SSP Group plc Preliminary Results 2014 27 November 2014 foodtravelexperts.com
SSP Group plc • Group Overview Kate Swann • Financial Review Jonathan Davies • Business Review Kate Swann 3 SSP – The Food Travel Experts
Group overview • Good profit performance up 21% YOY at constant currency (+12% actual) • LFL sales at +3.3%; net new space in line with plan, taking total sales growth to +4.0% at constant currency • Encouraging performance in existing and new geographies • Operating margin up 50bps • Strong cash generation and strengthened balance sheet • Early wins from initiatives to benefit from best practice and international scale • Forward pipeline positive and in line with plan • Continued investment in the business and its many growth opportunities 4 SSP – The Food Travel Experts
Financial Review Preliminary Results 2014 Jonathan Davies, CFO foodtravelexperts.com
Group financial overview Year on Year Change % £m 2014 2013 Currency 4 Reported Constant FX Rates Revenue 1,827.1 1,827.2 4.0% Flat LFL Sales 1 3.3% 4.3% n/a n/a Operating Profit 2 88.5 78.8 20.8% 12.3% Profit Before Tax 2 61.8 38.3 n/a 61.4% Proforma Profit Before Tax 2 3 71.5 62.7 n/a 14.0% Operating Cash Flow 2 83.3 67.0 n/a 24.3% 1 Same store like ‐ for ‐ like sales growth at constant currency 2 Underlying excluding exceptional items and amortisation of intangible assets created at acquisition of SSP Group by EQT in 2006 3 Proforma assumes post ‐ IPO financing in place throughout both years 4 Constant currency is based on 2013 exchange rates weighted over the year by 2014 results 6 SSP – The Food Travel Experts
Revenue growth of 4.0% (at constant currency) % YoY (at Constant Currency) 1 Total Net Contract Revenue LFL Sales Gains/(Losses) Growth UK 4.1% (2.2%) 1.9% Continental Europe 1.1% 0.6% 1.7% North America 5.9% 13.9% 19.8% Rest of World 8.8% 2.4% 11.2% Group 3.3% 0.7% 4.0% 1 Constant currency is based on 2013 exchange rates weighted over the year by 2014 results. 7 SSP – The Food Travel Experts
Operating profit growth* of 21% (at constant currency) Operating Profit* Year on Year Change % Constant Reported FX £m 2014 2013 Currency Rates UK 40.0 34.3 17.2% 16.6% Continental Europe 57.4 54.0 15.0% 6.3% North America (0.1) (1.2) 111.5% 91.7% Rest of World 12.7 13.4 5.8% (5.2%) Non ‐ attributable (21.5) (21.7) 1.2% 0.9% Group 88.5 78.8 20.8% 12.3% *Underlying 8 SSP – The Food Travel Experts
Operating profit margin* increased by 0.5% year on year £m 2014 2013 Year on Year Change % Sales Revenue 1,827.1 1,827.2 Gross Profit 1,215.0 1,212.5 % Sales 66.5% 66.4% 0.1% Labour Costs 541.8 559.0 % Sales 29.7% 30.6% 0.9% Concession Fees 301.8 296.0 % Sales 16.5% 16.2% (0.3%) Overheads 207.2 204.8 % Sales 11.3% 11.2% (0.1%) Depreciation & Amortisation 75.7 73.9 % Sales 4.1% 4.0% (0.1%) Underlying Operating Profit 88.5 78.8 % Sales 4.8% 4.3% 0.5% *Underlying 9 SSP – The Food Travel Experts
Underlying net profit of £39.8m 2014 2014 2013 £m Reported Adjustments Underlying Underlying Revenue 1,827.1 ‐ 1,827.1 1,827.2 Operating Costs (1,787.1) 48.5 (1,738.6) (1,748.4) Operating Profit 40.0 48.5 88.5 78.8 Net Financing Costs (54.3) 26.1 (28.2) (42.9) Share of Associates 1.5 ‐ 1.5 2.4 Loss on Disposal of Business (0.7) 0.7 ‐ ‐ (Loss)/Profit Before Tax (13.5) 75.3 61.8 38.3 Tax (14.3) (3.6) (17.9) (14.0) Non ‐ Controlling Interests (4.1) ‐ (4.1) (3.5) Net (Loss)/Profit (31.9) 71.7 39.8 20.8 Proforma net financing costs of £18.5m in 2014 10 SSP – The Food Travel Experts
Free cash flow of £51.5m £m 2014 2013 Operating Profit* 88.5 78.8 Depreciation & Amortisation 75.7 73.9 Working Capital 12.7 5.7 Capital Expenditure (76.0) (78.0) Net Tax (15.7) (12.3) Other (1.9) (1.1) Operating Cash Flow* 83.3 67.0 Net Financing Costs (25.1) (34.2) Exceptional Redundancy Costs (6.7) (8.0) Free Cash Flow 51.5 24.8 *Underlying 11 SSP – The Food Travel Experts
Net debt at £371m £m £m Opening Net Debt (1 Oct 2013) (870.4) Free Cash Flow 51.5 Net IPO Proceeds to delever: ‐ Gross issue proceeds 467.1 ‐ Less: settlement to B1 investors (32.0) ‐ Less: other transaction expenses (31.7) 403.4 Impact of FX Rates 43.9 Other Non Cash Movements 0.5 Closing Net Debt (30 Sept 2014) (371.1) 12 SSP – The Food Travel Experts
Financial summary • Strong operating profit growth, up 21% (at constant currency) • Good sales growth, up 4.0% (at constant currency) • Early benefits from efficiency programmes, operating margin up 50 bps Healthy free cash flow, +£51.5m • • Strengthened balance sheet post IPO, leverage down to 2.3x EBITDA at year end 13 SSP – The Food Travel Experts
