Krispy Kreme, Inc. · NASDAQ:DNUT
Krispy Kreme — Q2 2024 Earnings Presentation
26 slides from Krispy Kreme's earnings presentation, Aug 8, 2024
Slide 1: Krispy Kreme, Inc. Second Quarter 2024 Earnings Presentation
KRISPY KREME, INC. SECOND QUARTER 2024 EARNINGS PRESENTATION AUGUST 8, 2024 Krispy Kreme | 2Q24 Earnings 1
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS Cautionary Note Regarding Forward-Looking Statements This presentation contains forward-looking statements that involve risks and uncertainties. The words “believe,” “may,” “focus,” “expand,” “continuing,” “guidance,” “could,” “will,” “should,” “anticipate,” “estimate,” “e
Slide 3: Strong Results, Strategy Is Working
STRONG RESULTS, STRATEGY IS WORKING Krispy Kreme | 2Q24 Earnings 3
Slide 4: Ankara, Türkiye June 2024
Ankara, Türkiye June 2024 Krispy Kreme | 2Q24 Earnings 4
Slide 5: Key Messages
KEY MESSAGES +7.8% CONTINUING SALES GROWTH 2Q24 ORGANIC REVENUE GROWTH1 +23% INCREASING GLOBAL POINTS OF ACCESS 2Q24 POINTS OF ACCESS GROWTH1 +80 BPS PROFITABLE U.S. EXPANSION U.S. ADJ. EBITDA EXPANSION1 +5 – 7% FOCUS ON FRESH DOUGHNUTS >150% FY2024 ORGANIC REVENUE U.S. POAGROWTH Growth2 2 1) 2Q24 v
Slide 6: Continuing Sales Growth
CONTINUING SALES GROWTH Krispy Kreme | 2Q24 Earnings 6
Slide 7: Continuing Sales Growth
CONTINUING SALES GROWTH +27B +18% +22% MEDIA DFD DIGITAL IMPRESSIONS SALES1 SALES1 +27% LOYALTY GROWTH2 Krispy 1) Kreme 2Q24 | 2Q24 Earnings vs. 2Q23 7 2) U.S. Loyalty program year-over-year member growth
Slide 8: Increasing Global Points of Access
INCREASING GLOBAL POINTS OF ACCESS Krispy Kreme | 2Q24 Earnings 8
Slide 9: Increasing Global Points of Access
INCREASING GLOBAL POINTS OF ACCESS EXISTING 33,000 CUSTOMERS 33% CAGR NEW CUSTOMERS 19% 14,147 CAGR 8,316 NEW MARKETS 1 2020 2023 2026 1) 2026 Points of Access count represents management estimates Krispy Kreme | 2Q24 Earnings 9
Slide 10: Accelerating Profitable U.S. Expansion
ACCELERATING PROFITABLE U.S. EXPANSION Krispy Kreme | 2Q24 Earnings 10
Slide 11: Accelerating Profitable U.S. Expansion: U.S. Points of Access
ACCELERATING PROFITABLE U.S. EXPANSION 1 U.S. POINTS OF ACCESS COAST-TO-COAST EXPANSION OF DELIVERED FRESH DAILY NETWORK Krispy Kreme | 2Q24 Earnings 11 1) Rounded to nearest thousand; 2026 numbers represent management estimates
Slide 12: McDonald's Restaurants Serving Fresh Doughnuts
ACCELERATING PROFITABLE U.S. EXPANSION MCDONALD'S RESTAURANTS SERVING FRESH DOUGHNUTS NATIONWIDE ROLLOUT STARTING THIS FALL IN THE MIDWEST Krispy Kreme | 2Q24 Earnings 12
Slide 13: Modernizing the Making and Moving of Doughnuts
ACCELERATING PROFITABLE U.S. EXPANSION • Dedicated rollout team • Hiring and training • Hub readiness • Logistics optimization MODERNIZING THE MAKING AND MOVING OF DOUGHNUTS Krispy Kreme | 2Q24 Earnings 13
Slide 14: Improved Distribution Density to Drive Profitability
ACCELERATING PROFITABLE U.S. EXPANSION SPOKES PER HUB TODAY SPOKES PER HUB 2026 NATIONAL CHICAGO NATIONAL CHICAGO ~50 40 >100 ~150 HUB WITH SPOKES POINT OF Chicago Chicago ACCESS IMPROVED DISTRIBUTION DENSITY TO DRIVE PROFITABILITY Krispy Kreme | 2Q24 Earnings 14
Slide 15: Development of National Hub and Spoke Network Well Underway
