KOUFU GROUP LIMITED FY 2020 Corporate Presentation 23 February 2021 - Investor Relations
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KOUFU GROUP LIMITED
FY 2020 Corporate Presentation
23 February 2021
Important Notice
This presentation is prepared for information purposes only, without regard to the objectives, financial situation
nor needs of any specific person. This presentation does not constitute an offer or solicitation of an offer to sell
or invitation to subscribe for any securities nor shall it or any part of it form the basis of, or be relied on in
connection with, any contract or commitment whatsoever.
This presentation may contain certain forward-looking statements with respect to the financial condition, results
of operations and business of the Company and its subsidiaries and certain of the plans and objectives of the
management of the Company and its subsidiaries. Such forward-looking statements involve known and
unknown risks, uncertainties and other factors which may cause the actual results or performance of the
Company and its subsidiaries to be materially different from any future results or performance expressed or
implied by such forward-looking statements. Such forward-looking statements were made based on
assumptions regarding the present and future business strategies of the Company and its subsidiaries and the
political and economic environment in which the Company and its subsidiaries will operate in the future. You are
cautioned not to place undue reliance on these forward-looking statements, which are based on current view of
management of the Company and its subsidiaries as of the date of this presentation only.
Nothing in this presentation should be construed as financial, investment, business, legal or tax advice and you
should consult your own independent professional advisors.
2
Content
• Financial Highlights
• Impact of COVID-19
• Operations Review
• Transformational
Strategies
3
Financial Highlights
Total Revenue
(S$’m) (S$’m)
10.0
19.9
5.4
19.3
16.6
121.6
10.5 111.6
98.0 103.4
2H 2019 2H 2020
Singapore Overseas
217.6
200.1 204.5
FY 2020 revenue declined by $45.1m or 19.0% from $237.5m in FY
181.9
2020 to $192.4m in FY 2019 mainly due to:
- Lower contributions from both the outlet & mall management
and F&B retail business segments due to impact from the
circuit breaker and Phase 1 periods when dine-in services
were disallowed.
- Temporary suspension of operations of 10 food courts, 3
quick-service restaurants (“QSR”), 2 full-service restaurants
and 26 R&B tea kiosks/QSR during the circuit breaker and
Phase 1 periods.
FY 2017 FY 2018 FY 2019 FY 2020 - Lower footfalls at food courts located near offices, down-town
Singapore Overseas areas, tertiary institutions as well as tourist hot-spots due to
work-from-home trends and restriction in tourist arrivals.
5
Revenue Breakdown – By Segment
(S$’m)
FY 2020 Segment Breakdown
120.1 117.4
100.0
92.4
Outlet & Mall
F&B Retail
Management
52.0% 48.0%
Outlet & Mall Management F&B Retail
FY 2019 FY 2020
Outlet & Mall Management:
• Decrease in fixed rental income as rental rebates granted by landlords were passed on to stall tenants
• Decline in variable rent income and recovery of cleaning expenses from stall tenants as lower cleaning expenses were incurred during the
circuit breaker and Phase 1 of the re-opening of the economy as dine-in services were disallowed
• Decrease in recovery of utilities from stall tenants as lower utility expenses were incurred.
