Collins Foods Limited · ASX:CKF
Collins Foods — FY2023 Earnings Presentation
35 slides from Collins Foods's earnings presentation, Jun 27, 2023
Slide 1: Collins Foods Limited FY23 Results
Collins Foods Limited FY23 RESULTS 2 May 2022 to 30 April 2023 27 June 2023 Authorised for release by the Board ACN 151 420781
Slide 2: Solid Top-line growth despite challenging environment
Solid Top-line growth despite challenging environment managing Cost inflation across all business units • Revenue up 14.2% to $1,349.5m with growth across all business units FY22 FY23 FY23 Change Underlying [1] Underlying* Underlying ‒ KFC Australia surpasses $1 billion in revenue for the first time
Slide 3: Consistent Double-digit European growth the Standout
Consistent Double-digit European growth the Standout 22 restaurants added across the Group in FY23 KFC Australia KFC eUROPE Taco bell • FY23 SSS growth of +5.8% driven by • FY23 SSS growth of +13.9% reflecting • FY23 SSS decline of –4.8%, though second e-commerce, increased ticket and Uber strong gr
Slide 4: Kentucky Fried Chicken Australia
Kentucky Fried Chicken Australia
Slide 5: $1 Billion in sales achieved with network expanding
$1 Billion IN SALES achieved with network expanding • Revenue up 10.0% to $1,051.3m FY22 FY23 FY23 Change Underlying Underlying* Underlying • SSS growth of +5.8% reflects increased ticket and significant growth in ($m) POST AASB 16 POST AASB 16 PRE AASB 16 e-commerce. Transactions were broadly flat
Slide 6: Brand continues to strengthen and modernise, almost 25% of sales digital
Brand continues to strengthen and moderniSe, with ALMOST 25% of all sales coming through digital channels • YouGov tracking indicates KFC widening its lead on core brand and value metrics, backed by Sales % E-Commerce strong investment in media 24.3 22.2 • Innovative brand-in-culture initiatives suc
Slide 7: KFC enhancing value to consumers whilst mitigating inflationary pressures on margins
Kfc enhancing value to consumers whilst mitigating inflationary pressures on margins • Sophisticated approach to value keeps affordability strong via highly targeted campaigns to protect transactions and brand health • Regular willingness-to-pay studies informing menu pricing strategy, with increase
Slide 8: Innovations in design & technology driving e-commerce, efficiency & sustainability
innovations in design & technology driving e-commerce, efficiency & sustainability in development • 10 new restaurants opened, and one acquired, ahead of development agreement pace • Remodels completed in 47 restaurants, with enhancements aimed at unlocking capacity and improving customer experience
Slide 9: Kentucky Fried Chicken Europe
Kentucky Fried Chicken Europe
Slide 10: Strong same store sales growth supported stable margins
STRONG SAME STORE SALES GROWTH SUPPORTED STABLE MARGINS • Revenue up 31.0% to $249.5m, driven by strong SSS growth and FY22 FY23 FY23 Underlying Underlying* Change Underlying expanded restaurant network • KFC Europe SSS of +13.9% reflecting increased transaction volumes ($m) POST AASB 16 POST AASB 1
Slide 11: Strengthening brand fundamentals driving sales growth
STRENGTHENING BRAND FUNDAMENTALS DRIVING SALES GROWTH • Double-digit SSS growth in Netherlands and Germany with balanced increase in transactions and ticket • Key brand metrics continue to improve (+1% increase in consideration versus LY, translated also into +1.4% increase in customer conversion) •
Slide 12: Significant inflationary headwinds offset with scale & margin mitigation initiatives
significant inflationary headwinds offset with scale & margin mitigation initiatives • European businesses and consumers faced unprecedented market conditions over the course of FY23 ‒ annual inflation more than tripled in the EU in 2022 with CPI in Netherlands reaching 17% in September 2022 ‒ doubl
Slide 13: Achieved first year Netherlands CFA targets; building reputation as KFC growth partner
achieved first year NETHERLANDS cfa targets; building reputation as a KFC growth partner • Collins Foods Netherlands moving towards scale with 56 restaurants, representing KFC Netherlands 64% of the KFC market ‒ five net new KFC restaurants opened in Netherlands in FY23 (two via sub- franchisees), u
Slide 14: Taco Bell Australia
Taco bell Australia
Slide 15: Taco Bell consolidates to re-focus on growing same store sales
TACO BELL CONSOLIDATES TO RE-FOCUS ON growing Same store sales • Revenue up 36.1% to $48.7m, reflecting higher store count in FY23 FY22 FY23 FY23 Change Underlying Underlying* Underlying • Full year SSS decline of -4.8% full-year (H1 SSS of –7.8%) POST AASB 16 POST AASB 16 PRE AASB 16 • EBITDA profi
Slide 16: Greater focus on delivery, value, and product quality
greater focus on delivery, value, and product quality to drive consumer trial and engagement • SSS improved in H2 FY23 to –2.8%, reflecting impact of Uber Eats rollout • Delivery now >25% of total sales, with click-and-collect being trialled in Queensland and Victoria restaurants • Stronger value ma
Slide 17: Current network of 26 restaurants in key metro clusters
