Dp Poland Plc · LSE:DPP
Dp Poland — Investor Presentation (March 2024)
30 slides from Dp Poland's investor presentation, March 2024
Slide 1: DP Poland PLC Fundraising
DP POLAND PLC FUNDRAISING March 2024
Slide 2: Legal Disclaimer (1/2)
Legal Disclaimer (1/2) This document has been prepared by DP Poland plc, incorporated in England and Wales with company number 07278725 (the "Company"), solely for your information in connection with the proposed placing (the "Placing") and the proposed subscription (the “Subscription”) (the Placing
Slide 3: Legal Disclaimer (2/2)
Legal Disclaimer (2/2) This document contains (or may contain) certain forward-looking statements with respect to the plans and current goals and expectations of the Group (or any part thereof) relating to its future financial condition and performance and which involve a number of risks and uncerta
Slide 4: Executive team
Executive team Today’s presenters Nils Gornall Edward Kacyrz Chief Executive Officer Chief Financial Officer Appointed August 2022 Appointed December 2022 • ”Dominoid” • Chartered Accountant with 18 years of experience. • 28 years of operational experience at Domino’s • Has held a number of financia
Slide 5: Solid foundations set, time to accelerate
Solid foundations set, time to accelerate Accelerated growth and transition to a franchised business • Proven executive team combining local context and global Domino’s experience • Average store order count (AWOC) 45% growth over the last two years Growth • Like for like sales of 19.7% in 2023 and
Slide 6: Capital raise of up to £20.5 million
Capital raise of up to £20.5 million £11 million subscribed for by strategic investor SOURCES USES • Subscription committed by Domino's Pizza Group Plc, • Aggressive rollout of c.45-50 stores in Poland and UK Croatia • Understand the Subscriber intends to enter into an • Upgrade of c.25-30 existing
Slide 7: Introduction to DPP & Financial Highlights
Capital raise of £19-20 million INTRODUCTION TO DPP & FINANCIAL HIGHLIGHTS 7 FUNDRAISE PRESENTATION - NOVEMBER 2023
Slide 8: High-volume mentality delivering results
High-volume mentality delivering results Volume is the key to profitability AVERAGE WEEKLY ORDER COUNT AWOC 900 850 • Order counts have been growing consistently 800 750 • AWOC of 731 FY 2023 (+19.0% YoY) 700 • Record AWOC of 826 for Q4 in Poland 650 600 550 500 • YTD Feb24 – AWOC 761 450 400 NOV 23
Slide 9: Higher volumes driving improved profitability
Higher volumes driving improved profitability* Higher AWOC driven by improvements across all stores Stores Stores Order count (Poland corporates) Profitability (Poland corporates) 107 102 107 102 24% 30% 39% 12% 51% 14% Above 750 orders Profitable 39% 650 - 750 orders Break-Even 64% 32% 47% Below 65
Slide 10: Strong Poland LFL trading throughout the period
Strong Poland LFL trading throughout the period The result of customer focus and high-volume mentality LFL System sales (PLNm) - Poland +19.4% +16.8% +14.1% +27.5% +19.7% 70,0 64,6 230 224,8 An increase in LFL System Sales is mainly driven by: 60,0 52,2 53,7 54,3 50,6 220 46,0 47,6 50,0 43,7 210 • I
Slide 11: Improved sales driving a strong uplift in profitability
Improved sales driving a strong uplift in profitability Profitable corporate stores unlock franchise potential POLAND - STORE EBITDA DEVELOPMENT ( MPLN & %)* 1,5 8% 1,0 6% 4% EBITDA % 0,5 2% 0,0 0% -2% - 0,5 -4% - 1,0 -6% -8% - 1,5 -10% JAN 22 OCT 22 JAN 23 OCT 23 JAN 24 SEP 22 JUN 23 SEP 23 JUN 22
Slide 12: FY 2023 financial results (unaudited)
FY 2023 financial results (unaudited) Improvements evident in the numbers GROUP SYSTEM GROUP REVENUE • Running network of 116 stores (111 in Poland and 5 in Croatia) SALES • High quality revenue growth driven by increased order counts & Croatia acquisition £44.6 million £46.1 million • Average Weekl
Slide 13: Investment Overview
INVESTMENT OVERVIEW 13 FUNDRAISE PRESENTATION - NOVEMBER 2023
Slide 14: Store growth & EBITDA potential
Store growth & EBITDA potential Room for market consolidation and further profitability improvement CURRENT STORE COUNT STORE GROWTH AVERAGE STORE PROFITABILITY STORE PROFITABILITY 2023 14 Source: Public information available for Domino’s operators
Slide 15: Our core market – Poland
Our core market – Poland Established brand with potential to scale • Large EU market with 37.8 million population, 21st globally in terms of GDP (PPP) POLAND POPULATION: 37.8 million • Above average GDP growth* CURRENT STORE COUNT: 111 stores • 89% GDP growth (in PPP) since 2011 POTENTIAL STORE COUN
