JUBILANT FOODWORKS LIMITED - Corporate Presentation February 2017 - JFL
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JUBILANT FOODWORKS LIMITED
Corporate Presentation
February 2017
2 1 Overview of the Indian Food Service Industry 2 Overview of Jubilant FoodWorks Limited (JFL) 3 Domino’s Pizza – Journey & Positioning 4 Dunkin’ Donuts –Journey & Positioning 5 JFL Financial Highlights 6 Outlook 7 Annexures (Experienced Team, CSR Initiatives & Awards)
Overview of Indian Food Service Industry
4
Format 2016 CAGR 2021
Rs 204.0 bn ---- Rs 509.5 bn
Chained Market
(7%) 20.1% (10%)
Rs 810.8 bn ---- Rs 1,532.3 bn
Standalone Market
(26%) 13.6% (31%)
Rs 2,076.4 bn ---- Rs 2,939.5 bn
Unorganized Market
(67%) 7.2% (59%)
Rs 3,091.1 bn ---- Rs 4,981.3 bn
Total
(100%) 10.0% (100%)
Chained Market projected to grow at 20% CAGR
Source: India Food Services Report 2016- National Restaurant Association of India
5
Format 2013 CAGR 2016 CAGR 2021
Rs 15.2 bn ---- Rs 18.1 bn ---- Rs 29.1 bn
Cafe
(12%) 6% (9%) 10% (6%)
Rs 55.0 bn ---- Rs 91.3 bn ---- Rs 246.7 bn
Quick Service Restaurant
(43%) 18% (45%) 22% (48%)
Rs 39.5 bn ---- Rs 67.2 bn ---- Rs 172.5 bn
Casual Dining Restaurant
(31%) 19% (33%) 21% (34%)
Rs 5 bn ---- Rs 5.3 bn ---- Rs 6.2 Cr
Fine Dining Restaurant
(4%) 2% (3%) 3% (1%)
Rs 5.4 bn ---- Rs 10.7 bn ---- Rs 28.8 bn
Pubs & Bars
(4%) 25% (5%) 22% (6%)
Rs 7.8 bn ---- Rs 11.6 bn ---- Rs 26.4 bn
Frozen Dessert
(6%) 14% (6%) 18% (5%)
Rs 127.9 bn ---- Rs 204.0 bn ---- Rs 509.5 bn
Total
(100%) 17% (100%) 20% (100%)
QSR segment is projected to grow at 22% would stand as 48% of total chained market
Source: India Food Services Report 2016- National Restaurant Association of India
6
Pro-growth Demographics
(increased youth population, Higher disposable / discretionary
nuclear family & more working income
women)
Growth driven by
Greater urbanization
digitization
Changing consumer
preferences –
Growth in chained
widening exposure to
retail
new cultures and
cuisines
India an attractive proposition
Business potential in transit
for global players – more
locations
choices for consumers
Large consumption growth relative to emerging and developed markets
7
Consistent
quality of Rising
Focused & Execution & Focus on
Prudent roll- product with Value for aspiration of
integrated delivery of hygiene and
out finger on money using branded
approach strategy sanitation
customer’s products
pulse
Evolving according to the needs of the consumer, leading to growth
8
On the pedigree of the global brand
Capitalising
The palette with local flavors
Customising
New products on a regular basis
Introducing
A unique model through home delivery & dine-ins
Developing
Operational excellence- consistency of product and service
Delivering
On enticing customers with evolving mktg strategies
Focusing
Systematic approach to deliver sustainable growth
Overview of Jubilant FoodWorks
10
o Founded in 1960 o Founded in 1950
Presence Across o More than 13,200 franchised and Company- o More than 12,000 restaurants in more than 44
Countries owned Restaurants in more than 80 international countries
markets
Beginning of
Restaurants in India o 1st restaurant operated in India in Mar’96 o 1st restaurant operated in India in Apr’12
Presence in India o 1,111 restaurants across 260 Indian cities*
o 68 Restaurants across 19 Indian cities*
o India is currently the biggest market for Domino’s
Pizza outside the United States
Contract Details o Exclusive right to open Domino’s Pizza
o Exclusive right to operate and develop Dunkin’
restaurants in India, Sri Lanka, Bangladesh and
Donuts restaurants in India. The agreement is for
Nepal
a period of 15 yrs, till February 2026 with the
o Current franchising agreement till December option of renewal for 10 yrs, with first right of
