Slide 1: Annual Results for the Year Ended 30 June 2018
INTERIM RESULTS RESULTS FOR THE ANNUAL YEAR ENDED RESULTS FOR THE PERIOD ENDED FOR30 THEJUN 2017 YEAR ENDED 31 DECEMBER 2017 30 JUNE 2018
Slide 2: Trading Environment
TRADING ENVIRONMENT § Economic condiIons – poliIcal concerns, impact on consumer confidence § Sluggish growth, volaIle currency § Increasing living costs – pressure on discreIonary spend Restaurant sales § Decline up in shopping centre and restaurant foot traffic 129% § Strategy to drive home product q
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Slide 4: Financial Results for the Year to June 2018
FINANCIAL RESULTS FOR THE YEAR TO 30 JUNE 2018
Slide 5: The Year at a Glance
THE YEAR AT A GLANCE § During the year: § Disposed of Braviz – R17.5 million profit § Disposed of Captain DoRegos – R4.75 million profit § Establishment of RocoMamas Franchise business in Australia
Slide 6: The Year at a Glance
THE YEAR AT A GLANCE § Revenue 3.0% § Profit before tax 9.8% § Comparable profit before tax 8.0% § EffecIve tax rate 29.5% (2017: 36.4%) § Profit aeributable to ordinary shareholders 18.2% § Comparable net profit aeributable to ordinary shareholders 9.7%
Slide 7: Restaurant Turnovers – South Africa
RESTAURANT TURNOVERS* – SOUTH AFRICA R’000 Brand 2018 (# of outlets) 2017 (# of outlets) % change Spur Steak Ranches 4 351 067 (290) 4 478 004 (289) (2.8) Pizza Pasta 792 547 (92) 760 591 (86) 4.2 John Dory’s Fish Grill Sushi 453 809 (49) 450 919 (48) 0.6 The Hussar Grill 184 298 (17) 148 183 (14) 2
Slide 8: Restaurant Turnovers – South Africa (Quarterly)
RESTAURANT TURNOVERS – SOUTH AFRICA Brand Q1 Q2 Q3 Q4 Spur Steak Ranches (14.0) (5.3) (3.2) 14.8 Pizza Pasta 7.3 6.0 4.4 (1.0) John Dory’s Fish Grill Sushi 1.4 2.1 4.4 (5.7) The Hussar Grill 20.2 27.4 21.3 28.4 RocoMamas 44.0 32.5 27.9 23.7 Total (6.0) (0.1) 1.4 12.2
Slide 9: Franchise - Spur
FRANCHISE - SPUR R’000 2018 2017 % change Revenue July – September 47 508 57 652 (17.6) October – December 59 661 65 361 (8.7) January – March 51 146 53 633 (4.6) April – June 53 703 41 272 27.7 Year to June Revenue 211 018 217 918 (3.2) OperaIng profit 176 481 188 047 (6.2) OperaIng margin 83.6% 86.
Slide 10: Franchise – Pizza Pasta
FRANCHISE – PIZZA PASTA R’000 2018 2017 % change Restaurant turnover 792 547 760 591 4.2 Number of restaurants 92 86 Year to June Revenue 36 388 35 471 2.6 OperaIng profit 22 189 22 967 (3.4) OperaIng margin 61.0% 64.7% (3.8)
Slide 11: Franchise – John Dory's
FRANCHISE – JOHN DORY’S R’000 2018 2017 % change Restaurant turnover 453 809 450 919 0.6 Number of restaurants 49 48 Year to June Revenue 20 096 19 699 2.0 OperaIng profit 9 491 9 715 (2.3) OperaIng margin 47.2% 49.3% (2.1)
Slide 12: Franchise – Hussar Grill
FRANCHISE – HUSSAR GRILL R’000 2018 2017 % change Restaurant turnover 184 298 148 183 24.4 Number of restaurants 17 14 Year to June Revenue (pre-interco eliminaIons) 8 564 6 818 25.6 OperaIng profit 4 871 4 092 19.0 OperaIng margin 56.9% 60.0% (3.1)
Slide 13: Franchise – RocoMamas
FRANCHISE – ROCOMAMAS R’000 2018 2017 % change Restaurant turnover 627 951 477 619 31.5 Number of restaurants 65 50 Year to June Revenue (pre-interco eliminaIons) 33 586 24 333 38.0 OperaIng profit 22 988 16 457 39.7 OperaIng margin 68.4% 67.6% 0.8
Slide 14: South Africa Retail
