Slide 1: Annual Results 2013
ANNUAL RESULTS 20135 SPUR CORPORATION
Slide 2: Operational Overview
OPERATIONAL OVERVIEW Pierre van Tonder
Slide 3: Restaurant Base
RESTAURANT BASE South Inter- Franchise brand Africa national Total Spur Steak Ranches 267 36 303 Panarottis Pizza Pasta 61 12 73 John Dory’s Fish Grill 29 - 29 Sushi Captain DoRegos 72 2 74 Total 429 50 479
Slide 4: Overview
OVERVIEW ! 15.2% turnover growth ! Continuous enforcement of standards ! Positioning of the menu (menu price increase 3.6%) / Value perspective ! Excellent national marketing initiatives, boosting quieter weekday trading periods • Monday Burger • Kids Eat Free Wednesdays • Thursday Bottomless Ribs a
Slide 5: Overview (cont.)
OVERVIEW (cont.) ! Breakfast offering strengthened in growth and turnover – now 14% of unit sales ! Opened 13 new restaurants in SA, 3 relocations and 53 revamps (franchisee investment approximately R39m)
Slide 6: Overview
OVERVIEW ! 17.51% existing store turnover growth – STAR OF THE YEAR! ! Ongoing process of revamps and upgrading kids facilities ! Focus on weekday promotions – 33% of sales ! Tuesday – Buy one get one free ! Thursday – All you can eat Pizza for R59.90 (Kids R39.90) ! Sunday – Family Sunday – Kids Ea
Slide 7: Overview (cont.)
OVERVIEW (cont.) ! Focus on menu engineering – rationalise and improve menu content to improve franchisee profitability ! Opened 10 new restaurants (4 Express) ! Revamped 7 restaurants ! 61 restaurants in South Africa
Slide 8: Overview
OVERVIEW ! 11.4% turnover growth ! Successful national integration of John Dory’s sauces into Central Kitchens basket ! New spec and look completed – 9 stores revamped, 11 stores with kids facilities, 2 new stores (WIP) ! Furthered relationship with SASSI ! Redesigned weekday promotions ! TV adverti
Slide 9: Overview
OVERVIEW ! Rebranded to original Captain DoRegos ! Distribution integrated into Vector (Nov 2013) ! Continued aggressive expansion – 11 new stores opened ! Upgrading POS – enhance BI ! Franchisee integration
Slide 10: International - Australia
INTERNATIONAL - Australia ! Marketing consolidated ! Appointed a labour analyst to assess restaurants and implement labour saving strategies ! Upgrading POS to Pilot and introducing hand-held ordering devices ! Tight trading conditions
Slide 11: International – United Kingdom & Ireland
INTERNATIONAL – United Kingdom & Ireland ! Acquired two former franchised sites – Arapaho Spur in Staines and Iowa Spur in Dublin ! Continued re-branding ! Eight company owned restaurants ! Aggressive marketing ! Focused operations
Slide 12: International – Africa & Islands
INTERNATIONAL – Africa & Islands ! Spur brand successfully re-launched and well received in Zambia ! Captain DoRegos introduced in Namibia and Mauritius – well received ! Namibia remains an attractive market • Set up a National Marketing Fund – national promotions run, aligned with South African mod
Slide 13: Manufacturing
MANUFACTURING ! Bottling plant commenced production in September 2012 • 876 000 bottles of salad dressing • 325 000 bottles of barbecue sauce ! Total production – 4.95 million litres ! HACCP certification for further three years obtained ! Third party manufacturing
Slide 14: Distribution
DISTRIBUTION ! Number of cases delivered by Vector 4.7m (12.1% increase on PY) ! Number of kgs delivered 35 869 tons (12.9% increase on PY) ! Total Vector basket turnover R890.0m (19.9% increase on PY) ! Franchisee profitability / margin
