Ssp Group Plc · LSE:SSPG
Ssp — H1 2015 Earnings Presentation
27 slides from Ssp's earnings presentation, May 21, 2015
Slide 1: SSP ror
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Slide 2: SSP Group plc Interim Results 2015
SSP Group plc Interim Results 2015 21 May 2015 foodtravelexperts.com
Slide 3: SSP Group plc agenda
SSP Group plc • Group Overview Kate Swann • Financial Review Jonathan Davies • Business Review Kate Swann 3
Slide 4: Group overview
Group overview • Good profit performance up 28% YoY at actual exchange rates • LFL sales at 3.0% reflecting positive market dynamics • Net new space in line with plan • Progress on operating margin • Maiden dividend of 2.1p • Contract wins and medium term pipeline positive • Continued investment in
Slide 5: Financial Review
Financial Review Interim Results 2015 Jonathan Davies, CFO foodtravelexperts.com
Slide 6: Group financial overview
Group financial overview Change (%) £m 1H 2015 1H 2014 Constant Reported Currency FX Rates Revenue 859.2 865.8 2.6% (0.8%) LFL Sales Growth 1 3.0% 3.2% Operating Profit 2 25.2 19.7 35.2% 27.9% Profit Before Tax 2 16.4 10.9 3 n/a 50.5% Operating Cash Flow 2 (13.3) (19.2) n/a 30.7% 1 Same store like‐f
Slide 7: Like-for-like sales growth of 3.0%
Like‐for‐like sales growth of 3.0% Change at constant currency Net Contract Total Revenue LFL Sales Gains/(Losses) UK 3.7% (4.0%) (0.3%) Continental Europe ‐ 1.3% 1.3% North America 7.0% 5.3% 12.3% Rest of World 13.1% 0.3% 13.4% Group 3.0% (0.4%) 2.6% 7
Slide 8: Operating profit growth of 28%
Operating profit growth of 28% Operating Profit* Change (%) Reported FX £m 1H 2015 1H 2014 Constant Currency Rates UK 18.0 13.1 37.4% 37.4% Continental Europe 13.9 15.4 ‐ (9.7%) North America 0.9 (2.1) n/m n/m Rest of World 6.3 4.6 30.0% 37.0% Non‐attributable (13.9) (11.3) (23.0%) (23.0%) Group 25.
Slide 9: Operating profit margin increased by 0.6%
Operating profit margin increased by 0.6% £m 1H 2015 1H 2014 YOY change (% Sales) Revenue 859.2 865.8 Gross Profit 573.1 571.9 % Sales 66.7% 66.1% 0.6% * Labour Costs 267.0 269.8 % Sales 31.1% 31.2% 0.1% Concession Fees 145.6 142.5 % Sales 16.9% 16.5% (0.5%) * Overheads 102.0 105.6 % Sales 11.9% 12.
