Restaurant Brands Half Year Results Presentation

Arif Khan- Acting Group CEOJulio Valdés – Group CFO28 August 2023
Restaurant Brands
New Zealand Limited
Results Presentation
6 Months to 30 June 2023 (1H 23)

•Key Results•
Results Overview
•
New Zealand Operations
•
Australian Operations
•
Hawaiian Operations
•
Californian Operations
•
Outlook
•
Questions
Presentation Outline
2

Key Results
3
1H
 
23
 
vs.
 
1H
 
22
1H
 
21
1H
 
22
1H
 
23
•
   
Group
 
Sales
+9%
$540.6m
$584.9m
$640.2m
•
   
Store
 
EBITDA
‐
8%
$88.1m
$85.4m
$78.3m
•
   
NPAT
‐
86%
$34.5m
*
$15.3m
$2.2m
•
  
Continued
 
sales
 
growth
 
boosted
 
by
 
new
 
store
 
openings,
 
price
 
increases
 
to
 
cover
 
inflation
 
and
 
favourable
 
exchange
 
rate
•
  
EBITDA
 
reduces
 
on
 
inflation
 
impact
•
  
NPAT
 
reduces
 
on
 
inflation
 
impact
 
and
 
higher
 
interest
 
rates
* 1H 21 comparison distorted by "one-offs" and adjustments including loan forgiveness of $11.4m Hawaii PPP loan

4
NPAT decreases on inflation pressures, staff shortages and higher financing costs
* - Pre-G&A, NZ IFRS 16 and Other (Income)/Expenses
$NZm
1H
 
22
1H
 
23
Change
 
B/(W)
Group
 
EBITDA
 
*
85
 
78
 
(7)
G&A
 
Expenses
25
 
29
 
(4)
60
 
49
 
(11)
Other
 
Expenses
2
 
2
 
0
 
Depreciation
 
&
 
Amortisation
27
 
28
 
(1)
Operating
 
Profit
 
Pre
 
NZ
 
IFRS
 
16
31
 
19
 
(12)
NZ
 
IFRS
 
16
 
Adjustment
9
 
11
 
2
 
Operating
 
Profit
40
 
30
 
(10)
Financing
 
Expenses
20
 
27
 
(7)
Net
 
Profit
 
Before
 
Tax
20
 
3
 
(17)
Taxation
5
 
1
 
4
 
Net
 
Profit
 
After
 
Tax
15
 
2
 
(13)

5
Inflation – A significant and continuing impact on the business•
All divisions experienced significant inflation
pressures, with New Zealand stores suffering the most.
•
Labour market pressures caused staff shortages
hence reduced trading hours.
•
Price increases made at a pace and level factoring
sales volumes, customer loyalty, our relativity to competitors and long-term shareholder value.
•
Mitigation strategies include:
• Continue investing in digital platforms• Enhanced marketing and promotions• System improvements streamlining and improving
end to end processes.
• Margin recovery initiatives

6
Taco Bell – New Zealand & Australia•
At June 2023, 14 stores trading in New Zealand and
13 stores in NSW.
•
Ability to pass on cost increases more limited than with
established brands.
•
Roll out of further stores at a slower pace until margins
and trading conditions stabilise.
•
Two Australian stores impaired.

7
Results Overview

8
Sales up $55m supported by store openings; however Store EBITDA down $7m due to inflationary pressures and staff shortages
239
 
252
 
272
 
123
 
133
 
152
 
101
 
115
 
127
 
77
 
84
 
89
 
541
 
585
 
640
 
1H
 
21
 
(6
 
months)
1H
 
22
 
(6
 
months)
1H
 
23
 
(6
 
months)
Sales
$NZm
New
 
Zealand
Australia
Hawaii
California
43
 
42
 
32
 
16
 
14
 
17
 
16
 
21
 
20
 
13
 
9
 
9
 
88
 
85
 
78
 
 
1H
 
21
 
(6
 
months)
 
1H
 
22
 
(6
 
months)
 
