Collins Foods Limited · ASX:CKF
Collins Foods — FY2014 Earnings Presentation
25 slides from Collins Foods's earnings presentation, Jun 25, 2014
Slide 1: 2014 Financial Year Results
For personal use only COLLINS FOODS LIMITED 2014 FINANCIAL YEAR RESULTS 25 June 2014
Slide 2: FY14 financial overview
FY14 financial overview For personal use only Change • Underlying NPAT up 9.3% to $17.9m WA Significant FY14 versus FY13 FY14 impact (1) items (2) Underlying FY13 • Final dividend 6 cps (fully franked) bringing the full year $m Underlying dividend to 10.5 cps – an increase of 10.5% Revenue 423.9 440
Slide 3: FY14 operational highlights
FY14 operational highlights For personal use only • Acquired and successfully integrated 42 restaurants • Continued Top-line growth - revenue growth of 3.5% and SSS up 0.8% • Built 4 new restaurants, closed 1 and undertook 12 major remodels and 5 minor remodels • EBITDA margin up 120 bps as a result
Slide 4: KFC improves margin & consolidates the WA/NT acquisition
For personal use only KFC improves margin & consolidates the WA/NT acquisition
Slide 5: KFC WA/NT – building a national footprint
KFC WA/NT – building a national footprint For personal use only • Transaction completed on 7 March 2014 • Integration of acquisition complete • New store – Rockingham – under construction with a NORTHERN TERRITORY (4) further 2-3 stores to be built in calendar year’ 16 • 2 Minor remodels completed i
Slide 6: KFC Qld earnings growing faster than revenues
KFC Qld earnings growing faster than revenues For personal use only Significant FY14 • EBITDA margin 15.2% up 120 bps FY13 FY14 Change $m items Underlying • Direct and indirect labour efficiencies and productivity Restaurants gains key component in improved operating margins - average 120.9 123.5 -
Slide 7: KFC Qld/NT performing strongly vs peers
KFC Qld/NT performing strongly vs peers For personal use only QLD & NT – SPEND SHARE QLD & NT – TRAFFIC SHARE Fast food -1.2pts Fast food -0.9pts 31.8 28.7 -3.1% MCDONALD’S -1.3% 34.9 33.6 13.1 14.1 -1.0% SUBWAY -1.5% 13.1 14.6 11.9 10.6 1.3% KFC 0.8% 10.7 9.9 6.9 1.4% HUNGRY JACKS 2.6% 5.5 5.6 0.2%
Slide 8: KFC Brand supported by solid pipeline/campaigns
KFC Brand supported by solid pipeline/campaigns For personal use only • Strong new product promotions – Zinger pie, Mighty Burger, Boneless chicken etc – continuing to introduce innovation and excitement to the Brand • Innovative and fun family dinner offerings at centre of Brand strategy • Value of
Slide 9: Operational efficiencies driving margin improvements
Operational efficiencies driving margin improvements For personal use only • In-store labour – direct and indirect – efficiencies and productivity gains have been key to margin improvements • Service flow format and associated benefits have been rolled out across all non food court stores with posit
Slide 10: KFC capex focused on growth
KFC capex focused on growth For personal use only 25 • Total KFC capex of ~ $31m for FY15: • ~ $20.6m for Queensland: 20 • 5 new builds 15 • 11 major remodels $m 10 • 5 minor remodels • ~ $10.4m for WA/NT: 5 • 2 new builds 0 • 5 major remodels FY14 FY15 FY15 KFC Qld/NSW KFC WA/NT • 2 minor remodels
Slide 11: New builds and remodels
New builds and remodels For personal use only 4 new builds 12 major remodels 5 minor remodels North Lakes Gympie Kallangur Page 10
Slide 12: Sizzler in transition
For personal use only Sizzler in transition
Slide 13: Sizzler performance reflects ongoing transition
Sizzler performance reflects ongoing transition For personal use only Significant FY14 • Overall revenue down 9.3% to $95.8m with Sizzler FY13 FY14 Change Australia SSS down 9.3% items (1) Underlying $m Restaurants • Closed Sizzler Cairns in February 2014 on expiry of lease - average 27.0 26.8 - - 0
Slide 14: A fresh new look and feel for Sizzler
A fresh new look and feel for Sizzler For personal use only • Get Refreshed is a Brand wide initiative designed to contemporise Sizzler and re-engage with our guests • Key elements of Get Refreshed include: • creating a fresh/contemporary look and feel in the restaurants • elevating both the food an
Slide 15: Get Refreshed roll-out
Get Refreshed roll-out For personal use only • Sizzler Cleveland opened 2 June with the key Get Refreshed elements included in an overall front of house remodel • Sales in Cleveland over the past 3 weeks have been very positive • Over the next 6 to 8 months Get Refreshed to be rolled out across a nu
Slide 16: Sizzler Asia continues to grow
Sizzler Asia continues to grow For personal use only • Royalty revenue over the year up 9.9% Sizzler Restaurants in Asia • Opened 4 new restaurants in China and Thailand during FY14 • New restaurants in China have performed well on opening 9 • Plan to open a further 5 new restaurants in China and 2
Slide 17: Snag Stand concept evolving
For personal use only Snag Stand concept evolving
Slide 18: Snag Stand concept evolving
Snag Stand concept evolving For personal use only • Tightened the Snag Stand concept • New stand opened in Macquarie Centre, Sydney – 10 June • Macquarie Centre is the first stand to incorporate internal seating and providing a more complete brand experience • Revised the menu and added signature sh
Slide 19: Financial overview
For personal use only Financial overview
Slide 20: Strong cash flow generation
Strong cash flow generation For personal use only FY13 FY14 • Generated a net cash flow of $13.3m $m Net operating cash flows before interest and tax 50.1 57.5 • Net operating cash flow increased $7.4m reflecting strong cash generation and change in working capital primarily due to KFC Net interest
Slide 21: Comfortable debt profile
Comfortable debt profile For personal use only • Increased overall debt facilities to $175m up from $145m to Net debt () v Net leverage ratio (–) support KFC WA/NT acquisition 150 2.75 • Net debt up $46.4m to $127.4m (FY13: $81m) 2.50 125 • Strong net operating cash flow generation in the business
Slide 22: Balance sheet reflects KFC WA/NT acquisition
Balance sheet reflects KFC WA/NT acquisition For personal use only FY13 FY14 • Increase in cash of $13.4m up from $23.6m $m Cash and equivalents 23.6 37.0 • Impacts on the balance sheet arising from the KFC WA/NT acquisition include: Total current assets 31.8 44.7 Property, plant and equipment 59.1
Slide 23: Priorities and outlook for FY15
Priorities and outlook for FY15 For personal use only • Return Sizzler Australia to positive growth through the roll out of Get Refreshed • KFC sales performance over early FY15 tracking at 1.5% SSSG; expect this trend to continue • Focus on improving KFC WA/NT operational performance driving top li
Slide 24: Questions
For personal use only Questions
Slide 25: 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. Circums