Endeavour Group Ltd · ASX:EDV
Endeavour — Investor Presentation (February 2025)
55 slides from Endeavour's investor presentation, Feb 28, 2025
Slide 1: H1 F25 Results Presentation
Endeavour Group H1 F25 Results Presentation The Crows Nest Hotel, NSW
Slide 2: Overview and Group Strategy
Overview and Group Strategy Steve Donohue, CEO The Crows Nest Hotel, NSW
Slide 3: Acknowledgement of country
Acknowledgement of country Artwork: Celebration Place by Riki Salam Mualgal, Kaurareg, Kuku Yalanji)
Slide 4: Group highlights
Group highlights 36 endeavour ZyyS Group
Slide 5: Key H1 highlights - Stable revenue and strong cashflow
Key H1 highlights - Stable revenue and strong cashflow ● Stable H1 sales underpinned by strong Christmas trading despite Victorian supply chain disruption ● Retail H1 Operating EBIT margin of 7.2% within previously announced guidance range 1 ● Hotels sales momentum increased during the half, with al
Slide 6: H1 F25 financial overview - Group
H1 F25 financial overview - Group Financial strength Revenue & earnings Shareholder returns & capital discipline $6.6b 0.7% $1.0b H1 F24 $914m 16.7c H1 F24 19.6c Sales Operating cash flow Earnings per share $634m 6.6% Operating EBIT1 168% H1 F24 140% 12.5c H1 F24 14.3c Cash realisation ratio D
Slide 7: H1 F25 financial overview - Retail and Hotels
H1 F25 financial overview - Retail and Hotels Retail Hotels $5.5b 1.5% $1.1b 3.3% Retail Sales Hotels Sales $397m 11.6% $274m 3.4% 1,2 1 Retail Operating EBIT Hotels Operating EBIT 7.2% 83 bps 24.5% 2 bps 2 Retail Operating EBIT Margin Hotels Operating EBIT Margin 14.5% 112 bps 10.5% 35 bps
Slide 8: Unique market leading portfolio with significant upside
Unique market leading portfolio with significant upside Market leader in defensive Large, growing & highly Strong omnichannel Differentiated product offering categories engaged customer loyalty base execution ● Australiaʼs largest retail drinks and ● Building deeper connections by ● Expanding reach
Slide 9: Brand, customer and operating highlights
Brand, customer and operating highlights H1 F25 highlights H1 F25 highlights ● Delivered record pre-Christmas week sales despite Victorian ● Achieved record pre-New Years Eve week sales despite Victorian supply chain disruption supply chain disruption ● Grew My Danʼs members base by 470k, with memb
Slide 10: Brand, customer and operating highlights
Brand, customer and operating highlights H1 F25 highlights H1 F25 highlights ● 170 new products launched; K by Krondorf led red wine NPD ● Record food sales on both Fathers Day and Christmas Day performance1 ● Bars delivered two record weeks of trade in December ● Strong premium wine segment perfor
Slide 11: endeavourGO program achieving material cost savings
endeavourGO program achieving material cost savings Activity Based Rostering: delivering sustainable productivity uplift ● H1 F25 savings of $40 million benefiting GP Improved customer satisfaction and CODB ● $230 million in cumulative savings delivered to date and on track to deliver $290 million+
Slide 12: One Endeavour program tracking to plan
One Endeavour program tracking to plan Total estimated program costs unchanged Progress in H1 / Outlook in H2 Project timeline F23 F24 F25 F26 F27 F28/29 Completed and Inflight ● Stores infrastructure and applications Spend Management Complete progressing to plan Property Lease Management Complete ●
Slide 13: Hotel renewals - focused investment driving improved outcomes
Hotel renewals - focused investment driving improved outcomes Hotel renewals program Evolving our strategy ● We re-launched our Hotel renewal strategy at our December 2023 Investor Day1 ● The program is designed to: Focused investment in fewer, but on average larger-scale renewals touching more sale
Slide 14: Hotel renewals - adding value across multiple drivers
Hotel renewals - adding value across multiple drivers Newmarket QLD Bayswater VIC November ‘24 October ‘24 ● $4m capital spend ● $3m capital spend ● Renovation of gaming room, sports and front bars, ● Upgrade of Bistro and Bar areas, including the bistro and kitchen creation of an external, cove