SOUTH AFRICA RETAIL* R’000 2018 2017 % change Revenue 69 534 63 569 9.4 OperaIng profit 6 785 4 633 46.4 OperaIng margin 9.8% 7.3% 2.5 * Comprises four The Hussar Grill restaurants and one RocoMamas
Slide 15: Manufacturing & Distribution
MANUFACTURING & DISTRIBUTION R’000 2018 2017 % change Revenue – Manufacturing 87 402 86 650 0.9 Revenue – Retail 57 665 49 710 16.0 Revenue – DistribuIon 41 157 45 474 (9.5) Revenue – Total 186 224 181 834 2.4 OperaIng profit 61 050 66 243 (7.8) OperaIng margin 32.8% 36.4% (3.6)
Slide 16: Other South Africa
OTHER SOUTH AFRICA* R’000 2018 2017 % change Revenue 67 852 62 851 8.0 OperaIng loss (4 953) (3 188) (55.4) OperaIng margin (7.3%) (5.1%) (2.2) * Comprises décor, training, restaurant sundries, export, call centre
Slide 17: Corporate Services South Africa
CORPORATE SERVICES SOUTH AFRICA R’000 2018 2017 % change Revenue 2 552 3 269 (21.9) OperaQng loss (65 352) (93 794) 30.3 Revenue 2 552 3 269 Net interest income 30 537 35 788 Admin fees received 20 706 21 724 Shared overheads (110 411) (146 382) (24.6)
Slide 18: Corporate Services South Africa
CORPORATE SERVICES SOUTH AFRICA R’000 2018 2017 % change Shared overheads (110 411) (146 382) (24.6) IFRS2 charge (net of hedge) 2 283 1 996 IFRS2 charge (new scheme) 1 919 985 Braviz (profit)/impairment (17 500) 44 192 Spur FoundaIon 907 1 206 RocoMamas conIngent 12 745 777 consideraIon FV adjustmen
Slide 19: Franchise – Captain DoRegos
FRANCHISE – CAPTAIN DOREGOS* R’000 2018 2017 % change Year to June Revenue 1 924 2 812 (31.6) OperaIng profit/(loss) 4 002 (8 040) 149.8 Profit on sale (4 750) - Trademark impairment - 6 778 MarkeIng loan forgiven - 986 Comparable operaIng loss (748) (276) (171) Comparable operaIng margin (38.9%) (9.8
Slide 20: Australasia
AUSTRALASIA R’000 2018 2017 % change Restaurant turnover 205 366 254 787 (19.4) Number of restaurants 11 12 Revenue 6 547 9 870 (33.7) Net loss (10 993) (111) Impairment of loans 7 230 - RocoMamas setup costs 2 253 - Foreign exchange loss 44 83 Adjusted operaQng loss (1 466) (28)
Slide 21: Other International
OTHER INTERNATIONAL* R’000 2018 2017 % change Restaurant turnover 506 138 461 633 9.6 Number of restaurants 51 48 Revenue 25 916 22 181 16.8 OperaIng profit 13 114 8 991 45.9 OperaIng margin 50.6% 40.5% 10.1 * Includes Africa, MauriIus, Middle East, Cyprus, Pakistan and India
Slide 22: International Corporate Services
INTERNATIONAL CORPORATE SERVICES R’000 2018 2017 % change OperaIng loss (6 492) (5 345) (21.5) Foreign exchange loss 357 716 Adjusted operaQng loss (6 135) (4 629) (32.5)* * Applying a constant exchange rate, corporate costs increased by 28.3%
Slide 23: Comparable Profit – Continuing Operations
COMPARABLE PROFIT – CONTINUING OPERATIONS R’000 2018 2017 % change Profit before tax 231 368 214 775 7.7 Loss from disconInued operaIons - (4 084) Profit before tax – conInuing operaIons 231 368 210 691 9.8 Impact of share schemes 2 944 (1 332) RocoMamas conIngent consideraIon FV adj 12 745 777 Intere
Slide 24: Comparable Headline Earnings
COMPARABLE HEADLINE EARNINGS R’000 2018 2017 % change Headline earnings 153 656 133 863 14.8 United Kingdom - 1 218 Headline earnings – conInuing operaIons 153 656 135 081 13.8 Impact of share schemes 2 201 (1 003) RocoMamas conIngent consideraIon FV adj 12 745 777 (Disposals)/impairments of Braviz
Slide 25: Financial Position
