Collins Foods Limited · ASX:CKF
Collins Foods — H1 FY2012 Earnings Presentation
30 slides from Collins Foods's earnings presentation, Dec 5, 2011
Slide 1: FY12 Half Year Results Presentation
For personal use only FY12 HALF YEAR RESULTS PRESENTATION 5 DECEMBER 2011 24 WEEKS TO 16 OCTOBER 2011 ® COLLINS FOODS LIMITED 0
Slide 2: Disclaimer
DISCLAIMER For personal use only "This presentation contains forward looking statements which may be subject to significant uncertainties beyond CKF's control. No representation is made as to the accuracy or reliability of forward looking statements or the assumptions on which they are based. Circum
Slide 3: Presenting Today
PRESENTING TODAY For personal use only - RUSSELL TATE – CHAIRMAN - KEVIN PERKINS – MANAGING DIRECTOR & CEO - SIMON PERKINS – CFO COLLINS FOODS LIMITED 2
Slide 4: Agenda
AGENDA For personal use only - SECTION 1 – RESULTS OVERVIEW - SECTION 2 – KFC - SECTION 3 – SIZZLER - SECTION 4 – GROUP RESULTS - SECTION 5 – OUTLOOK - SECTION 6 – QUESTIONS - SECTION 7 – APPENDIX COLLINS FOODS LIMITED 3
Slide 5: Results Overview
For personal use only RESULTS OVERVIEW SECTION 1 COLLINS FOODS LIMITED 4
Slide 6: Executive Summary: 1H12 Results Overview
EXECUTIVE SUMMARY For personal use only 1H12 RESULTS OVERVIEW – Difficult consumer environment in Queensland impacting revenue and product mix – 1H12 pro forma results largely tracked prospectus expectations(a) until final period (19 Sept – 16 Oct) – Pro forma revenue of $188.1m down 1.3% on prospec
Slide 7: Group Income Statement – Pro Forma
GROUP INCOME STATEMENT – PRO FORMA For personal use only 1H12 ACTUAL VS PROSPECTUS EXPECTATION COMPARISON – Revenue performance for KFC and Sizzler close to prospectus expectations for majority of reporting period Pro Forma – October period materially weaker sales as: 1H12 1H12 1H11 – weaker custome
Slide 8: 1H12 Trading Conditions
1H12 TRADING CONDITIONS For personal use only 1H12 REVENUE PER PERIOD KFC 30.0 24.2 24.4 24.0 23.5 23.5 23.8 23.4 24.0 23.3 24.2 24.9 23.3 25.0 22.8 22.7 22.7 22.4 22.5 23.1 Revenue ($m) 20.0 15.0 10.0 5.0 0.0 P1 (29-May-11) P2 (26-Jun-11) P3 (24-Jul-11) P4 (21-Aug-11) P5 (18-Sep-11) P6 (16-Oct-11)
Slide 9: KFC
For personal use only KFC SECTION 2 COLLINS FOODS LIMITED 8
Slide 10: KFC Highlights
KFC HIGHLIGHTS For personal use only RESULTS SUMMARY – Business performance below prospectus expectation Pro Forma – Revenue in line with prospectus expectations for first 1H12 1H12 5 periods Actual Prospectus Δ – 6.4% below prospectus expectations for the 4 weeks $million Expectation ended 16 Oct 2
Slide 11: KFC Restaurant Upgrades
KFC RESTAURANT UPGRADES For personal use only RESTAURANT ROLL-OUT AND REFURBISHMENTS ON TRACK – Refurbishment program on track 1H12 1H12 Actual Prospectus – $4.8m spent on KFC refurbishments and new restaurants Expectation opened in 1H12 – $0.8m on new restaurants Refurbished – $1.6m on rebuilding e
Slide 12: 1H12 Refurbished Restaurants – Examples
1H12 REFURBISHED RESTAURANTS - EXAMPLES For personal use only – Reopened 16 June 2011 – Largely scrape and rebuild (15 week closure) Cairns KFC – Increase in area and seating 1 – Early trading results pleasing – Sales volumes post rebuild averaging $62k per week, in line with prospectus expectation
Slide 13: New Restaurants
NEW RESTAURANTS For personal use only NEW RESTAURANTS OPENED – Restaurant opened 13 October 2011 – Foodcourt 75m2 in new Canelands Shopping Centre 1 Mackay Foodcourt KFC – Record opening week sales of $84k for 7 days – Sales volumes settled at $37k per week, slightly above prospectus expectation – C
Slide 14: Products & Promotion – Activity During 1H12
PRODUCTS & PROMOTION – ACTIVITY DURING 1H12 For personal use only Value bundle for $24.95 – Premium positioning Bundled as a complete Flavour news to existing exceeded forecast endorsed by celebrity chef and affordable meal range – doubled expectations solution for the family promotional forecasts –
Slide 15: Products & Promotion – Activity for 2H12