F&B Retail:
• Lower footfalls at most of the outlets especially during the circuit breaker and Phase 1 periods as dine-in services were disallowed, and at
food courts located near offices, down-town areas, tertiary institutions as well as tourist hot-spots due to work-from-home trends and
restriction in tourist arrivals during gradual reopening of Singapore economy in Phase 2
• Temporary suspension of operations of 10 food courts, 3 QSRs, 2 full-service restaurants and 26 R&B tea kiosks/QSR during the circuit
breaker and Phase 1 periods
• Decrease was partially mitigated by contributions from newly acquired Deli Asia group. 6
Our Expenses Breakdown
Breakdown of expenses
Depreciation
37.2%
20.6% Property rentals and related
19.4% expenses
17.9% Staff costs
FY 2019
2.4%
1.9% Cost of inventories consumed
0.4%
0.1% Adminstrative expenses
Other operating expenses
39.7%
16.6%
Distribution and selling expenses
18.8%
17.7%
FY 2020 - Higher impairment loss on trade Impairment loss on trade receivables
2.8%
2.7% was due to provision for uncollectable
debts from stall tenants as part of the
0.7% Group’s conservative approach
1.0% amidst COVID-19
- Higher other operating expenses
was due to increase in impairment
loss on property, plant and equipment
and ROU assets, as a result of
COVID-19
8
Net Profit After Tax
Net Profit After Tax (attributable to Owners of the Company)
(S$’m) (S$’m)
NPAT NPAT margin %
12.4%
12.0% 12.0%
11.7%
10.9% 25 11.2%
10.0%
10.0%
26.9 27.7 7.1%
25.9 20
24.5 8.0% 5.0%
15 13.6 0.0%
6.0%
5.1%
10 -5.0%
4.0%
9.9 7.3
2.0% 5 -10.0%
0.0% 0 -15.0%
FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 2H 2019 2H 2020
8
Healthy Cashflow & Balance Sheet
Business is Resilient Through Economic Cycles
Cash-generative
Strong operating cash flow
Healthy balance sheet
Net Cash Generated from Operating Activities
(S$’m)
110.1 S$76.4m
Cash and cash equivalent
as at 31 December 2020
73.0
S$62.6m
Net Cash as at
31 December 2020
FY2019 FY 2020
N.B. The Group adopted the SFRS (I)16 effective 1 January 2019
9
Dividend
S$0.007 S$0.012 per ordinary share
FY 2020 Proposed Final Dividend Total Dividends for FY 2020*
* Inclusive of the interim dividend paid of S$0.005 per ordinary share on 3 September 2020.
10At a Glance – P&L
(S$’m)
FY 2019 FY 2020 Change (%)
Revenue
237.5 192.4 (19.0)
Profit after Tax
Attributable to Owners of the
Company 27.7 9.9 (64.3)
Profit After Tax Margin (%)
Attributable to Owners of the
Company 11.7 5.1 (6.6 ppt)
Earnings per Share
(SGD Cents) 4.99(1) 1.78(1) (64.3)
(1) Calculated based on 554,970,100 and 554,664,429 weighted average number of shares in FY 2019 and FY 2020 respectively.
11Robust Balance Sheet and Healthy Cash Flows
31 December
(S$’m)
2017 2018 2019 2020
Total Assets 107.2 159.7 348.9(1) 341.6
Total Liabilities 64.1 68.2 245.9(1) 240.3
Total Shareholder’s Equity 43.1 91.5 102.3 101.0
Cash and Cash Equivalents 53.0 61.0 90.4 76.4
Time Deposits - 35.0 4.6 3.1
Net Asset Value Per Share (S$) 0.09 0.16 0.18 0.18
Net cash generated from operating activities 51.0 33.2 110.1 73.0
Note:
(1) The Group adopted the SFRS(i)16 (Leases) effective 1 January 2019
12Impact of COVID-19
Update on COVID-19 Impact
Business Operations
• Partnering with delivery platforms
Singapore and launching delivery services
• Resumed operations of all outlets within our own “Koufu Eat” App to
• Significant improvements in footfall and revenue of heartland food boost online sales
courts and coffee shops
• Food courts located near offices, down-town areas, tertiary
institutions and tourist hot-spots continue to see lower footfall as • Negative impact mitigated to an
opposed to pre-COVID extent by government grants and
• Significant improvements to both footfalls and revenue since re- rental waivers or rebates, as well as
opening of most of the R&B tea kiosks and dine-in services of 4 property tax rebates passed down
full-service restaurants by landlords
Macau
• Opened third food court in Macau at Nova City • Actively monitoring stall occupancy
• Current occupancy rate for food stalls remains at 100% and sourcing for new tenants to
• Mainland China and Macau have slowly reopened its borders, replace any outgoing stallholders
along with the lifting of the 14-day quarantine policy on the Macau-
Guangdong borders in July 2020 • Strong balance sheet and cash
• Business operations remain at reduced level given lower number
position in meeting operating
of visitors and travellers generally
requirements
New Outlets/Integrated facility
• TOP for new integrated facility delayed to Q1 2021, expect to • Remain competitive with cautious
commence operations in new IF by Q2 2021 growth and expansion plans
14Operations Review
At a Glance – Brands
Food Courts
F&B Stalls, Franchised F&B Stalls, Kiosks, QSRs and Full-Service Restaurants
Coffee Shops
16At a Glance – Outlets by Country
As at 31 December 2020
Outlet & Mall Management F&B Retail
48 3 18 74 5
Food Courts Coffee Shops
F&B Stalls
1 1221
Commercial Mall
57 7
Authorised /licensed F&B Stalls/
Kiosks/Stores2
363 2 1
F&B Kiosks
4 7
Full-Service Quick-Service
Restaurants Restaurants (“QSR”)
Notes:
1 R&B Tea is available at 122 of the Shakey’s and Peri Peri stores, through a co-branding strategy with the Master
Franchisee, Shakey’s Pizza Asia Ventures Inc.
