Sphera Franchise Group Sa · BVB:SFG
Sphera Franchise Group Sa — H1 2020 Earnings Presentation
31 slides from Sphera Franchise Group Sa's earnings presentation, September 2020
Slide 1: Sphera Franchise Group Analyst Call H1 2020 Results
Sphera Franchise Group Analyst Call | H1 2020 Results 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: Welcome to SFG's H1 2020 Analyst Call – Presenters
Welcome to SFG’s H1 2020 Analyst Call – Presenters Anastasios Tzoulas Calin Ionescu Valentin Budes Monica Eftimie Zuzanna Kurek Vice-Chairman of the Board Interim CEO CFO CMO IR 3
Slide 4: Welcome to SFG's H1 2020 Analyst Call - Agenda
Welcome to SFG’s H1 2020 Analyst Call - Agenda 1 H1 2020 Highlights 2 COVID-19 Response 3 Brand Performances 4 Key H1 2020 Financials 5 Q3 2020 Gradual Recovery 6 Q&A session For further details We invite you to read the Full Director’s report which includes analysis of financial results, details ou
Slide 5: H1 2020 Highlights
(Np) H1.2020 Highlights
Slide 6: Sphera Franchise Group – H1 2020 Highlights
Sphera Franchise Group – H1 2020 Highlights Swift response helped close H1 2020 performance well-above the RO market average • In COVID-19 context, HoReCa industry was hit the hardest as it faced direct cease-of-operations order from authorities. • Romanian Hotels and Restaurant Association, HORA an
Slide 7: Sphera Franchise Group H1-2020 Performance
Sphera Franchise Group H1-2020 Performance RESTAURANT SALES EXPENSES NORMALIZED EBITDA RON m RON m, excluding IFRS 16 RON m, excluding IFRS 16 445.6 422.8 -23.7% 36.7 -31.6% -95.6% 322.4 216.8 304.6 -45.8% 230.8 21.2 -54.0% 117.5 106.3 Q2 -109.4% Q2 Q2 206.0 214.7 -0.6% 15.5 -7.6% 198.3 204.8 -77.4%
Slide 8: Sphera Franchise Group H1-2020 Sales performance per country
Sphera Franchise Group H1-2020 Sales performance per country 401.0m 39.2m -32.5% -21.9% 270.6m 30.6m 5.4m -38.9% 3.3 m Values in RON. H1 2019 values on top of the map, H1 2020 on the bottom. 8
Slide 9: COVID-19 Response
(Wp) coviv-i9Response
Slide 10: Markets of Activity: COVID-19 Developments
Markets of Activity: COVID-19 Developments • State of Emergency: 18.03.2020 – 14.05.2020. • State of Alert: 15.05.2020 – today. • SFG restricted restaurant operations on 18.03.2020 until 15.05.2020. • 15.05.2020 – restaurants with outdoor seating reopened. • 15.06.2020 – shopping malls open but clos
Slide 11: Business Calibration: Measures in response to COVID-19
Business Calibration: Measures in response to COVID-19 Maximizing Revenues • Change in strategy: enhanced cooperation with local food aggregators: o Romania: FoodPanda, Glovo, Tazz (EuCeManac), TakeAway; o Italy: Glovo, Deliveroo, Just Eat, UberEats; o Moldova: Straus (iFood pending). • Marketing ca
Slide 12: Business Calibration: Measures in response to COVID-19
Business Calibration: Measures in response to COVID-19 Staff Romania: • Technical unemployment covering 75% of average national salary implemented. Depending on the location, employees were sent either fully or partially into technical unemployment. • HQ kept oversight over the activity in the resta
Slide 13: Business Calibration: Measures in response to COVID-19
Business Calibration: Measures in response to COVID-19 Rent • In March 2020, the Group notified all the lessors to renegotiate or temporarily suspend the rental contracts and entered a detailed and extensive process of renegotiating rental agreements. • As of 30.06.2020, the amount of fixed rent dis
Slide 14: Business Calibration: Marketing
Business Calibration: Measures in response to COVID-19 Marketing 14
Slide 15: Value Always On, Build a Distinctive Brand
Business Calibration: Measures in response to COVID-19 • Recovered sales during the pandemic by adapting our marketing strategy to the new reality and built marketing pillars with the aim of generating acquisition, increasing frequency and strengthening brand equity. Value Always On DIGITAL & MENU B
Slide 16: Kiosk, Awareness, Social touchpoints and objectives
