appendix
Slide 21: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures In addition to the GAAP financial measures included in this presentation, the Company has presented certain non-GAAP financial measures (i.e., adjusted revenues, adjusted EBITDA, adjusted earnings per share, free cash flow, free cash flow conversion and
Slide 22: Reconciliations of Net Income to Adjusted EBITDA
In Thousands (Unaudited) Reconciliations of Net Income to Adjusted EBITDA and Revenues to Adjusted Revenues THE WENDY'S COMPANY | 22
Slide 23: Reconciliation of Net Income and Diluted Earnings Per Share
In Thousands except per-share amounts (Unaudited) Reconciliation of Net Income and Diluted Earnings Per Share to Adjusted Income and Adjusted Earnings Per Share THE WENDY'S COMPANY | 23
Slide 24: Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
In Thousands (Unaudited) Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow THE WENDY'S COMPANY | 24
Slide 25: Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
Reconciliation The Wendy’s Company and Subsidiaries In Thousands (Unaudited) of Net Cash Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow and Free Cash Flow Conversion Twelve Month Periods Ended January 1, 2023, January 2, 2022, January 3, 2021 and December 29, 2019 ($ I
Slide 26: The Wendy's Company