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Corporate Presentation
Q3 2016
2
Disclaimer
This presentation (the "Presentation") has been prepared and is issued by, and is the sole responsibility of Telepizza Group, S.A. (“Telepizza" or "the Company"). For the purposes hereof, the Presentation shall mean and
include the slides that follow, any prospective oral presentations of such slides by the Company, as well as any question-and-answer session that may follow that oral presentation and any materials distributed at, or in
connection with, any of the above.
The information contained in the Presentation has not been independently verified and some of the information is in summary form. No representation or warranty, express or implied, is made by the Company or its affiliates,
nor by their directors, officers, employees, representatives or agents as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or opinions expressed herein. None of
Telepizza, nor their respective directors, officers, employees, representatives or agents shall have any liability whatsoever (in negligence or otherwise) for any direct or consequential loss, damages, costs or prejudices
whatsoever arising from the use of the Presentation or its contents or otherwise arising in connection with the Presentation, save with respect to any liability for fraud, and expressly disclaim any and all liability whether direct
or indirect, express or implied, contractual, tortious, statutory or otherwise, in connection with the accuracy or completeness of the information or for any of the opinions contained herein or for any errors, omissions or
misstatements contained in the Presentation.
Telepizza cautions that this Presentation contains forward looking statements with respect to the business, financial condition, results of operations, strategy, plans and objectives of the Company. The words "believe",
"expect", "anticipate", "intends", "estimate", "forecast", "project", "will", "may", "should" and similar expressions identify forward-looking statements. Other forward-looking statements can be identified from the context in which
they are made. While these forward looking statements represent our judgment and future expectations concerning the development of our business, a certain number of risks, uncertainties and other important factors,
including those published in our past and future filings and reports, including those with the Spanish Securities and Exchange Commission (“CNMV”) and available to the public both in Telepizza’s website
(www.telepizza.com) and in the CNMV’s website (www.cnmv.es), as well as other risk factors currently unknown or not foreseeable, which may be beyond Telepizza’s control, could adversely affect our business and financial
performance and cause actual developments and results to differ materially from those implied in the forward-looking statements. There can be no assurance that forward-looking statements will prove to be accurate, as
actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements due to the inherent uncertainty therein.
The information contained in the Presentation, including but not limited to forward-looking statements, is provided as of the date hereof and is not intended to give any assurances as to future results. No person is under any
obligation to update, complete, revise or keep current the information contained in the Presentation, whether as a result of new information, future events or results or otherwise. The information contained in the Presentation
may be subject to change without notice and must not be relied upon for any purpose.
This Presentation contains financial information derived from Telepizza’s audited consolidated financial statements for the twelve-month periods ended December 31, 2015 and 2014. In addition, the Presentation contains
Telepizza’s unaudited quarterly financial information for 2014, 2015 and 2016 prepared according to internal Telepizza’s criteria as well as other performance measures as of April 2016. Financial information by business
segments is prepared according to internal Telepizza’s criteria as a result of which each segment reflects the true nature of its business. These criteria do not follow any particular regulation and can include internal estimates
and subjective valuations which could be subject to substantial change should a different methodology be applied.
In addition, the Presentation contains certain annual and quarterly alternative performance measures which have not been prepared in accordance with International Financial Reporting Standards, as adopted by the
European Union, nor in accordance with any accounting standards, such as “chain sales”, “like-for-like chain sales growth”, “underlying EBITDA” and “digital sales”. These measures have not been audited or reviewed by our
auditors nor by independent experts, should not be considered in isolation, do not represent our revenues, margins, results of operations or cash flows for the periods indicated and should not be regarded as alternatives to
revenues, cash flows or net income as indicators of operational performance or liquidity.
Market and competitive position data in the Presentation have generally been obtained from industry publications and surveys or studies conducted by third-party sources. There are limitations with respect to the availability,
accuracy, completeness and comparability of such data. Telepizza has not independently verified such data and can provide no assurance of its accuracy or completeness. Certain statements in the Presentation regarding
the market and competitive position data are based on the internal analyses of Telepizza, which involve certain assumptions and estimates. These internal analyses have not been verified by any independent source and
there can be no assurance that the assumptions or estimates are accurate. Accordingly, no undue reliance should be placed on any of the industry, market or Telepizza’s competitive position data contained in the
Presentation.
You may wish to seek independent and professional advice and conduct your own independent investigation and analysis of the information contained in this Presentation and of the business, operations, financial condition,
prospects, status and affairs of Telepizza. The Company is not nor can it be held responsible for the use, valuations, opinions, expectations or decisions which might be adopted by third parties following the publication of this
Presentation.
No one should purchase or subscribe for any securities in the Company on the basis of this Presentation. This Presentation does not constitute or form part of, and should not be construed as, (i) an offer, solicitation or
invitation to subscribe for, sell or issue, underwrite or otherwise acquire any securities, nor shall it, or the fact of its communication, form the basis of, or be relied upon in connection with, or act as any inducement to enter
into any contract or commitment whatsoever with respect to any securities; or (ii) any form of financial opinion, recommendation or investment advice with respect to any securities.
The distribution of this Presentation in certain jurisdictions may be restricted by law. Recipients of this Presentation should inform themselves about and observe such restrictions. Telepizza disclaims any liability for the
distribution of this Presentation by any of its recipients.
