Sphera Franchise Group Sa · BVB:SFG
Sphera Franchise Group Sa — FY2018 Earnings Presentation
28 slides from Sphera Franchise Group Sa's earnings presentation, 2019
Slide 1: Sphera Franchise Group Preliminary results: Year 2018
Sphera Franchise Group Preliminary results: Year 2018 1
Slide 2: Disclaimer
Disclaimer This presentation is not, and nothing in it should be construed as, an offer, invitation or recommendation in respect of shares issued by Sphera Franchise Group SA ("Sphera"), or an offer, invitation or recommendation to sell, or a solicitation of an offer to buy shares in Sphera. Neither
Slide 3: Sphera – Q4 / 12-mth 2018 key events
Sphera – Q4 / 12-mth 2018 key events All-store sales up 24.6% with same-store sales growth of 9.0% (Q3: overall +27.8%, same-store +10.3%) ▪ continued strong growth from KFC, increasing contributions from KFC Italy and Taco Bell Total store openings: 25 (8x KFC Romania, 8x KFC Italy, 1x PH, 5x PHD,
Slide 4: Macro environment becomes more volatile following new Government tax bills
Macro environment becomes more volatile following new Government tax bills Tax on Robor and energy expected to impact financing and energy costs Annualized CPI (RON) Annualized average Salaries and minimum gross salaries (Y/Y%) 6% (Y/Y% growth rates) 6,000 30% 100% 5% Average gross salary (Y/Y% chan
Slide 5: Sales performance by brands
(Sp) Sales performance by brands
Slide 6: Brand performance: KFC Romania Sales growth analysis
Brand performance: KFC Romania Sales growth analysis ▪ All-store sales growth of 21.5% Y/Y in FY-2018 30% 26.4% supported mainly by same-store growth of 11.0%; 25% 23.2% ▪ In Q4, all-store sales advanced 22.3%, with same- 21.5% 20.6% 20.4% store sales improving by 12.3%; 18.8% 19.6%20.1% 20% 17.7% 1
Slide 7: Brand performance: Pizza Hut Sales growth analysis
Brand performance: Pizza Hut Sales growth analysis ▪ All-store sales growth of 9.5% Y/Y in FY-2018, 30% 28.0% with virtually all growth being contributed by the 12 stores opened starting Jan-2017 (of which 7 in 25% existing cities); 20% All-store ▪ In Q4, all store sales advanced 8.5% Y/Y, while 16.
Slide 8: Development
(Np) Development
Slide 9: Development Restaurant openings in 2018
Development Restaurant openings in 2018 Total stores Openings Total stores 2018 Initial Difference vs 2019 Initial BoY 2018 end-2018 Plan (2) plan Plan 70 8 78 9(1) (1) 8 2 8 10 7(1) 1 10 22 1 23 2 (1) 1 17 5 22 5 0 1 2 3 5 3 0 5 113 25 138 26 (1) 25 (1) Of which 2x KFC Romania and 1x KFC Italy were
Slide 10: KFC Italy – Venice Santa Lucia
KFC Italy – Venice Santa Lucia 10
Slide 11: Pizza Hut Dine-in Craiova
Pizza Hut Dine-in Craiova 11
Slide 12: TB Cluj Iulius
TB Cluj lulius SEES
Slide 13: Brand news
(Np)Brandnews
Slide 14: Brand news Q4-2018 highlights
Brand news Q4-2018 highlights ▪ KFC continued to build sharing, a very important consumption occasion for the brand, by launching its “bucket approved by moms” campaign with the aim of strengthening consideration and brand love; the communication around bucket resulted in strong double digit same-st
Slide 15: Brand news FRIEND ZONE - Campaign results
Brand news FRIEND ZONE - Campaign results +14.8M +8.9M +328M paid views registered engagements generated sec of content viewed = 10.4 years in real life 15
Slide 16: Brand news Q4-2018 highlights
Brand news Q4-2018 highlights ▪ Continued to build on the successful launch of the new communication platform “a little crazy, just a bit” by introducing an innovative product, Cheesy Garlic Twist with the aim of building frequency and attracting new users to the brand; same-store sales growth was p
