Collins Foods Limited · ASX:CKF
Collins Foods — FY2020 Earnings Presentation
29 slides from Collins Foods's earnings presentation, Jun 30, 2020
Slide 1: ASX announcement cover letter
30 June 2020 ASX Market Announcements Office 10 Bridge Street SYDNEY NSW 2000 Via ASX Online Dear Sir/ Madam ANNOUNCEMENT FOR RELEASE VIA MARKET ANNOUNCEMENTS PLATFORM Please find attached for release via the ASX Market Announcements Platform an announcement entitled, “Collins Foods Limited FY20 Res
Slide 2: Collins Foods Limited FY20 Results
COLLINS FOODS LIMITED FY20 RESULTS 29 April 2019 – 3 May 2020 (53 weeks) 30 JUNE 2020 ACN 151 420 781
Slide 3: Earnings growth delivered despite COVID-19 impact
Earnings growth delivered despite COVID-19 impact FY19 FY20 FY20 FY20 FY20 • Revenue up 8.9% to $981.7m due to strong (1) Change growth and impact of 53 week year Underlying Statutory Non trading Underlying Statutory (2) ($m) (Pre AASB 16) (Pre AASB 16) items (Pre AASB 16) (Post AASB 16) • Underlyin
Slide 4: Reductions in Net Leverage Ratio and Net Debt highlight strong balance sheet
Reductions in Net Leverage Ratio and Net Debt highlight strong balance sheet • Net Leverage Ratio (pre AASB 16) at 1.69 – Net Debt / Net Leverage Ratio* significant headroom to covenant maximum of 2.75 • Net Debt of $203.2m(1) – significant headroom $227.2m to current facility of circa $400.0m(2) $2
Slide 5: Encouraging post COVID-19 results reflect brand resilience
Encouraging post COVID-19 results reflect brand resilience • Comprehensive actions taken to prioritise employee and customer health & safety at each stage of the crisis • Quick pivot to emphasis on take-away channels (including drive-thru and home delivery) minimised impact from government-mandated
Slide 6: FY20 results overview
FY20 results overview AUSTRALIA EUROPE AUSTRALIA • Same Store Sales (SSS) growth of • Same Store Sales (SSS) decline of • 6 new restaurants built and opened 3.5% (5.8)% in Queensland and 2 in Victoria • 9 new restaurants built and opened • Pre COVID-19 SSS +5.6% in Germany • Sales trends impacted by
Slide 7: KFC Australia
KFC Australia Page 5
Slide 8: KFC Australia sales and margins continue robust performance
KFC Australia sales and margins continue robust performance • Revenue up 9.5% to $791.5m FY19 FY20 FY20 FY20 FY20 (1) Change Underlying Statutory Non trading (2) Underlying Statutory • Overall SSS growth of 3.5%. Second half year ($m) (Pre AASB 16) (Pre AASB 16) items (Pre AASB 16) (Post AASB 16) SS
Slide 9: Strength of KFC brand and business model in Australia proving advantageous
Strength of KFC brand and business model in Australia proving advantageous • Research has shown that customers gravitate to known and trusted brands during uncertain times – attributes strongly associated with the KFC brand in Australia • Highly effective marketing communications consistently emphas
Slide 10: KFC Australia development pace increasing
KFC Australia development pace increasing • FY20 capex of circa $20.5m for KFC Australia network development: Southport QLD - 9 new restaurant openings in the year - 16 major remodels and 25 minor remodels completed • FY20 maintenance and other capital circa $6.8m • Digital menu board rollout for dr
Slide 11: KFC Europe
i) KFC Europe BESTELLEN |
Slide 12: KFC Europe experienced greater disruption than KFC Australia due to COVID-19
KFC Europe experienced greater disruption than KFC Australia due to COVID-19 • Overall Europe SSS decline of (5.8)%, FY19 FY20 FY20 FY20 FY20 significantly impacted by COVID-19 during Underlying (1) Statutory Non trading Underlying Change Statutory ($m) (Pre AASB 16) (Pre AASB 16) items (2) (Pre AAS
Slide 13: KFC Europe focusing on operational priorities as COVID-19 restrictions ease
KFC Europe focusing on operational priorities as COVID-19 restrictions ease • Government responses to COVID-19 in Netherlands and Germany featured tighter initial restrictions though also increased financial support for businesses and employees • KFC Netherlands impacted more significantly than Germ