By receiving or accessing to this Presentation you accept and agree to be bound by the foregoing terms, conditions and restrictions.
3
Telepizza at a glance
1,342 stores globally
(66% franchised /
34% owned)
Leading pizza delivery
player in its core markets
Digital accounts for 37% of delivery sales in Spain in
September
€506m LTM Group
chain sales
€63m LTM Underlying
EBITDA
Key facts1 Chain sales growth2
The largest non-US pizza delivery company worldwide
19% LTM Underlying
EBITDA margin
Market leader in core markets (2015) Geographic breakdown (2015)
53% 51%
16%
52%
33%
1 1 2 1 1Market
position
Europe Latin America
Spain Portugal Poland Chile Colombia
Store network Chain sales Underlying EBITDA
66%
15%
16%3%
Spain Rest of Europe Latin America Master franchises and Others
49%
17%
22%
12%
66%
15%
16%3%
65%13%
15%7%
Notes:
1. Data as of Q3 2016
2. Constant currency growth, excluding Master Franchises
4.7%4.3%
9.5%
7.9%7.4%
5.5% 5.3%
4.0%
3.2%
7.4%
6.5%
5.6%
3.2% 3.2%
Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16
Chain sales growth LFL sales
4
68236
561 580 640 632 628 624 630 621 630 644 665
14
51
315 369433 460 563 602 631 609 638 667 677
282
287
876949
1,073 1,0921,191 1,226 1,261 1,230 1,268 1,311 1,342
1988 1992 1996 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Q3 2016
Evolution of Telepizza
Telepizza has a long history of growth in the Spanish and international markets
# Spanish stores # International stores
Countries
enteredSpain
(1988)
Chile
(1992)
Poland
(1992)
Portugal
(1992)
Colombia
(2010)
Rapid growth in Spain and increased presence
in core international markets
Focus on operational efficiency in Spain
and entry in selected markets
Spain recovery fuels
new phase of
international growth
Guatemala
(2004)
El Salvador
(2004)
UAE
(2009)
Angola
(2014)
Russia
(2014)
Panama
(2013)
Bolivia
(2013)
Peru
(2011)Ecuador
(2012)
65%
Franchised stores
54% 54% 55% 59% 63%58%0% 29% 48% 58% 59%57%Franchised
Stores (%) 66%
UK
(2016)
Malta
(2016)
Saudi
Arabia
(2015)
Iran
(2016)
5
Telepizza stores as of Q3 2016Global footprint with leadership positions in key markets
Market entry: 1992
Market position1: #1
Telepizza stores (Q3 16): 142
Chile
Market entry: 2010
Market position1: #1
Telepizza stores (Q3 16): 92
Colombia
Market entry: 2011
Market position1: #2
Telepizza stores (Q3 16): 39
Peru
Market entry: 2012
Market position1: #4
Telepizza stores (Q3 16): 22
Ecuador
Market entry: 1988
Market position1: #1
Telepizza stores (Q3 16): 665
Spain
Market entry: 1992
Market position1: #2
Telepizza stores (Q3 16): 119
Poland
Market entry: 1992
Market position1: #1
Telepizza stores (Q3 16): 109
Portugal
Master franchises
Guatemala Bolivia
El Salvador Russia
Angola Saudi Arabia
United Kingdom Malta
Iran
Telepizza stores (Q3 16): 152
Master franchiseTelepizza own
and franchised
stores
Telepizza operated
production facilities
Master franchise
production
facilities
3rd party
warehouses
Note:
1. Market shares calculated as % of Chained Pizza foodservice and based on 2015 Euromonitor total number of stores (if there is a difference between Telepizza’s actual # of stores and Euromonitor’s figures for 2015, Company 2015 figures prevail when
calculating market share), except for Spain which is based on market value and according to 2015 NPD data, Ecuador which is company information and Peru, which is calculated based on 2015 Euromonitor number of stores and market share calculated as
% of Global Chained Pizza foodservice. In Colombia this includes stores operated under the Jeno's Pizza brand
6
Investment highlights
Differentiated, vertically integrated and scalable business model4
Proven digital platform supporting multi-channel strategy5
Well-seasoned management team6
Major global pizza brand3
Exposure to positive Spanish macroeconomic fundamentals2
Favorable secular trends in pizza delivery market1
Compelling financial profile with multiple growth levers7
7
2.6%
4.5%
5.1%
Real GDP Pizza foodserv ice Pizza delivery
CAGR (2015–20E)
Favorable trends in pizza delivery
Favorable secular trends in pizza delivery marketThe pizza delivery market is a highly attractive €43bn segment with fast growth
Source: Real GDP: Economist Intelligence Unit (EIU). Market data: Euromonitor
Notes:
1. Pizza delivery: Pizza 100% home delivery/takeaway; Chained pizza delivery: Chained pizza 100% home delivery/takeaway
2. CAGR calculations based on y-o-y Euro denominated market values as per Euromonitor methodology
1
Universal appeal and easily adaptable to local preferences