Slide 15: Unlocking value in our $1bn property portfolio
Unlocking value in our $1bn property portfolio Development applications now progressed for 5 out of the 10 development sites identified at our Investor Day Two development applications have We expect to lodge a further Opportunity to monetise value been lodged to date three applications in H2 in ou
Slide 16: Creating our positive imprint
Creating our positive imprint People Responsibility and Community Planet Championing individuality, Advocating responsible choices and supporting positive Reducing our impact human and personal rights change in our communities on the planet Of senior management 93% Of team members trained in our uni
Slide 17: Group Financials
Group Financials Kate Beattie, CFO New Brighton Hotel, Manly NSW
Slide 18: Group financial performance
Group financial performance H1 F25 H1 F24 $ million 27 WEEKS 27 WEEKS CHANGE ● Sales broadly in line with last year 0.7% Sales 6,621 6,667 0.7% ● Operating EBIT declined 6.6% included $13 million of Operating Retail EBIT 397 449 11.6% one-off restructuring costs2. Excluding these costs, O
Slide 19: Strong cash generation and inventory management
Strong cash generation and inventory management ● Strong cash realisation ratio1 of 168% H1 F25 H1 F24 $ million 27 WEEKS 27 WEEKS CHANGE ● Working capital improved as a result of reduced inventory, primarily driven by optimisation initiatives, which more than EBIT 595 661 66 offset COGS infla
Slide 20: Improved balance sheet metrics
Improved balance sheet metrics Net debt Net debt reduction of $273 million ● Net debt decreased by $273 million versus H1 F24 reflecting improved working capital as a result of reduced inventory, $1,546m lower capex reflecting disciplined capital allocation and $1,273m proceeds from asset sales. Net
Slide 21: Disciplined capital expenditure
Disciplined capital expenditure $ million H1 F25 H1 F241 CHANGE Stay in business 31 502 19 ● Total capital expenditure $73 million lower than H1 F241 Renewals 17 22 5 ● No Pinnacle growth capex deployed post Dorrien winery Pinnacle 0 332 33 expansion (efficiency investment) in F24 Network expa
Slide 22: Retail
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Slide 23: Retail financial performance
Retail financial performance ● Sales declined 1.5% 1.2% adjusted for New Yearʼs Day timing) reflecting subdued consumer spending and estimated lost sales of $40 million to $50 million resulting from Victorian supply chain disruption. BWS and Dan Murphyʼs comparable store sales declined 1.9% ● GP m
Slide 24: Hotels
Hotels Mermaid Waters Hotel, Mermaid Waters QLD
Slide 25: Hotels financial performance
Hotels financial performance ● Sales growth 3.3% with improved momentum from Q1 2.5%) to Q2 4.1%. Hotels comparable sales growth 3.2% ● Food and Bar growth benefited from a successful pub+ loyalty app launch as well as strong performance during key events ● Gaming remains resilient, with strong g
Slide 26: Outlook
36 endeavour ZyyS Group
Slide 27: H2 F25 outlook
H2 F25 outlook ● Retail sales in the first 7 weeks have been impacted by ongoing effects of supply chain disruption ● Hotel sales have accelerated in Q3. Renewals and upgrades to our EGM fleet are expected to underpin continued growth ● We operate in resilient categories and we expect Retail market
Slide 28: H2 F25 Priorities - Simplify and Focus
H2 F25 Priorities - Simplify and Focus Drive growth and optimise store network ● Drive sales momentum through price and value leadership ● Open up to 6 new Dan Murphyʼs stores ● Drive ROI via capital light renewals ● Continue to grow leadership in online and omnichannel convenience Accelerate optimi
Slide 29: Q&A
Q&A Steve Donohue Chief Executive Officer Kate Beattie Chief Financial Officer
Slide 30: Appendix - Investment Thesis
Appendix Investment Thesis 36 endeavour A ' ~ group
Slide 31: Endeavour Group investment thesis
Endeavour Group investment thesis | Unique market leading portfolio with significant upside Market leader in defensive Large, growing & highly Strong omnichannel Differentiated product offering categories engaged customer loyalty base execution ● Australiaʼs largest retail drinks and ● Building deep
