Cake Box Holdings Plc · LSE:CBOX
Cake Box — FY2023 Earnings Presentation
32 slides from Cake Box's earnings presentation, Jun 26, 2023
Slide 1: Full Year Results 2023
FULL YEAR RESULTS 2023 CAKE BOX GROUP PLC YEAR ENDED 31 MARCH 2023 26 JUNE 2023
Slide 2: Agenda
OVERVIEW Sukh Chamdal, CEO FINANCIAL PERFORMANCE Michael Botha, CFO AGENDA STRATEGIC AND OPERATIONAL UPDATE Sukh Chamdal, CEO 1
Slide 3: Overview
alall OVERVIEW Sukh Chamdal, CEO
Slide 4: Business model has delivered significant growth since IPO in June 2018
Business model has delivered significant growth since IPO in June 2018 80 £72.1m 250 9 8.125p 2019 205 70 8 60 200 7 50 2023 6 150 40 £30.7m 113 5 3.6p 4 30 100 3 20 2 50 10 1 0 0 0 Total franchise sales Franchise Stores Dividend per share 134.8% growth in 81.4% growth in 125.7% growth in Franchise
Slide 5: Robust trading, investment in growth, enhanced dividend
ROBUST TRADING, INVESTMENT IN GROWTH, ENHANCED DIVIDEND Business model well placed for growth in current environment Continued store growth amongst existing franchisees and new franchisees joining the Brand Trading gained momentum during H2 2023, significant improvement over first half of the year S
Slide 6: Cake Box is well positioned for growth
CAKE BOX IS WELL POSITIONED FOR GROWTH VALUE FOR FRANCHISE PARTNERS, CUSTOMERS AND SHAREHOLDERS Full Year Dividend (p) Stores Cash on hand (£m) 10.8% 205 11.9% 6.9% 8.125 7.4 7.6 185 6.6 2022 2023 2022 2023 2022 2023 Net Cash Surplus Net Assets (£m) Total Franchisee Sales (£m) (£m) 15.0% 6.0 5.9% 17
Slide 7: Financial Performance
FINANCIAL PERFORMANCE Michael Botha, CFO 6
Slide 8: Financial Highlights
FINANCIAL HIGHLIGHTS Sales and store growth with increased returns to shareholders • Total franchise sales up by 9.6% • Like-for-like franchisee sales up by 1.0% • 20 New stores opened during the year • Cake Box revenue up 5.6% • Gross profit up 8.5% due to improvement in margins • As previously rep
Slide 9: 2023 Sales Performance
2023 SALES PERFORMANCE Robust trading while maintaining margins • Total franchisee sales up % change due to new store openings £m FY23 FY22 vs. FY22 and stronger H2 2023 Franchise store sales 66.5 60.9 9.2% trading Kiosk sales 5.6 4.9 15.2% Total Franchise sales 72.1 65.8 9.6% • Cake Box sales impac
Slide 10: 2023 Franchise Sales Performance
2023 FRANCHISE SALES PERFORMANCE Positive sales growth driven by new and existing channels • 9.6% growth yr on yr in Total franchise sales • £6.3m increase in total franchise sales, £2.6m (41%) from new openings and £3.6m (59%) from existing stores/kiosks • H2 sales performance significantly improve
Slide 11: 2023 Franchise Sales Like-for-Like Performance
2023 FRANCHISE SALES LIKE-FOR-LIKE PERFORMANCE Positive Like-for-Like growth driven by improved H2 performance 2023 Total franchise store H1 H2 FY LFL for 2023 4.0% Total Franchise store 3.0% sales (1.6%) 3.4% 1.0% 2.0% • H1 performance impacted by 1.0% warmer weather and holidays 0.0% following lif
Slide 12: 2023 Online System Sales Performance
2023 ONLINE SYSTEM SALES PERFORMANCE Online sales normalised following Covid lockdowns % change Online franchise sales £m FY23 FY22 vs. FY22 (£m) - H1 vs H2 13.8 7.3 Total online sales 13.3 4.1% 7.2 7.2 7.1 % of franchise store sales 20.8% 21.8% (4.7%) 7.0 6.9 6.8 6.7 £m H1 H2 FY23 6.7 6.6 6.6 6.5 F
Slide 13: 2023 Online System Sales Performance
2023 ONLINE SYSTEM SALES PERFORMANCE Three phases of performance. Pre and Post Investment in growth and recruitment of Marketing Director. Online Sales (£) Performance Vs. LY 1300000 1250000 Post Covid Sales Extreme Heat Investment Strategy to Drive Online Growth - Stagnant Optimised 1200000 1150000
Slide 14: 2023 Group Sales Performance
2023 GROUP SALES PERFORMANCE 5.6% increase in group sales year on year Group sales by category (£m) Cake Box sales composition - 2023 Sponge 2.9% 16.0 8.2% 14.0 Food 2023 2022 12.0 10.0 Fresh cream 39.2% 8.0 21.4% 6.0 Other goods 4.0 2.0 Online 11.4% - commission 16.9% New stores • Group product rev
Slide 15: 2023 Analysis of Group EBITDA
2023 Analysis of Group EBITDA 8.5% increase in gross profit year on year % change • 16.9% reduction in £m FY23 FY22 vs. FY22 Underlying EBITDA Gross profit 17.2 15.8 8.5% driven by increase of £2.7m in overheads Overheads (11.6) (8.8) (31.0%) • Increase in overheads Depreciation 0.8 0.9 11.7% due to
