Dine Brands Global, Inc. Common Stock · NYSE:DIN
Dine Brands Global, Inc. Common Stock — Investor Presentation (March 2018)
31 slides from Dine Brands Global, Inc. Common Stock's investor presentation, Mar 5, 2018
Slide 1: Dine Brands Global, Inc. Investor Presentation
Dine Brands Global, Inc. Investor Presentation March 5, 2018
Slide 2: Disclosures
2 Disclosures Forward-Looking Information: The content contained in this presentation is as of February 21, 2018. The Company assumes no obligation to update or supplement the information. Statements contained in this presentation may constitute forward-looking statements within the meaning of the P
Slide 3: Business Overview
Business Overview • Two iconic brands – IHOP and Applebee’s • 3,700+ restaurants • $7.4 billion in system sales • #1 in U.S. Family and Casual dining(1) • Expanding international presence • 100% franchised model • 2017 revenue of $738mm(2) and EBITDA of $224mm(3) • Industry-leading margins and signi
Slide 4: Investment Highlights
Investment Highlights • Significant Scale in the U.S. • Expanding International Presence • Favorable Guest Dynamics • 100% Franchised Model with Strong and Improving Franchisee Base • Leader in U.S. Family and Casual Dining • Robust EBITDA Margins • Substantial Cash Flow Generation • History of Sign
Slide 5: Vision 2022
Vision 2022 • Significant Investment in Existing Brands • Continued Partnership with Franchisees • Greater Emphasis on Data and Analytics • New Technology to Enable Future Growth • G&A Expense Discipline • Shifting Capital Allocation Priorities • Scalable Platform for New Opportunities • Strong Proj
Slide 6: Shifting Capital Allocation Priorities
Shifting Capital Allocation Priorities • Quarterly cash dividend of $0.63 DIVIDEND YIELD per share in Q1 2018 ($2.52 per ~4.7%(2) share annualized) Dividend remains • Payout ratio of ~44%(1) amongst highest in restaurant category • Opportunity for meaningful share ~2% repurchases RETURNING CAPITAL T
Slide 7: Scalable Platform for New Opportunities
Scalable Platform for New Opportunities STRATEGIC EXPANSION OF PORTFOLIO ENABLED BY • Existing platform of corporate infrastructure • Extensive experience operating franchised model • Strong and well capitalized future franchisee base • Proficiency in building and growing brands Potential New Concep
Slide 8: IHOP Review
IHOP Review
Slide 9: Business Overview
Business Overview • Founded in 1958 • Fiscal 2017 system-wide sales: $3.3bn KEY • Leader in Family Dining category BRAND FINANCIALS • Fiscal 2017 Franchise revenue: $185mm(1) OVERVIEW • 1,671 IHOP locations domestically • 301 domestic franchisees in the system • #1 among Family Dining SCALE restaura
Slide 10: IHOP's Strategy For Success
IHOP’s Strategy For Success • Reinventing the Guest Experience Technology and Hospitality • Running Great Restaurants Hospitality and Value Service Leadership Culture • Driving Traffic ALL “GIVE FoodFOLKS and Customization A PLACE TO • Being Where the Guest Is PANCAKE TOGETHER” Convenience
Slide 11: Consistent Restaurant Development
Consistent Restaurant Development • Continued domestic development • Non-traditional and small formats ~1,900 • Significant growth opportunities in 1,671 urban/rural areas 2017 2018 2019 2020 2021 2022 Source: Company’s fiscal 2017 Form 10-K filing and Company projections.