Business Review Preliminary Results 2014 Kate Swann, CEO foodtravelexperts.com
Simple strategy to deliver value for our shareholders 1. Optimise our offer to benefit from the positive trends in our markets 2. Grow profitable new space 3. Optimise gross margin and leverage scale benefits 4. Run an efficient and effective business 5. Optimise investment using best practice and shared resource 15 SSP – The Food Travel Experts
1. Good growth in all divisions • Group LFL +3.3%, total sales +4.0% • All divisions performed strongly — Good growth in the UK — Trading mixed in Continental Europe — Strong growth in North America and substantial opening programme — Encouraging growth in Rest of the World but impacted by political instability • Continued underlying positive tailwinds expected • Broadly based business with good geographic diversification 16 SSP – The Food Travel Experts
1. Progress on key retail basics Ranging • Processes being established for ongoing range management • Better matching of ranges to market demand and trends Trading up • Perfect partner programme introduced in all major countries • Menus developed to encourage trading up 17 SSP – The Food Travel Experts
1.Progress on key retail basics Merchandising and impulse purchase • Early success with improved displays • Further impulse lines being introduced Upper Crust Category management • Speciality hot drinks • Burger category Impulse products Truffle burger 18 SSP The food travel experts
1. Better understanding of pricing, but still early days Example: SSP pricing vs competitors • Improved understanding of pricing elasticity but early days Baguettes -4% • Base pricing still very mixed Bockwurst 29% Bratwurst 0% Meat dishes 7% Soups 21% Sandwiches -13% Chocolate bars -2% Ice creams -14% Cola -2% Beer 6% Coffee 7% 0% TOTAL Source: SSP price checks 2014 19 SSP – The Food Travel Experts
2. Grow profitable new space – new units opened • Net gains in the year +0.7%, in line with our plan • Always likely to be lumpy due to nature of contract wins • 48 net new units opened in 2013/14 • Substantial opening programme in North America Doha Airport Doha Airport Bordeaux Airport San Diego Airport Phoenix Airport JFK Airport 20 SSP – The Food Travel Experts
2. Phoenix Sky Harbor International Airport case study Phoenix Sky Harbor International Airport The SSP package for Phoenix Sky Harbor International Airport • The 11 th largest airport in the US, handling over 40 “ Phoenix Sky Harbor International Airport's million passengers 1 goal of providing customers with a mix of local, regional and national favorites has • The airport has a stated mission to be the ‘friendliest’ received international recognition. airport in the US and to ‘support the local community’ Passengers are delighted to find • SSP offered a creative solution of brands based on establishments like Matt's Big Breakfast, Lo ‐ community ‐ anchored dining Lo's Chicken and Waffles and Four Peaks Brewing Company as they travel through our busiest terminal." Tamie Fisher, Acting Aviation Director • 10 year contract for 26 outlets • Local heroes and bespoke concepts 1 Airports Council International (ACI) website 21 SSP – The Food Travel Experts
2. Good progress on contract renewals and encouraging pipeline • Key renewals secured during 2013/14 Newcastle Airport Hurghada Airport Helsinki Airport • Some key contract wins during the period • Timing often difficult to predict Dubai Airport London Stansted Airport Beijing Airport 22 SSP – The Food Travel Experts
2. Continued development of new brands and concepts Innovating with our international brand partners Trend for bespoke new and unique continues 23 SSP – The Food Travel Experts
2. Continued development of new brands and concepts Partnering with experts and chefs in the Further development of our own brands industry Flying Hippo, Newcastle Airport Alan Yau James Martin Mum’s Kitchen, Malaga Airport 24 SSP – The Food Travel Experts
3. Early progress on gross margin optimisation Example: Waste losses by outlet UK % of COS, • Gross margin improvement 10 bps YOY 2013 • Utilising international scale • Simplification and rationalisation based on improved data collection • Waste an area of focus • Roll out of systems to allow better margin management 25 SSP – The Food Travel Experts
Recommend
More recommend