2024 with right of renewal for another 10 years refusal for Sri Lanka, Nepal & Bangladesh
* As of 06 February 2017
Accumulated learning's to drive ramp-up in Domino’s Pizza & Dunkin’ Donuts11
Driven by Consumer Focus
Operational Robust and Innovative
Excellence Integrated Marketing
Supply Chain Continuous
Systems Human Innovation
Resource Robust Project
Management Corporate Investments Management
driving growth Governance in Competency
Mechanism Technology
Delivering consistency in product and services to delight our customers12
ROBUST
INFRASTRUCTURE
OPERATIONAL
EXCELLENCE
Delivering consistency in product and services to delight our customersFood Safety and Quality Assurance
• Training on standards of Food safety and Quality
• Regular QA Assessment
• Third party assessment through NABL Accredited agency
• Regular compliance checks of food processes as per FSSAI guidelines
• Continual surveillance assessment of restaurants under ISO 22000
certification
• Stringent selection & monitoring
process of new and existing
suppliers based on key @ Restaurant
• Training of staff and managers on
performance indicators for Level
comprehensive standards of Food
Quality and Food Safety safety and Quality
requirements • Stringent sampling of all raw
• Food ingredient suppliers are materials & COA approach
FSMS certified Food Safety acceptance
• Moving all vendors towards and Quality • Comprehensive analysis of Food
FSMS certification Assurance products as per FSSAI guidelines
• NABL Accredited Third Party • Regular food quality and safety QA
Assessments Initiation for Core assessments based on FSSAI
ingredient supplying Food @ Supply Chain @ Commissary Schedule 4 requirements
Vendors level Level • Implemented FSMS (ISO 22000 )
• Alliances with all vendors to certification in 5 Commissaries
continuously enhance Quality and
Food safety norms and comply
regulations14
Vendors and Central Location
Partners
COLD CHAIN
TRUCKS at 1-40 C
COLD CHAIN
TRUCKS at 1-40 C Restaurants
Raw
Materials Restaurants
* As of February 06, 2017
Under
Construction
An integrated supply chain for Domino’s Pizza and Dunkin’ Donuts adapted to Indian
conditions; well-equipped to deal with geographic and demand expansion15
Guest Delight
Manager
(Restaurant
Manager) is Assist
Pre defined treated as CEO Employees in
growth path for of the encouraging
every Team Restaurant excellence
Member educational
growth
Reward & Learning &
Recognition with Professional
Variable Incentives Development and
bring motivation Training
Whistle Blower
institutionised at
Fun at work
every
restaurant/office
Team members act as brand ambassador imbibing JFL’s values, ethics and culture16
Institutionalised
Composition of Board with
Whistle Blower
Professional Acumen
Mechanism
Nurturing Enterprise Robust Audit and
Risk Management
Corporate Review Mechanism
Governance
Mechanism
Code of
Conduct/ Established Internal
No Gift Policy Control Mechanism
Truly inculcated mechanism of corporate governance17
Customer level Commissary / Supply chain level
Customer Relationship Management ( CRM ) Oracle Transport management – Optimizes route/ load
GPS enabled deliver vehicles – to track vehicle efficiencies for supplies from commissary to stores
movement COGNOS – system aids in procurement planning
OLO/mobile app /Voice ordering – for ease of SAP – for accounting and Supply Chain systems/ ERP
ordering GPS on commissary truck – Enables tracking trucks
and monitoring factors like temperature compliance
Barcoding – for efficient stock management
Automation – Implementation of sensor doors, use of
technology for temperature compliance, picking trolley
ARIBA – tool for vendor management
Restaurant level Organizational Level
