Restaurant Brands Half Year Results Presentation

Russel Creedy - Group CEOGrant Ellis - Group CFO24 August 2021
Restaurant Brands
New Zealand Limited
Results Presentation
6 Months to 30 June 2021 (1H 21)

•
Key Points
•
Results Overview
•
New Zealand Operations
•
Australia Operations
•
Hawaii Operations
•
California Operations
•
Outlook
•
Questions
Presentation Outline
2

Key Points
3
Note: •
1H 19R = 28 weeks to 9 Septem
ber 2019 prorated down to 26 weeks
•
1H 20 = 6 months to 30 June 2020
•
1H 21 = 6 months to 30 June 2021
1H
 
21
 
vs.
 
1H
 
20
1H
 
19R
1H
 
20
1H
 
21
•
   
Group
 
Sales
+41%
$411.0m
$383.4m
$540.6m
•
   
Reported
 
NPAT
+208%
$18.6m
$11.2m
$34.5m
•
   
Brand
 
EBITDA
+43%
$67.4m
$61.7m
$88.1m
•
   
COVID
‐
19's
 
adverse
 
impact
 
on
 
the
 
NZ
 
business
 
in
 
1H
 
20
 
saw
 
a
 
significant
 
turnaround
 
in
 
1H
 
21.
•
   
California
 
acquisition
 
contributed
 
an
 
entire
 
half
 
year
 
of
 
new
 
sales
 
$77.3m
 
and
 
EBITDA
 
$12.7m.
•
   
COVID
‐
19
 
continues
 
to
 
impact
 
operations
 
in
 
all
 
markets
 
to
 
a
 
greater
 
or
 
lesser
 
extent.

4
Results Overview

5
Rollover of NZ 1H 20 COVID-19 closur
es and bringing California acquisition on-
stream contributed to record sales and earnings outcome
214
 
175
 
239
 
97
 
99
 
123
 
99
 
110
 
101
 
77
 
411
 
383
 
541
 
1H
 
19R
 
(26w)
1H
 
20
 
(6
 
months)
1H
 
21
 
(6
 
months)
Sales
$NZm
New
 
Zealand
Australia
Hawaii
California
40
 
34
 
43
 
14
 
12
 
16
 
13
 
16
 
16
 
13
 
67
 
62
 
88
 
1H
 
19R
 
(26w)
1H
 
20
 
(6
 
months)
1H
 
21
 
(6
 
months)
Brand
 
EBITDA
$NZm
New
 
Zealand
Australia
Hawaii
California

6
Net “non-trading” items strongly positive on
US PPP loan forgiveness. Disclosure to
be changed going forward
$NZm
 
(Pre
 
tax)
1H
 
20
1H
 
21
ERP
 
implementation
           ‐
1.2
 
Acquisition
 
costs
0.8
 
0.7
 
Net
 
Other
 
Expense
0.8
 
1.9
 
Franchise
 
rights
 
amortisation
0.7
 
3.3
 
Relocation,
 
refurbishment
 
&
 
closures
0.7
 
0.6
 
Impairment
 
of
 
assets
0.6
 
‐
Sundry
 
other
 
income
 
&
 
expenses
(0.3)
(0.2)
Gain
 
on
 
sale
 
Pizza
 
Hut
 
stores
           ‐
(0.9)
Net
 
other
 
items
1.7
 
2.8
 
US
 
PPP
 
Loan
 
Forgiven
           ‐
(11.4)
Net
 
"non
‐
trading"
 
items
2.5
 
(6.7)

*Adjusted
 
for
 
payments
 
of
 
lease
 
interest
 
classified
 
as
 
operating
 
activities
 
under
 
NZ
 
IFRS
 
16
 
of
 
$10.8m
 
in
 
1H
 
20
 
and
 
$14.2m
 
in 1H 21,
 
and
 
payments
 
of
 
lease
 
costs
 
excluded
 
from
 
operating
 
activities
 
under
 
NZ
 
IFRS
 
16
 
of
 
$20.7m
 
in
 
1H
 
20
 
and
 
$26.3m
 
in
 
1H
 
21.
7
Operating cash flow up on prior year in line with higher profitability.Investing cash flow up by $29m with acquisition of KFC stores in Australia
$NZm
1H
 
20
1H
 
21
Operating Cash Flow (adjusted) *
28
 
50
 
Investing Cash Flow
(24)
(53)
Free Cash Flow
4
 
(3)

8
Net borrowings up on prior 1H despite str
ong operating cash flows, with settlement
of California acquisition in September
2020 for $119.2m and acquisition of 5 KF
C stores in Sydney for $25.3m. Ratios
remain well within required limits
*
EBITDA for rolling 12 months, including lease costs
$NZm
1H
 
