The One Group Hospitality, Inc. · NASDAQ:STKS
The One Group Hospitality — ONE Group Hospitality — Investor Presentation (July 2015)
29 slides from The One Group Hospitality's investor presentation, Jul 9, 2015
Slide 1: Investor Presentation Executive Summary May 2015
INVESTOR PRESENTATION EXECUTIVE SUMMARY MAY 2015july
Slide 2: Confidential Information and Forward-Looking Statements
Confidential Information This presentation contains confidential, sensitive or proprietary information . By accepting this presentation, the recipient agrees to treat this presentation and the information contained herein or delivered in connection herewith in a confidential manner in accordance wit
Slide 3: Global hospitality company developing upscale, high-energy restaurants and F&B services
We are a global hospitality company that develops and operates upscale, high - energy restaurants and turn - key food & beverage services for hospitality venues including hotels , casinos and other high end locations Our clients and partners are leading entertainment and hospitality companies, inclu
Slide 4: Our Company: Owned Restaurants and Hospitality Services
Our Company Owned Restaurants Primary restaurant brand is STK ─ Launched in NYC in 2006 ─ Upscale, high - energy steakhouse concept ─ 11 locations in operation or under construction in the US and Europe Created an under brand, STK Rebel, utilizing same successful concept with a b roader menu priced
Slide 5: STK, F&B Restaurants and Hospitality Services Venues
STK F &B Restaurants STK – Atlanta Cucina Asellina – Atlanta STK – DC Bagatelle – New York STK – Downtown NY Bagatelle – Los Angeles STK – Midtown NY STK – Rooftop NY W Hotel - Los Angeles STK – Miami STK STK – Disney World The Hideout STK – Chicago Hospitality Services STK Rebel – Denver 32 Venues
Slide 6: Transaction Overview
Transaction Overview The ONE Group Hospitality, Inc. (“TOG” or the “Company”) is in negotiations to acquire the Katsuya and Cleo restaurant assets from SBE Entertainment Group, the holding company of SLS Hotels, for a proposed cash purchase price of $75 million Katsuya and Cleo are upscale casual, f
Slide 7: Katsuya / Cleo Acquisition Rationale
Additional Avenues for Future Growth for Standalone & Hospitality Contracts Established High Volume & Profitable Brands Significantly Increases Venue Base with No Incremental Development Required Increases Footprint in Existing Cities and Provides Operational Economies of Scale Diversifies F&B Hospi
Slide 8: Internationally Recognized Restaurant Brands
Internationally Recognized Restaurant Brands Established Globally Complementary Offerings High - Energy Restaurants High Quality High Volume High Margin 7
Slide 9: STK: Differentiated Steakhouse with High-Energy & Great Atmosphere
Key Points STK is a reinvention of the traditional steakhouse High - energy dining experience Restaurants built around the bar, featuring DJ played music High female to male customer mix Destination location where guests can utilize our restaurant in multiple ways ─ Main and private dining rooms, ba
Slide 10: Katsuya: Japanese Cuisine - American Palate. International Appeal.
Katsuya: Japanese Cuisine - American Palate. International Appeal. Key Points An “upscale casual”, full - service restaurant that offers a uniquely stylish Japanese dining experience Restaurant concept by master sushi chef Katsuya Uechi , founded in Hollywood, CA ─ Distinguished by Philippe Starck d
Slide 11: Cleo Overview: Energized Ambience, People and Food
Cleo Overview: Energized Ambience, People and Food Key Points Cleo is an “upscale casual”, full - service restaurant that offers a uniquely stylish Mediterranean dining experience Created for stand alone and hotel operations Three meal a day dining concept Created by award winning Chef Danny Elmaleh
Slide 12: Venues Expected to be Opened by End of 2015
46 Venues Expected to be Opened by end of 2015 Note: Hospitality F&B refers to F&B restaurants, rooftops, pools, bars and hospitality F&B services. STK Katsuya F &B Restaurants STK – Atlanta Brentwood, LA Cucina Asellina – Atlanta STK – DC Downtown, LA Bagatelle – New York STK – Downtown NY Hollywoo
Slide 13: A Leading Hospitality Company – ONE Hospitality
A Leading Hospitality Company – ONE Hospitality™ Note: Bagatelle, Gansevoort Park Rooftop, Marconi, Radio M, Asellina , Cucina Asellina , Cleo and Heliot are jointly owned and / or licensed brands. and / or licensed brands . Comprehensive Portfolio of Internationally Recognized Brands Growing List o
Slide 14: Alshaya Partnership With Leading Global Brands
Alshaya Partnership With Leading Global Brands Headquartered in Kuwait with 125 year operating history Multinational retail franchise operator with 2,800+ stores Proven ability to activate brands globally with partnerships with over 70 consumer and retail brands across the Middle East, North Africa