OLO/mobile app /Voice ordering – for ease of Energy management system – tool to optimize
ordering energy usage
LMS – Learning management System – non trainer SAP – Accounting and Supply Chain related - ERP
based learning at restaurants Biometric device – tracking of employee attendance,
GRC – Governance Risk and Compliance tool helps improving productivity,
Energy management system – tool to optimize I Manage – Mobility, Ease of Compliance,
energy usage Socialization, automation of transactions, say
confirmation
Hyperion – tool for financial planning
Integration of technology across levels to drive efficiencies & enhance growth opportunities18
3
5
Negotiate
With landlords Average restaurant
opening/ construction
Handover of restaurant to time is between 35-45
2 contractor for interiors days from the date of
possession of premises
4 for a new restaurant
Construction/ Purchase and
location
installation of machinery
6
Operational and
Financial Diligence Legal due
diligence and
agreement sign off
with landlords
1
7 Training of team
members
Local
advertisement
(distribution of
Identify new Restaurant opening
flyers, regional
restaurant
media coverage) 8
location
ROI/Payback period analysis undertaken prior to opening a restaurant19
Pizza Mania Extremes
Big Joy Burgers Range of coffees
Product Innovation
Burger Pizza DunkyDoos
• Open Kitchen
Design Innovation • Flexible
Seating
• Heritage Wall
Technology Innovation
Innovating to keep the excitement alive20
National Marketing Local Store Marketing (LSM)
Television Door Hangers
Print Media & Radio Flyers
(including regional
language) Customer lifecycle
management programme
Emotional positioning of
‘Yeh hai Rishton ka Time’ Innovative BTL activation
(restaurant targeted)
Innovative new product
development and launches
Digital Marketing Customer Relationship Management
• More than 6.8 million • “One to one” marketing
Facebook fans utilizes information
from point-of-sales
• 137k followers on software system to
Twitter provide relevant
customized
• More than 12.7 mn
communication/ offers
views for video of
to consumers
Domino’s Pizza India
on YouTubeDomino’s Pizza –Overview
22
Striking an emotional
chord with consumers
through its campaigns
included ‘Hungry Kya?’,
‘Khushiyon ki Home
Delivery’ and the latest
Reaching out to one ‘Yeh Hai Rishton Ka
more people by Time’
launching unique
mobile applications
Providing
value by tapping
the middle
Mastering classes through
the on-time home the affordable
delivery model, ‘Fun Meal’ and
without penalizing the ‘Pizza Mania’
the delivery boy range
Popularizing
for late/free
the pizza
delivery
concept by
customizing it
to the Indian
palette23
Revenue 9 Yr CAGR (FY08-FY16) 36%
400 2016: Crossed 1000 1200
2012: Launch of new store milestone
Aug 2008: Launch of positioning “Yeh Hai
new positioning Rishton Ka Time”
"Khushiyon Ki Home 1026
350 2003: Launched Delivery"
1998: Launched "30 Min or Free" Nov 13:
1000
"Hungry Kya?" campaign Fresh Pan
2012: Taco
campaign Pizza
Aug 2008: Launch 2009: CLC, Indiana & 876
300 July 13:
of Rs.35 Pizza Pasta & Choco Lebanese Roll
BOGO Wed
Mania Lava Launched Launched
800
No. of Restaurants
726
250
Management
2005: Ajay Kaul 576
200 appointed as CEO 600
Changes
Largest
465
market outside
150 Pizza U.S.
378 Theatre 400
306
100 100th
241
Restaurant Feb 2010:
s 182 IPO 200
50 100 93
80
2 7.6 8.4 10.9 31.3 42.0 62.8 100.5 150.7 208.2 255.0 306.9 356.5
0.2
0 0
FY96 FY01 FY04 FY05 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16
Revenue (USD mn) Restaurants
Initial Phase Consolidation Planned Growth Aggressive Growth
Largest market for Domino’s Pizza outside of U.S.A24
Open Kitchen-
Benefits
Its Theatric-Consumer
can see the making of
Pizza’s
Confidence in Hygiene
and Sanitations.