1H
 
23
 
(6
 
months)
Store
 
EBITDA
$NZm
New
 
Zealand
Australia
Hawaii
California

9
Non trading – Two Australian stores impaired
$NZm
 
(Pre
‐
tax)
1H
 
22
1H
 
23
ERP
 
implementation
3.4
 
‐
Acquisition
 
costs
0.1
 
‐
Gain
 
on
 
acquisition
(0.9)
‐
Net
 
impairment
‐
1.8
 
Net
 
Other
 
(Income)/Expense
2.6
 
1.8
 
ERP
 
improvements
 
of
 
$0.8m
 
in
 
1H
 
23
 
expensed
 
under
 
new
 
IFRS
 
rules
 
as
 
G&A

*Adjusted
 
for
 
payments
 
of
 
lease
 
interest
 
classified
 
as
 
operating
 
activities
 
under
 
NZ
 
IFRS
 
16
 
of
 
$16.0m
 
in
 
1H
 
22
 
and
 
$17.6m
 
in 1H 23,
 
and
 
payments
 
of
 
lease
 
costs
 
excluded
 
from
 
operating
 
activities
 
under
 
NZ
 
IFRS
 
16
 
of
 
$29.3m
 
in
 
1H
 
22
 
and
 
$31.8m
 
in
 
1H
 
23.
10
Operating cash flows in line with prior year; store refurbishments continue
$NZm
1H
 
22
1H
 
23
Operating Cash Flow (adjusted) *
35
 
35
 
Investing Cash Flow
(34)
(33)
Free Cash Flow
1
 
2
 

11
Net borrowings up on 1H 22 with ongoing refurbishments and new store construction, but ratios remain well within required limits
*
EBITDA for rolling 12 months, including lease costs
$NZm
1H
 
22
1H
 
23
Net Debt
257
 
275
 
Net Debt:EBITDA*
2.1:1
2.4:1
Gearing (ND:ND+E)
48%
49%

12
New Zealand Operations

13
NZ sales up against prior year with moderate sales growth.EBITDA lower with inflation pressures
43
 
42
 
32
 
18.0%
16.6%
11.8%
1H
 
21
 
(6
 
months)
1H
 
22
 
(6
 
months)
1H
 
23
 
(6
 
months)
NZ
 
Store
 
EBITDA
Store
 
EBITDA
 
$m
Store
 
EBITDA
 
%
 
of
 
Sales
239
 
252
 
272
 
12.5%
1.4%
6.0%
1H
 
21
 
(6
 
months)
1H
 
22
 
(6
 
months)
1H
 
23
 
(6
 
months)
NZ
 
Sales
Total
 
Sales
 
$m
Same
 
Store
 
Sales
 
%

14
Australian Operations

15
Australia business continues to grow with recovery in CBD and Mall stores
115
 
123
 
140
 
5.2%
3.4%
9.7%
1H
 
21
 
(6
 
months)
1H
 
22
 
(6
 
months)
1H
 
23
 
(6
 
months)
Australia
 
Sales
Total
 
Sales
 
$Am
Same
 
Store
 
Sales
 
%
15
 
13
 
16
 
13.3%
10.6%
11.1%
1H
 
21
 
(6
 
months)
1H
 
22
 
(6
 
months)
1H
 
23
 
(6
 
months)
Australia
 
Store
 
EBITDA
Store
 
EBITDA
 
$Am
Store
 
EBITDA
 
%
 
of
 
Sales

16
Hawaiian Operations

17
Hawaii sales growth driven by increased trading hours but still short on expectations
73
 
76
 
79
 
9.9%
2.9%
2.6%
1H
 
21
 
(6
 
months)
1H
 
22
 
(6
 
months)
1H
 
23
 
(6
 
months)
Hawaii
 
Sales
Total
 
Sales
 
$USm
Same
 
Store
 
Sales
 
%
12
 
14
 
13
 
15.8%
18.0%
15.9%
1H
 
21
 
(6
 
months)
1H
 
22
 
(6
 
months)
1H
 
23
 
(6
 
months)
Hawaii
 
Store
 
EBITDA
Store
 
EBITDA
 
$USm
Store
 
EBITDA
 
%
 
of
 
Sales

18
Californian Operations

19
Sales growth impacted by weaker Californian economy
55
 
56
 
55
 
‐
3.0%
‐
3.7%
1H
 
21
 
(6
 
months)
1H
 
22
 
(6
 
months)
1H
 
23
 
(6
 
months)
California
 
Sales
Total
 
Sales
 
$USm
Same
 
Store
 
Sales
 
%
9
 
6
 
6
 
16.5%
10.4%
10.1%
1H
 
21
 
(6
 
months)
1H
 
22
 
(6
 
months)
1H
 
23
 
(6
 
months)
California
 
Store
 
EBITDA
Store
 
EBITDA
 
$USm
Store
 
EBITDA
 
%
 
of
 
Sales

Outlook
20
The Group continues to monitor the trading a
nd economic environment closely as volatility
continues across its key markets. Management
plans to provide an update on outlook, in
terms of expected time for recovery, at
the time of the full-year results.
The Group continues to predict a
full year NPAT of $12 to $16 million.

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
stated. Except as required by law or the NZX and ASX listing rule
s, 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 6 months ending 30 June 2023 and NZ
X 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.
21