Increasing emphasis on convenience
Rise in all-day dining and personalization
Premiumization and availability of new taste experiences
Growing trend of "stay-at-home" culture
Well-positioned to benefit from digitalization
Resilient throughout economic cycles
Strong unit economics and high cash conversion
Fragmented global market with significant white space
Co
nsu
mer
tren
ds
Bu
sin
ess m
od
el
Global
market
size (2015)€25.9bn
Chained
pizza delivery1
€43.3bn
Pizza
delivery1
GDP
2
Chained pizza delivery outgrows GDP and
independent pizza players
8
(0.9)% (0.1)%0.7%
1.4% 1.9% 2.4%2.8% 3.2% 3.4% 3.2%
(1.0)%0.5%
0.6%1.2%
2.6% 2.9% 4.3% 4.6% 4.4% 4.6%
(5.8)%
(1.1)%
0.0%1.0%
1.2% 2.5%
8.8%
11.4%
16.1%16.9%
Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Q2 16
Spain real GDP Spain QSR Spain delivery market
Delivery outperforms QSR market and other channels when overall macro environment improves
2
Source: Real GDP: EIU (except for Q1 and Q2 16 data which is from INE). QSR and Delivery market: NPD
Notes:
1. Based on INE data for Spanish PIB
2. UK delivery specialists market figures from NPD
Exposure to positive Spanish macroeconomic fundamentals
(LTM y-o-y growth)
Increase in delivery growth in line with macro recovery
(LTM y-o-y growth)
Clear outperformance of real GDP growth
… has been validated in other marketsImpact of macro recovery in Spain …
Delivery growing faster
than in store + take
away segments
1.2%
2.2%
2.9% 2.4%
2.8%
1.1%
3.2%
3.6%
4.5%
1.8%
6.9%7.6%
2012 2013 2014 2015
UK real GDP UK QSR UK delivery market2
1
Significant gap between
delivery segment and
total QSR market
9
644
105 121 138
91
53%
1
Telepizza market share1 Market position1#2 player market share1 #1 player market share1
# stores
(2015)
Market leading position in our core markets
Source: Euromonitor (2016), NPD (December 2015). Brand scoring: Toluna 2015
Note:
1. Market shares calculated as % of Chained Pizza foodservice and based on 2015 Euromonitor total number of stores (if there is a difference between Telepizza’s actual # of stores as of 2015 and Euromonitor’s figures for 2014, Telepizza's 2015 figures
prevail when calculating market share), except for Spain which is based on market value and according to 2015 NPD data
15%
51%
1
45%
3 Major global pizza brand…
Europe Latin America
16%
2
23%
52%
1
14%
33%
1
21%Main
competitor
10
…backed by an unmatched product portfolioUnique consumer understanding and ongoing product innovation allows Telepizza to differentiate itself with a best in class locally adapted menu offering
3
Pizza offering adapted to local taste
4 types of dough
6 sauces
4+ types of cheese
20+ ingredients
80% of pizzas offered globally
Homogenous dough production
BBQ
(top-seller)
VegetarianHawaiian Ham & Cheese Pepperoni
Increase
average ticket
price
Avoid
veto vote
Complete
product offering
Differentiate
Telepizza
Drive loyalty and
frequency
Diversity to
drive group
consumption
Burgers Pasta Sandwiches
Salads Spiro Dog SidesKebab
Core pizza portfolio Complementary products
Consistent global pizza offering Non-pizza / sides
Drinks Desserts Dedicated local adaptations Ongoing product innovation
Note:
1. Average ticket price increase in the delivery channel on a weekly basis
Innovation to
amaze
consumers
Key benefits
11
Differentiated business model through vertical integration…4
Vertically integrated model differentiating Telepizza from our competitors and ensuring higher profitability and product quality
Adapt to local market demands
Increase penetration of catchment areas
Capture more moments of consumption
Expand into attractive new formats
(malls/mini-stores)
Increase reach of brand
Ind
us
tria
lL
og
isti
cs
Sto
re n
etw
ork
7 logistics
warehouses
Balanced network with 1,342 locations globally (Q3 16)
Dough CheeseOther
ingredientsDirect
productsEquipment
3rd party suppliers
7 dough production
facilities in Europe &
Latam
Strategic
partnership with
Ornua
Scale benefits
Global sourcing policy
Product consistency
Long-term supply agreements
Frequent and efficient store deliveries
Minimized store inventory
By
format
456 own stores
(34% of total stores)
886 franchised stores
(66% of total stores)
By
owner-
ship
154Shopping malls
173 Mini-
stores
813Traditional
stores
128 In-store
concessions
74Other
Takeaway
• Group (27%)
• Spain (30%)
By
channel1
Delivery
• Group (56%)
• Spain (59%)
Eat-In
• Group (17%)
• Spain (11%)
Mainly Latin America
2 innovation labs
(Spain and Chile)
Note:
1. Telepizza brand stores only, H1 2016
12
…and a balanced approach to store ownership4
Tactical use of own store and franchisees allows us to control distribution and fully penetrate our markets
Local market knowledge and proof of concept
Ability to trial products
Deeper consumer knowledge
Enhanced flexibility and control
Attractive payback (<3 years)
456
Own
stores
Asset-light business model
Limited reliance on individual franchisees
Long-term contracts
75% former employees (in Spain)
Sourcing from Telepizza
886
Franchised
stores
…supported by Telepizza
Operations fully dedicated
Local & regional pricing / promotional policy
Brand and marketing initiatives
"One Stop" sourcing
Store opening and refurbishment support
Global IT platform with integrated CRM
Successful franchisee model in more
established market…
Developing presence in new markets
Master
Fran.OrganicM&A countriesStores development already consolidated
74%
61%
76%
35% 32%
14%3%
100%
66%
26%
39%
24%
65% 68%
86%97%
34%
Sp
ain
Po
rtu
ga
l
Po
lan
d
Ch
ile
Co
lom
bia
Ec
ua
do
r
Pe
ru
Oth
er
To
tal
Gro
up
Franchised stores Own stores
665 109 119 142 92 22 1,34239 152
# of stores
Store ownership by country (Q3 16)
13
Note:
1. Calculated as e-shoppers over total population in each country (excluding people aged 0-14)
78% 76%66% 65%
37%
The Spanish market has similar levels of internet and
smartphone penetration as the UK or the US…
Internet users (per 100 people)
The Spanish market has all the right attributes to benefit from increasing digital penetration
Source: Internet users: EIU (as of March-2016). Penetration of smartphones: Informa (March-2016), E-commerce sales growth: eMarketer (2015), Delivery food service market data: NPD (2015), e-commerce penetration: Ecommerce Foundation (2015)
5
Penetration of smartphones (smartphones as a % of
population)
Tangible digital upside potential to be captured…
70
8988
99
7992
60
110
2012 2013 2014 2015 2016 2017 2018 2019 2020
Spain United Kingdom US
43.4%
96.9%55.7%
106.3%
47.0%
103.3%
30%
80%
2012 2013 2014 2015 2016 2017 2018 2019 2020
Spain United Kingdom US
2015-19E
e-commerce
growth
44% 42% 33% 57% 47%
E-commerce penetration1 (as % of total population, 2015)
Digital benefits
Digital customers order more frequently than phone
customers, resulting in higher average expenditure per
digital customer
Improved order accuracy and reduced time on the phone
for Telepizza employees, allowing them to focus on
improving service
Enhanced brand image, increased brand awareness and
higher penetration of innovation
High engagement rate with customers through active
social media presence
70.0 €
80.0 €
90.0 €
100.0 €
110.0 €
120.0 €
Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Q2 16
Increased spend vs telephone channel in Spain
Spain spend per digital vs
phone customer since 2014
+35%
14
…with rapid growth of digital sales taking place in SpainThe digital platform is on track to becoming our prime source of consumer orders
Source: Company information
5
Digital increasing and shifting towards mobile platforms1Continued growth of the delivery channel in Spain
Notes:
1. Data for Spain based on number of orders
2. Includes App and web responsive
Digital fostering delivery sales growth (H1 2016) …
… and resulting in increased digital penetration
5.1% 9.5%
22.2%
49.0%
Total Spaingrowth
Delivery growth Digital deliverygrowth
App growth
Spain
sales (€m)
2
24.4%27.8%
31.1%
34.7%
0%
5%
10%
15%
20%
25%
30%
35%
40%
0
5
10
15
20
25
30
35
40
H1 13 H1 14 H1 15 H1 16
Mobile PC % Delivery Sales
58%
52%
42%
48%
Q1
15
Q2
15
Q3
15
Q4
15
Q1
16
Q2
16
Q3
16
Web PC Mobile2
31%
37% in
September
55%
45%
15
Organizational chart
Maintained
dominant market
share during
Spanish economic
downturn
Implementing
successful
expansion model of
own stores,
franchise
agreements and
selective
acquisitions
Innovation
culture
Strong digital
development
Hub structure
organization
Navigated
positively through
a severe
consumption crisis
in Spain
Refinancing and
new capital
structure
Pablo Juantegui
(7)
CEO
(x) Years with Telepizza
Stable and robust management team with combined expertise of more than 100 years within the industry
Key achievements in the last 5 years
Management team with long-standing experience6
Head of HR
Mar Romero
Joined 1-Mar-16
CFO
Igor Albiol
(16)
Chief Supply Chain
Officer
Manuel Loring
(9)
COO Latam
Ignacio González Barrajón (22)
COO International Expansion
Giorgio Minardi
(1)
CIO
Emilio Tovar
(6)
COO Europe & CMO
Fernando Frauca
(11)
16
39.7 38.1
13.719.6