Slide 32: Market leader in defensive categories
Market leader in defensive categories | We operate in resilient categories which perform through the economic cycle Retail Liquor Market EGM Market Endeavour Group Australian Retail Liquor Sales Australian Gaming Machine Expenditure Endeavour Group Sales $b, F04 F24 $b, F03 F23 $b, F04F24
Slide 33: Premiumisation trend in Pinnacle wine portfolio
Market leader in defensive categories | Premiumisation trend means customers are shifting to higher margin products within categories Pinnacle Premiumisation Trend - Shift in Pinnacle Wine Portfolio 1 Mix F18 to H1 F25 The mix of premium and luxury segments in Pinnacleʼs wine portfolio has increas
Slide 34: Large, growing and highly engaged customer base
Large, growing and highly engaged customer base | Leveraging our data and insights to deliver engaging customer experiences In H1 F25, My Danʼs grew to Our customers are embracing pub+ uptake has been strong 5.5m active members and the BWS app, which has since launching, reaching over maintained 80
Slide 35: Strong omnichannel execution
Strong omnichannel execution | Our best in class offering is delivering meaningful omnichannel experiences for our customers Our continued investment in Expanding our leading Leveraging web and app digital is delivering strong network of ultra-convenience capabilities to support sales growth deliver
Slide 36: Differentiated product offering
Differentiated product offering | Leveraging deep customer insights in Pinnacle Drinks to create products that customers love and trust Delivering products that customers love … … while supporting Endeavour Group returns Scale Internal & External Cat Amongst The Pigeons Lobster Reef Lighter Oakridge
Slide 37: Cost optimisation program: endeavourGO on track for $290m+ savings
Cost optimisation program| endeavourGO on track to deliver $290m+ in savings by F26 Retail GO Hotel GO Building robust and cross-functional capabilities to drive Building tools and processes that will optimisation benefits in cost savings help optimise Hotels operations. ● $230 million in cumulative
Slide 38: Hotel renewals and redevelopments - Year 2 ROI target
Hotel renewals and redevelopments | On track to deliver 15% Year 2 ROI target ALH Renewals and Redevelopments Program Results 1 Hotel renewals and redevelopment completed in H1 F24 1 F24 Cohort 2 Renewed venues (#) 15 2 Excludes renewals below $250,000 3 Capital invested $m $41m Total capital inve
Slide 39: Enhancing returns from our Hotel network - Recent case studies
Enhancing returns from our Hotel network | Recent case studies The Manly Hotel QLD The Brook Hotel VIC Apr ʼ24 Pub and Dec ‘24 Accom. May ‘23 ● $9m capital spend across pub renewal and ● Whole of venue redevelopment, including a new accommodation refurbishment, which included Dan Murphyʼs st
Slide 40: Unlocking value in our $1b property portfolio - DAs lodged
Unlocking value in our $1b property portfolio | DAs lodged in H1 F25 Camberwell, VIC Chelsea Heights, VIC Land Area 5,200 sqm Land Area 49,377 sqm Proposed Residential Net Saleable Area 17,337 sqm Building Area 11,577 sqm Commercial Net Lettable Area 3,512 sqm Development application lodged for Dan
Slide 41: Unlocking value in our $1b property portfolio - DAs to be lodged
Unlocking value in our $1b property portfolio | DAs on track to be lodged in H2 F25 The Morrison Hotel, QLD The Forest Hotel, NSW Doncaster, VIC Land Area 1,640 sqm Land Area 18,971 sqm Land Area 23,730 sqm Proposed Gross Proposed Gross Proposed Gross 25,508 sqm 6,336 sqm 92,745 sqm Floor Area Floor
Slide 42: Appendix
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Slide 43: Well positioned to deliver value for our stakeholders
Well positioned to deliver value for our stakeholders Attractive business Simple, scalable, customer-first strategy Creating value fundamentals Network scale Create meaningful experiences for our shared social customer Customers Australiaʼs largest retail drinks and Convenience, range, value and hos