Slide 14: KFC Europe restaurant build and remodel update
KFC Europe restaurant build and remodel update • FY20 capex of circa $12.2m for KFC Europe network development: Gorinchem, NL - 3 new restaurants opened in the Netherlands - 1 new restaurant opened in Germany and 1 restaurant closure • Greater COVID-19 uncertainty likely to moderately impact develop
Slide 15: Taco Bell
Taco Bell Page 13
Slide 16: Early launch of home delivery highlights Taco Bell COVID-19 response efforts
Early launch of home delivery highlights Taco Bell COVID-19 response efforts • Significant shift towards takeaway channels as a result of COVID-19, similar to other QSR brands • Operational focus has been to elevate hygiene and safety standards connected with COVID-19, as well as maximise efficiency
Slide 17: Successful openings of additional Taco Bell restaurants in Queensland and Victoria
Successful openings of additional Taco Bell restaurants in Queensland and Victoria • Opened 4 restaurants in Queensland in second half of FY20 • Expansion into Victoria with 2 restaurants opened, South Yarra and Hawthorn in December 2019. Unique launch with the Taco Bell “tram-thru” • Total of 8 res
Slide 18: Sizzler
Sizzler Page 16
Slide 19: Sizzler growth disrupted by COVID-19
Sizzler growth disrupted by COVID-19 • Same store sales decline in Australia of (5.6)% FY19 FY20 FY20 FY20 FY20 for the full year – significantly impacted by Underlying (1) Statutory Non trading Underlying Change Statutory ($m) (2) COVID-19 in the last few months of the (Pre AASB 16) (Pre AASB 16) i
Slide 20: Sizzler Asia heavily impacted by COVID-19
Sizzler Asia heavily impacted by COVID-19 JAPAN 10 CHINA 6 • All 3 markets where Sizzler Asia operates were significantly impacted by dining restrictions as a result of COVID-19, though Japan and Thailand have largely eliminated these in recent weeks THAILAND 57 • Total of 73 restaurants in Asia as
Slide 21: Financial overview
Financial overview Page 19
Slide 22: Operating cash flows remain healthy
Operating cash flows remain healthy FY19 FY20 FY20 • Net operating cash flow (pre AASB 16) of ($m) (Pre AASB 16) (Pre AASB 16) (Post AASB 16) $96.4m down $1.1m on prior year due to working capital timing offset by an increase in Net operating cash flows before interest and tax 125.0 127.4 180.2 inco
Slide 23: Reductions in Net Leverage Ratio and Net Debt highlight strong balance sheet
Reductions in Net Leverage Ratio and Net Debt highlight strong balance sheet • Net leverage ratio (pre AASB 16) at 1.69 – Net Debt / Net Leverage Ratio* significant headroom to covenant maximum of 2.75 • Net debt of $203.2m(1) – significant headroom $227.2m to current facility of circa $400.0m(2) $2
Slide 24: Balance sheet
Balance sheet 28-Apr-19 3-May-20 3-May-20 • Cash balance (pre AASB 16) up $36.5m to (Pre AASB 16) (Pre AASB 16) (Post AASB 16) $116.3m ($m) Cash and equivalents 79.8 116.3 116.3 • Property, plant and equipment up $10.8m to $187.5m mainly due to new restaurant builds, Total current assets 91.7 132.5
Slide 25: Key strategic priorities for FY21
Key strategic priorities for FY21 KFC Australia KFC Europe Taco Bell Australia Emphasise value and convenience to Build on sales momentum in Germany Continue to establish and build the Taco Bell maintain core brand strength in post brand in Australia Resume roll out of value focus agenda in
Slide 26: Questions
Questions Page 24
Slide 27: Appendix
Appendix Page 25
Slide 28: FY20 non trading items summary
FY20 non trading items summary ($m) EBITDA EBIT NPAT Fair value gain on debt modification (0.8) (0.8) (0.5) Netherlands development agreement fee 0.8 0.8 0.6 Make good expenses associated with equipment from a product exit 0.4 0.4 0.3 Insurance money relating to material damages – KFC Australia (1.6
Slide 29: Disclaimer
Disclaimer 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. Circumstances may change and