Slide 15: Training & the College of Excellence
TRAINING & THE COLLEGE OF EXCELLENCE ! Training • 7 220 staff trained (5 171 in 2012 FY) • Product workshops completed for Spur, Panarottis and John Dory’s; Captain DoRegos workshops being developed ! College of Excellence • 13 candidates completed course • Cape Town college opened • To have dual in
Slide 16: Information Technology
INFORMATION TECHNOLOGY ! Head Office ! Tablet-based Operations Manager Application ! Spur TV ! Restaurants ! Speed of Service – hand held devices
Slide 17: Family Card Statistics
FAMILY CARD STATISTICS ! Key Performance Indicators ! Number of family card members – 1.39m ! Number of Secret Tribe members – 1.08m ! Loyalty turnover for June 2013 is R119m ! The national average of loyalty turnover as a % of total turnover was 28.74% in December 2012, and has increased to 38.3%,
Slide 18: Sustainability
ENVIRONMENTAL SUSTAINABILITY
Slide 19: Spur Foundation
SPUR FOUNDATION ! “Nurture, Nourish, Now” ! Budget to 2017 set ! Total spend of approximately R5.5m ! Beneficiaries identified ! “Adopted” creches in GT and WC ! Committed to Asha Trust and Heifer International ! JAM ! Creating Change ! Sisanda Fundaytion ! Teddy Bear Clinic ! Reach for a Dream ! Fo
Slide 20: Financial Overview
FINANCIAL OVERVIEW Ronel van Dijk
Slide 21: Financial Highlights
FINANCIAL HIGHLIGHTS ! Revenue up 29.7% ! Comparable profit up 15.8% ! Headline earnings up 19.9% ! Diluted HEPS up 21.7% ! Distribution per share up 27.6% to 111.0 cents
Slide 22: Franchise – Spur SA
FRANCHISE – SPUR SA R’000 June 2013 June 2012 % change Revenue 179 464 155 433 15.5 Operating profit 158 818 136 447 16.4 Operating margin 88.5 87.8
Slide 23: Franchise – Panarottis SA
FRANCHISE – PANAROTTIS SA R’000 2013 2012 % change Revenue 16 692 12 952 28.9 Operating profit 9 874 7 866 25.5 Operating margin 59.2% 60.7%
Slide 24: Franchise – John Dory's
FRANCHISE – JOHN DORY’S R’000 2013 2012 % change Revenue 11 712 11 092 5.6 Operating profit 6 629 5 818 13.9 Operating margin 56.6% 52.5%
Slide 25: Franchise – Captain DoRegos
FRANCHISE – CAPTAIN DOREGOS R’000 2013 2012 % change Revenue 9 174 2 498 267.3 Operating profit 3 838 928 313.6 Operating margin 41.8% 37.1%
Slide 26: Procurement, Manufacturing and Distribution
PROCUREMENT, MANUFACTURING AND DISTRIBUTION R’000 2013 2012 % change Revenue 213 712 142 821 49.6 Captain DoRegos depot revenue 72 625 23 485 Adjusted revenue 141 087 119 336 18.2 Operating profit 59 525 55 662 6.9 Exceptional items Relocation, revamp & - 259 retrenchments Captain DoRegos depot (1 9
Slide 27: Corporate Services & Other SA
CORPORATE SERVICES & OTHER SA R’000 2013 2012 % change Revenue 30 399 34 395 (11.6) Operating loss (35 598) (35 018) (0.2 ) Exceptional items (13 934) (6 570) IFRS 2 (net of related hedge) (10 711) (3 514) Interest (5 854) (6 180) Due diligence - 745 Legal costs 1 424 3 171 Spur Convention + Spur Fo
Slide 28: United Kingdom
UNITED KINGDOM R’000 2013 2012 % change Revenue 118 353 81 631 45.0 Operating (loss)/profit (1 006) 694 (245.0) Exceptional items Gain on Larkspur One Limited realisation of collateral - (843) Larkspur One Limited rent 603 (603) New stores trading and start up losses 2 773 - Adjusted operating profi
Slide 29: Australia