Slide 16: 2023 Group EBITDA Movement
2023 GROUP EBITDA MOVEMENT (£m) Increase in gross profit offset by increase in overheads 15
Slide 17: 2023 Income Statement
2023 INCOME STATEMENT PBT lower due to increase in overheads % change • Amortisation on £m FY23 FY22 vs. FY22 right-of-use assets higher due to first Reported EBITDA 6.7 8.8 (24.3%) full year of amortisation charges Depreciation and Amortisation (1.1) (1.0) (7.6%) • Effective taxation Profit on disp
Slide 18: 2023 Free Cash Flow
2023 FREE CASH FLOW Free cash in line with FY22 • Working capital was % change mainly impacted by £m FY23 FY22 vs. FY22 the timing of the payment of suppliers at year end EBITDA 6.7 8.8 (24.2%) IFRS 16 - net lease payments (0.3) - Working capital 1.0 (1.6) 165.1% Net interest (0.1) (0.1) (66.5%) Tax
Slide 19: 2023 Net Cash Surplus
2023 NET CASH SURPLUS (£m) Increased investment in growth and shareholder returns 18
Slide 20: Investing to Drive Future Growth
INVESTING TO DRIVE FUTURE GROWTH Further £2.0.m capex spend to underpin future growth Distribution Investment in Distribution Centres Technology - Fleet – improvements - £0.4m £0.5m £1.1m Freehold improvements to New Website New Distribution centres development Refrigerated New production ERP system
Slide 21: Strategic and Operational Update
STRATEGIC AND OPERATIONAL UPDATE Sukh Chamdal, CEO 20
Slide 22: Operational Highlights
OPERATIONAL HIGHLIGHTS 20 200th 9.6% 4.1% Managed cost New Stores Franchise store opened Increase in total Increase in online pressures in high Opened during 2023 franchisee sales FY23 system sales inflationary environment 21
Slide 23: Franchisee Operational Highlights
FRANCHISEE OPERATIONAL HIGHLIGHTS £72.1m £13.8m 44 Total franchisee Online franchise Multi-store Positive LFL sales Upheld value proposition revenue sales franchisees growth for FY 2023 to customers 22
Slide 24: 5 Key Areas of Focus in 2024
5 KEY AREAS OF FOCUS IN 2024 Empowering Expanding Data-driven Franchisees and Store Estate Approach and Operational and Franchisee Multi-channel Excellence Growth Expansion Strengthening Commitment to Leadership and Community and Governance ESG Initiatives 23
Slide 25: Marketing
MARKETING FOCUSING ON PRODUCT, STORES AND CUSTOMERS TO DRIVE SUCCESS. PRODUCT Always Fresh. Always Personal Say It With Cake! Customer Omni- Centricity Channel & Insight System CUSTOMERS STORES 24
Slide 26: Optimise Click & Collect User Journey
OPTIMISE CLICK & COLLECT USER JOURNEY A BIG OPPORTUNITY TO WIN WITH DIGITAL FIRST APPROACH FOR ON AND OFFLINE (OMNI-CHANNEL) CLICK COLLECT REPEAT CUSTOMER CUSTOMER LOYALTY & ACQUISITION EXPERIENCE RETENTION EASY TO MORE REPEAT SHOP CUSTOMERS CUSTOMERS EASILY MORE DATA SERVED CUSTOMER RETURN CONVERSI
Slide 27: Summary & Current Trading
SUMMARY & CURRENT TRADING SUMMARY • Successfully navigated very tough trading conditions during 2023 • Continued franchise store growth – 20 stores opened in FY23 taking total to 205 • Maintained value to our end customers by keeping our price inflation well within the macro economic inflationary le
Slide 28: Q&A
Q&A 27
Slide 29: Appendix
APPENDIX 28
Slide 30: Introduction to Cake Box
INTRODUCTION TO CAKE BOX • First store opened in 2008 • Business conceived in 2008 with a single shop in East London, now headquartered in Enfield, Greater London • 205 franchise stores as at 31st March 2023 • Specialises in making delicious, high quality, bespoke celebration fresh cream cakes in-st
Slide 31: Our Products
OUR PRODUCTS • Freshly hand-made cakes and slices in-store using fresh cream • Cakes available to order in-store or online for collection Fruit Gateaux Serves 8 • Hundreds of celebration cake designs to choose from • Cakes can be personalised on the spot with a free message Cake Slice • Personalised
Slide 32: Store Franchise Application Process
STORE FRANCHISE APPLICATION PROCESS Online Application Store Received & Reviewed Open Full Franchise Application Sent Pre-open Marketing A PROFESSIONAL & SEAMLESS Successful Application FRANCHISE PROCESS Invited To Store Build & START TO FINISH Presentation Training Second Interview Legals Site Sele