Sphera Franchise Group Sa · BVB:SFG
Sphera Franchise Group Sa — H1 2022 Earnings Presentation
40 slides from Sphera Franchise Group Sa's earnings presentation, Sep 15, 2022
Slide 1: Sphera Franchise Group Investor Presentation
Sphera Franchise Group Investor Presentation September 2022
Slide 2: Disclaimer
Disclaimer This presentation is not, and nothing in it should be construed as, an offer, invitation or recommendation in respect of shares issued by Sphera Franchise Group SA ("Sphera"), or an offer, invitation or recommendation to sell, or a solicitation of an offer to buy shares in Sphera. Neither
Slide 3: Contents
Contents 1 About Sphera Franchise Group 2 Development Plan 3 H1 2022 Highlights 4 2022 Updates 5 Annex 1: Key H1 2022 Financials 6 Annex 2: Key 2021 Financials 3
Slide 4: About Sphera Franchise Group
About Sphera Franchise Group 4
Slide 5: Purpose, Vision, Mission
PURPOSE Development through relevance and trust. VISION Be the leaders in the Romanian food service industry and become an important player at the European level. MISSION Offer customers a memorable experience, through excellent services and unique products, prepared by passionate teams. 5
Slide 6: Sphera Franchise Group at a glance
Sphera Franchise Group at a glance • Sphera is one of the leading food operators in Romania, operating through subsidiaries in Moldova and in Italy. • Sphera Franchise Group was incorporated in May 2017 to consolidate all brands operated by the Group: KFC, Pizza Hut Dine-In and Pizza Hut Delivery si
Slide 7: 2nd QSR Operator in Romania
2nd QSR Operator in 1st Full-Service Restaurant 25 years track-record Romania Operator in Romania 3 iconic brands: KFC, Pizza 174 restaurants in 3 SFG shares included in BVB Hut, Taco Bell countries BET & FTSE Russell Micro- cap 7
Slide 8: Sphera Franchise Group at a glance
Sphera Franchise Group at a glance Locations split per brand Geographical footprint 2 20 23 150 3 14 24 19 69 9 11 Bucharest Food Court In Line Drive-through KFC restaurants PH and PH Delivery restaurants Taco Bell restaurants 8 Notes:Restaurants of of 12.09.2022, 1 Paul Store & 1 PHD sub-franchise
Slide 9: Sphera Franchise Group corporate structure
Sphera Franchise Group corporate structure 99.9% 99.9% 99.9% 100% 80% American Restaurant California Fresh US Food Network US Food Network US Food Network S.A. System S.A. Flavors S.R.L. S.R.L. - Italy S.R.L. - Moldova Holds the franchise rights to Holds the franchise and sub- Holds the franchise ri
Slide 10: Management team
Management team CALIN IONESCU VALENTIN BUDES MONICA EFTIMIE CRISTIAN OSIAC MARINA TOPSA CEO CFO CMO COO Legal Director Mr Ionescu is the CEO of Sphera Mr Budes is the CFO of the Sphera Mrs Eftimie is the CMO of Sphera Mr Osiac has been the Chief Mrs Topsa is the Legal Director at Franchise Group sin
Slide 11: Leading foodservice group in Romania
Leading foodservice group in Romania QSR QSR #2 player on the chained QSR segment (21.4% market share) #1 player on the QSR chicken segment ü 88% aided brand awareness among Romanian customers (Dec’21) ü Stronger than McDonald’s in Brand Power, Usage Funnel and Main Product Attributes ü First Taco B
Slide 12: Key investment highlights
Key investment highlights Leading food service Scalable platform with Improved liquidity due Operational excellence group operating a fully fledged process in to Market Making, proven by consistent top portfolio of iconic, place allowing efficient attested by inclusion in ranked among YUM internatio
Slide 13: Track record of growth & network development
Track record of growth & network development KFC Pizza Hut Dine-In Pizza Hut Delivery Taco Bell VUCA Phase 174 Transformation Phase 168 Development Phases 14 154 156 13 10 11 20 138 19 Acceleration Phase 5 18 22 113 22 22 22 2 21 23 98 17 Initial Phase 23 86 12 74 75 76 9 22 21 64 10 9 9 18 60 54 8
Slide 14: Historical performance, slowed by the pandemic
Historical performance, slowed by the pandemic Turnover Normalized EBITDA 14% CAGR 2016-2021 96 73.5 69.3 72.4 73.5 44.1 2016 2017 2018 2019 2020 2021 1000 955 Net profit 771 711 619 514 64.2 51.6 32.6 24.3 27.4 -2.4 2016 2017 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021 14
Slide 15: SFG on BVB
SFG on BVB Other shareholders 34.40% Tatika Investments Ltd 28.61% SFG is quoted on the Main Market of Bucharest Stock Exchange since November 2017. Since September 2018, SFG shares are included in the reference index of BVB, BET and since March 2022, in FTSE Global Micro Cap Wellkept Group SA Compu
Slide 16: Sustainability
Sustainability Sphera Franchise Group strategy is based on four pillars and relevant material topics defined together with the organization stakeholders. The management set general and specific medium and long-term objectives, with targets until 2025, aligned with the Sustainable Development Goals.