Business Calibration: Measures in response to COVID-19 • To be competitive in the category, our brands started to devote outsized efforts in Q2 on maintaining an edge on digital and ease. KIOSK Awareness Social Instore DMB Increase traffic reach E-comm* Loyalty* Brand Boost KOLs conversions website
Slide 17: Brand Performance
(Np) Brand Performance
Slide 18: Active Stores: Evolution in H1
Active Stores: Evolution in H1 Restaurant count as of 30.06.2020 81 2 16 23 21 10 153 Operational restaurants - 22-Mar 29 1 0 0 15 0 46 - 14-May 46 1 10 5 15 5 82 - 30-Jun 79 1 16 21 21 10 148 • The number of active stores dropped drastically mid-March following the introduction of State of Emergenc
Slide 19: Brand Evolution in H1 2020
Brand Evolution in H1 2020 % of pre- pandemic sales* - March 51% 53% 18% 35% 72% 43% 47% - April 25% 21% 10% 0% 63% 0% 22% - May 49% 42% 40% 9% 72% 46% 46% - June 68% 42% 80% 24% 70% 61% 65% • Hardest hit in April, with no sales for Pizza Hut (dine-in) and Taco Bell. Recovery trend starting May. Sal
Slide 20: Key H1 2020 Financials
(Np) Key H1.2020 Financials
Slide 21: H1 2020 Result
H1 2020 Result Statement of Comprehensive Income (excluding IFRS 16) • Sales down 31.6% in H1 2020 compared to H1 2019; expenses down by 23.8%. • Restaurant operating profit of RON 6.7 million in H1 2020, 86.5% lower compared to H1 2019. • The 8.2% decrease in General & Administrative expenses, help
Slide 22: H1 2020 – Restaurant Expenses
H1 2020 – Restaurant Expenses Restaurant Expenses lower by 25% in H1 2020 vs H1 2019 (excluding IFRS 16) • Except for other operating expenses and depreciation and amortization, all the restaurant expenses have decreased significantly. • The rent costs (without IFRS 16) decreased by 7,4% compared to
Slide 23: H1 2020 – G&A Expenses
H1 2020 – G&A Expenses G&A Expenses lower by 8.2% (excluding IFRS 16) in H1 2020 vs H1 2019 Data in RON ‘000 Percentage of sales H1-20 H1-20 H1-19 H1-19 Change (%) H1-20 H1-20 H1-19 H1-19 2020/ 2020/ (1) (2) (1) (2) (1) (2) (2) (2) 2019 (1) 2019 (2) General and 23,915 24,447 26,410 26,632 -9.4% -8.2
Slide 24: H1 2020 – individual performance by companies from the group
H1 2020 – individual performance by companies from the group USFN (KFC) Romania and Moldova ended H1 2020 with a net profit (excluding IFRS 16) • USFN Romania and USFN Moldova closed H1 2020 on operating profit, corresponding to a net profit of RON 7.4 million. • The rest of the Group entities ended
Slide 25: Impact of IFRS 16 on H1 2020 Results
Impact of IFRS 16 on H1 2020 Results As a result of IFRS 16 adoption, normalized EBITDA increased to RON 29.3m in H1 2020 H1-20 H1-20 Including Excluding Impact of Data in RON’000 impact of impact of IFRS ▪ Starting 1 January 2019, Sphera applies IFRS 16 that sets IFRS16 IFRS16 Adoption out the prin
Slide 26: Q3 2020 Gradual Recovery
(Np) 23 2020 Gradual Recovery
Slide 27: Key indicators of gradual recovery – Q2 & Q3 2020
Key indicators of gradual recovery – Q2 & Q3 2020 27
Slide 28: Key indicators of gradual recovery – March + Q2 + Q3
Key indicators of gradual recovery – March + Q2 + Q3 To support the Group’s confidence in the improving situation, we exceptionally provide estimates showcasing the increasing trend in sales as registered in July 2020 and August 2020 (estimated data as of August 26th, 2020). 90% • On the adjacent gr
Slide 29: Ongoing business evolution
Ongoing business evolution Further Support Measures in Romania • On 29.05.2020, the Emergency Ordinance no. 92/2020 on the application of support measures for the Romanian employees and employers in the context of SARS-CoV-2 coronavirus, as well for the amendment of legislation was published in the
Slide 30: Q&A session
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Slide 31: Thank you for your attention!
Thank you for your attention! We will be attending Frontier Investor Days, WOOD’s Virtual Conference on September 3 rd and 4th, 2020. Feel free to book a meeting with our team. For more information, please contact our IR Team at: investor.relations@spheragroup.com.
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