53.4
57.7
FY2014 FY2015
Spain International
45.5
51.1
9M 2015 9M 2016
Total Group
Profitable growth in Spain and internationally
236.1 246.1
104.8109.9
23.422.5
9M 2015 9M 2016
300.9 318.5
130.2141.3
19.8
32.0
FY2014 FY2015
Underlying EBITDA (€m)
6.6%
Chain sales (€m)
4.6%
LfL growth (%)Constant currency
growth1 (%)
6.1%
6.8%
451.0
491.8
364.2378.5
7.2%
2.7%
Spain Core International1
Note:
1. Excluding Master Franchises
7 Compelling financial profile
Master Franchises
8.1%
12.4%
17
Telepizza is well-positioned to take advantage of further LfL growth as well as expansion potential in both existing and new geographies
Multiple levers for future growth
Multiple potential growth levers
Expansion strategyOrganic unit expansionLfL chain sales and revenue growth
Existing markets New markets
Product innovation
Increase digital penetration
Store refurbishment and optimization
Incremental opportunity in Spain
Significant expansion potential in core
international markets
Increasing share of franchised stores
1 2
Development of own store network
Selective and complementary
acquisitions
New master franchise agreements
7
Financial information
19
c.7%2
Royalties+
Marketing
SG&A EBITDACOGSRevenues
Understanding our financials
Own Stores
Sales
Supply
Sales
Royalty &
Marketing
fees
Own Stores
Sales
Franchised
Stores
Sales
LfL Own
Stores
New Own
Stores
LfL
Franchised
Stores
New
Franchised
Stores
Other
Revenues3
c.60% Fixed
c.40% Variable
(% Margin)
Chain sales flow through EBITDA benefiting from significant operating leverage
Net revenues impacted by own vs. franchised mix
100%
c.35%1
Margin
Chain Sales
Revenues to EBITDA bridge
%Margin
Notes:
1. Based on 2015 margin over franchised stores sales excluding Master franchises
2. Based on 2015 margin over franchised stores sales
3. Includes opening or renewal franchise fees, transfer fee and other ancillary services to franchisees and others
20
Chain sales growth10 consecutive quarters growing in Spain, while posting double digit growth in International
1.1%
3.4%
4.7%
3.3%
9.1%
6.5% 6.4%
3.7%
2.6%
-0.2%
2.3%
4.1%
1.7%
7.2%
5.6%5.2%
2.1%
Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16
Chain sales growth LFL sales
3.0%
4.2%
4.8%
6.6%
10.4%
11.3%
10.0%
9.5%
11.4%
2.8%
3.7% 3.7%
6.7%
7.9%
8.7%
6.7%
5.8%
Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16
Chain sales growth LFL sales
Core International1 sales growthSpain sales growth
Note:
1. Constant currency growth, excluding Master Franchises
9.0%
0.6%
21
630 644 649 665
638667 676 677
1,2681,311 1,325 1,342
Dec-14 Dec-15 Jun-16 Sep-16
Spain International
Profitable unit expansion with increasing weight of franchisesActive management of store network, with openings of franchised mall units and mini-stores in Spain, continued International expansion and closures of unprofitable locations
Store network development Continued increase of franchised proportion
By n
um
be
r o
f s
tore
sB
y c
ha
in s
ale
s
34%
66%
36%
64%
FY 2015 9M 2016
FY 2015 9M 2016
38%
62%
41%
59%
Continued increase of franchises, representing 66% of stores and 62% of chain sales in 9M 2016
39%
61%
Owned Franchised
39%
61%
Owned Franchised
+14
stores+43
stores
+29
stores
+14
stores
+9
stores
Source: Company information
+5
stores
+17
stores
+4
stores
+13
stores
Notes:
1. Includes stores in Morocco
1
22
242 249
9M 2015 9M 2016
Total Group
149 144
192 212
2323
9M 2015 9M 2016
202 200
229260
20
32
FY2014 FY2015
202 200
97 109
28 20
FY2014 FY2015
Revenue growth impacted by higher proportion of franchised stores
Chain sales flow through revenues
Chain sales & revenues Group (€m)
(3.4)%
3.9%
2.7%
10.5%
Chain sales Revenues
364379
242 249
(1.1)%
9.1%
0.7%
13.5%
12.8%
(1.1)%
Chain sales Revenues
451
492
327 329
23
c.40% of total operating costs (c.60% of opex excluding COGS) are fixed, providing operating leverage as the Business grows
Operating costs
Source: Company information
43 38
4646
43 46
H1 15 H1 16
Operating costs (€m)
(2.3)%
90 91
94 91
89 89
FY2014 FY20152
(1.0)%
273 271
133 130
1
COGS positively impacted in H1
2016 by reduction in milk prices
since H2 2015, and increases in
average ticket in 2016YTD
Limited reduction in personnel
expenses, despite higher number
of franchised stores, as delivery
grows and service levels continue
to improve
Other costs increased in line with
unit sales in H1, driven by
incremental investments in brand
and higher presence in media
Notes:
1. Operating costs excluding €32.2m of IPO related costs