Pizza Flexible Seating
Theater
High stools for
Youngsters
Soft sitting for Seniors
Long Table for Families
Heritage Wall
Indicating more than 60
years Old Brand25
Quattro Formaggi Burst Crust Pizza Mania Extremes
Choco Pizza
Burger Pizza Fresh Pan Pizza in Regular size Taco Mexicana Zingy Parcel26
National Delivery
Number
Restaurant Takeaway
3600
Indian mode of Mobile
Railways customer App
outreach
Online
Delivery
ordering27
Q3 FY16 Q4 FY16 Q1 FY17 Q2 FY17 Q3 FY17
Average OLO contribution to delivery sales 36% 41% 44% 47% 49%
Mobile Ordering sales contribution to overall OLO 38% 38% 41% 54% 56%
Downloads of mobile ordering app 3.7 mn 3.9 mn 4.4 mn 5.0 mn 5.3 mn
Accessible through all platformsDunkin’ Donuts – Overview
29 ALL DAY PART MENU
30
“Get your Mojo Back” positioning, focused on the urban youth consumer and aimed to get Dunkin’ Donuts
better placed in the sweet spot between the QSR and the Café markets
New, evolved products with higher degree of complexity and gourmet qualities
All day part menu offering of food (burger, wraps, sandwiches, etc), apart from donuts & beverages (coffee)31
Munchkins DunkyDoos Donut Cakes
Donuts
Big Joy Burgers Chef’s Favourite Paneer
Food
Virgin
Mojito
Coolatta
Beverages
Salty Classic
Lemonade
Coolatta32
Financial Highlights-Jubilant FoodWorks
34
All figures in Rs mn
Total Income EBITDA (LHS) EBITDA% (RHS)
30,000 3,000 20%
18.6% 2,852
17.7%
2,628 18%
17.3% 2,551
25,000 24,102 2,500
2,444 16%
14.7%
20,745
19,333 14%
20,000 2,000 1,904 1,861
17,328 11.8%
12.7% 12%
15,000 14,153 1,500 10%
9.6%
1,201
8%
10,233
10,000 1,000
6%
6,803
4%
5,000 29% CAGR 500 19% CAGR
2%
0 0 0%
FY11 FY12 FY13 FY14 FY15 FY16 9MFY17 FY11 FY12 FY13 FY14 FY15 FY16 9M FY17
Note: 1. Financial discussion throughout this release is based on standalone reporting
2. The financials of Dunkin’ Donuts have been included in the results & related financial discussion35
All figures in Rs mn
PAT (LHS) PAT % (RHS) Networth
1,600 12% 9,000
8208
10.6%
8,000 7,681
1,400 1,351
10.4% 10%
1,258 1,233
7,000 6,711
9.6%
1,200 1,146
1,056
8% 6,000 5,635
1,000
7.3% 5,000
5.9% 4,362
800 6%
720
4.8% 4,000
605
600 2,996
4% 3,000
400 3.1% 1,917
2,000
10% CAGR 2% 32% CAGR
200 1,000
0 0% 0
FY11 FY12 FY13 FY14 FY15 FY16 9MFY17 FY11 FY12 FY13 FY14 FY15 FY16 H1FY17
Note: 1. Financial discussion throughout this release is based on standalone reporting
2. The financials of Dunkin’ Donuts have been included in the results & related financial discussion36
No. of Employees No. of Restaurants
27,122 27,719 27,971
24,969
1,180* 1,179**
19,734
1,097
14,626 930
11,514 752
586
465
378
FY11 FY12 FY13 FY14 FY15 FY16 9M
FY17
Same Store Sales Growth (SSG) Debt-Equity ratio
37%
30%
16%
2% 3.2%
0.05% -0.8% 0 0 0 0 0 0 0
FY11 FY12 FY13 FY14 FY15 FY16 9M FY11 FY12 FY13 FY14 FY15 FY16 H1 FY17
FY17
• *Total No of stores includes 1107 Domino's Pizza stores + 73 Dunkin’ Donuts Restaurants (as of 31 December, 2016 )
• **Total No of stores includes 1111 Domino's Pizza stores + 68 Dunkin’ Donuts Restaurants (as of 31 December, 2016 )Outlook
38
Target to become a
stronger Company
with improving
Portfolio profitability
Driving Expansion
Innovation
Brand
Strategic development
infrastructure Committed to
Evaluate strengthen
Increase and investment Aim to
international and utilize
consistently
optimize use renowned business
keep innovating
of technology brands around capabilities to
ROI focused Continuous across business
QSR/ Casual generate
expansion investments and functions
Make requisite Dining. sustainable
up gradations Product
Continuous evaluation investments in profitability
Continued towards band innovation to
of expansion program
business to Explore starting
to ensure adherence to investments to developments to remain a
leverage market own brand or
profitability strengthen capture the dominant part
opportunities acquiring/
parameters OLO and dynamics of the of the agenda in
Progress on investing in
mobile sector and order to deliver
Aligned to this construction of some