FINANCIAL POSITION R’000 2018 2017 ASSETS Interest in equity accounted investees 3 461 - Loans receivable (LT & ST) 145 759 129 815 Tax receivable 36 197 41 479 Trade and other receivables 99 997 72 836 Cash and cash equivalents 259 895 265 953 LIABILITIES ConIngent consideraIon – ST - 5 797 Trade a
Slide 26: Cash Flow
CASH FLOW R’000 2018 2017 Cash flow from operaIons 224 787 236 229 Net interest received 22 537 25 117 247 324 261 346 DistribuIons paid (124 250) (141 809) TaxaIon paid (60 646) (85 303) Working capital changes (27 560) (1 515) Net investment in fixed and intangible assets (11 913) (17 105) Purchase
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Slide 28: Operational Overview for the Year to June 2018
OPERATIONAL OVERVIEW FOR THE YEAR TO 30 JUNE 2018
Slide 29: Restaurant Count
RESTAURANT COUNT (30 June 2018) Brand South Africa InternaQonal Total Spur Steak Ranches 290 39 329 PanaroWs Pizza Pasta 84 12 96 Casa Bella 8 - 8 Restaurant John Dory’s sales Fish Grill Sushi 49 3 52 up The Hussar Grill 17 1 18 129% RocoMamas 65 7 72 Total 513 62 575
Slide 30: Spur Steak Ranches
SPUR STEAK RANCHES § 284 Spur Steak Ranches in South Africa § 6 Spur Grill & Go restaurants in South Africa § 2.8% restaurant turnover § Menu price increases § 3.5% December 2016 § 1.1% December 2017 § 5.3% April 2018 § Move away from aggressive discounIng – more sustainable model § Increase in conc
Slide 31: Spur Steak Ranches
SPUR STEAK RANCHES § Strategy for the year ahead § InnovaIon to breakfast offering and menu engineering § MarkeIng advantages § Heighten focus on authenIcity and quality “home-made” credenIals § Targeted TV markeIng campaigns § Rolling out smaller concept § Refurbishments and strategic relocaIons
Slide 32: Pizza Pasta
PIZZA PASTA § 84 PanaroWs restaurants in South Africa § 8 Casa Bella restaurants in South Africa § Store turnover growth 4.2% § R21.4 million invested by franchisees § Menu price increases: Date of increase Panaro^s Casa Bella July 2016 5.1% November 2016 7.2% December 2016 2.9% July 2017 1.8% Decem
Slide 33: Pizza Pasta
PIZZA PASTA § DisconInuaIon of specific weekday specials – highly aggressive discounIng § Focus on franchisee profitability § reducing labour § external loan restructuring § renegoIaIng rentals Strategy for the year ahead § InstallaIon of rotaIng wood-fired pizza oven – enhance product authenIcity and
Slide 34: Fish Grill Sushi
FISH GRILL SUSHI § 49 restaurants in South Africa § 0.6 turnover growth § Menu price increases § 6.0% December 2016 § 5.6% May 2017 § 4.0% December 2017 § 4.6% May 2018 § R35.3 million invested by franchisees § Move away from specific weekday specials § Focus on labour costs, effecIve scheduling and m
Slide 35: The Hussar Grill
THE HUSSAR GRILL § 17 restaurants in South Africa § 24.4% turnover growth (exisIng restaurant turnover up 6.6%) § Menu price increase § 6.0% May 2017 § 5.0% May 2018 § R17.3 million invested by franchisees § Increased contribuIon by franchisees to markeIng fund - spend on social media channels to re
Slide 36: RocoMamas
ROCOMAMAS § 65 restaurants in South Africa § Menu price increase § 2.3% November 2016 § 3.9% September 2017 § 4.3% April 2018 § R63 million invested by franchisees § Focused on growing exisIng businesses and franchisee profitability § Capturing market share through increased focus on online delivery
Slide 37: Brand Development in South Africa
