Shakey’s Pizza Asia Ventures, Inc. 2021 Dividends
22
Shakey’s Pizza Asia Ventures, Inc. PIZZA FIRST HALF 2021 RESULTS PRESENTATION AUGUST 2021
Transcript of Shakey’s Pizza Asia Ventures, Inc. 2021 Dividends
Shakey’s Pizza Asia Ventures, Inc.
PIZZA FIRST HALF 2021RESULTS PRESENTATION
AUGUST 2021
Latest Financial Performance
1H and 2Q 2021 Financial Results Highlights
SYSTEMWIDE
SALES
NEW STORE
OPENINGS
-4%year-on-year
+43%year-on-year
EBITDA
MARGIN
NET
INCOME
3
1H
2Q
+16+9 Shakey’s
+7 Peri
+8+4 Shakey’s
+4 Peri
16%
13%+25.7 pps
-15PHP mill
+7.6 ppsyear-on-year
year-on-year
14PHP mill
Systemwide Sales
Quarterly Systemwide Sales
2.3
1.11.4
1.81.7 1.6
1Q20 2Q20 3Q20 4Q20 1Q21 2Q21
43%YoY in 2Q21
Quarterly SSSG
-45% -42%-34%
-25%
31%
1Q20 2Q20 3Q20 4Q20 1Q21 2Q21
Pre-
Lockdown
Jan, Feb, and
1st half of
March
Pre-
Lockdown
Jan, Feb, and
1st half of
March
• Systemwide sales sustained sequentially notwithstanding strict lockdown restrictions in the second quarter
• Off-premise outperformance and low base in 2020 drove strong recovery in 2Q same-store sales
4
FlattishQoQ
Limitations to Dine-In Service…
Sales performance affected substantially by levels of lockdown and dine-in restrictions
5
1Q20Pre-Quarantine
Jan 1, 2020 – Mar 15, 2020
General Community QuarantineAug 19, 2020 – Mar 21, 2021
2Q20
3Q20
4Q20
1Q21
Modified Enhanced Community QuarantineMay 16, 2020 – May 31, 2020
Enhanced Community QuarantineMar 16, 2020 – May 15, 2020
General Community QuarantineJun 1, 2020 – Aug 3, 2020
NCR Plus BubbleMar 22, 2021 – Mar 28, 2021
Modified Enhanced Community QuarantineAug 4, 2020 – Aug 18, 2020
Dine-in Allowed
Dine-in NOT Allowed
Dine-in NOT Allowed
Dine-in Allowed
Dine-in NOT Allowed
Dine-in NOT Allowed*
Dine-in Allowed
*Outdoor dining still allowed at 50% capacity
**Outdoor dining at 50% capacity, Indoor dining at 20% capacity
2Q21
Enhanced Community QuarantineMar 29, 2021 – Apr 11, 2021
Modified Enhanced Community QuarantineApr 12, 2021 – May 15, 2021
Heightened General Community QuarantineMay 16, 2021 – Jul 30, 2021
Dine-in Allowed**
Dine-in NOT Allowed*
Dine-in NOT Allowed*
…Partly Offset by Strong Off-Premise Sales
• Robust delivery and carryout sales partly offset contraction in dine-in
• Continued investments in digital channels and assets translated to sales outperformance
6
1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21
Strong and
resilient
double-digit
growth
YoY in 1H21
1H Sales Breakdown by Channel Dine In QoQ TrendDelivery & Carryout
QoQ Trend
Dine-in
c. 1/4
Delivery &
Carryout
c. 3/4
Sequential decline
in dine-in
due to
reimposition of
strict measures
beginning end-
March
Top-of-Mind Brand Among Our Guests
7
Strong Off-Premise Presence Scale of Store Network
2%
4%
9%
14%
31%
Competitor 4
Competitor 3
Competitor 2
Competitor 1
Shakey's
Shakey’s leads among pizza
chains in terms of
spontaneous brand
awareness* as of 2Q 2021
*Source: Food Tracker
Top-of-Mind Brand Among Our Guests
8
Value-for-Money Better-for-You Menu Items
*Source: Food Tracker
2%
4%
9%
14%
31%
Competitor 4
Competitor 3
Competitor 2
Competitor 1
Shakey's
Shakey’s leads among pizza
chains in terms of
spontaneous brand
awareness* as of 2Q 2021
Profitability
9Figures in Php million
Gross Profit & Gross Margin
481
566
17.4%
22.2%
10.0%
20.0%
30.0%
400
450
500
550
600
1H 2020 1H 2021
18%
Opex & Opex as % of Sales
EBITDA & EBITDA Margin
Net Income & Net Margin
+4.8pps
• Positive bottomline in 1H supported by topline growth and turnaround efforts, including strategic pivots on store formats, right-
sizing programs, optimization initiatives and digital acceleration
529
387
19.1%15.2%
0.0%
10.0%
20.0%
30.0%
0
200
400
600
1H 2020 1H 2021
27%
-3.9pps
229
404
8.3%
15.9%
0.0%
10.0%
20.0%
30.0%
0
200
400
600
1H 2020 1H 2021
76%
+7.6pps
-290
14
-10.5%
0.5%
-30.0%
-10.0%
10.0%
30.0%
-400
-300
-200
-100
0
100
1H 2020 1H 2021
+11ppsReturn to
profitability
Healthy Cash Generation
Quarterly Operating Cash Flows
• Positive operating cash flows maintained in 2Q despite macroeconomic and operational challenges
