Retail Food Group Limited · ASX:RFG
Retail Food — H1 2022 Earnings Presentation
27 slides from Retail Food's earnings presentation, Feb 23, 2022
Slide 1: 1H22 Results Presentation
For personal use only 1H22 RESULTS PRESENTATION
Slide 2: Disclaimer
DISCLAIMER This Presentation contains summary information about the current activities of Retail Food Group Limited ACN 106 840 082 (RFG, the Company or Group) & its subsidiaries as at the date of this Presentation, unless otherwise stated. The information in this Presentation is of a general nature
Slide 3: 1H22 Snapshot
1H22 SNAPSHOT POSITIVE INDICATORS DESPITE CHALLENGING COVID-19 ENVIRONMENT For personal use only • Reasonable outcomes across Group’s operations given challenging > Contributed to 1H22 Underlying EBITDA(4) of $9.3 million (1H21: trading conditions throughout 1H22: $14.4 million): • Numerous positive
Slide 4: 1H22 Snapshot: Domestic Network Metrics
1H22 SNAPSHOT: DOMESTIC NETWORK METRICS For personal use only > 1H22 network performance broadly reflects three distinct periods: +7.4%(1) • Significant impact of Delta related lockdowns, border closures & other measures: 1H22 Average Transaction Value • All States/Territories subject to lockdowns o
Slide 5: 1H22 Snapshot: Coffee Brand Customer Count
1H22 SNAPSHOT: COFFEE BRAND CUSTOMER COUNT COVID-19’s Impact on Coffee Brand System Customer Count For personal use only 2 Year Trend (excluding Gloria Jean’s Drive Thru)(1)(2) > Coffee Brand Systems’ Customer Count since pandemic onset COVID-19 reflects: Onset Post Post Lockdown Lockdown • Signific
Slide 6: 1H22 Snapshot: Strong ATV Growth
1H22 SNAPSHOT: STRONG ATV GROWTH > Ongoing investment in marketing, product innovation & consumer engagement For personal use only delivering positive results: • Drove strong 1H22 network ATV of +7.4%(1): • Delivered increased basket size at store level • Mitigated full impact of COVID-19 induced cu
Slide 7: 1H22 Snapshot (Continued)
1H22 SNAPSHOT (CONTINUED) ONGOING TURNAROUND ACTIVITY: For personal use only POSITIVE OUTLOOK DESPITE ONGOING CHALLENGES/UNCERTAINTY: • Underscored by ‘franchisee first’ philosophy & driving improved franchise partner outcomes: • Despite COVID-19 impact: • Focused on core franchise & coffee business
Slide 8: 1H22 Performance Summary
For personal use only 1H22 PERFORMANCE SUMMARY
Slide 9: 1H22 Performance Summary
1H22 PERFORMANCE SUMMARY GROUP PERFORMANCE(1) 1H22 1H21 % Change For personal use only (2) > 1H22 underlying EBITDA(1) of $9.3 million (1H21: $14.4 million): Revenue $54.7m $85.1m (35.8%) • Reflects 13% decrease on PCP when effect of 1H21 Government support Revenue - continuing operations $54.7m $60
Slide 10: Reconciliation of Underlying to Statutory Results
RECONCILIATION OF UNDERLYING TO STATUTORY RESULTS 1H22 UNDERLYING STATUTORY For personal use only > $3.3 million non-core expenditure in continuing operations from restructuring EBITDA $9.3m $11.8m activities & provisioning, comprising: NPAT $7.4m $5.1m • Advisory costs in connection with restructur
Slide 11: Underlying EBITDA Performance by Division
UNDERLYING EBITDA(1) 1H22 1H21 % Change EBITDA PERFORMANCE BY DIVISION TO PCP For personal use only (2) Bakery / Café Division $2.6m $6.2m (57.7%) Coffee Retail Division(3) $1.5m $3.7m (59.6%) > 1H22 Underlying EBITDA divisional results attributable to: QSR(4) $3.2m $3.3m (2.9%) • Significant decrea
Slide 12: Cash Flows
CASH FLOWS CASH FLOW STATEMENT 1H22 ($m) 1H21 ($m) Receipts from Customers 53.8 97.6 > Decrease in cash receipts from customers & payments to suppliers & Payments to Suppliers & Employees (41.7) (82.6) For personal use only employees consistent with: • 1H21 disposal of high-volume/low-margin non-cor
Slide 13: Balance Sheet at Dec 2021
BALANCE SHEET AT 31 Dec 2021 1H22 ($m) FY21 ($m) BALANCE SHEET Assets Cash Reserves 32.2 34.6 > Increased net assets arising from 1H22 Statutory NPAT result For personal use only Trade Receivables 8.0 7.1 > Movements in lease receivables & lease liabilities during the period reflect: Finance lease r
