Slide 1: Results Presentation for the year ended 29 February 2016
RESULTS PRESENTATION for the year ended 29 February 2016
Slide 2: Milestones
MILESTONES Commissioned Crown Mines Distribution Centre – frozen and chilled facility Integrated the business of Cater Chain Food Services – commenced with take on of the Group’s pork basket Concluded integration of Retail Group Botswana
Slide 3: Acquisitions and new partnerships
Acquired a 51% controlling stake in: Mythos Lupa Osteria Salsa Mexican Grill Catch Appointed SA licensed partner for global brand PAUL Opened Group’s pilot bespoke craft beer restaurant 14 on Chartwell
Slide 4: Manufacturing plant and acquisitions
Commissioned serviette manufacturing plant at Midrand Expanded FBFCC (Coega Cheese) to include manufacture of cream cheese and prepared for manufacture of sliced cheese Acquired 100% of Lamberts Bay Foods – frozen chips manufacturer
Slide 5: Competing
COMPETING to
Slide 6: 15th consecutive year of record results
Stellar results, irrefutable evidence of competitive, hungry and high performance culture 15th consecutive year of record turnover and profits
Slide 7: Headline earnings per share and dividends
Headline earnings per share increased 16% Total dividends to shareholders 405 cents per share up 14%
Slide 8: Annual dividends and new restaurants
Annual dividends to shareholders R 404m versus market cap of R 25m in 1994 Opened 184 new restaurants, network now in excess of 2 600
Slide 9: Market share gains and customers served
Successful entry into Angola and Ethiopia Market share gains despite fierce competition (local and global) like-on-like +10.7%, added 1.2 million customers like-on-like +11.5%, added 3.1 million customers like-on-like +8.5%, added 500 000 customers Across our brand repertoire we serve on average 20
Slide 10: Building Brand Capability
BUILDING BRAND CAPABILITY
Slide 11: System-wide sales growth
SYSTEM-WIDE SALES GROWTH 20.1% 11.2% 12.0% Domestic International Total
Slide 12: Like-on-like sales growth
LIKE-ON-LIKE SALES GROWTH 7.3% 6.9% 2.6% Domestic International Total
Slide 13: New restaurants opened
NEW RESTAURANTS OPENED 184 71 Total 37 24 23 18 11 STEERS WIMPY DEBONAIRS PIZZA FISHAWAYS MUGG & BEAN EMERGING BRANDS Emerging Brands
Slide 14: Franchise network
FRANCHISE NETWORK 2 614 593 603 563 Total 293 227 201 134 STEERS WIMPY DEBONAIRS FISHAWAYS MUGG & BEAN MR BIGGS EMERGING PIZZA Emerging BRANDS Brands
Slide 15: Trading footprint
TRADING FOOTPRINT South Africa 2 171 Rest of Africa including UAE 360 United Kingdom 83 UK 83 Egypt 7 2 614 Sudan 6 Nigeria 144 Total restaurants UAE 5 Ethiopia 1 Ivory Coast 5 Kenya 9 DRC 2 Tanzania 1 Angola 5 Malawi 7 Zambia 44 Mozambique 3 Zimbabwe 8 Mauritius 21 Botswana 34 Namibia 52 Swaziland
Slide 16: 2017 Goals
2017 GOALS Open flagship PAUL restaurant Conclude maiden entry into Ghana Open 292 new restaurants Continue with Wimpy rejuvenation project Swiftly integrate and grow Lupa Osteria, Salsa Mexican Grill and Catch Proceed with rollout of Thrupps @ Total Leverage the Group’s strategic alliance partnersh
Slide 17: Building Logistics Capability
BUILDING LOGISTICS CAPABILITY
Slide 18: Revenue growth - Logistics