2 Authorised/ licensed F&B Stalls/kiosks/ stores refer to Delisnacks F&B stalls in Singapore and R&B Tea kiosks/ stores
in Indonesia/ Phillipines
16
3 Including eight Dough Culture kiosks from the recent Deli Asia group acquisitionAt a Glance – New Openings in 2H 2020
Singapore
Month Brand Location F&B Outlets Business Segment
Aug 2020 Dough Causeway Point F&B Kiosks F&B Retail
Culture Waterway Point
NEX
AMK Hub
North Pont
Tampines Mall
Changi City Point
Oct 2020 R&B Tea Change Alley Mall F&B Kiosk F&B Retail
Oct 2020 Koufu Le Quest Food Court Outlet & Mall
Management
Dec 2020 R&B Tea Le Quest F&B Kiosk F&B Retail
Dec 2020 Grove Canberra Plaza QSR F&B Retail
Dec 2020 Dough Canberra Plaza F&B Kiosk F&B Retail
Culture
Overseas
Month Brand Location F&B Outlets Business Segment
Sep 2020 Koufu Nova City, Macau Food court Outlet & Mall
Management
Sep 2020 R&B Tea Nova City, Macau F&B Kiosk F&B Retail
18Transformational Strategies
19Outlet & Mall Management
Reinforcing our foothold in Extending our network
Singapore further abroad
• Opened one new food court in 2H 2020 at Le • Expand overseas with an initial focus in Macau
Quest • Opened third food court at Nova City, Macau in
• To open three new for food courts at Sun Plaza, Q3 2020
Woodlands Height (Koufu’s new HQ) and NTU in
Q2 2021
• To expand in Singapore with a focus on new
housing estates, hospitals, commercial malls and
tertiary educational institutions
• Notwithstanding the challenges amidst the
COVID-19 outbreak, the Group expects to
remain competitive with its productivity efforts
and expansion plans as it monitors the situation
closely
• Adopt a tactical and calculated approach in
expansion plans in targeted markets for
sustainable growth
20F&B Retail – Increasing our Multi-Brand Recognition
Network Expansion in Widening Footprint
Singapore Overseas
• Opened two R&B Tea kiosks in 2H 2020, • Macau & Malaysia: Looking out for suitable
achieving a total of 30 outlets, and secured franchise partners to expand the brands in
further two leases at Fusionopolis (opened in Jan these markets
2021) and Sun Plaza (to be open in Q1 2021)
• Indonesia: Sold off 55% stake in Supertea
• Opened one Dough Culture kiosk at Canberra Indonesia to PT Berkah, while continuing
Plaza in Q4 2020, and secured three new leases Master Licensing agreement with Supertea
at SingPost Centre (opened in Jan 2021), Sun Indonesia, in a strategic move to streamline
Plaza and Oasis Terrace, to be open in Q1 and operations
Q2 2021 respectively.
