Wendy's Company (the) · NASDAQ:WEN
Wendy's Company (the) — The Wendy's Company — Q2 2021 Earnings Presentation
26 slides from Wendy's Company (the)'s earnings presentation, Aug 11, 2021
Slide 1: Second Quarter 2021 Conference Call
Second Quarter 2021 Conference Call August 11, 2021 © Quality Is Our Recipe, LLC
Slide 2: Greg Lemenchick
Greg Lemenchick Senior Director – Investor Relations & Corporate FP&A © 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 2021 Outlook Franchise Health Update IR Calendar Q&A THE WENDY'S COMPANY | 4
Slide 5: Todd Penegor
Todd Penegor President & Chief Executive Officer © Quality Is Our Recipe, LLC
Slide 6: CEO Business Update
CEO Business Update ▪ Accelerating Double Digit Global 2-year SRS1 ▪ Significant Restaurant Margin Expansion ▪ Successfully Entered Into Europe with our First UK Restaurant ▪ 2025 Global Restaurant Target Increasing to 8,500 to 9,000 ▪ Significant Increase in U.S. Franchise Financial Health ▪ Quarte
Slide 7: Global SRS Momentum Accelerated in Q2
Global SRS Momentum Accelerated in Q2 Q2 Global SRS 17.4% 1 Year 11.6% 2 Year First UK Restaurant Opening Q2 US SRS 16.1% 1 Year 11.7% 2 Year Q2 International SRS 31.4% 1 Year 13.0% 2 Year Rick and Morty Pop-Up Event First UK Restaurant Opening – June 2 THE WENDY'S COMPANY | 7
Slide 8: US Sales Continued to Outperform Expectations
US Sales Continued to Outperform Expectations ▪ Customer counts improved while checks remained elevated ▪ Made to Crave units sold reached all time high ▪ Significant growth in salad business ▪ Craveable innovation in place for Q3 and beyond THE WENDY'S COMPANY | 8
Slide 9: Breakfast Sales Accelerated In Q2; Adding Additional Advertising Dollars to Fuel Growth
Breakfast Sales Accelerated In Q2; Adding Additional Advertising Dollars to Fuel Growth ▪ Breakfast sales accelerated vs. Q1 and are in line with expectations in Q2/YTD ▪ Continue to expect step up in breakfast sales and mix in back half of year ▪ Adding $10M of additional Company advertising spendi
Slide 10: Digital Continued to Deliver in Q2
Digital Continued to Deliver in Q2 ▪ International sales mix remained in the double digits ▪ U.S. digital sales dollars grew more than 10% vs. Q1 and are ahead of plan ▪ U.S. rewards members grew ~25% to ~17M at quarter end ▪ Several successful acquisition campaigns throughout quarter THE WENDY'S CO
Slide 11: Increasing 2025 Global Restaurant Count Target Meaningfully to 8,500 to 9,000
Increasing 2025 Global Restaurant Count Target Meaningfully to 8,500 to 9,000 • Signed multi-year commitment with REEF Kitchens to accelerate non- traditional unit growth • Created a build-to-suit development fund to drive unit growth • Groundbreaker incentive program a huge success THE WENDY'S COMP
Slide 12: Remain Fully Committed to Long Term Growth Initiatives
Remain Fully Committed to Long Term Growth Initiatives Investing in Accelerated Global Growth Build Our Digital Expand Our Breakfast Acceleration Footprint Daypart Fast Food Operational Good Done Done Right Excellence Right Restaurant Economic Model THE WENDY'S COMPANY | 12
Slide 13: Gunther Plosch
Gunther Plosch Chief Financial Officer © Quality Is Our Recipe, LLC
Slide 14: Second Quarter Financial Results
Second Quarter Financial Results $ Mils (except per share amounts) 2021 2020 B/(W) Global Systemwide Sales Growth 22.9% (6.2%) 2910 bps Global System SRS 17.4% (5.8%) 2-Yr 11.6% Company Restaurant Margin 20.3% 14.4% 590 bps G&A $63.1 $48.6 (29.9)% Adjusted EBITDA1 $131.1 $97.4 34.5% Adjusted EPS1 $0
Slide 15: Increasing 2021 Outlook for Second Consecutive Quarter
Increasing 2021 Outlook for Second Consecutive Quarter Metric Previous Outlook Updated Outlook Global Systemwide 8% to 10%* 11% to 13%* Sales Growth Adjusted EBITDA ~$455M to $465M ~$465M to $475M Adjusted EPS ~$0.72 to $0.74 ~$0.79 to $0.81 Capital Expenditures ~$80M to $90M Reaffirmed Free Cash Fl
Slide 16: Significant Increase in U.S. Franchise Financial Health
Significant Increase in U.S. Franchise Financial Health 2020 US Franchise Economics Sales Growth = ~2% EBITDA $ Growth = ~18% Restaurant Economic Model THE WENDY'S COMPANY | 16
Slide 17: Capital Allocation Policy Remains Unchanged
Capital Allocation Policy Remains Unchanged Continue to Invest in the 1 Business for Growth Sustain an Attractive Dividend; 2 Payout Ratio > 50% Flexibility to Utilize Excess 3 Cash to Repurchase Shares and/or Reduce Debt THE WENDY'S COMPANY | 17
Slide 18: Greg Lemenchick
Greg Lemenchick Senior Director – Investor Relations & Corporate FP&A © Quality Is Our Recipe, LLC
Slide 19: Investor Relations Calendar
Investor Relations Calendar • Aug 17: Virtual NDR with Oppenheimer (Boston) • Aug 18: Virtual NDR with Barclays (New York) • Sept 1: Virtual NDR with RBC (Canada) • Sept 9: Conference Call with BTIG • Sept 22: Wells Fargo Conference (California) • Sept 30: Virtual HQ Visit with KeyBanc • Nov 11: Q3
Slide 20: Q&A
Q&A
Slide 21: Appendix
Appendix
Slide 22: 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 and systemwide sales). These no
Slide 23: Reconciliations of Net Income to Adjusted EBITDA and Revenues to Adjusted Revenues
In Thousands (Unaudited) Reconciliations of Net Income to Adjusted EBITDA and Revenues to Adjusted Revenues THE WENDY'S COMPANY | 23
Slide 24: Reconciliation of Net Income and Diluted EPS to Adjusted Income and Adjusted EPS
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 | 24
Slide 25: Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
Reconciliation In Thousands (Unaudited) of Net Cash Provided by Operating Activities to Free Cash Flow THE WENDY'S COMPANY | 25
Slide 26: Slide 26