The One Group Hospitality, Inc. · NASDAQ:STKS
The One Group Hospitality — Merger or Acquisition (March 2024)
21 slides from The One Group Hospitality's merger presentation, March 2024
Slide 1: The ONE Group to Acquire Owner of Benihana
The ONE Group to Acquire Owner of Benihana
Slide 2: Forward-looking Statements
Forward-looking Statements Forward-Looking Statements This presentation includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995, including with respect to restaurant openings, run-rate adjustments,
Slide 3: Vision, Mission and About Us
VISION The Undisputed Global Leader in VIBE Dining MISSION To be the BEST Restaurant In Every Market That We Operate by Delivering Exceptional and Unforgettable Guest Experiences to Every Guest, Every Time. ABOUT US We are an international restaurant company that develops and operates upscale and po
Slide 4: The Global Leader in VIBE Dining
The Global Leader in VIBE Dining Experiential Entertaining VIBE DINING – Unforgettable, Energetic, Fun and Entertaining Created by the Flawless Execution of the Seven Fundamentals! 4
Slide 5: Strategic Fit
Strategic Fit The ONE Group Hospitality, Inc. is acquiring Safflower Holdings Corp., the owner of Benihana Inc. (“Benihana”), a leading operator of highly differentiated experiential brands that owns the only national teppanyaki brand in the U.S. and owns RA Sushi Combines top entertainment bran
Slide 6: Footprint – 168 Venues Internationally and Growing
Footprint – 168 Venues Internationally and Growing Full-Service Entertainment Restaurants (114) Grill Restaurants (46) 28 International 86 Americas 27 Domestic 19 Domestic ~$350MM System-wide Revenue Brand ~$500MM System-wide Revenue Brand ~$150MM System-wide Revenue Brand ~$80MM System-wide Revenue
Slide 7: Benihana: An Iconic Pioneer in Entertainment Dining with Far Reaching Press
Benihana: An Iconic Pioneer in Entertainment Dining with Far Reaching Press Lester Kasai, “The Benihana” 1990’s 2000’s 2010’s 2020’s Joshua Weissman Influencer Police Academy 2 8M 8M subscribers 7 subscribers
Slide 8: Benihana: One-of-a-Kind, Celebratory Experience Drives Strong Brand Advocacy
Benihana: One-of-a-Kind, Celebratory Experience Drives Strong Brand Advocacy TIMELESS APPEAL MOMENTS WORTH CREATING GREAT GUEST STRONG TRANSCENDS CELEBRATING MEMORIES!! BRAND ADVOCACY GENERATIONS Net Promotor Score (1) #1 Fun Place to Go Generation Overall Guest Satisfaction (Represents NPS “Gap” vs
Slide 9: The Undisputed Global Leader in VIBE Dining
The Undisputed Global Leader in VIBE Dining VIBE DINING Iconic & Highly Differentiated Experiential Brands High Quality, Flavorful and Craveable Menu World Class Bar Program Memorable Hospitality & Exceptional Service Fun, Vibrant & Energizing Environment 9
Slide 10: Proven & Scalable Global Platform with Compelling Whitespace
Proven & Scalable Global Platform with Compelling Whitespace 168 Total Venues Across 32 States and 12 Countries United Kingdom Italy Canada Panama El Salvador Brazil Aruba Puerto Rico UAE Qatar Mexico Spain (1) STK (28) Kona Grill (27) F&B Venues (8) Benihana (86) RA Sushi (19) Benihana & STK 10 (1)
Slide 11: Highly Complementary Brands that Diversify the Portfolio and Guest Base
Highly Complementary Brands that Diversify the Portfolio and Guest Base Proof of Concept: (Number of Years) 19+ Years 24+ Years 55+ Years 26+ Years Real Estate Flexibility: 8,000-10,000 sq. ft. 7,000-8,000 sq. ft. 8,000 sq. ft. 5,000 sq. ft. (Targeted Square Feet) Distinct Dining Occasions: $130 $37
Slide 12: Proven Acquisition & Integration Capabilities
Proven Acquisition & Integration Capabilities Existing Capabilities to High Impact Sales Drivers and Driving Significant Performance Support Platform Acquisitions Operational Improvements Improvement at Kona Grill Focused menu reengineering AUV ($mm) Best-in-Class Leadership Team +24% Menu innov
Slide 13: Core Values Supporting Our Strategy
Core Values Supporting Our Strategy Honesty *** Integrity *** Fact Based *** Accountability Leverage Corporate G&A Believe in the ONE Team – Power of ONE ONE Mission - (“Pof1”) ONE Goal Change is the ONLY Constant 37 Strategic: Set Goals => Execute => Measure => Reward 13
Slide 14: The Core
The Core Vision: The Undisputed Global Leader In VIBE Dining. To be the BEST Restaurant In Every Market That We Operate by Delivering Mission: Exceptional and Unforgettable Guest Experiences to Every Guest, Every Time. STRATEGY PILLARS Operations Marketing Culinary Execution: Best at Four Wall Execu
Slide 15: Transaction Summary
Transaction Summary Consideration • $365 million enterprise value, paid in cash • 5.2x FY 2023 Benihana Run Rate Adj. EBITDA of ~$70 million Transaction Multiple • 4.1x FY 2023 Benihana Run Rate Adj. EBITDA of ~$90 million with expected synergies • Expect to achieve up to $20.0 million in annual syn
Slide 16: Additional Estimates
Additional Estimates $ in Millions BEFORE AFTER CHANGE • Cash $21 $55 $34 • Debt $74 $350 $276 Capitalization • Net Debt $53 $295 $242 • Preferred Equity $0 $160 $160 • Share Count 31.3 33.0 1.7 • Venue Count 63 168 105 • TTM System-wide Revenue $436 $1,039 $603 • TTM GAAP Revenue $333 $847 $514 Fin
Slide 17: Expected Sources and Uses of Cash
Expected Sources and Uses of Cash Sources New Term Loan (Net of OID) $338.3 Preferred Equity (Net of OID) 152.0 Total Sources $490.3 Uses Purchase Price $365.0 Paydown of Existing Debt 76.2 Transaction Expenses 15.0 Cash to Balance Sheet 34.1 Total Uses $490.3 17
Slide 18: Benihana Consolidated SSS Trailing Eight Quarters
Benihana Consolidated SSS Trailing Eight Quarters 18
Slide 19: Path to Five Billion
Path to Five Billion (1) Long-Term Growth Targets* • 3-5 annual STK unit growth • 3-5 annual Kona Grill unit growth • 3-5 annual Benihana unit growth • 1-3 new F&B Hospitality managed deal • Same store sales growth of 3% - 5% • Focus on capital light • Disciplined G&A management • Maintain strong re
Slide 20: The ONE Group Highlights
The ONE Group Highlights Well Positioned for Fast Growing Hospitality Significant Growth in a Company Transforming Hospitality Sector Acquisitions can Further Strong Management Team Enhance our Brand Portfolio and Infrastructure to Support and Unit Pipeline Growth Strong Economics Drives Flexibility
Slide 21: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures 2023 and TTM Financials (1) The ONE Group Benihana Net Income $4.0 $5.8 Income Taxes (1.8) 2.6 Interest Expense 7.0 34.2 D&A Expense 15.7 17.1 Pre-opening Expense 8.9 2.3 Stock-based Compensation 5.0 0.0 (2) Other Addbacks $1.3 3.2 Adjusted EBITDA $40.1
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