Slide 44: Delivering on our strategy scorecard commitments
Delivering on our strategy scorecard commitments ● Customer value: Dan Murphyʼs extended price leadership gap to nearest competitor1 Shared customer ● Customer experience: VOC maintained at 80 in Dan Murphyʼs and 75 in BWS; 0.3 pt to 8.9 in Hotels v H1 F24 foundations ● Omnichannel engagement: Incr
Slide 45: Retail Operating EBIT margin
Retail Operating EBIT margin Underlying H1 Retail Operating EBIT margin of 7.5% was at the upper end of our guidance range after adjusting for Victorian supply chain disruption and one-off restructuring costs. 7.5% H1 Retail Operating EBIT margin guidance range 7.0% Approximately $8m $11m impact on
Slide 46: Network
Network 1 277 2 Dan Murphyʼs stores2 18 6 56 425 1,449 4 BWS stores 27 144 136 27 1 19 101 38 354 Hotels (incl. managed clubs) Key: 2 3 86 397 55 Dan Murphyʼs BWS 86 328 86 1 6 Wineries Hotels (incl clubs) Wineries 3 3 36 6 1 1 Bottling facilities Bottling facilities 1. As at 5 January 2025 2. Inc
Slide 47: Group sales composition
Group sales H1 F25 H1 F24 CHANGE BWS and Dan Murphy's 81.04% 81.67% 63 bps composition Specialty 1 2.05% 2.07% 2 bps Gaming 6.72% 6.49% 23 bps Bars 5.17% 4.96% 21 bps Food 3.87% 3.75% 12 bps Accommodation 0.79% 0.71% 8 bps Other Hotels 0.36% 0.35% 1 bps Total 100.00% 100.00% 1. Specialty includes
Slide 48: Group financial performance
H1 F25 H1 F24 $ million 27 WEEKS 27 WEEKS CHANGE Group Sales financial Retail Hotels 5,501 1,120 5,583 1,084 1.5% 3.3% performance Total sales 6,621 6,667 0.7% Profit for the period Operating Retail EBIT 397 449 11.6% Operating Hotels EBIT 274 265 3.4% Other EBIT 37 35 5.7% Operating E
Slide 49: Balance sheet
Balance $ million H1 F25 5 JAN 2025 F24 30 JUNE 2024 H1 F24 31 DEC 2023 sheet Trade working capital Lease assets 392 725 592 3,128 3,201 3,260 Property, plant and equipment 2,199 2,234 2,187 Intangible assets 4,275 4,274 4,253 Other liabilities (net) 749 710 790 Funds employed 9,245 9,724 9,50
Slide 50: Cash flow
Cash flow $ million H1 F25 27 WEEKS H1 F24 27 WEEKS CHANGE EBIT 595 661 66 Depreciation and amortisation expenses 318 301 17 Changes in trade working capital 326 186 140 Changes in assets and liabilities and other non-cash items 65 49 16 Finance costs on borrowings paid 57 54 3 Payment f
Slide 51: Historical financial performance
Historical financial performance1 COVID19 unwind / Pre COVID19 COVID19 Post COVID19 Retail H1 F19 H2 F19 H1 F20 H2 F20 H1 F21 H2 F21 H1 F22 H2 F22 H1 F23 H2 F23 H1 F24 H2 F24 H1 F25 Sales $M 4,564 3,889 4,777 4,509 5,690 4,488 5,657 4,429 5,446 4,459 5,583 4,491 5,501 Operating EBIT 316 222 33
Slide 52: Summary of forward looking statements
Summary of forward looking statements Area Description Group optimisation We are targeting cumulative optimisation savings of $290 million+ by F26, with $230 million delivered as at H1 F25, to mitigate inflationary pressures and enable continued investment in line with strategy. Effective tax rate W
Slide 53: Comparative figures
Comparative figures Normalised 52-week Equivalent F19 Information, Equivalent F20 Information and 52-week F24 Information Woolworths' Drinks and Hotels businesses were transferred to, and merged with, Endeavour Group Limited on 2 February 2020 Restructure) and 4 February 2020 Merger, respectively
Slide 54: Glossary
Glossary Term Description CAGR Compound annual growth rate Cash realisation ratio Operating cash flow as a percentage of Group profit for the year after income tax but before depreciation and amortisation Cost of doing business CODB Expenses which relate to the operation of the business eCommerce
Slide 55: Disclaimers
Disclaimers This presentation is dated 28 February 2025 and unless stated otherwise is current as at that date. This presentation contains summary and general information about Endeavour Group Limited and its controlled entities (together, Endeavour, the Group, or Endeavour Group), and Endeavour Gro
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