Slide 17: Development Plan
Development Plan NY SPHERA KFC @
Slide 18: 2022 Guidance
2022 Guidance • Inflation in 2022 exceeded the levels estimated in Budget approved in April 2022 GSM: the food and material costs due to inflation are expected to exceed the estimates used in preparing the 2022 budget. This is due to the increase in all material costs categories with the greatest im
Slide 19: Restaurant Development Plan
Restaurant Development Plan 2022 2023 2024 2025 2026 Total Food Court 1 1 1 1 1 5 KFC Romania* Drive-Thru 2 5 5 5 5 22 In-line 3 - - - - 3 Pizza Hut FCD 1 3 - - - 4 Romania Express 1 1 - - - 2 Taco Bell Food Court 2 3 3 3 3 14 Romania In-line - 2 2 2 2 8 KFC Italy Drive-Thru - 1 1 1 1 4 In-line - -
Slide 20: Efficient restaurant roll-out
Efficient restaurant roll-out Restaurant-selection criteria New restaurant opening process Market Analysis Generators Identify Best Locations (leisure – e.g. shopping centres, cinemas or retail – Traffic Traffic & Market Research e.g. DIY, hypermarkets, furniture stores etc) Project Management Archi
Slide 21: H1 2022 Highlights
H1 2022 Highlights NY SPHERA KFC @
Slide 22: SFG Performance in H1 2022
SFG Performance in H1 2022 • Best quarter in history: SFG delivered the best sales quarter in history, registering RON 327.4 million in revenues, + 40% YoY. All brands registered record sales, across all markets Data in RON’000 H1-22 H1-21 Y/Y % of activity in a rapid ramp-up following the lifting o
Slide 23: SFG H1 2022 Performance
SFG H1 2022 Performance 606 6% 608 +3 0% 30.7 444.5 +4 327.4 H1 -31% 322.3 +4 0% 434.1 233.1 21.2 17.6 208.3 225.8 3% Q2 +4 -1% 3.8 17.5 278.6 285.7 211.4 7% 13.1 Q1 2% +3 -71% +3 2021 2022 2021 2022 2021 2022 Restaurant Sales Expenses (Restaurant + G&A) Normalized EBITDA in RON m in RON m, excl. IF
Slide 24: SFG H1 2022 Performance breakdown
SFG H1 2022 Performance breakdown Contribution to H1 2022 turnover 5.2% 11.9% 1.2% 9.6% Q1 46% 54% 86.8% 85.2% Q2: 15% Q3: 27.8% Q2 Per market Per brand Per quarter 24
Slide 25: 2022 Updates
2022 Updates 25
Slide 26: COVID-19 & Fiscal Updates
COVID-19 & FISCAL UPDATES Restrictions • Lifting of the restrictions in all markets of activity in Q2 2022: As of 09.03.2022, Romania has lifted all the COVID-19 restrictions and consequently, both vaccinated and unvaccinated customers can enter shopping malls and restaurants without limitations. Th
Slide 27: Restaurant development, Staff
Restaurant development, Staff Number of stores • 174 restaurants operated: SFG operated 174 restaurants as of 30.06.2022, out of which 94 KFC restaurants in Romania, 2 in Moldova and 20 in Italy, as well as 14 Taco Bell restaurants, 42 Pizza Hut restaurants (of which 22 Pizza Hut and 20 Pizza Hut De
Slide 28: Capital Markets, Sustainability & Dividends
Capital Markets, Sustainability & Dividends FTSE Russell • Inclusion in the FTSE Global Microcap: SFG shares were included, as of March 21st, 2022, in the FTSE Russell indices for Emerging Markets, FTSE Global Micro Cap index. Liquidity criteria has been met each month since the beginning of 2022 (t
Slide 29: Marketing
Marketing KFC: Drive frequency and maximize relevance • Zinger Mozzarella: KFC focused on strengthening favorability for the burger layer by successfully launching an innovative burger in Q2 called Zinger Mozzarella. The unique communication campaign resulted in strong same-store sales growth and an
Slide 30: Marketing
Marketing Taco Bell: Drive trial and build brand • New chalupa: Taco Bell focused its communication in Q2 on product innovation with a value price point by re-launching the Chalupa with the aim of building both consideration and trial while making the core products affordable. • Nothing ordinary: Wi
Slide 31: Annex 1: Key H1 2022 Financials
Annex 1: Key H1 2022 Financials 31
Slide 32: Summary of H1 2022 Consolidated FS
Summary of H1 2022 Consolidated FS 32 Results excl. IFRS16
Slide 33: Summary of H1 2022 Consolidated FS
Summary of H1 2022 Consolidated FS (with and without IFRS 16 impact) 33
Slide 34: Breakdown of H1 2022 results by entity
Breakdown of H1 2022 results by entity 34 Results excl. IFRS16
Slide 35: Annex 2: Key 2021 Financials
Annex 2: Key 2021 Financials 35
Slide 36: Summary of 2021 Consolidated FS
Summary of 2021 Consolidated FS (excluding IFRS 16 impact) 36
Slide 37: Summary of 2021 Consolidated FS
Summary of 2021 Consolidated FS (with and without IFRS 16 impact) 37
Slide 38: Breakdown of 2021 results by entity
Breakdown of 2021 results by entity (excluding IFRS 16 impact) 38
Slide 39: Notes
Notes 39
Slide 40: Thank you!
SFG 2022 Financial Calendar 14.11.2022 – Q3 2022 Results 14.11.2022 – Q3 2022 Results Call Thank you! For any follow-up questions related to Sphera Franchise Group’s activity on the Bucharest Stock Exchange, please contact Zuzanna Kurek, IRO at: investor.relations@spheragroup.com. 40
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