Slide 12: Projected Financial Performance
Projected Financial Performance SEGMENT REVENUE(1) SEGMENT PROFIT ($mm) ($mm) 2%+ CAGR $340+ 3%+ CAGR $314 $225+ Rental + $194 Financing Revenue 4%+ CAGR Franchise Revenue 2017A 2018E 2019E 2020E 2021E 2022E 2017A 2018E 2019E 2020E 2021E 2022E Source: Company’s fiscal 2017 Form 10-K filings, fourth
Slide 13: Applebee's Review
Applebee’s Review
Slide 14: Business Overview
Business Overview • Founded in 1980 • Fiscal 2017 domestic system- wide sales: $4.1 billion • Leader in Casual Dining category KEY BRAND FINANCIALS • Fiscal 2017 Franchise revenue: $169 million(1) • 1,782 Applebee’s locations OVERVIEW domestically • 35 domestic franchisees in the • #1 among Casual D
Slide 15: Applebee's Growth Strategy
Applebee’s Growth Strategy • Restaurant Excellence • Technology Investment • Culinary Innovation • World-Class Marketing • Off-Premise Relevance • Return to Unit Growth in 2020
Slide 16: Strong Asset Base
Strong Asset Base RESTAURANT COUNT 1.782 ~1.750 • 92% of restaurants remodeled between 2012-2015 • Closing under-performing, non-viable restaurants (~60 in 2018) • Begin traditional and non-traditional development again in 2020 2017A 2018E 2019E 2020E 2021E 2022E Source: Internal Company data and pr
Slide 17: Projected Financial Performance
Projected Financial Performance APPLEBEE’S REVENUE APPLEBEE’S PROFITABILITY ($mm) $180+ 98% 3%+ CAGR $161 82% 2017A 2018E 2019E 2020E 2021E 2022E 2017A 2018E 2019E 2020E 2021E 2022E Source: Internal Company data and projections Note: Excludes advertising revenue
Slide 18: International Review
International Review
Slide 19: Dine Brands: Broad Global Footprint
Dine Brands: Broad Global Footprint Canada: Kuwait: (44 locations) Bahrain: Qatar: (13 locations) (8 locations) UAE: (3 locations) United States: (16 locations) (3,453 locations) India: (1 location) Mexico: (98 locations) Lebanon: Thailand: (1 location) (1 location) Dominican Republic: Puerto Rico:
Slide 20: Historical Growth
Historical Growth TOTAL UNITS 269 206 2013A 2014A 2015A 2016A 2017A Source: Company’s 10-K filings for fiscal years 2013-2017 International Strategic Review
Slide 21: Expected Growth Acceleration
Expected Growth Acceleration INTERNATIONAL UNITS OVER TIME +200 units over 4 years ~[VALUE] +60 units over 4 years ~[VALUE] 269 206 2013A 2017A 2018E 2022E Source: Company’s 10-K filings for fiscal years 2013 & 2017 and Company projections International Strategic Review
Slide 22: Financial Summary
Financial Summary BRANDS
Slide 23: Commitment to Financial Success
Commitment to Financial Success • We are implementing a plan to return to growth at both brands • We continue to pursue cost optimization opportunities • We expect to generate substantial cash flow and earnings going forward • We are committed to making the necessary investments to further strengthe
Slide 24: Substantial Cash Flow Generation
Substantial Cash Flow Generation ADJUSTED FREE CASH FLOW(1) ($mm) • Investment to drive growth at both $175+ brands Includes $30M in corporate • Attractive capital return to Ad fund contribution for $95 - $115 Applebee’s shareholders $94 - $114 • Minimal capex requirements $63 FULLY-FRANCHISED AND A
Slide 25: Strong Projected Financial Performance
Strong Projected Financial Performance ($mm) REVENUE EBITDA(3) $900+(1) $738(1) $315+ $565+(2) Low single digit growth(1) $224 $492(2) – Applebee’s: +3% Mid single digit growth – IHOP: +2% 46% 56% – International: +15% 10%+ margin expansion Margin (2) Margin (2) 2017A 2022E 2017A 2022E ADJUSTE
Slide 26: Projected Annual Shareholder Growth Algorithm
Projected Annual Shareholder Growth Algorithm WE ARE EXPECTED TOTAL ADJUSTED EPS DIVIDEND SHAREHOLDER COMMITTED TO GROWTH YIELD RETURN CREATING SIGNIFICANT FUTURE VALUE High FOR teens ~4.7% (1) 20%+ SHAREHOLDERS Source: Internal Company data and projections (1) Assumes a common stock price of $54 Fi
Slide 27: Appendix
Appendix
Slide 28: Appendix: Adjusted Free Cash Flow
Appendix: Adjusted Free Cash Flow Adjusted free cash flow is a non-GAAP financial measure. Reconciliation of the cash provided by operating activities to adjusted free cash flow is as follows: ($ in 000s) 2016 2017 Cash flows provided by operating activities $118,110 $65,733 Receipts from notes and
Slide 29: Appendix: Adjusted Earnings per Share
Appendix: Adjusted Earnings per Share Adjusted earnings per share is a non-GAAP financial measure. Reconciliation of net income available to common stockholders to the diluted net income available to common stockholders, as adjusted, is as follows: 2017 Net Income Available to Common Stockholders Ne
Slide 30: Appendix: EBITDA
Appendix: EBITDA Reconciliation of U.S. GAAP income before taxes to EBITDA Definitions of all components used in calculating the above ratios are found in the Base Indenture and the related Series 2014-1 Supplement to the Base Indenture, dated September 30, 2014, filed as Exhibits 4.1 and 4.2, respe
Slide 31: Dine Brands Global, Inc.
IHOS 7 Ny Applebees Dine Brands Global, Inc. BRANDS
Dine Brands Global — Investor Presentation (March 2018) on 6ix