2. Operating costs excluding €14.1m of non-recurring refinancing costs
24
45.5
51.1
9M 2015 9M 2016
39.7 38.1
13.7 19.6
53.4
57.7
FY2014 FY2015
Chain sales growth translating into double digit EBITDA growth
Double digit underlying EBITDA growth on the back of strong LfL and operating leverage
Underlying EBITDA growth evolution (€m)
9M 2016 vs. 9M 2015FY 2015 vs. FY 2014
Chain sales growth
Key underlying EBITDA growth drivers in H1 2016
Gross margin expansion (average ticket increase
and COGS reduction)
Operating leverage (c.40% of cost base fixed)
Economies of scale internationally
Underlying EBITDA margin (%)
8.1% 12.4%
16.4%
17.6%
18.9%
2014 2015 LTM Q3 16
+120bps
+130bps
Spain International Total Group
25
Summary income statement
Notes:
1. Includes impairment losses, losses on sale of PP&E, and extraordinary refinancing costs in 2014
2. Net operating loses
Tax assets as of 30 June
€169m of interest carried forward
(deductible up to 30% of annual EBITDA)€52m NOLs2
€m (unless otherwise stated) 9M 2016 9M 2015 % change FY2015 FY2014 % change LTM Q3 2016
Total revenues 248.7 242.2 2.7% 328.9 326.5 0.7% 335.3
Underlying EBITDA 51.1 45.5 12.4% 57.7 53.4 8.1% 63.4
Underlying EBITDA margin (%) 20.6% 18.8% 1.8% 17.6% 16.4% 7.3% 18.9%
Depreciation and amortisation (excl. PPA amortisation) (8.7) (7.9) 10.0% (10.8) (11.5) (5.9%) (11.6)
Underlying EBIT 42.4 37.5 13.0% 46.9 41.9 11.9% 51.8
IPO costs (32.0) - - - - - (32.0)
PPA amortisation (4.4) (4.4) n.m. (5.8) (5.9) n.m. (5.8)
Net financial income / (expense) (19.1) (27.0) (29.1%) (35.4) (68.4) (48.2%) (27.6)
Other1 (0.2) (2.0) n.m. (4.0) 105.7 n.m. (1.9)
Profit before tax on continued operations (13.4) 4.2 n.m. 1.7 73.3 n.m. (15.5)
Income tax 1.0 (6.4) n.m. (2.8) 17.5 n.m. 4.6
Results for the period (12.4) (2.2) n.m. (1.1) 90.7 n.m. (10.9)
26
4.3 5.12.6
2.4
3.5
2.1
0.4
4.6
1.1
0.6
1.8
1.7
11.4
15.2
2.6
19.1
30.2
FY 2014 FY 2015 H1 16
2016 investment plan
Digital and IT
Refurbishments and
Relocations
Maintenance, Efficiency,
Buybacks and Other
Store openings
Investing in upgrading the digital
platform
Improving the App with better
usability and new features
15-20% of capex in FY 2016
Accelerating store network
renewal plan
Selective relocations to adapt to
changes in urban landscape
20-25% of capex in FY 2016
Rate of openings increasing in H2
Bulk of owned store openings in
fast-growing LatAm countries
20-25% of capex in FY 2016
Maintenance capex in line with 2015
Efficiency plans
Limited store buybacks planned for
2016
Capex evolution (€m)
Target FY 2016
€20-25m
Note:
1. Including c.€0.5m of maintenance IT per year
35-40% of capex in FY 2016
Maintenance
Digital & IT1
Refurbishments and
Relocations
Store Openings
Efficiency, Buybacks &
Others
10.0
27
36.0
26.0(10.0)
Cash conversion and Leverage
Cash conversion2
Notes:
1. Operating cash flow measured as Underlying EBITDA - Capex
2. Cash conversion measured as operating cash flow divided by underlying EBITDA
3. Measured as Net Debt (underlying cash) / Underlying LTM EBITDA
4. Adjusted by pending payments from IPO, reported cash position c.€63m, Net debt measured as gross debt – Underlying cash position
198.4
47.962.3
150.5
Gross debt Underlying cash position Underlying net debt H1 16 LTM underlying EBITDA
Leverage ratio3 as of 30 June: 2.4x
Cash conversion (Underlying EBITDA – Capex) (€m)
Leverage
2.4x
4
72%48%64%
1
4
53.4
34.4(19.1)
57.7
27.5(30.2)
FY 2014 FY 2015 H1 2016
Additional information
29
Strong economic recovery
Unemployment reduction
Growth in e-commerce penetration
More single households
Increasing women in workforce
Positive economic & demographic trends
Booming middle class
Vibrant young population profile
Strong urban growth
Historical outperformance versus
GDP both in Spain and Internationally
Universal appeal and easily adaptable to local preferences
Growing trend of "stay-at-home" culture
Increasing emphasis on convenience
Rise in all-day dining and personalization
Premiumization and availability of new taste experiences
Source: Euromonitor
Key Trends
Pizza
foodservice
Pizza
delivery
Chained
pizza
delivery
3.5%1 4.5% 5.1%Global
Western
Europe
15-20E
CAGR
Eastern
Europe
Middle East
& Africa
Latin
America
2.3% 3.2% 5.0%
4.3% 8.5% 14.8%
6.3% 13.4% 6.8%
6.3%2 8.3% 9.3%
Pizza delivery has highly favorable industry dynamics
Notes:
1. Excluding Latin America
2. 2014-2019E CAGR
30
September 2016 2015 2014 2013
Number of StoresOwn
stores
Franchised
stores
Total
stores
Own
stores
Franchised
stores
Total
stores
Own
stores
Franchised
stores
Total
