Slide 1: First-Quarter 2015 Conference Call
© 2013 Oldemark LLC First-Quarter 2015 Conference Call Exhibit 99.1 © 2013 Oldemark LLC May 6, 2015
Slide 2: David Poplar, Vice President Investor Relations
© 2013 Oldemark LLC DAVID POPLAR 2 © 2013 Oldemark LLC Vice President Investor Relations
Slide 3: Today's Agenda
Today’s Agenda CEO Overview Emil Brolick Financial Update Todd Penegor Q&A
Slide 4: Emil Brolick, President & CEO
© 2013 Oldemark LLC EMIL BROLICK 5 © 2013 Oldemark LLC President & CEO
Slide 5: How We Grow
HOW WE GROW Shareholder Value-Enhancing Initiatives Core Organic Growth Strategies System Optimization Financial Management New Restaurant Growth Image / Experience Activation North America Same-Restaurant Sales Growth BRAND RELEVANCE + ECONOMIC RELEVANCE = GROWTH Global Growth Restaurant Utilizatio
Slide 6: Wendy's: New QSR Quality, QSR Price
HIGH LOW FUNCTIONAL EMOTIONAL Wendy’s: New QSR Quality, QSR Price 7 Traditional QSR B A C New QSR EXPERIENCE
Slide 7: Recipe to Win
PEOPLE 5-Star Talent PRICE New QSR Quality / QSR Price PRODUCT Playing a Different Game PROMOTION Tactically Brilliant / Strategically Directed PLACE Total Brand Experience PERFORMANCE Keeping Brand Promise Recipe to Win
Slide 8: Q1 highlights
© 2013 Oldemark LLC NORTH AMERICA COMPANY-OPERATED RESTAURANT MARGIN INCREASES 160 BPS IMPROVEMENT OF 360 BPS IN ADJUSTED EBITDA MARGIN* ADJ. EBITDA & ADJ. EPS GROWTH IN LINE WITH EXPECTATIONS RECAP ON SCHEDULE; COMPANY TO PROVIDE UPDATED GUIDANCE ON JUNE 3 NORTH AMERICA SYSTEMWIDE SRS INCREASE OF 3
Slide 9: 2015 Balanced Across Core, LTO & Price/Value
2015 Balanced Across Core, LTO & Price/Value LTO Price/Value Core
Slide 10: Menu Vision: Limited Time Offerings + Core
Menu Vision: Limited Time Offerings + Core CORE CORE LTO
Slide 11: Jalapeno Fresco Chicken & Ghost Pepper Fries
Jalapeno Fresco Chicken & Ghost Pepper Fries
Slide 12: Brand Access: Image Activation
Brand Access: Image Activation
Slide 13: Brand Access: New Restaurant Growth
14 $1.6M 2010 $1.9M 2014 Brand Access: New Restaurant Growth Image Activation New Build AUV ~$300K Higher than Previous Design
Slide 14: Brand Access: Consumer-Facing Technology
Brand Access: Consumer-Facing Technology Mobile Order Mobile Pay Customer Self Order Kiosk
Slide 15: Financial Management Strategies On Track
Financial Management Strategies On Track DEBT REFINANCING • On schedule for June 1 completion • Targeting leverage ratio of 5-6x net debt to 2014 Adj. EBITDA SHARE REPURCHASE • Intend to return refinancing net proceeds to shareholders via share repurchase program
Slide 16: System Optimization Phase III Update
System Optimization Phase III Update Process on track with dispositions commencing in Q3 2015; Expect ~280 to be sold in 2015 with the remaining ~260 in 2016 Process to identify markets to be sold has been completed; Engaged The Cypress Group to assist with divestitures ~ 540 ~ 5% of System U.S. Com
Slide 17: Sale of Bakery Operations
Sale of Bakery Operations Expect Transaction to Close in Q2 of 2015 Allows for Greater Sourcing Flexibility Focus on Core Restaurant Operations Eliminate Future Bakery Capital Expenditures
Slide 18: Reasons to Believe
Reasons to Believe Transforming the System by Facilitating Growth through Image Activation & New Restaurant Development Strengthening the Franchise System through Concentrated Ownership Improving the Company & Franchisees Economic Models Growth Pyramid Continue to Execute Against our Strategic Growt
Slide 19: Todd Penegor, Chief Financial Officer
© 2013 Oldemark LLC TODD PENEGOR 20 © 2013 Oldemark LLC Chief Financial Officer
Slide 20: First Quarter Financial Highlights
First Quarter Financial Highlights N.A. Systemwide SRS 3.2% 0.7% 2-Year 3.9% N.A. Company SRS 2.6% 1.3% 2-Year 3.9% N.A. Co. Rest. Margin 14.7% 13.1% +160 bps G&A $60.3 $70.4 $10.1 Adjusted EBITDA* $84.0 $75.3 11.6% Adjusted EBITDA Margin* 18.0% 14.4% +360 bps Adjusted EPS* $0.06 $0.05 20.0% $Mils 2
