Wendy's Company (the) · NASDAQ:WEN
Wendy's Company (the) — Investor Day (March 2025)
26 slides from Wendy's Company (the)'s investor day presentation, Mar 6, 2025
Slide 1: Ken Cook, Chief Financial Officer
KEN COOK CHIEF FINANCIAL OFFICER
Slide 2: Long Term Financial Algorithm, 2028 Targets, Capital Allocation Policy
LONG TERM FINANCIAL ALGORITHM 2028 TARGETS CAPITAL ALLOCATION POLICY
Slide 3: Our Long-Term Strategy
OUR LONG-TERM STRATEGY DOUBLE DOWN ON DELIVER AN EXCEPTIONAL ACCELERATE FRESH, FAMOUS FOOD CUSTOMER EXPERIENCE GLOBAL UNIT GROWTH CREATING VALUE FOR FRANCHISEES AND SHAREHOLDERS 3
Slide 4: Our Value Creation Framework
OUR VALUE CREATION FRAMEWORK Value Creation Value Creation for FRANCHISEES for SHAREHOLDERS § SRS Growth § Systemwide Sales Growth § Restaurant Profitability § Disciplined Capital Allocation § New Unit Growth § Increased Adj. EBITDA & Cash Generation 4
Slide 5: Our Long-Term Financial Algorithm
OUR LONG-TERM STRATEGY OUR LONG-TERM FINANCIAL ALGORITHM 3-4% 5-6% 7-8% Annual Net Annual Systemwide Adj. EBITDA Unit Growth Sales Growth* Growth* * Non-GAAP financial measure. See Appendix for additional information. 5
Slide 6: 2028: Our Growth Targets
OUR LONG-TERM STRATEGY 2028: OUR GROWTH TARGETS GLOBAL UNITS SYSTEMWIDE SALES* ADJUSTED EBITDA* 8,100-8,300 $17.5-$18.0B $650-$700M 7,240 $14.5B $544M 2024 2028E 2024 2028E 2024 2028E Add ~1,000 net Grow systemwide Increase Adjusted restaurants to the system sales by up to $3.5B EBITDA by up to 30%
Slide 7: Global Systemwide Sales Growth in 2028
OUR LONG-TERM STRATEGY GLOBAL SYSTEMWIDE SALES GROWTH IN 2028 $17.5 - $18.0B ~30% US ~70% International SRS $14.5B NET UNIT GROWTH 2024 2028E *Visual chart not to scale 7
Slide 8: Global Systemwide Sales Growth in 2028
OUR LONG-TERM STRATEGY GLOBAL SYSTEMWIDE SALES GROWTH IN 2028 $17.5 - $18.0B ~30% US ~70% International SRS $14.5B NET UNIT GROWTH § Global Next Gen Design § Development Incentives § Localized Resources 2024 § Globalizing Supply Chain 2028E *Visual chart not to scale 8
Slide 9: Global Systemwide Sales Growth in 2028
OUR LONG-TERM STRATEGY GLOBAL SYSTEMWIDE SALES GROWTH IN 2028 $17.5 - $18.0B ~30% US ~70% International SRS § Menu Innovation $14.5B NET UNIT § Collaborations GROWTH & Promotions § Digital Engagement 2024 2028E *Visual chart not to scale 9
Slide 10: Global Systemwide Sales Growth in 2028
OUR LONG-TERM STRATEGY GLOBAL SYSTEMWIDE SALES GROWTH IN 2028 $17.5 - $18.0B ~30% US ~70% International SRS § Menu Innovation $14.5B NET UNIT § Collaborations GROWTH & Promotions § Digital Engagement § Global Next Gen Design § Development Incentives § Localized Resources 2024 § Globalized Supply Cha
Slide 11: Adjusted EBITDA Drivers in 2028
OUR LONG-TERM STRATEGY ADJUSTED EBITDA DRIVERS IN 2028 $650-$700M RESTAURANT MARGIN EXPANSION $544M SALES GROWTH § Investing in Field Resources § Unit Development § Digitally Enabled § SRS Growth Ordering Experience § Increasing Labor Productivity 2024 2028E *Visual chart not to scale 11
Slide 12: Capital Allocation
i) CAPITAL ALLOCATION
Slide 13: Our Capital Allocation Priorities