• Healthy balance sheet and cash generation allowed us to adequately fund expansion plans and off-premise enhancements
• JE Holdings infusion provides additional financial flexibility to pursue organic and inorganic growth opportunities
10
-47
98
210225
142
2Q20 3Q20 4Q20 1Q21 2Q21
Strict
lockdown
In PHP Mill
Strict
lockdown
1H Ending Cash Bridge
Outlook
Outlook
• Continued ramp-up of vaccination rollout in the country is key to unlock mobility and faster recovery
• Majority of PIZZA employees now fully vaccinated via local government units’ and company-wide inoculation programs
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Prioritizing health and safety; business prepared for uncertainties
Health and
Safety as Our
Top Priority
Business
Continuity
Plans in
Place
Outlook
• Launch of bundles and deals tailored for delivery and carryout to further strengthen our off-premise presence
• Measures in place to maintain cost discipline on overhead, drive COGS efficiency, and minimize operational
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Health and
Safety as Our
Top Priority
Business
Continuity
Plans in
Place
Prioritizing health and safety; business prepared for uncertainties
Outlook
• Cautiously optimistic amidst various risks and uncertainties
• Strategic pivots, focus on value creation and a strengthened balance sheet put us in good position to weather through the crisis
and prudently pursue potential opportunities
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PrioritiesNet Income
In PHP Mill
Delivering on our store network expansion plans
to drive growth
Continued streamlining of operations to
manage costs
-254
2020A 2021F
Positive
bottomline
in 2021
Upholding our sustainability agenda across
People, Planet and Pizza
Leveraging and strengthening brand equity via
formal launch of new and improved Shakey’s app
Boosting off-premise capabilities, including
expanding the rollout of 31-minute delivery promise
Other Financials
1H 2021 Summarized Reported P&L
16
In PHP Mill 1H 2020 1H 2021 Change YoY
Systemwide Sales 3,453 3,301 -4%
Total Revenue 2,762 2,551 -8%
Cost of Sales -2,280 -1,984 -13%
Gross Profit 481 566 18%
Operating Expenses -529 -387 -27%
Operating Income -47 180 N/A
EBITDA 229 404 76%
Interest Expense -155 -161 4%
Income before Tax -241 18 N/A
Net Income -290 14 N/A
Earnings per Share -0.19 0.01 N/A
Margins
Gross Profit 17.4% 22.2% 4.8 pps
Operating Income -1.7% 7.0% 8.7 pps
EBITDA 8.3% 15.9% 7.6 pps
Net Income -10.5% 0.5% 11 pps
• Flattish systemwide sales year-on-year as 2Q
topline improves 43% vs last year’s low base
during the height of lockdown restrictions
• Store expansion strategy on track with the
net addition of 16 stores in 1H
• Off-premise sales sustains uptrend following
the reimposition of tighter restriction
measures beginning end-March
• Profitability improvement year-on-year
driven by expanded sales base and cost
structure enhancement
• EBITDA margin maintained at double-digit
territory
1H 2021 Summarized Balance Sheet
17
In PHP Mill FY 2020 1H 2021
Cash 608 1,739
Receivables 561 447
Other Current Assets 697 541
Total Current Assets 1,866 2,728
Property, Plant, and Equipment 1,420 1,355
Intangible Assets 7,052 7,046
Other Non-Current Assets 1,883 1,715
Total Non-Current Assets 10,354 10,116
TOTAL ASSETS 12,220 12,844
In PHP Mill FY 2020 1H 2021
Trade Payable and Others 801 577
Short-Term Debt 1,098 798
Total Current Liabilities 2,130 1,606
Long-Term Debt 3,740 3,715
Other Non-Current Liabilities 1,565 1,474
Total Non-Current Liabilities 5,306 5,190
TOTAL LIABILITIES 7,436 6,795
TOTAL EQUITY 4,784 6,048
TOTAL LIABILITIES AND EQUITY 12,220 12,844
• Increase in cash due to Php1.25 billion capital
infusion from JE Holdings
• Decline in receivables driven by strict monitoring of
franchisee receivables
• Decline in short-term debt following the partial
repayment of Php300 million in COVID-related loans
• Long-term loan of PHP3.7 billion all peso-
denominated with fixed interest rates
1H 2021 Summarized Cash Flows
18
• Capex primarily for investments in
new stores
• Partial repayment of Php300m
COVID-related loan
• Maintained positive operating cash