Slide 16: Polish pizza market overview
Polish pizza market overview Room for market consolidation 2017-22 £ 1.3B CAGR 26% 9% 9.4% 2022 value Growth rate Share of Share of of total of total CHAINED limited Polish Pizza sector restaurants service market at in total pizza restaurants RSP market (QSR) in total pizza market • The Polish pizza
Slide 17: Croatia
Croatia Strong profitability from the outset CROATIA POPULATION: 4 million** • Above average GDP growth* CURRENT STORE COUNT: 5 stores POTENTIAL STORE COUNT: 50+ • 72% GDP growth (in PPP) since 2011 • 318% GDP growth (in PPP) since 1991 • Acquired in June 2022, started by Nils (current CEO of DPP Pl
Slide 18: Gain leadership position in large cities as the first goal
Gain leadership position in large cities as the first goal Followed with expansion to smaller cities Store potential Current Domino’s stores • Further in-fill opportunities in larger cities • Untapped market for Domino’s in second and third-tier towns • Selection criteria: • Population & purchasing
Slide 19: Reach 200 stores in 3 years in Poland and Croatia
Reach 200 stores in 3 years in Poland and Croatia And challenge No.1 position in the market AWOC no of stores +30-40 +26-33 +15-20 900 200 116 731 2023 YE 2024 2025 2026 2023 YE 2024 2025 2026 • Goal to replicate the success of Domino’s in other markets FRanchise share • Concentrating on big cities
Slide 20: Upgrade store network to support brand perception
Upgrade store network to support brand perception Delivery of high quality offering improves order count and profitability • In 2023 we fully refurbished 4 stores: Post refurbisment store performance 80,0% 64,5% 60,0% 37,8% 38,3% 37,1% 40,0% 27,0% 18,0% 20,0% 10,6% 9,4% 0,0% Grodzisk 8mths Myslowice
Slide 21: Optimization projects driving performance
Optimization projects driving performance Examples of efficiency initiatives • Commissary upgrade – installation of • Development of kiosks silos • Investment of ca.100k GBP • Investment of ca.200k GBP • Payback period – up to 3 years • Payback period – up to 3 years • Further development of the app
Slide 22: Summary
Summary Ready for expansion • Constantly focus on strong brand image and consumer satisfaction • Grow AWOC and order count as a platform for topline growth and Approach EBITDA improvement 200 stores • Open up to 85 stores in 3 years in Poland and Croatia (45-50 financed from fundraise) & challenge t
Slide 23: Appendix
APPENDIX 23
Slide 24: Management Team & Board
MANAGEMENT TEAM & BOARD STRENGTHENED BOARD WItH PrIor domINo’s eXPerIeNCe EXECUTIVE DIRECTORS NON-EXECUTIVE DIRECTORS Nils Gornall - CEO David Wild - Chairman Przemyslaw Glebocki - NED Appointed August 2022 Appointed January 2023 Appointed January 2021 • 28 years of operational experience at Domino’
Slide 25: Accelerated growth and transition to franchised business
Accelerated growth and transition to franchised business Executing our strategy for growth CUSTOMER RETENTION IMPROVED PROFITABILITY ORGANIC GROWTH A strong customer value Increased AWOC and lower unit Converting corporate stores to proposition improves customer costs due to decreased food and franc
Slide 26: DP Poland PLC – Milestones
DP POLAND PLC – MILESTONES 14 years oF PolIsH domINo’s HIstory Appointed David Wild as Acquisition of Dominium new Chairman 20 stores opened in • A veteran of the Domino’s Poland The deal doubles the number of business stores in Poland to 122 • Previously CEO of Domino’s UK 2010 2014 2018 2020 2022
Slide 27: A Solid Foundation for Growth
A SOLID FOUNDATION FOR GROWTH 18 MONTHS INTO THE TURNAROUND • Refreshed Board & management team with prior global Domino’s experience • Focus on High- Volume mentality & increased customer value proposition – fast delivery, compelling pricing, high-quality DELIVERED IN • Store portfolio optimisation
Slide 28: Strong Economic Growth in Poland & Croatia
STRONG ECONOMIC GROWTH IN POLAND & CROATIA TWO OF THE HIGHEST GROWTH MARKETS IN EUROPE Source: Euromonitor for the year 2022 28
Slide 29: Rapid Growth in Disposable Incomes
RAPID GROWTH IN DISPOSABLE INCOMES TRENDS ARE EXPECTED TO CONTINUE Source: Eurostat – The real gross disposable income of households per capita (index = 2008) Source: Eurostat – Real GDP per capita for the year 2022 29
Slide 30: Slowing Inflationary Pressures
SLOWING INFLATIONARY PRESSURES HEADWINDS SHOULD TURN TO TAILWINDS Source: Polish Central Statistics Office - for the period till December 2023 • Inflationary pressures began to abate in March 2023 30