Slide 17: Marketing Q4-2018 campaigns
Marketing Q4-2018 campaigns 17
Slide 18: Financials
Financials
Slide 19: Pro forma financials
Pro forma financials Note: FY-2018 pro forma results are identical to consolidated results FY-2017 pro forma results include ARS performance for the full period FY-2017 consolidated results do not include ARS performance for Jan-May period
Slide 20: Financial performance: Q4-2018 Statement of comprehensive income
Financial performance: Q4-2018 Statement of comprehensive income ▪ Pro forma sales up 27.8% Y/Y on strong performance from KFC Romania/Moldova (+23.2% Y/Y) and Pizza Hut (+9.1% Y/Y) and increasing contributions from the new businesses (KFC Italy and Taco Bell); ▪ Restaurant operating profit up 18.7%
Slide 21: Financial performance: Q4-2018 Quarterly trends in key indicators
Financial performance: Q4-2018 Quarterly trends in key indicators Restaurant sales - Y/Y% growth Restaurant operating profit margin 27.8% 26.6% 15.3% 15.3% 15.1% 24.6% 24.6% 23.4% 13.9% 22.5% 22.5% 21.6% 13.0% 13.3% 13.5% 13.4% 20.8% 11.4% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY Quarte
Slide 22: Financial performance: FY-2018 (Consolidated) vs FY-2017 (Pro-forma)
Financial performance: FY-2018 (Consolidated) vs FY-2017 (Pro-forma) Statement of comprehensive income ▪ Pro forma sales up 24.6% Y/Y on strong performance from KFC Romania/Moldova (+21.5% Y/Y) and Pizza Hut (+9.7% Y/Y) and increasing contributions from the new businesses (KFC Italy and Taco Bell);
Slide 23: Breakdown of 2018 results by Group companies
Financial performance: FY-2018 (Consolidated) vs FY-2017 (Pro-forma) Breakdown of 2018 results by Group companies Data in RON'000 USFN (RO) ARS USFN (MD) USFN (IT) CFF SFG Cons.Adj SFG Cons. Restaurant sales 586,460 122,820 9,764 38,613 12,033 26,514 (25,007) 771,197 Dividend revenue 0 0 0 0 0 61,79
Slide 24: Restaurant operating expenses and margin
Financial performance: FY-2018 (Consolidated) vs FY-2017 (Pro-forma) Restaurant operating expenses and margin Y/Y% % of Sales Contribution to change in restaurant opex ratio Data in RON'000 Dec-18 Dec-17 2018/2017 Dec-18 Dec-17 Δ% Restaurant expenses 668,018 520,031 28.5% 86.6% 84.0% 2.6% Food and m
Slide 25: G&A expenses
Financial performance: FY-2018 (Consolidated) vs FY-2017 (Pro-forma) G&A expenses Y/Y% % of Sales Contribution to growth in G&A expense Data in RON'000 Dec-18 Dec-17 2018/2017 Dec-18 Dec-17 General and adm inistration expenses (net), of w hich: 62,379 60,296 3.5% 8.1% 9.7% Employee benefits 30,563 3
Slide 26: Consolidated financials
(Sp) Consolidated financials
Slide 27: Sphera – Consolidated financial performance
Sphera – Consolidated financial performance Statement of comprehensive income ▪ Consolidated sales up 34.5% Y/Y on strong performance from KFC Romania (+21.5% Y/Y), while the consolidation of ARS (Pizza Hut restaurants), starting with June 2017, contributed 9.8pp in the consolidated sales growth rat
Slide 28: Sphera – Consolidated financial performance: Statement of financial position
Sphera – Consolidated financial performance Statement of financial position Data in RON'000 31-Dec-18 31-Dec-17 Change Assets Non-current assets 229,169 176,123 53,046 Property, plant and equipment 158,122 105,220 52,902 Intangible assets 62,150 67,471 (5,321) Deposits for rent guarantee 5,219 1,288
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