flow generation following
continued sales recovery and cost
structure optimization
In PHP Mill 1H 2020 1H 2021
Income before Income Tax -241 18
Depreciation and Amortization 268 226
Changes in Working Capital -105 10
Others 123 113
Net Operating Cash Flow 45 367
Capital Expenditures -157 -99
Others 98 143
Net Investing Cash Flow -59 44
Proceeds from (Payment of) Loan 125 -325
Payment of Interest -160 -107
Deposit for future stock subscription 0 1,250
Net Financing Cash Flow -130 720
Beginning Cash 508 608
Change in Cash -143 1,132
Ending Cash 364 1,739
Free Cash Flow -77 277
• Php1.25 billion in fresh capital
from entry of JE Holdings as a
strategic investor
Financial Ratios
19
Net Debt-to-Equity (x)
Net Gearing (x)
Interest-Bearing
Debt-to-EBITDA (x)
Return on Equity
1.43
0.84
FY 2020 1H 2021
0.88
0.46
FY 2020 1H 2021
10.53
7.12
FY 2020 1H 2021
-5.3%
0.9%
FY 2020 1H 2021
• Decline in leverage ratios following the partial repayment of Php300m in COVID-related loan
• Gearing ratios expected to remain compliant with debt covenants
Cash Conversion Cycle
• Decline in receivable days driven by strict monitoring of franchisee receivables
• Steady inventory level despite reimposition of strict quarantine measures in 2Q21
• Lower payables due to decline in supplier payables
• Increase in cash
conversion cycle
relative to end-2020 to
15 days
445 387
37 34
-
10
20
30
40
50
60
70
80
90
-
200
400
600
800
1,000
1,200
FY20 1H21 Days
₱
Mns
801
577
67
51
-
10
20
30
40
50
60
70
80
90
-
200
400
600
800
1,000
1,200
FY20 1H21 Days
₱
Mns
561
447
39
32
-
10
20
30
40
50
60
70
80
90
-
200
400
600
800
1,000
1,200
FY20 1H21 Days
₱
Mns
205 257
9 15
-
10
20
30
40
50
60
70
80
90
-
200
400
600
800
1,000
1,200
FY20 1H21 Days
₱
Mns
Working Capital Receivables Inventory Payables
20*Period-end figures were used to compute for working capital
components. P&L items based on trailing 12-month figures
Cash Conversion Cycle
21
STORE NETWORK BREAKDOWN AS OF JUNE 30, 2021
Franchised
45%
Company-owned
55%
184208
228 246 242 251
30 3441
12
3 33
2016 2017 2018 2019 2020 1H21
Shakey's Peri International
184209
230
279 279295
Serving you through Thick & Thin,
Paranaque City, Philippines
www.shakeyspizza.ph
http://edge.pse.com.ph
https://www.linkedin.com/company/sha
keyspizzaasiaventuresinc/
https://www.facebook.com/ShakeysPH
+632 8742 5397
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information and for your use and may not be, or any portion thereof,
shared, copied, reproduced or redistributed to any other person in any
manner. The statements contained in this document speak only as of the
date which they are made, and the Company expressly disclaims any
obligation or undertaking to supplement, amend or disseminate any
updates or revisions to any statements contained herein to reflect any
change in events, conditions or circumstances on which any such
statements are based. By preparing this presentation, none of the
Company, its management, and their respective advisers undertakes any
obligation to provide the recipient with access to any additional
information or to update this presentation or to correct any inaccuracies in
any such information which may become apparent.
This presentation contains statements, including forward-looking
statements, based on the currently held beliefs and assumptions of the
management of the Company, which are expressed in good faith and, in
their opinion, reasonable. Forward-looking statements in particular involve
known and unknown risks, uncertainties and other factors, which may
cause the actual results, financial condition, performance, or achievements
of the Company or industry results, to differ materially from the results,
financial condition, performance or achievements expressed or implied by
such forward-looking statements. Given these risks, uncertainties and
other factors, recipients of this document are cautioned not to place undue
reliance on these forward-looking statements.
Any reference herein to "the Company" shall mean, collectively, Shakey’s
Pizza Asia Ventures, Inc. and its subsidiaries.