Current network of 26 restaurants in key metro clusters • Eight new restaurants opened in FY23: three in Victoria, three in Western Australia and two in Queensland • New restaurants featuring upgraded dual line format, combined with new operating processes, have increased back-of-house efficiency an
Slide 18: Asia
COLLINS FooDS UNITED
Slide 19: Sizzler Asia sold for SGD $20.2m to Minor International
Sizzler Asia sold for SGD $20.2m to Minor international FY22 FY23 Change Statutory* Statutory* Revenue ($m) 2.8 4.1 45.8% EBITDA ($m) 1.7 2.9 73.6% JAPAN % margin 59.8% 71.3% 1145 bps ↑ 10 EBIT ($m) 1.1 2.0 81.7% % margin 38.6% 48.2% 953 bps ↑ • Sizzler Asia royalty revenue up 45.8% to $4.1m, genera
Slide 20: Financial Performance
Financial Performance
Slide 21: Cash flow continues to be reinvested for growth
Cash flow continues to be reinvested for growth FY22 FY23 FY23 • Net operating cash flow (post AASB 16) of $146.2m, down $10.1m on prior year ($m) POST AASB 16 POST AASB 16 PRE AASB 16 Net operating cash flows before interest and tax 212.3 208.2 143.0 • Net operating cashflows before interest and ta
Slide 22: Healthy Balance sheet reflects growing network
Healthy Balance sheet reflects growing network • Cash balance of $80.2m, down on prior year by 1 MAY 2022 30 April 2023 30 April 2023 $17.0m ($m) POST AASB 16 POST AASB 16 PRE AASB 16 • Property, plant and equipment of $224.5m, up $8.4m reflecting new restaurant builds and Cash and equivalents 97.2
Slide 23: Funding capacity & covenants available to support growth initiatives
Funding capacity & covenants available to support growth initiatives Net debt ($m)/ net leverage ratio* • Net leverage ratio* (pre AASB 16) of 1.47 $212.2 ‒ significant headroom to covenant maximum of 2.75 • Net debt of $212.2m [1] $177.4 $174.9 ‒ significant headroom to current facility of circa $4
Slide 24: Progressing towards 2026 ESG targets
Progressing towards 2026 ESG TARGETs Our people, our communities and our planet deserve our wholehearted commitment. We want our growth to be sustainable People and communities Planet Governance • Strong safety culture with the Lost Time • Greenhouse gas emissions decreased* • Group ESG & Sustainabi
Slide 25: Outlook
CL OUTLOOK
Slide 26: Focused on long-term growth while navigating short-term margin headwinds
Focused on LONG-TERM GROWTH while navigating short-term MARGIN HEADWINDS KFC Australia KFC eUROPE Taco bell • First seven weeks FY24 SSS of +8.8% • First seven weeks FY24 SSS of: • First seven weeks FY24 SSS of +2.1% +9.0% (Netherlands), +12.4% (Germany) • Cost pressure expected to persist during •
Slide 27: Collins Foods' proven recipe for long-term success
Collins Foods’ proven recipe for long-term success • A healthy balance sheet Collins foods’ • World-class, scalable brands strengths are well- • Specialisation in the resilient, value-centric QSR sector suited to navigate a • Operational excellence focus turbulent environment • Management team capab
Slide 28: Collins Foods Limited
COLLINS FOODS LIMITED
Slide 29: Appendix
COLLINS FOODS LIMITED APPENDIX | =
Slide 30: Group results summary
Group results summary Post aasb 16 Pre aasb 16 FY23 FY23 FY22 FY23 FY23 FY22 FY23 FY23 non-trading Change non-trading Change Underlying [1] Statutory Underlying Underlying [1] Statutory Underlying items items ($m) POST AASB 16 POST AASB 16 POST AASB 16 POST AASB 16 PRE AASB 16 PRE AASB 16 PRE AASB 1
Slide 31: KFC Australia results summary
KFC Australia results summary Post aasb 16 Pre aasb 16 FY23 FY23 FY22 FY23 FY23 FY22 FY23 FY23 non-trading Change non-trading Change Underlying Statutory Underlying Underlying Statutory Underlying items items POST AASB 16 POST AASB 16 POST AASB 16 POST AASB 16 PRE AASB 16 PRE AASB 16 PRE AASB 16 PRE
Slide 32: KFC Europe results summary
KFC Europe results summary Post aasb 16 Pre aasb 16 FY23 FY23 FY22 FY23 FY23 FY22 FY23 FY23 non-trading Change non-trading Change Underlying Statutory Underlying Underlying Statutory Underlying items items POST AASB 16 POST AASB 16 POST AASB 16 POST AASB 16 PRE AASB 16 PRE AASB 16 PRE AASB 16 PRE AA
Slide 33: Taco Bell results summary
Taco Bell results summary Post aasb 16 Pre aasb 16 FY23 FY23 FY22 FY23 FY23 FY22 FY23 FY23 non-trading Change non-trading Change Underlying Statutory Underlying Underlying Statutory Underlying items items POST AASB 16 POST AASB 16 POST AASB 16 POST AASB 16 PRE AASB 16 PRE AASB 16 PRE AASB 16 PRE AAS
Slide 34: FY23 non-trading items summary
FY23 non-trading items summary Post aasb 16 Pre aasb 16 EBITDA EBIT NPAT EBITDA EBIT NPAT ($m) POST AASB 16 POST AASB 16 POST AASB 16 PRE AASB 16 PRE AASB 16 PRE AASB 16 Restaurant impairments and provisions[1] - Taco Bell 3.7 52.7 36.7 3.7 24.9 17.3 Closure of 2 restaurants - Taco Bell 0.5 0.5 0.4
Slide 35: For further information please contact
For further information please contact CORPORATE Drew O’Malley Managing Director & CEO P: +61-7 3352 0800 INVESTORS & MEDIA Tristan Everett Automic Markets P: +61-403 789 096 E: tristan.everett@automicgroup.com.au Disclaimer This presentation contains forward looking statements which may be subject