Slide 10: Underlying net profit of £10.2m
Underlying net profit of £10.2m 1H 2015 1H 2014 Change (%) £m Operating Profit 1 25.2 19.7 27.9% Net Financing Costs (8.6) (9.4) 2 8.5% Share of Associates (0.2) 0.6 n/m Profit Before Tax 1 16.4 10.9 2 50.5% Tax 1 (3.0) (2.8) 2 (7.1%) Non‐Controlling Interests (3.2) (2.0) (60.0%) Net Profit 1 10.2 6
Slide 11: Improved operating cash flow
Improved operating cash flow £m 1H 2015 1H 2014 Operating Profit* 25.2 19.7 Depreciation & Amortisation 33.3 34.3 Working Capital (24.5) (32.4) Capital Expenditure (39.8) (33.4) Net Tax (7.6) (6.9) Other 0.1 (0.5) Operating Cash Flow* (13.3) (19.2) Net Financing Costs (8.4) (14.5) Exceptional costs
Slide 12: Financial summary
Financial summary • Good like‐for‐like sales growth of 3.0% • Net gains as expected; anticipate stronger performance in second half • Strong operating profit growth of 28% • Further benefits from efficiency programmes, operating margin up 60bps; tougher comparative in second half • Improved operatin
Slide 13: Business Review
Business Review Interim Results 2015 Kate Swann, CEO foodtravelexperts.com
Slide 14: Simple strategy to deliver value for our shareholders
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 s
Slide 15: Good LFL sales growth
Good LFL sales growth • Group LFL +3.0% • All divisions delivered robust performance — Continued strong growth in the UK — Continental Europe flat despite challenging conditions in some geographies — North America strong LFL and ongoing opening programme — Rest of World growth encouraging • Underlyi
Slide 16: Progress on retail basics benefits LFL sales
Progress on retail basics benefits LFL sales Ranging improvements in key categories • Best sellers into more locations – e.g baguettes • Opportunity to improve ranges by benchmarking Transferring ‘winners’ across SSP brands Competitor best sellers Best Best sellers sellers A 9 9 8 8 9 A 8 9 8 9 8 (G
Slide 17: Progress on retail basics benefits LFL sales
Progress on retail basics benefits LFL sales Merchandising • Development of planograms to improve display • Day part analysis to change displays by time of day Pricing • Country trials progressing well — Germany — North America — France – Bonne Journee • Increased resource centrally and regionally 1
Slide 18: Grow profitable new space
Grow profitable new space • Net gains in H1 ‐0.4% reflecting previous year as expected • Full year net gains expected to be positive • Timings of openings determined by clients • Always likely to be lumpy due to nature of contract wins • On average expect net gains of c1% over time • Renewal rate in
Slide 19: Stansted Airport Case Study
Stansted Airport Case Study Background • In 2014 it was the 4th busiest Airport in the UK • Manchester Airport Group purchased Stansted in February 2013 • MAG announced an £80m redevelopment programme SSP at Stansted Airport • SSP has been trading at Stansted Airport for almost 20 years with a small
Slide 20: Stansted Airport Case Study
Stansted Airport Case Study “The opening of the first ever James Martin Kitchen is a very exciting development at Stansted and will be a real hit with passengers seeking different tastes and experiences on their journey through. Our aim at Stansted is to give passengers greater choice and James Mart
Slide 21: Strong progress on contract wins
Strong progress on contract wins • New contract wins in H1 95 units (excluding CDG) including: Montreal Norway 10 units 10 units across 2 airports CDG 34 units* Nice 10 units Beijing Houston 8 units 10 units Thailand 2 units Orlando 4 units *20 new 14 renewals SSP presence Hobart 21 5 units
Slide 22: Good progress building the brand portfolio
Good progress building the brand portfolio Gino Di Campo 22
Slide 23: Good progress on gross margin optimisation
Good progress on gross margin optimisation • Gross margin improved by 60bps (underlying 30 bps) • Global/regional procurement where advantageous • Crockery – rationalised range • Frozen bakery – reduced suppliers • Recipe rationalisation and improvement progressing well • Further rollout of improved
Slide 24: Encouraging progress on operating efficiency
Encouraging progress on operating efficiency • Overheads ‐ 30bps improvement • Labour costs including central labour –10bps improvement underlying 40bps improvement • Substantial opportunity to align labour to sales far better • Systems project to enable labour forecasting, scheduling and KPI report
Slide 25: Summary
Summary • Strong H1 financial performance • LFL sales in line with plan and underlying trends positive • Encouraging progress on margin and efficiency • Success with new brands • Maiden dividend 2.1p • Pipeline encouraging going forward into the medium term • H2 has started in line with our expectat
Slide 26: SSP Group plc Interim Results 2015 – Q&A
SSP Group plc Interim Results 2015 – Q&A 21 May 2015 foodtravelexperts.com
Slide 27: Disclaimer
Disclaimer Certain statements in the presentation may constitute “forward‐looking statements”. These statements reflect the Company’s beliefs and expectations and are based on numerous assumptions regarding the Company’s present and future business strategies and the environment the Company will ope