Slide 1: 1H14 Results Presentation - Correction
ASX/media release For personal use only 28 February 2014 1H14 Results Presentation - Correction Retail Food Group Limited (RFG or the Company) advises that two errors have been identified in the 1H14 Results Presentation released this morning: • The “Total Australian” (1,263 outlets not 1,261 as sta
Slide 2: 1H14 Results Presentation
1H14 Results Presentation For personal use only
Slide 3: 1H14 Summary
1H14 Summary For personal use only Statutory Results 1H10 1H11 1H12 1H13 1H14 PCP % Total Revenue (1) $61.3m $60.3m $49.5m $60.0m $64.6m 7.7% EBIT $21.5m $22.2m $24.0m $25.2m $27.4m 8.7% NPAT $12.5m $13.6m $14.5m $14.6m $17.3m 18.0% Basic EPS 12.4 cps 12.8 cps 13.4 cps 12.5 cps 12.9 cps 3.2% Interim
Slide 4: Retail Food Group Limited
Retail Food Group Limited (ASX: RFG) For personal use only RFG designs, develops and manages retail franchise systems and is the intellectual property owner and licensor of the following Brand Systems: Non-QSR QSR - Donut King - Crust Gourmet Pizza - Michel’s Patisserie - Pizza Capers - Brumby’s B
Slide 5: 1H14 Headlines
1H14 Headlines For personal use only Financial Headlines: - NPAT: $17.3m (up 18.0% on PCP) - EPS: 12.9 cps (up 3.2% on PCP) - Dividends: 10.75 cps (up 13.2% on PCP) - Gross debt: $62.9m with cash and facility headroom of $85.5m - Gearing: Conservative gearing ratio of 14.1% and interest coverage o
Slide 6: 1H14 Financial Highlights
1H14 Financial Highlights For personal use only EBIT of $27.4m represents 8.7% increase on PCP ($25.2m) - EBITDA increase of 9.7% to $28.1m (PCP: $25.6m) NPAT of $17.3 million represents 18.0% increase on PCP ($14.6m) - Strong result given continued investment in organic growth Robust cash gen
Slide 7: 1H14 Brand System Review
For personal use only 1H14 Brand System Review 6
Slide 8: 1H14 Summary of Brand System Performance
1H14 Summary of Brand System Performance For personal use only 1H14 Donut Brumby's Michel's QSR Other Summary King Bakery Patisserie GFR($m)(1) 43.7 9.3 8.8 13.1 10.0 2.5 EBITDA contributions of the respective Brand Systems FSF ($m)(1) 23.5 5.4 5.4 5.1 6.4 1.2 vindication of RFG’s multi-revenue EB
Slide 9: 1H14 Summary of Brand System Performance
1H14 Summary of Brand System Performance For personal use only EBITDA contribution from QSR of $7.0m now representing 24.9% of RFG Group EBITDA, notwithstanding QSR 400 start up costs Exemplary performance of the Crust Brand System achieving performance hurdles set at acquisition, triggering ful
Slide 10: Operational Overview
Operational Overview For personal use only Significant traction in the QSR 400 project, with 49 outlets commissioned - Exceeded 1H14 initial program expectation of 30 Project Evo pilot outlet commissioning completed; comprising: - Donut King (Traditional & Drive Thru) - Esquires (Traditional, St
Slide 11: Crust Gourmet Pizza Bar
Crust Gourmet Pizza Bar For personal use only 39% growth in online transactions on PCP continue to drive sales: - Represents 29% of total sales - 9% higher ATV than Brand System ATV Delivery: - Delivery order increase of 6% on PCP - Delivery sales increase of 9% on PCP - ‘Best Practice’ driver e
Slide 12: Pizza Capers
Pizza Capers For personal use only Aggressive digital marketing campaigns resulted in: - Increased online sales of 119% on PCP, representing 18% of Brand System sales - Significant investment in digital advertising resulting in 5.2m impressions generating valuable brand exposure and sales traction
Slide 13: Donut King
Donut King For personal use only Proliferation of Evo concepts that meet consumer demand for customisation and rich brand engagement, through experiential retailing Evo outlets continue to outperform comparative stores (1H14): - New stores (neighbourhood and sub regional) avg. 25% above ‘Compara
Slide 14: Michel's Patisserie
Michel’s Patisserie For personal use only Project Evolution successfully launched based on leading European patisserie trends, coffee and retail excellence First Evo outlet commissioned 1H14 in Lilydale, Victoria: - Trial successfully completed - Performance to date: - Sales trending c. 19% abov
