Ssp Group Plc · LSE:SSPG
Ssp — Investor Day (June 2023)
9 slides from Ssp's investor day presentation, Jun 21, 2023
Slide 1: Delivering long term sustainable growth
Delivering long term sustainable growth Jonathan Davies, Group CFO and Deputy CEO 21 June 2023 www.foodtravelexperts.com
Slide 2: A strong track record of delivering margin progression
3. Profit conversion A strong track record of delivering margin progression Reported Underlying Drivers of margin enhancement % Sales FY 2014 FY 2019 variance variance1 • Structural operating leverage Gross profit 66.5% 71.1% 4.6% 3.6% • Scaling up in key markets Labour (29.7)% (29.0)% 0.7% 1.3% • O
Slide 3: Key drivers of operating leverage
3. Profit conversion Key drivers of operating leverage Sales growth Operating cost 2019 % sales Component LFL Net contract gains • Food • Consumables Cost of goods 29% • Logistics • Variable • Variable • Waste and losses • Pre-opening costs and contract • Colleagues in units maturity, especially new
Slide 4: Our revitalised efficiency programme will underpin margin performance
3. Profit conversion Our revitalised efficiency programme will underpin margin performance 1 2 3 4 Gross margin Supply chain Labour Overheads • Menu engineering • Inflation tracking • Digital roll-out • Installation of smart • Recipe reviews • Supplier & product • Scheduling reviews energy meters •
Slide 5: Our business model has a track record of generating surplus cash for shareholders
4. Cashflow generation Our business model has a track record of generating surplus cash for shareholders £m 2017-2019 300 Capex Acquisitions Operating cash generation Returns: LFL c.2-3% 250 Net gains c.5-6% 200 Operating cashflow c.£250-£280m p.a. 150 Capex c.£120-£190m p.a. Acquisitions c.£80m 100
Slide 6: Our capital investment model is broadly unchanged
4. Cashflow generation Our capital investment model is broadly unchanged Renewals and maintenance Covid Catch Up Expansionary capex into new contracts Capex (£m) £160m to deliver secured pipeline 300 Every £1 250 expansionary capex Expected to deliver £200m c.£50m = £2-£3 sales c.£80m 200 revenue c.
Slide 7: Our capital allocation strategy remains unchanged
4. Cashflow generation Our capital allocation strategy remains unchanged Uses of cash and balance sheet efficiency Clear priorities to generate returns 1 2 • Priority is organic growth and value Organic investment M&A creating infill M&A Significant structural growth Value creating infill • All pote
Slide 8: FY23 and FY24 planning assumptions underpinned by trading momentum
FY23 and FY24 planning assumptions underpinned by trading momentum Preliminary Results FY 2022 Planning Assumptions 2023 2024 Outlook • Revenue for first 10 weeks of H2 at 110% of 2019 levels Revenue £2.9-3.0bn £3.2-3.4bn • FY23 outcome expected at upper end of sales and vs. 2019 EBITDA planning ran
Slide 9: From 2025, we enter a new phase of sustainable growth and returns
From 2025, we enter a new phase of sustainable growth and returns Medium-term financial framework 1 Stronger sales growth • Stronger like-for-like driven by pivot to high growth markets (namely N.America and Asia PAC) • Increasing level of investment driving stronger net new contract wins in these r