Investor Presentation MAY 2017
FORWARD-LOOKING STATEMENTS Forward-Looking Statements This presentation contains forward-looking statements that are subject to risks and uncertainties. All statements other than statements of historical fact or relating to present facts or current conditions included in this presentation are forward-looking statements. Forward-looking statements give Wingstop Inc. ’s (the “Company”) current expectations and projections relating to its financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as “anticipates,” “believes,” “continues,” “estimates,” “expects,” “goal,” “objectives” “intends,” “may,” “opportunity,” “plans,” “potential,” “near - term,” “long - term,” “projections,” “assumptions,” “projects,” “guidance,” “forecasts,” “outlook,” “target,” “trends,” “should,” “could,” “would,” “will” and similar expressions and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events. The forward-looking statements contained in this presentation are based on assumptions that the Company has made in light of its industry experience and perceptions of historical trends, current conditions, expected future developments and other factors it believes are appropriate under the circumstances. As you read and consider this presentation, you should understand that these statements are not guarantees of performance or results. They involve risks, uncertainties (many of which are beyond our control) and assumptions. Although the Company believes that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect its actual operating and financial performance and cause its performance to differ materially from the performance anticipated in the forward-looking statements. The Company believes these factors include, but are not limited to, those described under the sections “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in its Form 10-K filed with the SEC. Should one or more of these risks or uncertainties materialize, or should any of these assumptions prove incorrect, the Company’s actual operating and financial performance may vary in material respects from the performance projected in these forward- looking statements. Any forward-looking statement made by the Company in this presentation speaks only as of the date on which it is made. Factors or events that could cause the Company’s actual operating and financial performance to differ may emerge from time to time, and it is not possible for the Company to predict all of them. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law. Non-GAAP Financial Measures This presentation contains certain non-GAAP financial measures. A “non -GAAP financial measure” is defined as a numerical measure of a company’s financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with GAAP in the statements of income, balance sheets or statements of cash flow of the company. The Company has provided a reconciliation of Adjusted EBITDA, a non-GAAP financial measure, to net income in the Appendix to this presentation. Adjusted EBITDA is presented because management believes that such financial measure, when viewed with the Company’s results of operations in accordance with GAAP and the reconciliation of Adjusted EBITDA to net income (loss), provides additional information to investors about certain material non-cash items and about unusual items that the Company does not expect to continue at the same level in the future. Adjusted EBITDA is used by investors as a supplemental measure to evaluate the overall operating performance of companies in the Company’s industry, you should not consider it in isolation, or as a substitute for analysis of results as reported under GAAP. Our calculation of Adjusted EBITDA may not be comparable to that reported by other companies. For additional information about our non-GAAP financial measures, see our filings with the Securities and Exchange Commission. JOBS Act The Company is an “emerging growth company” within the meaning of the Jumpstart Our Business Startups Act. As a result, the Company will be subject to reduced public company reporting requirements. 1 Confidential Information - Do Not Distribute
A CATEGORY OF ONE
