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Institutional Presentation
February/ 2020
1
Wow Box 2: Double Crunch Bacon with 2 strips and french fries
Disclaimer
The material that follows is a presentation of general background information about International Meal Company Alimentação
S.A. (“IMC” or the “Company”) as of the date of the presentation. It is information in summary form and does not purport to be
complete. No representation or warranty, express or implied, is made concerning, and no reliance should be placed on, the
accuracy, fairness, or completeness of this information.
This presentation may contain certain forward-looking statements and information relating to the Company that reflect the
current views and/or expectations of the Company and its management with respect to its performance, business and future
events. Forward looking statements include, without limitation, any statement that may predict, forecast, indicate or imply
future results, performance or achievements, and may contain words like “believe”, “anticipate”, “expect”, “envisages”, “will
likely result”, or any other words or phrases of similar meaning, which speak only as of the date the statement was made.
Such statements are subject to a number of risks, uncertainties and assumptions. We caution you that a number of important
factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions
expressed in this presentation. Neither the Company nor any of its affiliates, directors, officers, agents or employees shall be
liable before any third party (including investors) for any investment or business decision made or action taken in reliance on
the information and statements contained in this presentation or for any consequential, special or similar damages.
This presentation does not constitute an offer, or invitation, or solicitation of an offer, to subscribe for or purchase any
securities. Neither this presentation nor anything contained herein shall form the basis of any contract or commitment
whatsoever.
The market and competitive position data, including market forecasts, used throughout this presentation was obtained from
internal surveys, market research, publicly available information and industry publications. Although we have no reason to
believe that any of this information or these reports are inaccurate in any material respect, we have not independently verified
the competitive position, market share, market size, market growth or other data provided by third parties or by industry or
other publications.
This presentation and its contents are proprietary information and may not be reproduced or otherwise disseminated in whole
or in part without the Company’s prior written consent. Please, for any investment decision, read the risk factor section in the
Company’s “Formulário de Referência”, available in our IR website.
2
IMC at a Glance - Geographic Footprint¹
POINTS OF SALE
Brazil - 442 (192) 512 (262) United States - 22
225 (30) 51
84 (29) 15
22
25 6²
28 2
6
Colombia - 25 Panama - 23
12 13
5 9
8 1
Airport Restaurants (multiple brands)
¹As of December/2019. (x) Owned 3
²Includes two operations at airports
IMC at a Glance – P&L Figures
Financial Figures – LTM
Net Debt/
Net Revenues Gross Profit Adj. EBITDA
Adj. EBITDA
R$499 R$137 R$1.4x
R$1,565 32% margin 8.7% margin
R$185mm net
debt
Revenues – LTM Adjusted EBITDA – LTM
Brazil: 28%
Caribbean¹
Caribbean¹
12% Roads
Airports
29% Malls
59%
USA Brazil
USA
LTM Non IFRS-16 Figures - last reported figures 3Q19 ¹ Caribbean consists of Colombia and Panama
4
IMC Strategy Plan
• 3 brownfields/year for 5 years*
Growth
• 40 openings/year over the next 5 years*
Growth
• 40 openings/year over the next 5 years*
• 3 openings/year per year for 5 years*
Margin
Margin • Central Kitchen roll-out 1H20
Central Kitchen
Simplification
Simplification • Evaluate sale of other brands
*From 2020
5
Frango Assado Expansion
Solid SSS performance on Existing market is huge and Looking for brownfield
tough macro environment fragmented opportunities with high ROIC
~1,100 highway gas stations only in the Target Southeast Region
state of São Paulo
~ R$10 million per units (capex + key money)
4-5 years payback
3 units per year
*Truckers strike effect over the 2Q18
96%* of the highway
travelers knows the brand
Frango Assado
*Research made in 2017 with 348 highway travelers
6
MultiQSR Agreement
New shares issued New Board in place 14 Post Merger Integration
Flávio Benício Jansen
Chairman 1. IT
~196 million shares 2. Treasury
Marcel Fleischmann 3. Supply
outstanding 4. S&OP
José Agote 5. HR
6. Quality
Rodrigo Furtado
7. Pricing
Joseph Call 8. FP&A
9. Legal
~13% Martins Family Lincoln Martins 10. Accounting
Educação
11. Internal Communication
~2% Yum! Brands Charles Martins 12. Product Registration
13. Internal Audit
14. Tax
7
Why do we like the deal? - Market
Food outside of home with Pizza Market is big and Chicken is the most consumed
acceleration in the short term fragmented protein in Brazil
(kg/per capita 2017)
Market Size ($)
United
6,7% States 18%
Brazil
4,2% 1 st
2 nd
PIZZA 50%
36k
CAGR 15-18 CAGR 18-23e restaurants 32%
Source: Euromonitor Source: ECD and Statista
Pizza Hut with 0.5%
Market Share Largest Chicken
Restaurant Chain is KFC
wiht more than 80 stores
8
Why do we like the deal? - Company
Iconic and valuable brands Variety of stores type Franchise business helps to
globally increases addressable market expand store base without capex
2019 world's most valuable and
strongest restaurant brands.