BRAND DEVELOPMENT IN SOUTH AFRICA Brand 30 June 2019 Spur Steak Ranches 6 Pizza Pasta 6 John Dory’s Fish Grill Sushi 6 The Hussar Grill 3 RocoMamas 8 Total 29
Slide 38: Restaurant Turnovers – International
RESTAURANT TURNOVERS – INTERNATIONAL LocaQon 2018 (R’000) 2017 (R’000) % change % change* Australasia 205 366 254 787 (19.4) (16.9) Africa 346 600 336 319 3.1 7.4 MauriIus 133 865 114 323 17.1 18.7 Middle East 25 673 10 991 133.6 146.4 Total 711 504 716 420 (0.7) 2.7 * Using a constant exchange
Slide 39: Restaurant Footprint – International
RESTAURANT FOOTPRINT – INTERNATIONAL LocaQon Spur Panaro^s John Dory’s Hussar RocoMamas Total Australia 6 3 1 10 Botswana 2 2 Ethiopia 1 1 Kenya 5 1 6 Lesotho 1 1 Malawi 1 1 MauriIus 3 7 1 11 Namibia 7 1 2 1 11 New Zealand 1 1 Nigeria 4 1 5 Oman 1 1 Saudi Arabia 1 1 Swaziland 3 3 Tanzania 1 1 Uganda
Slide 40: International
INTERNATIONAL § Australasia § Turnovers disappoinIng, labour costs high § High unemployment in WA – foot traffic down § Concessions § MarkeIng assistance § Opened RocoMamas in Melbourne opened in June 2018 – 45% associate § MauriIus § 11 restaurants § Good restaurant turnover growth – 17.1% § ConInued
Slide 41: International
INTERNATIONAL § Africa § Some poliIcal issues – Kenya and Tanzania § Currency volaIlity result in pressure on margins § Constantly improving supply channels – full support in Botswana, Lesotho, Namibia, Swaziland and Zambia § Smaller footprint more viable § Middle East § RocoMamas Oman opened in Oct
Slide 42: Brand Development - International
BRAND DEVELOPMENT - INTERNATIONAL Brand 30 June 2019 Botswana – RocoMamas 1 Cyprus - RocoMamas 1 India - RocoMamas 1 Namibia – Spur 2 Namibia – PanaroWs Express 1 Pakistan – Spur 1 Saudi Arabia – The Hussar Grill 1 Saudi Arabia – RocoMamas 1 Zambia – The Hussar Grill 1 Zambia – PanaroWs 7 Total 17
Slide 43: Manufacturing & Distribution
MANUFACTURING & DISTRIBUTION § Sauce factory § No price increase in the 2018 year § Revenue grew by 6.4%, despite a decline in restaurant turnovers § InvesIgaIon conInuing into the relocaIon of current facility § Outsourced distribuIon § Delivered 4.7 million cases/40 577 tonnes to our restaurants i
Slide 44: Prospects / Outlook
PROSPECTS / OUTLOOK
Slide 45: Nikos Coalgrill Greek
NIKOS COALGRILL GREEK § 51% acquired 1 August 2018 § 6 franchised outlets § Marries contemporary dining with tradiIonal homestyle greek cooking, coalgrilled to perfecIon § Good potenIal to expand
Slide 46: Prospects
PROSPECTS § Increasing financial pressure on middle market § Focus on product quality, innovaIon and value § InnovaIve targeted markeIng § Capitalise on delivery technology § Digital focus – e-commerce § Sauce factory § Smaller footprints – worldwide § New store openings locally and internaIonally §
Slide 47: Disclaimer
DISCLAIMER • Spur CorporaIon has acted in good faith and has made every reasonable effort to ensure the accuracy and completeness of the informaIon contained in this presentaIon, including all informaIon that may be defined as 'forward-looking statements' within the meaning of United States securiIes
Slide 48: Thank You – Questions?
THANK YOU QUESTIONS?
Slide 49: Contact Details
CONTACT DETAILS CEO – Pierre van Tonder pvt@spur.co.za CFO – Phillip Maehee phillipm@spur.co.za Tier 1 Investor RelaIons 021 702 3102
Slide 50: Our Brand Family
OUR BRAND FAMILY tts ; & Gos A taste for life SALE KB (S7, @ NIkoy gis COALGRILL GREEK GRILLEGO