2016 – ANOTHER STRONG YEAR $2.90/share Special 153 New Openings (Net) (1) 3.2% Domestic (1) Dividend (2) SSS Growth 18% Unit Growth Rate (1) 10% Return of Market Cap (2) 2016 was the 13 th Consecutive Year of SSS Growth Note: (1) Fiscal year ended December 31, 2016 (2) Special dividend paid in July 2016 3
CONTINUES A LONG TRACK RECORD OF DELIVERING OUTSTANDING RESULTS 3 Year CAGR (1) Unit Development 18% System-Wide Sales 20% Revenue 14% Adjusted EBITDA (2) 21% Note: (1) Three year period ended December 31, 2016 (2) Refer to Adjusted EBITDA reconciliation in Appendix 4
INDUSTRY LEADING DEVELOPMENT… 59% Unit Growth since 2013 (Domestic) 58.9% 2016 2015 48.3% 17.3% 2014 2013 34.5% 17.1% 29.1% 21.3% 21.2% 19.4% 13.2% 11.8% 9.6% 8.7% 11.3% (1) (1) (1) (1) (1) (1) (1) (1) (2) (1) Source: Company filings Notes: (1) Domestic system-wide (2) Dunkin U.S. segment only 5
AND INDUSTRY LEADING SSS 2012 – 2016 Stacked Same Store Sales 2016 47.3% 2015 3.2% 2014 38.5% 7.9% 2013 37.3% 34.6% 2012 12.5% 26.1% 24.5% 22.8% 18.8% 9.9% 13.4% 12.1% 7.8% 6.9% 13.8% (1) (1) (5) (1) (2) (1) (2) (3) (4) (6) (2) (2) Source: Company filings Notes: (1) Domestic system-wide (2) Domestic company-owned (3) Global company-owned (4) Franchised (5) System-wide 6 (6) Dunkin U.S. segment only
SHAREHOLDER FRIENDLY MODEL EBITDA Growth and Cash Generation Support Return of Capital and Deleveraging % LTM Q1 2017 Cash Conversion (1) Net Debt / LTM Adjusted EBITDA (3) $48M $38M $83M Dividend Dividend Dividend 96.9 96.9 94.1 5.2x 5.1x 5.0x 88.2 87.7 3.9x 3.4x 2.4x (2) DIN (2) DNKN WS DPZ PLKI (4) Q4 2013 Q4 2014 Q1 2015 Q2 2016 Q2 2016 Q1 2017 Post Recap. Pro-Forma Notes: Source: Public company filings 3. Leverage = Net Debt / LTM Adjusted EBITDA (Refer to appendix for reconciliation) Notes: 4. Primary proceeds were used to pay a $2.90 per share special cash dividend. Defined as (EBITDA – CapEx) / EBITDA 1. Refer to appendix for Pro-Forma reconciliation. 7 2. Calculations use Adj. EBITDA
WITH SIGNIFICANT GROWTH OPPORTUNITY DOMESTIC INTERNATIONAL • • 948 Restaurants in 41 states (1) 83 Restaurants in 5 countries (1) • • 16% Unit Growth Rate Growing brand awareness • • Compelling Economic Model Accelerating Sales / Investment Ratio • • Strong Pipeline Recent territory agreements • • 2,500 unit potential Significant franchisee interest Note: (1) Restaurant count as of 4/01/17 8
Domestic Development
DIFFERENTIATED BRAND • Simple concept • Efficient operating model • Coveted consumer • Compelling economic model 10
PASSIONATE & ENGAGED FANS Brand Sentiment & Conversation Volume Top 20 US Restaurant Brands 115% HIGH (% Positive Social Comments) 90% Brand Sentiment LOW HIGH 65% LOW 40% 0 1,000 2,000 3,000 4,000 Brand Conversation Volume (Mentions per $1MM in Revenue) Source: Netbase 2016 Industry Report: US Restaurants 11
FRANCHISEES LOVE OUR MODEL Franchisee Domestic Year 2 System Target (1) Average (4) Unit Economics AUV $890k $1.1M Investment Cost (2) $370k Unlevered Year 2 COC Return (3) 35% - 40% 50% + Notes: (1) AUV based on year 2 sales volumes for the 2014 vintage years (2) Investment cost based on last 2 fiscal years actual costs; excludes pre-opening and working capital (3) Average store economics are internal Company estimates based on unaudited results reported by franchise owners (4) As of April 1, 2017 12
… AND CONTINUE TO INVEST Domestic Gross New Unit Openings Domestic Restaurant Opening Commitments Rapid Unit Development Healthy Franchisee Base 79% of current domestic pipeline is from existing franchisees as of 12/31/16 Mix of small and large franchisees 139 530 518 503 118 363 82 1 274 64 53 29 2012 2013 2014 2015 2016 2011 2012 2013 2014 2015 2016 13
PROVEN PORTABILITY 41 State Footprint with Room to Grow in All Markets (1) Total Domestic Store Count – 948 Averaging 3 Domestic Closures Per Year Since 2013 Note: (1) Restaurant count as of 4/01/17 14
LONG-TERM DOMESTIC ROADMAP 2,500 Unit Domestic Potential 2,500 Existing Markets New Markets 855 771 781 1,645 948 Q1 2017 (1) (1) Q3 2016 (actual) Existing Market Potential New Market Potential Long-Term Domestic Potential Note: (1) Includes 864 restaurants in existing markets and 84 restaurants in new markets as of 4/01/17. 15
Strengthening the Model
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