Arcos Dorados Holdings Inc. · NYSE:ARCO
Arcos Dorados — Q3 2023 Earnings Presentation
24 slides from Arcos Dorados's earnings presentation, Nov 16, 2023
Slide 1: 3rd Quarter 2023 Earnings
Arcos Dorados 3 Quarter rd 2023 Earnings November 16, 2023
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements that represent our beliefs, projections and predictions about future events or our future performance. Forward-looking statements can be identified by terminology such as “may,” “will,” “would,” “could,” “should,” “expect,” “intend,” “
Slide 3: Agenda
Agenda Key Highlights Divisional Sales & Profitability Three D’s Strategy Balance Sheet & Growth Recipe for the Future Wrap Up 03
Slide 4: Key Highlights
Key Highlights 3rd Quarter 2023
Slide 5: Third Quarter 2023 Key Highlights
Third Quarter 2023 Key Highlights Systemwide Comparable Sales – 1.4x Blended Inflation 3Q 2023 Systemwide • All main markets grew comps well above inflation in the quarter. Total Revenue Comparable Sales • Guest volume growth remained strong throughout the ARCO footprint. $1.1b +37.3% • Visit share
Slide 6: Sales & Profitability
Sales & Profitability Divisional Sales Performance
Slide 7: 3Q23 – Brazil Division Sales Performance
3Q23 – Brazil Division Sales Performance BRAZIL 10.8% ($million) 15.9% 24.5% 352.8 439.2 408.7 3Q22 3Q23 3Q23 (as reported) (in constant currency) ✓ Comps up 2.3x inflation, about evenly split between guest volume and average check. ✓ Digital channels generated 61% of sales, with 25% identified sale
Slide 8: 3Q23 – North Latin American Division Sales Performance
3Q23 – North Latin American Division Sales Performance NOLAD 11.5% ($million) 15.1% 27.0% 232.9 295.6 267.9 3Q22 3Q23 3Q23 (as reported) (in constant currency) ✓ Comps up 4.0x blended inflation. ✓ All markets grew comps by at least high single digits to mid teens. ✓ Around 2/3 of NOLAD’s comp sales
Slide 9: 3Q23 – South Latin American Division Sales Performance
3Q23 – South Latin American Division Sales Performance SLAD 93.8% ($million) 90.6% 16.1% 336.1 390.3 640.5 3Q22 3Q23 3Q23 (as reported) (in constant currency) ✓ Comps up 1.3x SLAD’s blended inflation. ✓ Chile, Ecuador and Uruguay comps up 2.0 to 3.5x local inflation. ✓ Strong Digital sales channel g
Slide 10: 3Q23 – Consolidated Adjusted EBITDA Growth & Margin Bridge
3Q23 – Consolidated Adjusted EBITDA Growth & Margin Bridge Consolidated 11.5% ($million) margin 43.9% 25.8% 102.6 129.1 147.7 3Q22 3Q23 3Q23 (as reported) (in constant currency) • Consolidated Adj. EBITDA margin expanded by 40 basis points, driven by gross margin expansion and G&A leverage. • Food &
Slide 11: 3Q23 – Adj. EBITDA Growth by Division
3Q23 – Adj. EBITDA Growth by Division Adjusted EBITDA margin (%) BRAZIL NOLAD SLAD 17.7% 10.9% 10.7% ($million) ($million) ($million) 15.8% 105.0% 24.8% 27.4% 5.3% 42.0% 62.4 77.8 72.2 22.7 32.3 29.0 39.7 41.8 81.4 3Q22 3Q23 3Q23 3Q22 3Q23 3Q23 3Q22 3Q23 3Q23 (as reported) (in constant (as reported)
Slide 12: Digital, Delivery & Drive-thru
Digital, Delivery & Drive-thru
Slide 13: Total Digital Sales – Driving Consistent Topline Growth
Total Digital Sales1 – Driving Consistent Topline Growth Systemwide Digital Sales ($USD) Total Digital Identified Sales Penetration Sales Penetration 42% 50% 16% 20% 3Q 2022 3Q 2023 3Q 2022 3Q 2023 3Q22 4Q22 1Q23 2Q23 3Q23 75 m 17 m Unique Registered Average Monthly Users Active Users 1Delivery, Mob
Slide 14: Delivery & Drive-thru: Strong Despite Front Counter Normalization
Delivery & Drive-thru: Strong Despite Front Counter Normalization McDelivery Sales Drive-thru Sales 3Q22 4Q22 1Q23 2Q23 3Q23 3Q22 4Q22 1Q23 2Q23 3Q23 17.0% 25.0% of systemwide sales of systemwide sales 1in constant currency versus 3Q 2022 14
Slide 15: Loyalty Program: 1.8 million members and growing fast
Loyalty Program: 1.8 million members and growing fast 15
Slide 16: Balance Sheet & Growth
Balance Sheet & Growth Capital Structure & Investments
Slide 17: Cash Flow from Operations & Net Leverage
Cash Flow from Operations & Net Leverage Key Debt Metrics Cash Flow from Operating Activities Leverage Ratio ($ million) 7.6x 1.4x 1.0x 1.0x 235.4 232.3 ($ million) 519 458 BB+ 379 370 Stable 685 166 658 279 674 304 709 251 Ba2 2020 2021 2022 9M23 Stable 9M22 9M23 Total Debt Cash & Equivalents Net D
Slide 18: Restaurant Portfolio – A Major Competitive Advantage
Restaurant Portfolio – A Major Competitive Advantage 3Q 2023 QUARTER-END RESTAURANT FOOTPRINT STORE TYPE TOTAL DESSERT DIVISION McCAFÉ RESTAURANTS CENTERS Freestanding In Store MS & FC BRAZIL 564 92 457 1,113 137 1,993 NOLAD 392 51 195 638 13 519 SLAD 237 128 223 580 166 710 TOTAL 1,193 271 875 2,33
Slide 19: Recipe for the Future
Recipe for the Future ESG Platform
Slide 20: Recipe for the Future – ESG Platform
Recipe for the Future – ESG Platform Youth Opportunity & Commitment to Families ✓ Brazil – #8 Overall among Large Companies. ✓ Argentina - #1 for Young Talent & #1 Companies that Care. ✓ Chile - #11 for People under 35 / #1 University Talent. ✓ Uruguay – #1 for Young People. Diversity & Inclusion an
Slide 21: Wrap Up
Wrap Up Closing Remarks
Slide 22: Closing Remarks
Closing Remarks Consistent, long-term, strategic approach to delivering value and convenience. Sustainable topline growth to drive higher profitability. Strengthening structural competitive advantages for the QSR industry’s favorite Brand. Operating from a position of strength to capture growth oppo
Slide 23: Questions & Answers
Questions & Answers
Slide 24: Thank you!
IR Contacts www.arcosdorados.com/ir Thank you! Dan Schleiniger Vice President Investor Relations daniel.schleiniger@mcd.com.uy Leticia Santiago Senior Manager Investor Relations leticia.santiago@br.mcd.com Follow us on:
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