ordering customer high quotients
process, for FY17, the
Greater Noida promising
target would be to platforms in preferences of customer
mega domestic brand
open 110- 115 new order to drive satisfaction
Domino’s Pizza sales and commissary as
restaurants and
enhance per plan
around 15 new
Dunkin’ Donuts efficiencies
Successfully opened
95 Domino’s Pizza and
11 Dunkin’ Donuts’
restaurants thus farAnnexures: Experienced Team, CSR initiatives Awards
40
Mr. Shyam S. Bhartia (Chairman & Director) Mr. Hari S. Bhartia (Co-Chairman & Director)
o Has experience in the pharmaceuticals and specialty o Has experience in pharma, life sciences & healthcare,
chemicals, food, oil and gas, aerospace and IT sectors oil & gas (exploration & production), agri &
o Bachelor’s degree in commerce St. Xaviers College, performance polymers, food & retail and consulting
Calcutta University; Fellow member of the ICWAI services in aerospace and oilfield services
o Bachelor’s degree in chemical engineering from IIT,
Delhi
Mr. Ajay Kaul (CEO and Wholetime Director) Mr. Vishal Marwaha (Independent Director)
o Has experience in India and abroad in industries such o He has expertise in private equity and investment
as financial services, airlines, express distribution, banking.
logistics and food retail o Bachelor’s degree in commerce from the University of
o Bachelor’s Degree in Technology from IIT Delhi and Delhi and is a qualified chartered accountant
MBA from XLRI, Jamshedpur41
Ms. Ramni Nirula (Independent Director)
o Has experience in the banking and finance industry
including Project Financing, Strategy, Planning &
Resources and Corporate Banking
o Bachelor’s degree in economics and MBA from
University of Delhi
Mr. Phiroz Vandrevala (Independent Director)
o He has been part of numerous expert committees
constituted by the Reserve Bank of India to guide the
Central Bank in its policy-making efforts, as well as IT
advisory bodies in India and on the Board of several
prominent educational institutions
o He is a graduate from Kolkata and a qualified
Chartered Accountant
Mr. Arun Seth (Independent Director)
o He has commercial and technical expertise in the IT
and telecommunications industry in India.
o Holds a bachelor’s degree in engineering from IIT,
Kanpur and MBA from IIM, Calcutta42
Sachin Sharma (President & CFO) Mr. Tarun Bhasin (President & Chief Business Officer, Dunkin’ Donuts
India)
o Spearheading finance & accounts, legal, secretarial
and Investor relations o Responsible for Operations & business development,
o Has over 21 years of work experience in Media and training & customer service, quality and Six Sigma,
entertainment, Digital, IT/ITES and Infrastructure. marketing, new product development and HR
o Mr. Sharma is a qualified Chartered Accountant and o Has over 23 years overall experience out of which 20
holds a Bachelor of Commerce (Hons) Degree from years have been with the Company
Delhi University o He holds a bachelor’s degree in Arts from University
of Delhi and diplomas in public relations and hotel
management from Bhartiya Vidya Bhavan, New Delhi
and National Council for Hotel Management and
Catering Technology, New Delhi, respectively
Dev Amritesh (President & Chief Business Officer, Domino’s Pizza Arvind Vats (Chief Investor Relations Officer & Deputy CFO)
India)
o Responsible for management assurance, corporate
o Responsible for operations and business governance, FP&A, Investor relations and corporate
development, marketing, project and maintenance, affairs
training and customer service, quality & Six Sigma for o Has over 22 years overall experience out of which 11
India years have been with the Company
o Has over 17 years overall experience out of which over o He is a CA, ICWA and MBA (Finance)
10 years have been with the Company
o He holds a BE degree from Bangalore University and
also holds a PGDBM (Marketing and Operations)
diploma from IMT, Ghaziabad.43
Swachh Bharat Abhiyan
Proactive efforts towards the mission of a Clean India.