OUR CAPITAL ALLOCATION PRIORITIES 1 2 3 4 CONTINUE TO PAY AN MAINTAIN A UTILIZE INVEST IN ATTRACTIVE STRONG EXCESS THE BUSINESS DIVIDEND BALANCE CASH TO FOR GROWTH SHEET REPURCHASE SHARES 13
Slide 14: Disciplined Investment in the Business Is Our #1 Priority
1 CONTINUE TO INVEST IN THE BUSINESS FOR GROWTH DISCIPLINED INVESTMENT IN THE BUSINESS IS OUR #1 PRIORITY Digital Capabilities Development ~50% ~30% § Disciplined approach to investing in highest return opportunities ~$115M § Growth investments focused on: Annual Capex Spend § New Unit Development 2
Slide 15: Accelerating Restaurant Development
1 CONTINUE TO INVEST IN THE BUSINESS FOR GROWTH ACCELERATING RESTAURANT DEVELOPMENT BUILD-TO-SUIT PROGRAM Accelerate New Unit Growth around the World ~$70M2025 Company Attractive Return on Investment for the Company Investment Improves Payback Period for Franchisees 15
Slide 16: Target Dividend Payout Ratio
2 PAY AN ATTRACTIVE DIVIDEND TARGET DIVIDEND PAYOUT RATIO TARGET PAYOUT RATIO 50-60% of Adjusted Earnings Future dividend payments, if any, will be at the discretion of our Board of Directors. 16
Slide 17: Target Leverage Ratio
3 MAINTAIN A STRONG BALANCE SHEET TARGET LEVERAGE RATIO 5.0x Maintain Investment Grade 4.3x Debt Rating on Securitized Notes 3.5x 3.5x – 5.0x Long-Term Leverage Ratio $830M in Debt Maturities through 2028 2024 2028E 17
Slide 18: Attractive Opportunity for Share Repurchase
4 UTILIZE EXCESS CASH TO REPURCHASE SHARES ATTRACTIVE OPPORTUNITY FOR SHARE REPURCHASE EV / NTM EBITDA Multiple 20.0x Up to $200M 10.0x 2025 Planned Share Repurchases LARGEST QSR BURGER PEERS 18
Slide 19: Growth Plans Translate to Significant Free Cash Flow Generation
OUR GROWTH PLANS TRANSLATE TO SIGNIFICANT FREE CASH FLOW GENERATION $1.2B $1.1B 4 Year Cumulative FCF* $279M 2024 2025 - 2028E Visual chart not to scale * Non-GAAP financial measure. See Appendix for additional information, including certain reconciliations. 19
Slide 20: Key Takeaways
KEY TAKEAWAYS We are WELL-POSITIONED to leverage Wendy’s STRENGTHS and BRAND EQUITY to SCALE OUR SYSTEM We have a FOCUSED STRATEGY that we are executing with a new level of OPERATIONAL INTENSITY We will DRIVE PROFITABLE GROWTH to create value for OUR CUSTOMERS, OUR FRANCHISEES and OUR SHAREHOLDERS 2
Slide 21: Gotta Be Wendy's
Slide 22: Appendix
APPENDIX
Slide 23: Forward-Looking Statements and Non-GAAP Financial Measures
FORWARD-LOOKING STATEMENTS AND NON-GAAP FINANCIAL MEASURES This presentation, and certain information that management may discuss in connection with this presentation, contains certain statements that are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act
Slide 24: Reconciliation of Non-GAAP Financial Measures
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES In addition to the GAAP financial measures included in this presentation, the Company has presented certain non-GAAP financial measures (i.e., adjusted EBITDA, free cash flow, and systemwide sales). These non-GAAP financial measures exclude certain expen
Slide 25: Reconciliation of Net Income to Adjusted EBITDA and Revenue
Reconciliation of Net Income to Adjusted EBITDA and Revenue to Adjusted Revenues 25
Slide 26: Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow 26