• Philippines: Entered into Master Franchise
• Looking to expand the Grove QSRs and Dough Agreement with Shakey’s Pizza Asia Ventures
Culture kiosks further Inc., for expansion of R&B Tea; plans to set up
• Opened one new Grove QSR at Canberra Plaza first stand-alone outlet in Q2 2021
in Q4 2021
• New markets: Actively looking for JV partners
to expand R&B Tea brand to Thailand
• Tap experience and network accumulated in
various markets to progressively expand other
F&B Retail brands, such as Elemen
21Integrated Facility – to Drive and Support Growth
GFA of S$43.0 Million
Estimated total construction
20,000 sqm including renovation cost, capital
More than 5 times larger than our expenditure for equipment and
current central kitchens and machinery (S$3.9m land premium
corporate headquarters paid upfront for 30 years lease)
The Group will be occupying 75% of total GFA;
Remaining 25% to be tenanted out
Achieved 100% tenancy for total central kitchen units to be tenanted out
• To house a larger Central Kitchen and Corporate HQ, new
Training Centre and R&D Centre
• Expand central procurement, preparation, processing and
Artist impression of proposed integrated facility distribution functions
located at Woodlands Avenue 12
• 25% of total GFA to be rented out to F&B operators and our
stallholders to build their own central kitchen
Commenced construction in Q4 2018 • 75% of total GFA for our own business and operations
including production of snacks and dough products and a
Expected TOP in Q1 2021 cloud kitchen
• Improve productivity and operational efficiency
Expect to commence operations in Q2 2021
22Revenue Diversification & Broadening of Supply Chain
• Completed acquisition of traditional snacks and dough
* Acquisition of Deli Asia (S) Pte. Ltd., Delisnacks Pte. products Group, Deli Asia* for an aggregate cash
Ltd., Dough Culture Pte. Ltd. and Dough Heritage Pte.
Ltd. (collectively, the “Target Group”) consideration of S$22,040,000 on 30 July 2020
• Fast-tracks Koufu’s revenue diversification and network
expansion in complementary dim sum, snacks and dough
products
• Gain access to new markets through the supply of frozen food
products to third party businesses, including supermarkets and
exports to overseas markets
• Plans to further expand the number of retail kiosks under
Dough Culture brand
• Approximately 60 franchised F&B stalls in coffee shop and
hawker centres carrying products under the Delisnacks brand
• Strengthens Koufu’s supply chain with the broadening and
consolidation of production and manufacturing capabilities
• Gain immediate access to the Target Group’s production
facilities of high quality, halal snacks and dough products.
• Enhance supply chain security with the consolidation of Deli
Asia’s manufacturing capabilities at Koufu’s new IF upon its
Licensed brand logo completion
Retail brand logo
23Improving Productivity – Using Technology As a Key Enabler
In line with the Singapore government’s emphasis on improving productivity through innovation as well as
consumer experience, we have implemented the following, and will continue to actively look for ways to extend
the below:
Mobile ordering NETS unified payment 43 smart tray return
Automated Traditional
application terminals implemented robots deployed to 16 food
coffee making machine
Started using at Le Quest implemented to most food across all food courts courts and coffee shops
and Pasir Ris West Plaza courts and coffee shops.
and will implement to a total To encourage self ordering-
of 20 outlets in the next 1-2 payment-collection,
years customers get to enjoy 10%
direct discount. Delivery 24
option have been rolled out.Investment Merits
Market Leadership: One of Singapore’s most established and largest
1 operators and managers of food courts and coffee shops with presence in
Macau
Complementary Business Segments with Diversified Revenue Stream:
2 outlet & mall management business and F&B retail business segments
3 Resilient Business and Steady Income Stream
4 Quality Stall Operators and Active Manager-Operator Partnership
Comprehensive Supply Chain Facilitates Costs Management and
5 Operational Efficiency
Holistic Approach to Improving Productivity by Using Technology as a
6 Key Enabler
7 Experienced Management Team with Proven Track Record
25THANK YOU For enquiries, please contact: Citigate Dewe Rogerson Singapore Pte Ltd Ms Dolores Phua / Ms Samantha Koh / Ms Valencia Wong Email: dolores.phua@citigatedewerogerson.com samantha.koh@citigatedewerogerson.com valencia.wong@citigatedewerogerson.com
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