Food Court
(Shopping Malls)
1st
2nd Royalties
DELCO Franchisee
Capex % Sales
(Delivery/Carryout)
3rd
KFC
7th Free Standing
Source: Brand Finance Restaurants
9
Why do we like the deal? - Synergies
Significant suppliers synergies Store-in-store at our Frango
Assado Restaurants
IMC: 1.1 Ton
Chicken
MultiQSR: 2.5 Ton Immediate access to high traffic
locations (Frango Assado)
IMC: 1.6 Ton
Flour
MultiQSR: 1.6 Ton
Credit Card IMC: R$600mn
Transactions MultiQSR: R$400mn
Equipment and
Others
10IMC Brazilian Operations Structure – Post Deal
Pizza Hut and KFC operations attached into our existing operations team
Pizza Hut synergies
CEO
with the store-in-store
operations
Frango Central Olive
Pizza Hut KFC
Assado Kitchen Garden
GM GM
Operations Operations
Expansion Expansion
Marketing Marketing
Incorporated into IMC
11Synergies and Opportunities – Post Deal
Supply discussion held or Pizza Hut and KFC pricing
under negotiation strategy
Mozzarella
Menu Engineering
Chicken tender and
Chicken thigh fillet
Store Segmentation
Flour
Competitive Environment
Fruit and Vegetables
Utensils (gloves, hair restraints,
Promotion Strategy Review
cutlery, cups)
Stronger opportunity
on the Pizza Hut side
12Pizza Hut Expansion
Record openings in one year, December with 20 new stores
Store Frango Assado Louveira We already have 10
Store Delco (gas station)
Stores inside the Ipiranga
Frango Assado*
+ 41 stores
in 2019
Store Shopping Parque das Bandeiras Store Delco Vila Nova Conceição
Campinas
225 total
vs. 184 in 2018
Store Juazeiro do Norte
Expansion 2019: 21 Owned and 20 Franchisees
Base 2019: 30 Owned and 195 Franchisees 13
*includes one store that opened in FebruaryKFC Expansion
47% expansion in the store base in 2019, December with the opening of 15 stores
Shopping Bourbon Wallig
(1st Porto Alegre store) Lago Azul Bandeirantes Highway
+ 27 stores
in 2019
KFC
KFC
KFC
Shopping Palladium Curitiba Shopping Patio Cianê
(3 stores in Curitiba) (1st Sorocaba store)
84 total
vs. 57 in 2018
Expansion 2019: 10 Owned and 17 Franchisees / Base 2019: 29 Owned and 55 Franchisees
14PH and KFC Expansion Plan
Specialized consultant company to identify the best stores’ locations
Almost 6k cities mapped Different Type of Locations Inputs
5.6k cities with Shopping Malls Strip Malls
Influence Area Existing Stores
population above 30k
Data Enrichment
Gas Station Hypermarkets
Correlation Analysis
Street Stores
Input City Model
Free Standing DELCO
Lago Azul Bandeirantes Highway Local Model Application
15Margaritaville Expansion
Strong cash generation within Expansion supported by the Expansion at iconic locations in the
the businesses landlord generating high ROIC USA, following the American tourists
Expansion until 2020 already
secured
50% Landlord
Mgmt. fee
Capex ~3-4% of sales
50%
Above 80% of the EBITDA
converting to cash in 2018 Total Capex
Hawaii
~US$ 5M/store
5 new locations
3 units per year
~US$ 3M/store Existing store
New store
~70% of our guests
are tourists
16Central Kitchen
Construction Done
Located at Louveira/SP, 60 km from São Paulo
67% less employees
2.3x more production capacity
Started in December/2019
Soft start of the new Central Kitchen in December
and the closure of Viena’s Old Kitchen
Gradual implementation at the
restaurants within 1H20
Start on January 2020 – End on June 2020
Roll-out in phases to mitigate risks
17Central Kitchen - Opportunities
1st wave 2nd wave 3rd wave
IMC Brasil Owned and Franchisees
operations Franchisees
Pizza dough Frango Assado
products
Airport
Restaurants Retail
Semolina
Retail Bread
Manioc Starch
Biscuit
“Biscoito de
Polvilho”
18Central Kitchen - Status
Bakery Frozen Semolina
Bread
Fried products
All stores
Pasta
All stores
Manioc Starch Biscuit “Biscoito de Polvilho” Cook & Chill Portioned Products
Frango Assado stores and Food retailers
Cheese Bread “Pão de Queijo” What is next?