Slide 15: Multiple Avenues for Future Growth
Multiple Avenues for Future Growth Owned STK : Opportunity to open up to 50 STK restaurants globally Targeting 2 - 3 STK restaurants per year, short - term STK Rebel : Opportunity to open at least 100 STK Rebel restaurants globally Targeting 1 - 2 STK Rebel restaurants per year, short - term Katsuya
Slide 16: Purchase of Katsuya / Cleo and Pro Forma Capitalization
Purchase of Katsuya / Cleo Pro Forma Capitalization Note: Sources and Uses and Pro Forma Capitalization subject to post - closing adjustments. (1) Economic share of management, incentive and other fees. * Indicates all or portion of number is from SBE internal financials and is in the process of bei
Slide 17: Ability to Leverage G&A and Enhance Profitability
Ability to Leverage G&A and Enhance Profitability Growth (12) Public Company (4) ▪ Chief Operating Officer ▪ Director of SEC Reporting ▪ VP Restaurant Operations ▪ General Counsel ▪ Directors of Operations (4) ▪ Support Staff (2) ▪ Senior Managers (2) ▪ Operational Support Staff (4) Acquire highly p
Slide 18: GAAP Revenue and Total Food & Beverage Sales
($Millions) GAAP Revenue Total Food & Beverage Sales at Owned & Managed Units (1) Note: Pro Forma numbers also include sales at licensed locations and licensing fees. (1) See Appendix for a reconciliation of Total Food & Beverage Sales at Owned and Managed Units. (2) STK same store sales refers to T
Slide 19: Adjusted EBITDA and Adjusted Net Income
TOG Adjusted Net Income (1) TOG Adjusted EBITDA (1) (1) See Appendix for definition of Adjusted EBITDA and Adjusted Net Income and for reconciliation to GAAP Net Income (Loss). * Indicates all or portion of number is from SBE internal financials and is in the process of being audited. Adjusted EBITD
Slide 20: Targeted Unit Economics
TARGETED STK Rebel Katsuya F&B Hospitality Owned Units Owned Units Owned Units Managed Units Revenue $9.0 mil $5.0 mil $7.2 mil -- EBITDA $2.0 mil $1.0 mil $1.8 mil -- Average Cash Investment $3.8 mil (2) $2.5 mil (2) $5.2 mil (3) <$500,000 ROI 53% 40% 35% -- Management Fees -- -- -- 5.0% to 6.5% In
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Slide 22: Appendix
APPENDIX 21
Slide 23: Average Unit Volume (AUV)
Average Unit Volume (AUV) (Data as of FYE 2014) Sources: Company filings, investor presentations and equity research. Notes: STK figures represent the average results from STK’s open for at least one year: STK – Downtown (including Rooftop), STK – LA, STK – Las Vegas, STK – Midtown and STK – Atlanta
Slide 24: Historical GAAP Income Statement
($ Millions ) Historical GAAP Income Statement FYE December 31, 2011A 2012A 2013A 2014A Revenues: Owned unit net revenues 43.7$ 56.4$ 36.6$ 40.5$ Management and incentive fee revenue 2.4 3.7 7.3 8.8 Total revenue 46.1$ 60.1$ 43.9$ 49.3$ Cost and expenses: Owned operating expenses: Food and beverage
Slide 25: Historical GAAP Balance Sheet
($ Millions ) Historical GAAP Balance Sheet FYE December 31, 2011A 2012A 2013A 2014A Assets: Cash and cash equivalents 1.7$ 1.0$ 11.7$ 7.9$ Accounts receivable, net 2.3 3.4 2.9 4.4 Inventory 1.2 1.4 1.0 1.1 Other current assets 0.1 0.3 0.8 1.9 Due from related parties 0.2 0.1 0.2 1.2 Total Current A
Slide 26: Adjusted EBITDA Definition
ADJUSTED EBITDA : We define adjusted EBITDA as net income before interest expense, provision for income taxes, depreciation and amortization, n on - cash impairment loss, deferred rent, pre - opening expenses, non - recurring gains and losses and losses from discontinued operations. Adjusted EBITDA
Slide 27: Adjusted EBITDA Reconciliation
($ Millions ) (1) Deferred rent is included in occupancy expense on the statement of income. (2) Non - recurring gain is included in other income on the statement of income. (3) For the purposes of calculating Adjusted EBITDA, only those units that were either closed, or a determination was made by
Slide 28: Adjusted Net Income Reconciliation
($ Millions ) (1) Non - recurring gain is included in other income on the statement of income. (2) For the purposes of calculating Adjusted Net Income (Loss), only those units that were either closed, or a determination was mad e by us to close those units as of December 31st of the respective year
Slide 29: Total F&B Sales at Owned and Managed Units Reconciliation
Total F&B Sales at Owned and Managed Units Reconciliation ($ Millions ) FYE December 31,2011A 2012A 2013A 2014A Owned Unit Net Revenue (a) $43.7 $56.4 $36.6 $40.5 Management and Incentive Fee Revenue 2.4 3.7 7.3 8.8 GAAP Revenue 46.1 60.1 43.9 49.3 Food & Beverage Sales at Managed Units (a) 37.3 49.
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