20
1H
 
21
Net Debt
119
 
195
 
Net Debt:EBITDA*
1.3:1
1.4:1
Gearing (ND:ND+E)
35%
42%

9
New Zealand Operations

10
NZ sales strongly up against prior year’s COVID-19 closures and restrictions. EBITDA up in $ terms
214
 
175
 
239
 
5.2%
2.7%
12.5%
1H
 
19R
 
(26w)
1H
 
20
 
(6
 
months)
1H
 
21
 
(6
 
months)
NZ
 
Sales
Total
 
Sales
 
$m
Same
 
Store
 
Sales
 
%
40
 
34
 
43
 
18.6%
19.2%
18.0%
1H
 
19R
 
(26w)
1H
 
20
 
(6
 
months)
1H
 
21
 
(6
 
months)
NZ
 
EBITDA
EBITDA
 
$m
EBITDA
 
%
 
of
 
Sales

11
New store openings have continued apace for both Taco Bell and KFC in NZ
Taco Bell Stonefields (Lunn Avenue)Taco Bell Eastgate
KFC Takanini

12
Australia Operations

13
Australia business partially recovered
from mall store closures and dine
in restrictions, but still suffering
from limitations in non-FSDT stores. Five store KF
C acquisition in North Sydney boosted sales and profits
92
 
94
 
115
 
5.9%
0.3%
5.2%
1H
 
19R
 
(26w)
1H
 
20
 
(6
 
months)
1H
 
21
 
(6
 
months)
Australia
 
Sales
Total
 
Sales
 
$Am
Same
 
Store
 
Sales
 
%
14
 
11
 
15
 
14.9%
11.9%
13.3%
1H
 
19R
 
(26w)
1H
 
20
 
(6
 
months)
1H
 
21
 
(6
 
months)
Australia
 
EBITDA
EBITDA
 
$Am
EBITDA
 
%
 
of
 
Sales

14
Taco Bell roll out is gaining momentum in Australia
Taco Bell Green Square

15
Hawaii Operations

16
Hawaii held on to solid Pizza Hut gains
from COVID-19 period and also enjoyed a
significant improvement in Taco Bell post crisis
66
 
69
 
73
 
9.1%
8.0%
9.9%
1H
 
19R
 
(26w)
1H
 
20
 
(6
 
months)
1H
 
21
 
(6
 
months)
Hawaii
 
Sales
Total
 
Sales
 
$USm
Same
 
Store
 
Sales
 
%
9
 
10
 
12
 
13.2%
14.8%
15.8%
1H
 
19R
 
(26w)
1H
 
20
 
(6
 
months)
1H
 
21
 
(6
 
months)
Hawaii
 
EBITDA
EBITDA
 
$USm
EBITDA
 
%
 
of
 
Sales

17
Refurbished and relocated Taco Bell stores continue to deliver returns significantly ahead of expectation
Taco Bell Kahalui
Pizza Hut staff at the opening of the new Pahoa store

18
California Operations

19
Despite the residual impact of the COVID-19
crisis in California, the new acquisition
produced a strong 1H result
55
 
1H
 
21
 
(6
 
months)
California
 
Sales
Total
 
Sales
 
$USm
9
 
16.5%
1H
 
21
 
(6
 
months)
California
 
EBITDA
EBITDA
 
$USm
EBITDA
 
%
 
of
 
Sales

20
RBD California completes its first acquisition with solid sales growth following re-opening after refurbishment
KFC Adalanto

Outlook
21
Restaurant Brands enjoyed a strong start to the y
ear, despite the continued challenges of the
COVID-19 pandemic.Taco Bell store builds are expected to conti
nue in Australia and New Zealand, with another
eight stores expected to be open by year end.
New KFC store openings will continue in New
Zealand and California.Hawaii will focus on maintaining the refurbis
hment programme momentum which is still
delivering strong same store
sales growth on re-opening.
Despite the strong half year result and
this ongoing network growth the prevailing
uncertainty of COVID-19 makes it too difficu
lt to predict a full year trading outcome.

Questions
DISCLAIMERThe information in this presentation: 
Is provided by Restaurant Brands New Zealand Limited (“
RBD
”) for general information purposes and does not constitute investm
ent advice or an offer of or invitation to purchase RBD secu
rities.

Includes forward-looking statements. These
statements are not guarantees or
predictions of future performance. They involve kno
wn and unknown risks, uncertainties
and other factors,
many of which
are beyond RBD’s control, and which may cause actual results to
differ materially from those contained in this presentation.

Includes statements relating to past performance which should not
be regarded as reliable indicators of future performance.

Is current at the date of this presentation, unless otherwise st
ated. Except as required by law
or the NZX Main Board and ASX li
sting rules, RBD is not under any obligation to update this presentation,
whether as a result of new information, future events or otherwise.

Should be read in conjunction with RBD’s unaudited consolidated
financial statements for the 26 week period ending 30 June 2021
and NZX and ASX market releases.

Includes non-GAAP financial measures including "EBITDA”. These measures do not have a standardised meaning prescribed by GAAP a
nd therefore may not be com
parable to similar financial
information presented by other entities. However, they should not
be used in substitution for, or isolation of, RBD’s audited co
nsolidated financial statements. We
monitor EBITDA as a key performance
indicator and we believe it assists investors in assessing
the performance of the core operations of our business.

Has been prepared with due care and attention. However, RBD and its directors and employees accept no liability for any errors
or omissions.

Contains information from third parties RBD believes reliable. Ho
wever, no representations or wa
rranties are made as to the acc
uracy or completeness of such information.
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