Building inventory All restaurants
Roasted products What is next?
Air restaurants All restaurants
Coxinha Maker Biscoito Polvilho
Semolina bread (large and medium size) What is next?
7 Frango Assado Stores All Frango Assado (25)
Cook&Chill What is next?
Pilot Program with 4 items at Frango Assado and Olive Garden All restaurants
19Central Kitchen - Status
Cheese Bread
Tomato Sauce “Pão de Queijo” Olive Garden Raviolis
Deep-fried meatballs Alfredo Sauce for Olive Cook&Chill
“Croquete” Garden Caramelised pumpkins
20Evolution of IMC Execution
Frango Assado • 3 signed NDAs
Expansion
Pizza Hut • 20 stores opened in December
Expansion
KFC Expansion • 15 stores opened in December
Margaritaville • Branson in 2019
• San Antonio, Miami, Boston and NYC in 2020
Expansion
• Opened in December without a delay
Central Kitchen • Roll-out to the stores in the 1H20
Central Kitchen
• Asset sales in Mexico, Dominican Republic and
Puerto Rico
Simplification • End of Wraps, Go Fresh, Carls Jr and Red Lobster in
Brasil
• Outsourced logistics
21IMC Expansion Plan
2020 Expansion Guidance
Pizza Hut and KFC Frango Assado Margaritaville
+80 stores/year at 50% owned +3 Stores/year +3 Stores/year
+40 +40
KFC
Owned +20 +20
Hawaii
Franchise +20 +20
Existing store
New stores already signed
22Brands Portfolio
IMC main* brands with traditional history among consumers
Relevant
Brands Start Date Number of Stores Highlight
Country
1952 25 Pioneer roadside restaurant
Buffet style restaurant specialized
1975 511
in Brazilian cuisine
Jimmy Buffett’s Caribbean-
1987/2011 18² / 4
inspired restaurant
One of the largest Italian Casual
1982 6³
Dining Restaurant Chain in the US
Airport catering operations, mainly
1958 6⁴ / 8⁴
at regional airports
Airport Restaurants - 51 Several brands
World's second-largest restaurant
1930 84
chain
World's largest pizza chain in
1958 225
terms of locations
Source: As of December, 2019; Notes: *Represents 96% of the footprint. (¹) Includes Viena, V. Café, Viena Express, Viena Snacks, Viena Café, Viena Delicatessen, Viena Gourmet and Viena Delish. (²) Includes
23
two operations at hospitals (Viena Pizza and Pollo Tropical) and one Viena at MIA airport. (³) Includes two operations at airports. (⁴) At the catering division, please consider airports in which we operate.IMC Adjusted EBITDA Evolution
+10%
136
+20% 121 Flat
116 116
101
Adj. EBITDA
6.5% 8.1% 8.6% 9.6% 9.8%
Margin
R$ million Non-IFRS 16 Figures
24Financial Highlights
Financial and Operational Highlights
Net Revenue Adjusted EBITDA and EBITDA Margin
(R$ Million) (R$ Million and %)
2000
9.6% 9.8%
8.6%
8.1%
1,541 1,582 6.5%
1,495
195 191
179
1,206 1,189
391 368 439 142 141
359 366
136
121 116 116
101
955 947 952
705 682
2016 2017 2018 9M18 9M19 2016 2017 2018 9M18 9M19
Brazil USA Caribbean
Same Store Sales (SSS) Number of Stores
(Growth in R$,%) (#)
252 242 241
26 231 227 222
24 24 213 212 210
20 23 22 22 195
19 20 20 21 21 21 194
22 22 22 22 22
21 22 22 22 21 21
21 21 22
21 22 22 22
-2.8% 23 23
-4.6%
-4.9%
-10.3% 184 177 175 167 162 157 149 147 145 129 128
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19
IMC Brazil Caribbean USA Brazil Panama USA Colombia
26Financial and Operational Highlights
Indebtedness (3Q19)
Debt and Leverage Breakdown by Type
(R$ Million)
1.4x Foreign Libor
24% 24%
0.5x
0.2x
-0.3x
552
334
160 206 185
22 66
-31
2016 2017 2018 3Q19
Local CDI
Gross Debt Net Debt Net Debt/ Adj. EBTDA LTM 76% 76%
Debt Amortization Schedule
367
175
110 102
75
45 40
Cash and cash Short-term 2020 2021 2022 2023 2024+
Equivalents
27Speakers
CEO
Newton Maia Alves
IRO
Luis Felipe Bresaola
Phone: +55 11 3041.9653
ri@internationalmealcompany.com
www.internationalmealcompany.com/ir
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