Sphera Franchise Group Sa · BVB:SFG
Sphera Franchise Group Sa — 9M 2017 Earnings Presentation
28 slides from Sphera Franchise Group Sa's earnings presentation, November 2017
Slide 1: Sphera Franchise Group Interim results: Jan-Sep 2017
Sphera Franchise Group Interim results: Jan-Sep 2017 1
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: Sphera – 2017 key events
Sphera – 2017 key events ▪ Successful IPO & listing on the BSE ▪ EUR 62m @ RON 29/share ▪ +14% stock price growth in first trading week ▪ Strong sales & operational performance ▪ Double-digit same-store sales growth ▪ YTD net openings: 11 ▪ On plan to reach 116 units by YE (+18 Y/Y) ▪ Leading top of
Slide 4: Sphera at a glance: Corporate structure
Sphera at a glance Corporate structure 99.9% 99.9% 99.9% 100% 80% American Restaurant California Fresh Flavors US Food Network S.R.L. US Food Network US Food Network S.A. System S.A. S.R.L. - Italy S.R.L. - Moldova holds the franchise holds the franchise holds the franchise holds the franchi
Slide 5: Leading restaurant group in Romania by sales, network and sector coverage
Sphera at a glance Leading restaurant group in Romania by sales, network and sector coverage QSR #2 player on the QSR segment (18% market share) and #1 on the chicken segment #2 player on the overall chained foodservice market (15% market share) ✓ 81% spontaneous brand awareness among Romanian custo
Slide 6: The Company's Value Proposition
Sphera at a glance The Company’s Value Proposition Marketing Locations Product Brands ▪ Careful selection of ▪ Cooperation with the ▪ Offering products ▪ Operating brands with a restaurants' location best specialists to popular among local successful market maximize the results of clientele recognit
Slide 7: Long-term growth strategy based on four key pillars
Sphera at a glance Long-term growth strategy based on four key pillars Text Maintain Strong Continue Organic Develop a Significant Expand Brand LFL Sales Growth Network Roll-out KFC Business in Italy Portfolio – Taco Bell Note: Size of segments do not constitute indication to their contribution to t
Slide 8: Sales performance by brands
(Sp) Sales performance by brands
Slide 9: Brand performance: KFC Sales growth analysis
Brand performance: KFC Sales growth analysis 26% 27% ▪ All-store sales growth of 22% Y/Y supported by mainly by same-store performance (+13%), 22% ▪ new openings contributed another 9% (including 20% Italy – contribution of 2.7%) All-store performance 2015 2016 2017 6-mth 2017 9-mth 2015 2016 2017 6
Slide 10: Brand performance: Pizza Hut Sales growth analysis
Brand performance: Pizza Hut Sales growth analysis 19% ▪ All-store sales growth of 16% Y/Y supported by 17% 17% 16% mainly by new openings (contribution of 12% to the overall growth), especially coming from the new delivery units All-store performance 2015 2016 2017 6-mth 2017 9-mth 2015 2016 2017 6
Slide 11: Development
(Np) Development
Slide 12: Restaurant openings in 2017
Development Restaurant openings in 2017 Total stores YTD YTD Openings DtYE Openings YE stores New store locations 69 5 6 75 ▪ Romania: Bucharest (1x IL, 1x DT), Oradea (1x DT) ▪ Italy: 2x FC -1 ▪ Closed stores: Romania (Oradea: 1x FC) 22 1 22 ▪ Galati (1x FC) ▪ Bucharest (4x IL), Ploiesti (1x IL) 17
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Slide 16: Significant Further Growth Opportunities: Total Restaurants at year-end
Significant Further Growth Opportunities Total Restaurants at year-end (considering target roll-out2) 241 250 Total Restaurants 221 14 14 194 200 12 77 166 69 10 150 139 61 5 34 116 53 32 2 98 46 25 100 87 39 17 76 33 9 27 3 23 116 106 50 96 86 79 72 60 65 53 0 2014 2015 2016 2017 2018 2019 2020 202
Slide 17: Restaurants roll-out plan by brands
Significant Further Growth Opportunities Restaurants roll-out plan by brands 2017 2018 2019 2020 2021 2022 Total Commitment 4 6 7 8 9 9 43 KFC Romania Target 7 7 7 10 10 10 51 Pizza Hut: Commitment 6 7 7 8 8 8 44 Delivery Target 5 5 5 6 6 6 33 Dine in Target 1 2 2 2 2 2 11 Commitment 2 3 5 - - - 10
Slide 18: Marketing / CSR
(Np) Marketing/CSRO
Slide 19: Continuous activities to promote our brands
Marketing Continuous activities to promote our brands January February March April May June July August September October November December Note: (1) size of campaigns’ pictures are not an indication of exact duration of the respective campaign 19
Slide 20: Marketing Q3-2017 highlights
Marketing Q3-2017 highlights ▪ KFC focused on value innovation for Q3, successfully launching a new recipe for Duetos after researching it with consumers; sales results were above expectations with +11.2% same-store sales growth and the product was bought almost half a million times during the campa
Slide 21: Corporate Social Responsibility: Ongoing CSR campaigns & programs
Corporate Social Responsibility Ongoing CSR campaigns & programs ‘I want to go to high-school’ (with World Vision Romania) ‘Physics (taught) differently’ (with CEAE) EUR 130k raised in 2017, to finance school for 200 children “SOS Children’s Villages Bucharest” ‘Hospice, House of Hope’ 21
Slide 22: Financials
Financials
Slide 23: Sphera – Financial reports in brief
Sphera – Financial reports in brief Consolidation perimeter 2016 2017 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 J F M A M J J A S O N D J F M A M J J A S O N D Sphera - Consolidated financials Expected impact on Sphera P&L KFC Romania Consolidated Pro forma KFC Moldova ▪ Sales KFC Italy ▪ Restaurant expense Pizza Hut
Slide 24: Pro forma financials
(Rp) Proforma financials
Slide 25: Sphera – Financial performance: Pro-forma
Sphera – Financial performance: Pro-forma Statement of comprehensive income Pro forma - summary RO N'000 % of Sales 2014 2015 2016 Jun-17 Sep-17 2014 2015 2016 Jun-17 Sep-17 Restaurant sales 324,912 405,830 514,475 287,833 446,982 100.0% 100.0% 100.0% 100.0% 100.0% Restaurant expenses 267,699 325,13
Slide 26: Consolidated financials
(Sp) Consolidated financials
Slide 27: Sphera – Consolidated financial performance
Sphera – Consolidated financial performance Statement of comprehensive income Breakdown by main companies S phera (Consolidated) S phera US FN-C ARS Data in RON'000 S ep-16 S ep-17 Δ% Y/Y % of S ales S ep-17 Restaurant sales 300,482 401,353 33.6% 100.0% 100.0% 401,353 365,776 35,577 Food and materia
Slide 28: Sphera – Consolidated financial performance: Statement of financial position
Sphera – Consolidated financial performance Statement of financial position All data are in RON’000 unless All data are in RON’000 unless otherwise stated 31-Dec-16 30-Jun-17 30-S ep-17 otherwise stated 31-Dec-16 30-Jun-17 30-S ep-17 Assets Equity and liabilities Non-current assets 54,245 143,055 15
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