Road Safety
Working concertedly across cities to spread awareness on road safety.
Inclusive Development of People with Disabilities
(PwD)
Empowering PwDs to integrate them seamlessly in the work environment.
Empowering Youth
Enhancing skills of socially disadvantaged youth to facilitate their gainful
employment.
Farmers Development Program
To enhance the cattle productivity & farmer’s income
Committed to be a Good Neighbour44
JFL won the National Award for Excellence Domino’s won Star Retailer of the year JFL won CSR Initiative of the year Award in
in Corporate Communication in the Award at Franchisee India Award FY16 at Annual Indian Retail Awards organized
category of Best Annual Report for FY2016 by Franchisee India
Domino’s Pizza won the National Award –
Excellence in Customer Service,organised JFL was awarded as Best Risk Management
Domino’s Pizza won the National Award – by World HRD Congress
Best Deployment of Learning Management Framework & System – Retail award by by
System at Best in Class Learning & ICICI Lombard and CNBC TV18
JFL won Golden Peacock award in FY16 for
Development Awards, organised by World • National Quality Award for concentrated
HRD Congress efforts in building a culture of continuous Domino's Pizza has won the “Best Customer
improvement Service Award” at the Indian Restaurant
Coca Cola Golden Spoon Award under • National Training Award Awards 2016, organized by Franchise India.
following categories: • Risk Management
• IMAGES Most Admired Food Service Chain
Of The Year – QSR Foreign Origin JFLwon the 4th Edition of “India’s Most JFL won 7 CII Awards for Food Safety - 2016
• IMAGES Most Admired Food Service Ethical Companies Award 2016” by the World under following categories:
Retailer Of The Year – Retail Expansion CSR Day • Outstanding Performance in Food Safety in the
category of 'Small & Medium manufacturing
Dunkin’ Donuts has won business: ready to cook’ and 'Small &
• “National Award - Excellence In Customer Medium Food Service QSR’.
Domino’s Pizza India has won the “Golden Service & Loyalty – in the Category of Café • Significant Achievement in Food Safety in the
Peacock National Training Award” by the Restaurant” at Global Awards for Excellence in category of ‘Small & Medium Manufacturing
“Institute of Directors(IOD)- India at Quality Management & Leadership organized by Business: Rising Star: Ready To Cook’ and
the”25th World Congress on Leadership for World Quality Congress. ‘Small & Medium Food Service: Rising Star:
Business Excellence & Innovation’ and the • “Asian Award for Best in Quality Service” at 7th QSR’
Golden Peacock Awards Presentation Asian Best Employer Brand Award 2016 • Strong Commitment to Food Safety in the
Ceremony organized jointly by World HRD Congress. Category of ‘Small & Medium Food Service:
• “National Award - Best Customer Service by a Rising Star: QSR’
Dunkin’ won Café Restaurant” at Indian Restaurants Awards • Letter of Appreciation in Food Safety in the
• Delhi NCR Hot 50 Brands Award in FY16 2016 organized by Franchise India. Category of ‘Small & Medium Food Service:
• Food Safety Excellence Award” at the Dunkin’ QSR’ and ‘Small & Medium Food Service:
presented by One India
International Middle East Rally Awards 2016 Rising Star: QSR’
• Best marketing and promotions Award at
organized by Dunkin’ International.
Images Retail Award by India Retail ForumThank You
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