REVENUE GROWTH - LOGISTICS 31% 52% 28% 19% 16% 13% 13% GAUTENG KZN WESTERN CAPE EASTERN CAPE FREE STATE MPUMALANGA Western Eastern Free Mpuma- Gauteng KZN Cape Cape State langa
Slide 19: 2017 Goals
2017 GOALS Relocate Midrand ambient primary distribution Conduct feasibility study regarding additional capacity in KZN and Western Cape
Slide 20: Building Manufacturing Capability
BUILDING MANUFACTURING CAPABILITY
Slide 21: Revenue growth - Manufacturing
REVENUE GROWTH - MANUFACTURING 43% 100% 100% 36% 26% 26% 27% 20% 11% 12% 11% 10% 10% 8% BAK GAU FBSP FBICP FBJP FBFCC BAK WC FBCC FBMC-BB1 FBMC-BB2 FBMC-BB3 MPP WC SSP FBGBC
Slide 22: 2017 Goals
2017 GOALS Conclude take on of Group’s pork and Halaal basket Commence with commissioning of cheese slice manufacture at FBFCC Conclude take on of Wimpy muffin business Integrate business of Lamberts Bay Foods
Slide 23: Financial Results
FINANCIAL RESULTS
Slide 24: Salient features
SALIENT FEATURES Rm F 2016 F 2015 % Change Revenue (Rm) 4 308 3 283 31 Operating profit (Rm) 792 672 18 Cash generated (Rm) 718 713 1 Earnings per share (cents) 529 468 13 Headline earnings per share (cents) 541 467 16 Total dividends per share (cents) 405 355 14 Net debt : equity (%) (0.4) (8.9) Di
Slide 25: Income statement
INCOME STATEMENT Rm F 2016 F 2015 % Change Revenue 4 308 3 283 31 Gross profit 1 838 1 451 27 Selling and administrative expenses (1 046) (779) (34) Operating profit before impairment loss 792 672 18 Impairment loss (12) - Net interest paid (7) - Share of profit from associates - 8 Profit before tax
Slide 26: Revenue
REVENUE Rm 5000 4500 4000 3500 3000 2500 4 308 2000 3 283 2 826 1500 2 516 2 156 1 878 1000 500 0 2011 2012 2013 2014 2015 2016
Slide 27: Operating profit
OPERATING PROFIT Rm % 900 23 800 700 20.5 600 20.0 792 19.1 19.1 18.5 500 18.4 19 400 672 300 566 466 413 200 358 100 0 15 2011 2012 2013 2014 2015 2016
Slide 28: Statement of financial position
STATEMENT OF FINANCIAL POSITION Rm F 2016 F 2015 Move ASSETS Property, plant and equipment 286 209 77 Intangible assets 1 096 923 173 Investments in associates 53 58 (5) Working capital 276 147 129 1 711 1 337 374 FUNDING Equity 1 551 1 417 134 Net borrowings (6) (126) 120 Put option liabilities 124
Slide 29: Cash flow
CASH FLOW Rm 1000 23 900 Forex effect 800 (244) 700 Tax 600 718 Cash from 500 operations (398) 400 Dividends 300 200 (202) (17) Capex & 100 Acquisitions Financing 126 activities 6 0 Opening Opening Cash from Interest Tax Dividends Funding Capex Closing Closing Cash Cash operations raised cash Cash
Slide 30: Equity ratios
EQUITY RATIOS NAV per Debt/ share (R) Equity % NAV per share R Debt/Equity % 18 20 16 14.3 15 14 15.5 9.7 8.1 14.2 10 12 12.4 10 5 10.2 -0.4 8 8.7 -2.1 0 6 7.4 -5 4 -8.9 -10 2 0 -15 2011 2012 2013 2014 2015 2016
Slide 31: Ratios
RATIOS % times RONA % ROE % NAV times Dividend cover times 2.7 55 2.7 2.4 2.4 2.5 2.3 2.3 50 2.2 49.0 2.3 50.0 46.1 2.1 44.5 45 43.6 1.9 42.5 1.7 40 1.6 1.4 1.4 1.4 1.5 1.3 1.3 1.3 35 36.4 1.1 35.7 35.9 36 35.1 34.5 0.9 30 0.7 2011 2012 2013 2014 2015 2016
Slide 32: Segmental analysis - Revenue
SEGMENTAL ANALYSIS - REVENUE Rm F 2016 F 2015 % Change Franchising and development 681 615 11 Supply Chain 3 364 2 507 34 Manufacturing 1 800 1 258 43 Logistics 2 911 2 223 31 Corporate 3 2 South Africa 4 048 3 124 30 International 260 159 63 Rest of Africa 145 57 152 UK 116 102 13 4 308 3 283 31