ACCELERATING PROFITABLE U.S. EXPANSION U.S. HUBS WITH SPOKES 1 1) Acquired July 15, 2024 DEVELOPMENT OF NATIONAL HUB AND SPOKE NETWORK WELL UNDERWAY Krispy Kreme | 2Q24 Earnings 15
Slide 16: Financial Update
FINANCIAL UPDATE Krispy Kreme | 2Q24 Earnings 16
Slide 17: Financial Results Beat Expectations
FINANCIAL RESULTS BEAT EXPECTATIONS ORGANIC REVENUE ADJ EBITDA ADJ EBITDA MARGIN +7.8% +12.1% +60 bps $55 12.5% $440 $49 $407 11.9% 2Q23 2Q24 Krispy Kreme | 2Q24 Earnings All metrics are $MM except Adjusted EBITDA margin 17
Slide 18: U.S. Segment
U.S. SEGMENT DFD DOORS 7,497 2Q22 2Q23 2Q24 6,320 5,520 POINTS OF ACCESS 6,043 6,858 8,082 SALES PER HUB ($MM) $4.3 $4.7 $5.0 NET REVENUE ($MM) $244.7 $267.4 $289.3 ORGANIC GROWTH % 6.0% 12.7% 8.4% AVERAGE REVENUE PER DOOR PER WEEK $632 $657 ADJ EBITDA ($MM) $24.2 $28.1 $32.7 $546 ADJ EBITDA MARGIN
Slide 19: International Segment
INTERNATIONAL SEGMENT 1 DFD DOORS 2Q22 2Q23 2Q24 4,871 POINTS OF ACCESS 3,649 3,922 5,437 3,161 3,396 SALES PER HUB ($MM) $9.5 $9.9 $10.1 NET REVENUE ($MM) $110.6 $120.6 $125.3 AVERAGE REVENUE PER DOOR ORGANIC GROWTH % 14.5% 9.1% 5.0% PER WEEK $847 $763 ADJ EBITDA ($MM) $22.6 $24.7 $21.7 $613 ADJ EB
Slide 20: Market Development Segment
MARKET DEVELOPMENT SEGMENT 1 2Q22 2Q23 2Q24 POINTS OF ACCESS 2,334 POINTS OF ACCESS 1,717 2,092 2,334 2,092 1,717 NET REVENUE ($MM) $20.0 $20.9 $24.2 ORGANIC GROWTH % 14.7% 8.7% 16.1% ADJ EBITDA ($MM) $9.3 $10.5 $12.9 ADJ EBITDA MARGIN 46.3% 50.3% 53.1% 2Q22 2Q23 2Q24 1) Reflects move of Canada and
Slide 21: Earnings Per Share
EARNINGS PER SHARE 2Q23 2Q24 ADJ EBITDA $48.8 $54.7 DEPRECIATION & (21.8) (27.2) AMORTIZATION INTEREST & TAX (15.7) (17.8) NONCONTROLLING 0.1 (0.6) INTEREST WEIGHTED AVERAGE 170.7 171.5 SHARES OUTSTANDING ADJ DILUTED EPS $0.07 $0.05 All metrics are $MM, except Adjusted Diluted EPS ($s) and Weighted
Slide 22: Cash Flow as Expected Ahead of Insomnia Transaction
CASH FLOW AS EXPECTED AHEAD OF INSOMNIA TRANSACTION FY 2023 YTD 2024 CASH, CASH EQUIVALENTS & NET LEVERAGE RATIO RESTRICTED CASH AT BEGINNING OF $35.7 $38.6 THE FISCAL YEAR 4.2x 4.2x 4.1x 4.2x 4.2x 3.9x 4.0x NET CASH FROM OPERATIONS 45.5 15.5 NET CASH USED FOR INVESTING (112.6) (65.2) NET CASH FROM
Slide 23: Guidance Updated Solely to Reflect the Sale of Insomnia Cookies
GUIDANCE UPDATED SOLELY TO REFLECT THE SALE OF INSOMNIA COOKIES INSOMNIA PREVIOUS1 UPDATED 2024 FULL YEAR TRANSACTION GUIDANCE GUIDANCE EFFECT NET REVENUE $1,770 – $1,805 ~$120 $1,650 – $1,685 GROWTH ORGANIC REVENUE 6 – 8% ~1% 5 – 7% GROWTH ADJ EBITDA $229 – $235 ~$15 $215 – $220 GROWTH ADJ DILUTED
Slide 24: Focus on High Quality, Profitable Growth
FOCUS ON HIGH QUALITY, PROFITABLE GROWTH EXPAND AVAILABILITY DRIVE OPERATING Disciplined Pursuit to LEVERAGE MAXIMIZE CAPITAL RETURNS Krispy Kreme | 2Q24 Earnings 24
Slide 25: Q&A
Q&A Krispy Kreme | 2Q24 Earnings 25
Slide 26: Appendix
APPENDIX Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 International Segment Revenue 104,493 110,558 107,585 113,015 111,988 120,588 126,077 130,978 Adjusted EBITDA 19,999 22,627 19,895 24,728 18,982 24,702 24,961 27,887 Market Development Segment Revenue 20,120 20,022 23,107 20,74