AUSTRALIA R’000 2013 2012 % change Revenue 60 632 53 140 14.1 Operating loss (2 194) (682) (221.7) Add back: Depreciation 2 107 2 039 Interest (70) 10 Impairment 2 188 1 564 Cash flow profit 2 031 2 931 (30.7)
Slide 30: International Other & Corporate Services
INTERNATIONAL OTHER & CORPORATE SERVICES R’000 2013 2012 % change International other Revenue 12 374 9 277 33.4 Operating profit 7 487 5 305 41.1 Operating margin 60.5% 57.2% International Corporate Services Operating loss (12 316) (1 920) Exceptional items Australia wind up costs 1 052 - Foreign ex
Slide 31: Comparable Profit Before Tax
COMPARABLE PROFIT BEFORE TAX R’000 2013 2012 % change Profit before tax 195 057 175 100 11.4 IFRS2 charge (10 711) (3 514) Corporate services and other exceptional 2 631 3 124 items International exceptional items 6 616 118 Procurement, manufacturing exceptional - 259 items Foreign exchange loss/(ga
Slide 32: Financial Position - Assets
FINANCIAL POSITION - Assets R’000 2013 2012 Property, plant & equipment 76 878 73 492 Intangible assets & goodwill 321 698 320 986 Investments & loans 13 880 8 818 Deferred tax 9 347 7 776 Leasing rights 5 290 1 826 Derivative financial asset 22 087 4 654 Inventory 17 020 10 304 Taxation receivable
Slide 33: Financial Position – Equity & Liability
FINANCIAL POSITION – Equity & Liability R’000 2013 2012 Equity 470 858 425 606 Long-term loans 423 446 Operating lease liability 5 481 6 564 Other non-current liabilities 12 048 4 520 Deferred tax 72 284 69 048 Bank overdrafts 1 605 1 854 Taxation 4 132 6 052 Trade & other payables 105 214 89 004 Ot
Slide 34: Cash Utilisation
CASH UTILISATION R’000 2013 2012 Cash from operations 200 302 171 060 Net interest received 5 871 6 164 206 173 177 224 Distributions paid (88 444) (65 108) Taxation paid (60 675) (58 578) Working capital changes 2 958 6 378 Investment in fixed assets (12 937) (6 204) Acquisition of Captain DoRegos
Slide 35: Other
OTHER ! Appointment of new independent non-executive director ! JSE pro-active monitoring ! Contingent liabilities ! SARS query ! Paid R2.8 million in August 2013 ! ADR ! Zambia legal case ! Fixed asset budget for 2014 – R9 million, excluding Johannesburg building
Slide 36: Outlook
SPUR CORPORATION OUTLOOK Pierre van Tonder
Slide 37: Outlook: Opening 8 new restaurants
! Consumer cash flow remains ! Family card under pressure ! Gift card ! Opening 8 new restaurants
Slide 38: Outlook: Opening six new restaurants
! Opening six new restaurants ! Continuing upgrade of all restaurants with kids facilities ! Continuous innovations in marketing campaigns ! Loyalty programme
Slide 39: Outlook: Opening four new restaurants
! Opening four new restaurants ! Continue to build on improved relationship with franchisees ! Landlord relationships
Slide 40: Outlook: Opening new restaurants, distribution
! Opening 12 new restaurants ! Extension of distribution centre basket ! Integration with Vector ! Upgrade signage and menu boards
Slide 41: Outlook International
OUTLOOK INTERNATIONAL !Australia – focus on franchised outlets !UK – consolidate cash flow !Africa – eight new restaurants • Namibia • Tanzania • Nigeria • Seychelles • Zambia • Mozambique
Slide 42: Outlook Other
OUTLOOK OTHER ! Increase Vector basket size ! Bottling plant – extend product range ! BBBEE ! Acquisitions ! Training focus ! Johannesburg building
Slide 43: Thank You
SPUR CORPORATION THANK YOU QUESTIONS