Slide 21: Q1 2015 vs. Q1 2014: Adjusted EBITDA
Q1 2015 vs. Q1 2014: Adjusted EBITDA * See reconciliation in appendix. (Unaudited) $ in millions $87.3 $75.3 $84.0 ($8.4) ($12.0) $10.1 $4.8 $3.9 $2.2 $1.2 ($5.1) 2014 Q1 Reported Adj. EBITDA * LY Gains on Rest. Sales & Surplus Property 2014 Q1 Revised Adj. EBITDA * G&A Savings Royalties & Net Renta
Slide 22: Image Activation Accelerating
Image Activation Accelerating Total System Annual Reimages & New Builds Total System Cumulative Reimages & New Builds 450 Reimages 80 New 10 64 234 486 530 10 74 308 794 1,324 2011A 2012A 2013A 2014A 2015E 2011A 2012A 2013A 2014A 2015E
Slide 23: Facilitating Franchisee Commitments for Reimages and New Builds
Facilitating Franchisee Commitments for Reimages and New Builds 60% Image Activation Requirement by 2020 Canadian Build-to-Suit program Multi-Year Incentives Turnkey Services Construction Support Multi-Year Investment Plan Market & Joint Capital Planning
Slide 24: System Optimization Update
System Optimization Update Canada System Optimization • Plan to sell all 131 restaurants • Expect to sell remaining restaurants by the end of Q2 • Expect to be EBITDA-dilutive in near term, but EBITDA-accretive longer-term with build-to-suit restaurant development U.S. System Optimization • Plan to
Slide 25: Company Reaffirms 2015 Adj. EBITDA & Adj. EPS Outlook
Company Reaffirms 2015 Adj. EBITDA & Adj. EPS Outlook Adjusted EBITDA of $390 to $400 million Adjusted EPS of $0.33 to $0.35 To provide updated guidance June 3 after completion of debt refinancing • Reaffirming G&A expense of approximately $250 million • Revising: • Company-operated SRS growth of 2.
Slide 26: Debt Refinancing on Schedule to Close June
Debt Refinancing on Schedule to Close June 1 Recapitalization to Target Five to Six Times Net Debt to 2014 Adjusted EBITDA Intend to use the Net Proceeds to Return Cash to Shareholders Via a Share Repurchase Program Company to Update Guidance on June 3 to Reflect Expected Completion of Refinancing,
Slide 27: Transformation of Company Economic Model
Transformation of Company Economic Model System Optimization Provides a Stronger Platform to Return Cash to Shareholders Supports Long-Term Income and Growth Commitment Leveraging Our Balance Sheet Less Capital Intensive Enhances Quality of Earnings Generates Higher Adj. EBITDA Margins More Predicta
Slide 28: David Poplar, Vice President Investor Relations
© 2013 Oldemark LLC DAVID POPLAR 29 © 2013 Oldemark LLC Vice President Investor Relations
Slide 29: 2015 Investor Relations Calendar: Key Dates
2015 Investor Relations Calendar: Key Dates June 1 Annual Meeting June 3 Company to Issue Updated Outlook June 22 Stifel Conference (Baltusrol, NJ) June 23 New York Road Show August 5 2Q Earnings Release September 10 CL King (NYC) Conference November 4 3Q Earnings Release
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Slide 32: Reconciliation of Adjusted EBITDA to Net Income
Reconciliation of Adjusted EBITDA to Net Income Adjusted EBITDA 84,027 $ 75,283 $ Plus (less): Reversal of pension withdrawal liability in cost of sales 12,486 - Depreciation and amortization (36,880) (42,021) System optimization losses (gains), net (813) 72,992 Reorganization and realignment costs
Slide 33: Reconciliation of Adjusted Income and Adjusted EPS to Net Income and EPS
Reconciliation of Adjusted Income and Adjusted Earnings Per Share to Net Income and Earnings Per Share Per share Per share Adjusted income and adjusted earnings per share 23,912 $ 0.06 $ 18,814 $ 0.05 $ Plus (less): Reversal of pension withdrawal liability in cost of sales 7,816 0.02 - - Depreciatio
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