Slide 14: Debt Structure
DEBT STRUCTURE Gross debt $46.2 million For personal use only > Fully compliant with all covenants as of 31 December 2021 Net debt at 31 December 2021 (1) $21.2 million > Borrowings decreased by $2.5 million during period, following 1H22 Covenant compliance Fully compliant with all lending covenants
Slide 15: 1H22 Divisional Performance
For personal use only 1H22 DIVISIONAL PERFORMANCE
Slide 16: Domestic Bakery / Café Division
DOMESTIC BAKERY / CAFÉ DIVISION 1H22 1H21 % Change > 1H22 performance influenced by: New Outlets 4 3 • Brumby’s successfully cycling strong FY21 Brand System metrics: Closures (32) (33) For personal use only • 1H22: SSS +0.5%/ATV +2.3%(2) • Underpinned by strong customer demand for quality bakery pr
Slide 17: Domestic Coffee Retail Division
DOMESTIC COFFEE RETAIL DIVISION 1H22 1H21 % Change New Outlets - - > 1H22 performance influenced by: • Standout performance amongst Gloria Jean’s Drive Thru outlets: Closures (34) (29) For personal use only • Best performing outlets in network: Outlets at Half Year (1) 191 209 (8.6%) • +11.6% SSS gr
Slide 18: Domestic QSR Division
DOMESTIC QSR DIVISION 1H22 1H21 % Change > QSR Division Brand Systems were standout performers during 1H22(2): New Outlets - 1 • Crust: SSS +7.7%, CC +7.7%, ATV flat Closures (3) (18) For personal use only • Pizza Capers: SSS +0.7%, CC -0.4%, ATV +1.1%: • Represents improvement from -0.7% YTD SSS re
Slide 19: International Franchising Division
INTERNATIONAL FRANCHISING DIVISION(1) 1H22 1H21 % Change > Strong 1H22 performance influenced by: New Master Franchise Agreements 1 - For personal use only • Cost reduction benefits realised from restructuring activity & improved trading New Outlets 36 27 conditions across majority of international
Slide 20: Di Bella Coffee (DBC)
DI BELLA COFFEE (DBC) 1H22 1H21 % Change External Revenue $3.6m $8.8m (59.5%) > 1H22 divisional performance influenced by: For personal use only • Negative COVID-19 related impacts on independent cafe/contract roasting EBITDA Underlying(1)(2) $0.5m $0.8m (40.8%) customer volumes, particularly where
Slide 21: 2H22 Focus & Outlook
For personal use only 2H22 FOCUS & OUTLOOK
Slide 22: 2H22 Focus
2H22 FOCUS > Unwavering commitment to supporting franchise partner community: • Ongoing focus on Gloria Jean’s new fresh food range trial: • Exclusive to Gloria Jean’s • Maintaining aggressive campaign activity to drive category & ATV For personal use only growth: • Provides new growth opportunity v
Slide 23: Network Development & Support
NETWORK DEVELOPMENT & SUPPORT > Network development & support: • Further resourcing & refinement of corporate store division: • Ongoing focus on new outlet growth opportunity: • Affords scope to: For personal use only • 1H22 frustrated by COVID-19 impact, including: • Execute on new outlet growth op
Slide 24: Strategic Growth Drivers
STRATEGIC GROWTH DRIVERS > Donut King Mobile Van model: Established & Operating: • Launched Aug 2021, following a successful trial in FY21 For personal use only • Strong positive interest in concept received to date: • 3 units operational • Further 6 units pending vehicle delivery from overseas Esta
Slide 25: Outlook
OUTLOOK > COVID-19’s unavoidable impact demonstrated by 1H22 performance: • Barriers to optimal trading continue to exist: For personal use only • Ongoing government measures in response to COVID-19 • Omicron effect on customer traffic & isolation requirements (leading to lost trading hours/staff sh
Slide 26: Appendix
For personal use only APPENDIX
Slide 27: Definitions
Definitions ATV Average Transaction Value For personal use only BCD Bakery/Café Division: Donut King; Michel’s Patisserie; Brumby’s Bakery CC Customer Count COGS Cost of Goods Sold CRD Coffee Retail Division: Gloria Jean’s; Cafe2U; The Coffee Guy; Esquires Coffee DBC Di Bella Coffee Division: Franch