Slide 33: Segmental analysis - Operating profit
SEGMENTAL ANALYSIS – OPERATING PROFIT Rm % of Total F 2016 F 2015 % Change Franchising and development 49 389 365 7 Supply Chain 44 348 262 33 Manufacturing 31 248 173 43 Logistics 13 100 89 12 Corporate (1) (11) 1 South Africa 92 726 628 15 International 8 67 44 52 Rest of Africa 4 34 23 47 UK 4 33
Slide 34: Segmental analysis - Operating margin
SEGMENTAL ANALYSIS – OPERATING MARGIN % F 2016 F 2015 Franchising and development 57.1 59.4 Supply Chain 10.3 10.4 Manufacturing 13.7 13.7 Logistics 3.4 4.0 South Africa 17.9 20.1 International 25.5 27.3 Rest of Africa 23.3 40.0 UK 28.2 20.1 Group 18.4 20.5
Slide 35: Productivity and margin ratios
PRODUCTIVITY AND MARGIN RATIOS % Operating profit margin % Expense to turnover % Gross profit magin % 50 43.3 43.4 44.2 45 42.8 41.8 42.7 40 35 30 24.2 23.7 23.3 23.4 23.7 24.3 25 20 20.0 20.5 15 19.1 19.1 18.5 18.4 10 5 0 2011 2012 2013 2014 2015 2016
Slide 36: Operating margins by division
OPERATING MARGINS BY DIVISION % Manufacturing Logistics Domestic Franchising Group 70 60.9 60.2 60.1 60.4 59.4 60 57.1 50 40 30 19.1 19.1 20.0 20.5 18.5 18.4 20 10 15.3 15.3 13.7 13.7 13.6 12.5 0 3.0 3.5 3.5 4.0 4.0 3.4 2011 2012 2013 2014 2015 2016
Slide 37: Foundations for the future
FOUNDATIONS FOR THE FUTURE
Slide 38: Strategic advisory role
STRATEGIC ADVISORY ROLE Accountable for all M&A activity and driving the Group’s growth agenda Mentoring the new CE and ExCo team Managing all investor relations and shareholder interactions
Slide 39: Prospects
PROSPECTS The forecast for the economy in the year ahead remains bleak The SA consumer will remain under pressure
Slide 40: Competitive climate will intensify
South Africa will remain an attractive destination for global competitors and the competitive climate will intensify Famous Brands has the determination, experience and energy to continue to flourish in this challenging environment
Slide 41: You're in good company
YOU’RE IN GOOD COMPANY The platform for continued growth is firmly in place Business comprises an accomplished executive management team
Slide 42: Pipeline of opportunities and R1 billion operating profit goal
There exists a pipeline of organic, numeric and acquisitive opportunities The Group’s BHAG of achieving R1 billion Operating Profit by February 2018 is on track R1 Billion
Slide 43: Legacy
LEGACY
Slide 44: Legacy
Being part of a booming business has been a thrilling experience LEGACY
Slide 45: Legacy
Consistently beaten turnover targets Being part of a boo business has bee thrilling experien LEGACY
Slide 46: Legacy
Achieved record profits LEGACY
Slide 47: Legacy
Unlocked significant value for shareholders ecord LEGACY s
Slide 48: Legacy
Unlocked sign value fo sharehold Attracted great people and built a phenomenal team LEGACY
Slide 49: Legacy
Developed entrepreneurs and realised the dreams of start-up at people ta brands and al team businesses LEGACY
Slide 50: Legacy
Created millionaires, employed thousands of people and supported tens of thousands more LEGACY
Slide 51: Legacy
Established a culture of risk without being rash naires, sands of LEGACY pported ds more
Slide 52: Legacy
ALWAYS, ALWAYS competed to win LEGACY