Slide 15: Brumby's Bakery
Brumby’s Bakery For personal use only First Evo outlet commissioned December 2013 in Underwood QLD: - Concept trialling for 3 month period - Represents most significant transformation in Brand System’s history to strengthen position as Australia’s leading Bakery: - Returning to authentic baker roo
Slide 16: 2H14 Initiatives & Outlook
For personal use only 2H14 Initiatives & Outlook 15
Slide 17: 2H Initiatives – QSR Brand Systems
2H Initiatives – QSR Brand Systems For personal use only QSR400: - Continuing to capitalise on strong new site pipeline - c. 40 outlets to be commissioned - Continued investment in franchise support initiatives Menu Innovation: - Pending launch of Crust’s ‘Premium Starters’ category - Pizza Cape
Slide 18: 2H Initiatives – Non QSR Brand Systems
2H Initiatives – Non QSR Brand Systems For personal use only Project Evo new outlets and refurbishments c.80 across: - Donut King - Michel’s Patisserie - Brumby’s Bakery Continued backfill of Evo elements into existing Brand System networks, including: - Menu extension - Product innovation - Mer
Slide 19: 2H Initiatives – Operational
2H Initiatives – Operational For personal use only Commissioning of 2nd Australian coffee roasting facility at Yatala, QLD incorporating chocolate blending capability Commissioning of Australian wholesale coffee division: - Launch of RFG proprietary New Zealand brands Evil Child and Roasted Addi
Slide 20: Capital Management & Outlook
Capital Management & Outlook For personal use only Capital Management Capital raising proceeds of $58.3m (before costs) received in December 2013 used to pay down debt whilst organic growth opportunities are pursued and other investment opportunities assessed Acquisitive activity remains a centr
Slide 21: Appendices
Appendices For personal use only Appendix 1 – Summary Financial Performance Appendix 2 – Earnings Performance Appendix 3 – Cash Flow Performance Appendix 4 – Financial Position Appendix 5 – Debt Structure Appendix 6 – Capital Management 20
Slide 22: Appendix – Summary Financial Performance
Appendix 1 – Summary Financial Performance For personal use only 21
Slide 23: Appendix – Earnings Performance
Appendix 2 – Earnings Performance For personal use only 1H14 1H13 Franchise, licensing & other fees up 9.8% to $38.1m, $’m $’m reflecting contribution of acquisitions completed during Revenue from franchising operations 51.6 45.5 1H13 and increase in initial franchise fees from new Revenue from wh
Slide 24: Appendix – Cash Flow Performance
Appendix 3 – Cash Flow Performance For personal use only 1H14 1H13 $’m $’m Receipts from customers 82.9 71.8 Payments to suppliers and employees (58.0) (49.9) Gross operating cash flows 24.9 21.9 Continuing strong cash flows – a feature of RFG’s business model – supported by balanced investment an
Slide 25: Appendix – Financial Position
Appendix 4 – Financial Position For personal use only 1H14 FY13 $’m $’m Assets: Working capital increases attributable to increased funding of marketing initiatives, seasonal increases in Cash reserves 13.4 16.8 revenues and payment terms offered to franchisees on Trade receivables 21.1 19.0 new s
Slide 26: Appendix – Debt Structure
Appendix 5 – Debt Structure For personal use only ‘NAB’ Facility 1H14 Facility headroom (including cash) at 31 December 2013 of $85.5m Gross debt $62.9m Gross debt of $62.9m at 31 December 2013: Interest expense $2.8m - $50m of debt subject to a fixed interest rate, with tenure extended to Inter
Slide 27: Appendix – Capital Management
Appendix 6 – Capital Management For personal use only Proceeds/Value Shares Price ($m) Shares on issue 1st July 2013 130,277,856 ESOP – exercise of options (October 2013) 103,334 2.43 0.25 Institutional/Sophisticated Investor Placement 12,325,582 4.30 53.0 (November 2013) SPP (December 2013) 1,238,2
Slide 28: Disclaimer
Disclaimer For personal use only No responsibility for contents of Presentation To the maximum extent permitted by law, Retail Food Group Limited (ABN 31 106 840 082), its officers, advisers and representatives: make no representation, warranty or undertaking, and accept no responsibility or liabi