Biglari Holdings Inc. · NYSE:BH
Biglari — Proxy Contest (March 2015)
18 slides from Biglari's proxy contest presentation, Mar 20, 2015
Slide 1: March 2015
March 2015 www.biglariholdings.com
Slide 2: Legal Disclaimer
LEGAL DISCLAIMER This presentation may include “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These statements are based on current expectations and are subject to a number of risks and uncertainties that cou
Slide 3: When Sardar Biglari became CEO, Steak n Shake was within 90 days of insolvency
When Sardar Biglari became CEO, Steak n Shake was within 90 days of insolvency 2
Slide 4: Price Per Share - Was Failing
STEAK N SHAKE WAS FAILING After the Company was unable to retain an outside candidate as CEO, Sardar Biglari assumed the role of CEO in August 2008 – one month before the collapse of Lehman Brothers in the midst of the Great Recession $350 Steak n Shake Same-Store Sales Declines 2005 2006 2007 200
Slide 5: Steak n Shake had 14 consecutive quarters of declining customer traffic
STEAK N SHAKE WAS FAILING 5% Same-Store Customer Traffic Steak n Shake had 14 consecutive quarters of declining customer traffic 0% (1.0%) (3.8%) -5% (5.0%) (5.1%) (5.7%) (6.0%) (6.5%) (6.6%) (6.8%) (7.9%) (8.5%) -10% (8.8%) (10.2%) (13.3%) -15% 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q FY 2005 FY 2
Slide 6: Steak n Shake had 13 consecutive quarters of declining same-store sales
STEAK N SHAKE WAS FAILING 5% Same-Store Sales Steak n Shake had 13 consecutive quarters of declining same-store sales 0% (0.3%) (1.1%) (1.7%) (3.0%) (3.4%) (3.9%) (4.3%) -5% (3.9%) (4.7%) (6.3%) (5.8%) (7.4%) -10% (9.5%) 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q FY 2005 FY 2006 FY 2007 FY 2008 5
Slide 7: Steak n Shake was generating negative cash flow from its core operations
STEAK N SHAKE WAS WITHIN 90 DAYS FROM INSOLVENCY WHEN SARDAR BIGLARI BECAME CEO ON AUGUST 5, 2008 Steak n Shake was generating negative cash flow For the month ending September 2008 $ in thousands from its core operations Earnings Before Interest and Taxes $ (9,601.8) Had sales continued to decline
Slide 8: Quote from Ruth Person, Independent Director
“Those were the scariest of times. We were on the verge of bankruptcy and quickly running out of time and money.” – Ruth Person, Independent Director 7
Slide 9: Current management resurrected the company
IN THE MIDST OF THE GREAT RECESSION CURRENT MANAGEMENT RESURRECTED THE COMPANY Q4 FY 2008 Q1 FY 2009 Sardar Biglari became CEO on August 5, Jul. Aug. Sep. Oct. Nov. Dec. 2008 and by December 2008 same-store Same-Store Customer Traffic 8.6% 10.6% 11.4% 7.6% 4.4% 9.6% sales and customer traffic
Slide 10: Sardar Biglari resurrected Steak n Shake from near bankruptcy
In the face of daunting economic headwinds, Sardar Biglari resurrected Steak n Shake from near bankruptcy and initiated one of the great brand turnarounds in the history of the restaurant industry 9
Slide 11: Cumulative same-store customer traffic vs Knapp-Track Index
IN THE MIDST OF THE GREAT RECESSION CURRENT MANAGEMENT RESURRECTED THE COMPANY Cumulative Same-Store Customer Traffic 50% Prior Management Current Management 40% 37.8% 35.1% 32.3% 30% 27.6% 21.8% 20% 10.1% 10% 0% -2.8% -6.2% -5.7% -6.5% -10% -9.9% -9.4% -9.9% -11.5% -11.1% -13.3% -15.9% -20% Steak n
Slide 12: Sardar Biglari resurrected Steak n Shake
SARDAR BIGLARI RESURRECTED STEAK N SHAKE As CEO of Steak n Shake, Cumulative Same-Store Customer Traffic Growth 40% Sardar was and continues to 37.8% be involved in all key day-to- day management decisions, 35% 35.1% including supply chain 32.3% logistics, marketing, menu offerings, training, and
Slide 13: Steak n Shake's remarkable turnaround
STEAK N SHAKE’S REMARKABLE TURNAROUND When Sardar assumed management responsibilities, Steak n Shake was losing nearly $100,000 per day However, by FY 2010, the chain was making over $100,000 per day As a result of Sardar’s focused turnaround strategy, Steak n Shake was awarded the Golden Chain
Slide 14: Same-store sales growth versus the Knapp-Track Index
SAME-STORE SALES GROWTH VERSUS THE KNAPP-TRACK INDEX Cumulative Same-Store Sales 30% 27.3% Prior Management Current Management 25% 23.7% 21.0% 20% 16.6% 15% 11.9% 10% 5% 4.1% 0.5% 0% -0.2% -2.1% -2.3% -5% -5.8% -5.9% -5.5% -6.4% -6.6% -7.6% -7.5% -10% Steak n Shake Knapp-Track Index (1) -12.5% -15%
Slide 15: 6-year cumulative same-store sales growth
6-YEAR CUMULATIVE SAME-STORE SALES GROWTH 6-Year Cumulative Same-Store Sales 27.3% 17.7% 13.1% 6.4% 5.8% 4.2% 0.0% -0.3% -2.2% -2.3% -2.4% -4.0% -5.5% -6.4% -7.5% -11.3% -17.9% -20% -15% -10% -5% 0% 5% 10% 15% 20% 25% 30% Source: Public filings 14
Slide 16: Groveland owns 0.167% of shares outstanding
Groveland owns 0.167% of shares outstanding and is seeking to take over a $1 billion company with a $1 million investment 15
Slide 17: Questions for Groveland
QUESTIONS FOR GROVELAND e Groveland Rech th What qualifications do dand what is the Boar inees have for ' nominess their plan? rant Who on the Groveland slate has restau a to) : 3 i ce? rating experien vate? ae many restaurants did they ope @ How -store sales What was their record of same-sto! e gro
Slide 18: Contact Information
CONTACT INFORMATION Shareholders Bruce H. Goldfarb/Charles Garske/Michael Fein (212) 297-0720 / (877) 279-2311 info@okapipartners.com 17