stores
Own
stores
Franchised
stores
Total
stores
Spain 170 495 665 183 461 644 191 439 630 235 386 621
International 286 391 677 278 389 667 273 365 638 266 343 609
Rest of Europe 71 157 228 73 153 226 74 149 223 79 146 225
Portugal 42 67 109 44 61 105 44 64 108 45 65 110
Poland 29 90 119 29 92 121 30 85 115 34 81 115
Latin America 215 82 297 205 79 284 199 75 274 187 66 253
Chile 93 49 142 89 49 138 85 52 137 67 58 125
Colombia 63 29 92 64 27 91 82 20 102 94 7 101
Peru 38 1 39 35 1 36 22 1 23 20 1 21
Ecuador 19 3 22 17 2 19 10 2 12 6 0 6
Panama1 2 0 2 0 0 0 0 0 0 0 0 0
Master Franchises & Others 0 152 152 0 157 157 0 141 141 0 131 131
Guatemala 0 84 84 0 83 83 0 83 83 0 81 81
El Salvador 0 44 44 0 47 47 0 49 49 0 46 46
Russia 0 13 13 0 14 14 0 2 2 0 0 0
Angola 0 5 5 0 5 5 0 1 1 0 0 0
Bolivia 0 4 4 0 4 4 0 2 2 0 1 1
Saudi Arabia 0 2 2 0 0 0 0 0 0 0 0 0
Panama1 0 0 0 0 3 3 0 3 3 0 2 2
United Arab Emirates 0 0 0 0 1 1 0 1 1 0 1 1
Total Group 456 886 1342 461 850 1311 464 804 1268 501 729 1230
Note:
1. Panama, previously operated as MF, operated directly by Telepizza since Q3 2016
Store Count
31
Chain sales—Quarterly Evolution
Source: Company information
Total2014 2015 2016 2014 2015 2016
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 FY FY 9M
Group chain sales (%) -4.20% 1.50% 2.70% 5.50% 8.60% 8.40% 10.70% 8.60% 5.20% 2.20% 4.40% 1.30% 9.10% 3.90%
Core Geographies1 chain sales (%) -4.50% 0.70% 1.40% 3.90% 5.60% 5.50% 8.60% 6.80% 5.20% 3.00% 5.20% 0.30% 6.60% 4.50%
Core Geographies1 constant currency sales growth (%) -1.90% 3.10% 2.80% 4.80% 4.70% 4.30% 9.50% 7.90% 7.40% 5.50% 5.30% 2.10% 6.60% 6.10%
Core Geographies1 LFL sales growth (%) -3.10% 2.20% 0.70% 2.70% 4.00% 3.20% 7.40% 6.50% 5.60% 3.20% 3.20% 0.60% 5.30% 4.00%
International2014 2015 2016 2014 2015 2016
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 FY FY 9M
International chain sales (%) -1.50% 2.60% 5.80% 9.80% 17.20% 18.70% 13.80% 12.70% 2.90% -0.40% 7.50% 4.20% 15.50% 3.30%
Core International1 chain sales (%) -2.40% 0.10% 2.00% 5.00% 8.00% 10.70% 7.70% 7.50% 2.30% 1.30% 11.10% 1.20% 8.50% 4.90%
Core International1 constant currency sales growth (%) 3.60% 4.40% 3.00% 4.20% 4.80% 6.60% 10.40% 11.30% 10.00% 9.50% 11.40% 3.80% 8.30% 10.30%
Core International1 LFL sales growth (%) 2.90% 3.40% 2.80% 3.70% 3.70% 6.70% 7.90% 8.70% 6.70% 5.80% 9.00% 3.20% 6.80% 7.20%
Spain2014 2015 2016 2014 2015 2016
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 FY FY 9M
Spain chain sales (%) -5.40% 1.00% 1.10% 3.40% 4.70% 3.30% 9.10% 6.50% 6.40% 3.70% 2.60% -0.10% 5.80% 4.30%
LFL sales growth (%) -5.20% 1.70% -0.20% 2.30% 4.10% 1.70% 7.20% 5.60% 5.20% 2.10% 0.60% -0.50% 4.60% 2.70%
32
Key financial metrics – 9M 2016 and FY 2015 YoY evolution
Source: Company information
€m (unless otherwise stated) 9M 2016 9M 2015 % change FY2015 FY2014 % change
Group chain sales 378.5 364.2 3.9% 491.8 451.0 9.1%
Core Geographies1 chain sales 356.0 340.8 4.5% 459.8 431.2 6.6%
Core Geographies1 constant currency sales growth (%) 6.1% 6.6%
Core Geographies1 LFL sales growth (%) 4.0% 5.3%
Spain chain sales 246.1 236.1 4.3% 318.5 300.9 5.8%
LfL sales growth (%) 2.7% 4.6%
International chain sales 132.4 128.1 3.3% 173.3 150.1 15.5%
Core International1 chain sales 109.9 104.8 4.9% 141.3 130.2 8.5%
Core International1 constant currency sales growth (%) 10.3% 8.3%
Core International1 LFL sales growth (%) 7.2% 6.8%
Group Underlying EBITDA2 51.1 45.5 12.4% 57.7 53.4 8.1%
Notes:
1. Excluding Master Franchises
2. 9M 2016 adjusted for €32m of IPO related costs
33
Chain sales breakdown – 9M 2016 and FY 2015 YoY evolution
Source: Company information
€m (unless otherwise stated) 9M 2016 9M 2015 % change FY2015 FY2014 % change LTM Q3 2016
Total chain sales 378.5 364.2 3.9% 491.8 451.0 9.1% 506.2
Own store sales 144.3 149.4 (3.4%) 200.2 202.4 (1.1%) 195.2
Franchised and master franchised stores 234.2 214.8 9.0% 291.6 248.6 17.3% 311.0
0.0 0.0
LfL sales growth (%) 3.6% 5.5%
Horizontal (%) 2.2% 2.7%
Exchange rate adjustment (%) (1.8%) 0.9%
Spain chain sales 246.1 236.1 4.3% 318.5 300.9 5.8% 328.6
LfL sales growth (%) 2.7% 4.6%
Horizontal (%) 1.6% 1.2%
International chain sales 132.4 128.1 3.3% 173.3 150.1 15.5% 177.6
LfL sales growth (%) 5.3% 7.2%
Horizontal (%) 3.4% 5.5%
Exchange rate adjustment (%) (5.3%) 2.9%
34
Balance sheet
€ '000 (unless otherwise stated) June 2016 FY 2015 June 2016 FY 2015
Non current assets 800,806 792,404 Equity 570,737 354,342