PRODUCTS & PROMOTION – ACTIVITY FOR 2H12 For personal use only – Cricket – 3 year contract with KFC Twenty20 – Messaging “Put us to the FRESH Test” – Brand exposure through: ground signage, KFC Fresh Trivia (feature during Tests and One Day Internationals for duration of cricket season), Classic Cla
Slide 16: Sizzler
For personal use only SIZZLER SECTION 3 COLLINS FOODS LIMITED 15
Slide 17: Sizzler Australia Summary
SIZZLER AUSTRALIA For personal use only SUMMARY – Revenue performance largely on track Periods 1 to 5 Pro Forma – 8.8% unfavourable variance to prospectus expectations for the 4 weeks ended 16 Oct 2011 1H12 1H11 Pro forma Prospectus Δ – Expected improvement did not occur $million Expectation – Refur
Slide 18: Sizzler Facilities Investment
SIZZLER FACILITIES INVESTMENT For personal use only RESTAURANT ROLL-OUT AND REFURBISHMENTS ON TRACK – Refurbishment program on track 1H12 1H12 Actual Prospectus – $1.0m spent on refurbishments completed in 1H12 Expectation – Difficult to assess returns due to limited availability of post data Refurb
Slide 19: New and Reimaged Restaurants
NEW AND REIMAGED RESTAURANTS For personal use only NEW AND REIMAGED RESTAURANTS PERFORMING TO PROSPECTUS EXPECTATIONS – Opened 1 December 2011 – Full sized restaurant in Canelands Shopping Centre 1 Mackay Sizzler – 800m 2 with 230 seats – Total project cost of $2.9m - slightly below prospectus expec
Slide 20: Products & Promotion – Activity During 1H12
PRODUCTS & PROMOTION – ACTIVITY DURING 1H12 For personal use only - Change in advertising laws February - Winter Menu: focussed on - Research suggested people 2011 for add on promotions: must bringing back the customer wanting lighter meal options for show total product price favourites lunch - 1st
Slide 21: Products & Promotion – Activity for 2H12
PRODUCTS & PROMOTION – ACTIVITY FOR 2H12 For personal use only – New Brand Creative – “Now You’re Talking” – Create a conversation around Sizzler through social media – New TVC launched 30th October: initial sales results pleasing – One Trip Salad Bar plus Grill at Dinner or Complete Salad Bar plus
Slide 22: Group Results
For personal use only GROUP RESULTS SECTION 4 COLLINS FOODS LIMITED 21
Slide 23: Group Cash Flow
GROUP CASH FLOW For personal use only PERIOD-ON-PERIOD COMPARISON 1H12 1H11 $million Δ – Net operating cash flows before tax and interest reduced due Actual Actual to trading results Net operating cash – Net interest paid pre IPO increased due to the timing of flows before interest 22.1 24.7 (2.6) i
Slide 24: Group Balance Sheet
GROUP BALANCE SHEET For personal use only PERIOD-ON-PERIOD COMPARISON 1H12 Pro forma $million Actual at 1 May , Δ 2011 – Half year balance sheet compared to prospectus pro forma at 1 May, 2011 and is largely in line Inventory 4.1 4.5 0.4 – PP&E increased by $2.8m due to capex of $9.6m offset by Re
Slide 25: Financial Indebtedness
FINANCIAL INDEBTEDNESS For personal use only 1H12 COMPARED TO PRO FORMA AT 1 MAY 2011 – Maintained liquidity 1H12 Pro forma $million Actual at 1 May, Δ – Cash of $4.9m up by $1.4m 2011 – Debt headroom $40.0m Cash 4.9 3.5 1.4 – Net leverage ratio up slightly to 1.97x but significant headroom to cov
Slide 26: Outlook
For personal use only OUTLOOK SECTION 5 COLLINS FOODS LIMITED 25
Slide 27: FY12 Full Year Outlook
OUTLOOK For personal use only FY12 FULL YEAR OUTLOOK Market conditions – Economic conditions in Queensland remain tough – Consumer uncertainty and sales volatility – Difficult to predict trading levels Guidance for FY12 financial year – New restaurants and refurbishment program on track with 1 KFC a
Slide 28: Questions
For personal use only QUESTIONS SECTION 6 COLLINS FOODS LIMITED 27
Slide 29: Appendix
For personal use only APPENDIX SECTION 7 COLLINS FOODS LIMITED 28
Slide 30: Group Income Statement: NPAT Bridge from Statutory to Pro Forma
GROUP INCOME STATEMENT For personal use only 1H12 ACTUAL NPAT BRIDGE FROM STATUTORY TO PRO FORMA Please refer to section 3.3.2 of the prospectus for a description of the nature of the above adjustments (a) Net interest expense relating to the capital structure prior to the IPO was higher than antici