Property, plant and equipment 40,597 40,158 Non-current liabilities 286,455 472,988
Goodwill 382,971 382,694 Borrowings 196,983 286,176
Other intangible assets 331,919 333,982 Shareholders loans 0 96,704
Other non-current assets 45,319 35,570 Other non-current liabilities 89,472 90,108
Current assets 117,599 94,086 Current liabilities 61,213 59,075
Subtotal currents assets 117,599 93,956 Trade and other payables 55,918 48,696
Other current liabilities 5,295 10,379
Inventories 12,107 11,392
Receivables and other current assets 42,942 42,618
Cash and cash equivalents 62,550 39,946
Assets classified as discontinued operations 0 130Liabilities classified as discontinued
operations0 85
Total assets 918,405 886,490 Total equity and liabilities 918,405 886,490
Source: Company information
35
35
8
FY2015 Post-IPO
251
155
Dec-15 Post-IPO
Post-IPO capital structurePrimary IPO proceeds reducing leverage to c.2.6x LTM EBITDA Average cost of debt of c.3% (on gross debt of €200m)
Financial debt pre and post IPO1 Annualised interest expense (€m)
3
Notes:
1. Calculated as gross financial debt minus cash
2. Based on LTM March-2016 EBITDA of €60.3m
3. On an annualised basis
4.4x 2.6x2
xLeverage (net debt /
underlying EBITDA)
-€27m
Source: Company information
36
51.1
19.1
(32.0)
9M 2016 underlying EBITDA P&L IPO impacts 9M 2016 EBITDA
4.7
Refinancing expenses
Impact of IPO charges
IPO costs (€m)
IPO expenses
Management incentive plan
Cash impact fully
financed at IPO
9M 2016 EBITDA bridge IPO refinancing charges
To be expensed linearly
for 5 years post IPO
Source: Company information
37
Translational FX impact in contextLatam reported financials in EUR impacted by steep decline in local currencies yoyImpact more pronounced in H1, with current exchange rates in line with H2 2015
640
660
680
700
720
740
760
780
800
Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-162250
2500
2750
3000
3250
3500
3750
4000
Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16
Avg. 9M15:
713
Avg. 9M16:
758
Avg. 9M15:
2,923
Avg. 9M16:
3,418+6% +17%
Avg. since 2012: 704
Avg. since 2012: 2,768
Source: Bank of Spain
EUR/COPEUR/CLP
Q3 15:
751
Q3 16:
739
Q3 15:
3,267
Q3 16:
3,292
38
Glossary
Chain sales: Chain sales are own store sales plus franchised and master franchised store sales as reported to us by the franchisees and master franchisees
LfL chain sales growth: LfL chain sales growth is chain sales growth after adjustment for the effects of changes in scope and the effects of changes in the euro exchange rate as explained below
– Scope adjustment. If a store has been open for the full month, we consider that an “operating month” for the store in question; if not, that month is not an “operating month” for that store. LfL chain sales growth takes into account only variation in a store’s sales for a given month if that month was an “operating month” for the store in both of the periods being compared. The scope adjustment is thepercentage variation between two periods resulting from dividing (i) the variation between the chain sales excluded in each of such periods (“excluded chain sales”) because they were obtained in operating months that were not operating months in the comparableperiod, by (ii) the prior period’s chain sales as adjusted to deduct the excluded chain sales of such period (the “adjusted chain sales”). In this way, we can see the actual changes in chain sales between operating stores, removing the impact of changes between the periods that are due to store openings and closures; and
– Euro exchange rate adjustment. We calculate LfL chain sales growth on a constant currency basis in order to remove the impact ofchanges between the euro and the currencies in certain countries where the Group operates. To make this adjustment, we apply themonthly average euro exchange rate of the operating month in the most recent period to the comparable operating month of the prior period
EBITDA: EBITDA is operating profit plus asset depreciation and amortization
Underlying EBITDA: Underlying EBITDA is EBITDA excluding the operating costs associated with our refinancing operation in FY2014 and IPO related costs in 2016
Digital delivery chain sales: Digital delivery chain sales are the delivery chain sales made through digital channels (PC, web responsive and Telepizza application), expressed in percentage terms. Digital delivery chain sales (both own and franchised) are recorded automatically in the Company’s SAGA store information system when the online order is placed by the customer