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Barbeque-Nation Hospitality Limited Earnings Conference Call Summary
Date and Context • Date of Call: August 7, 2024 • Financial Results: Q1 FY2025 • Key Executives: Managing Director Kayum Dhanani, CEO Rahul Agrawal
Financial Performance • Revenue: Declined by 5.6% to INR 306 crores • Same-Store Sales Growth (SSSG): Gradual improvement over four months • Gross Margins: Improved by 400 basis points • Operating Margins: Increased by 220 basis points • New Openings: Four new restaurants opened; plans for 100 more by FY2027
Guest Experience and Cash Flow • Focus Areas: Enhancing guest experience and maintaining strong cash flows • Investment Plans: Commitment to restaurant upgrades and culinary experiences
Performance Trends • June and July Trends: Improvement noted after a challenging April and May • Dine-In Segment: Stable core demand despite broader casual dining sector challenges
Expansion Plans • New Store Targets: 100 new stores over three years • 50 Barbeque India locations • 40 from premium brands (Toscano and Salt) • 12 from Barbeque International
Margin Expansion and Pricing • Drivers of Margin Expansion: 400 basis point improvement attributed to accounting changes and promotional pricing • Projected Gross Margin: Stable at 68% for FY25
Capital Expenditure • Cost per New Restaurant: Approximately INR 3 crores • Payback Period: Around three years
SSSG Performance • Dine-In vs. Delivery: Proportional impact across both channels • Seasonality: Q1 typically performs better due to summer holidays
Market Challenges • Rising Vegetable Prices: Minimal impact on gross margins; meat prices more significant • Competitive Landscape: Trend towards premium dining experiences and potential consolidation among smaller players
Future Outlook • Mature Store Margins: Expected to exceed 20% as SSSG improves • Store Count by Year-End: Estimated range of 240 to 245 stores, up from 219 • Capex for Premium Brands: Approximately INR 3 crores per store
Conclusion • Forward-Looking Statements: Acknowledgment of potential risks affecting the business.
Barbeque Nation Earnings Conference Call Summary (Q4 and FY2024)
Key Executives Present • Managing Director: Kayum Dhanani • CEO: Rahul Agrawal • CFO: Amit Betala
Financial Performance Highlights • Q4 Revenue Growth: 6% year-on-year • Full Year Revenue Growth: 1.7% • Annualized Revenue per Store: • New restaurant portfolio: INR 4.5 crores • Consolidated: INR 5.5 crores • Operating Margins: • New restaurants: 7.8% • Consolidated: 14.4% • Gross Margins: Improved by 300 basis points year-on-year
Growth Plans • New Store Openings: • 100 new stores planned over three years • 25-30 expected in FY'25 • International Business and Toscano: Strong growth with plans for a merger
Delivery and Dine-in Performance • Delivery Contribution: Expected to be 15-16% of total sales • Dine-in Profitability: Remains the more profitable segment
Capital Expenditure and Store Management • Total Capex for FY'25: Approximately INR 100 crores • Store Relocations: 8 relocated, 13 new added • Restaurant Closures: Plans to close around 5 restaurants in FY'25
Market and Pricing Strategy • Inflation Outlook: Stable meat prices, slight increase in chicken, downward trend in prawns and fish • Pricing Strategy: No pan-India price hikes; focus on customer value
Future Outlook • Same-Store Sales Growth (SSSG): Projected 2-3% for FY'25, with optimism for 5% from FY'26 onwards • Gross Margin Expectations: Sustained between 68-69%, with adjusted margins potentially reaching 12-13% by FY'25-26
Cautionary Note • Forward-looking statements may differ due to risks and uncertainties, including market trends and economic conditions.
Barbeque-Nation Q3 FY2024 Earnings Conference Call Summary
Financial Performance • Revenue: Rs. 331 crores • 1% year-on-year growth • 10% sequential increase • Dine-in Revenue: Flat at Rs. 283 crores • Delivery Revenue: Grew by 5% • EBITDA Margins: 20.5%, a six-quarter high
Restaurant Operations • Total Restaurants: 216 • Opened 2 new locations • Consolidated 6 Salt restaurants • Closed 4 restaurants • Expansion Plans: • 5 restaurants under construction • 10 more in the pipeline • Aim to add 25-30 new restaurants in FY25
Margin Improvements • Gross Margins: Improved by 120 basis points year-over-year • Restaurant Operating Margin: Increased from 4.3% in Q1 FY24 to 10.6% in Q3 FY24 • Cost Initiatives: • Reductions in food and packaging costs • Employee cost rationalization • Future Outlook: Optimistic about returning to historical margin levels of 13-14%
Strategic Plans for FY25 • New Store Openings: 25-30 new stores planned • Half for Barbeque Nation, half for Toscano and Salt • International Expansion: 2-3 international store openings planned
Market and Demand Insights • Demand Environment: • Competitive landscape with increased supply • Cautious optimism about same-store sales growth (SSSG) • Customer Loyalty: Decline attributed to subdued consumer demand and increased competition
Operational Focus • Guest Engagement: Efforts to enhance guest experiences and optimize operations • CAPEX: Projected at Rs. 80-90 crores for new store openings, supported by internal cash generation
Conclusion • Overall Sentiment: Management remains cautiously optimistic about future performance despite challenges in the market.
Barbeque-Nation Hospitality Limited Earnings Conference Call Summary
Overview • Date of Call: November 6, 2023 • Financial Results: Second quarter and first half of FY2024 • Key Participants: Managing Director, CEO, CFO
Financial Performance • H1 FY24 Revenues: Flat at Rs. 626 crores • Q2 Performance: • Revenue decline: 2.8% • Dine-in revenues: Down 5% • Delivery revenues: Up 11% • Restaurant Operations: • Opened: 4 new restaurants • Closed: 4 restaurants • Total locations: 212
Strategic Focus • Emphasis on: • Capacity utilization • Network rationalization • Notable Developments: • Launch of 'Fiesta' restaurant • Acquisition of 53% stake in Blue Planet Foods ('Salt' brand)
EBITDA and Margins • Q2 FY2024 EBITDA Margin: 5.9% on revenues of Rs. 17.7 crore • Stability attributed to: • Improved gross margins • Cost control measures • Strategic rationalization of restaurant portfolio
Growth Insights • Toscano Brand: Over 20% revenue increase year-on-year • International Business: Grew by over 25% • Delivery Segment: Expanded due to 'Salt' acquisition • Management remains cautiously optimistic about future growth and margin improvement.
Key Discussions • Gross Margins: Improved due to increased realizations and reduced input costs; stabilization expected around 66%. • Dine-in vs. Delivery: Dine-in declining due to vegetarian days; delivery benefiting from a lower base. • Same-Store Sales Growth (SSSG): Negative overall; Toscano and international formats showed slight positive growth. • Overhead Costs: Expected to grow by 3-4% in FY25 without new expansions. • New Formats: Strategic diversification to reduce reliance on dine-in business.
Future Outlook • Focus on: • Maximizing revenue from existing locations • Enhancing operational efficiency and profitability • Confidence in growth potential of newer brands, with expectations of over 20% growth. • No immediate plans to reduce reliance on the Barbeque Nation brand, which remains a key revenue contributor.
Barbeque-Nation Q1 FY24 Earnings Conference Call Summary
Date and Submission • Date of Call: August 7, 2023 • Submission to BSE and NSE: August 14, 2023
Financial Performance Highlights • Revenue: Rs. 324 crores • 15.6% sequential increase • 2.9% year-on-year increase • Volume Growth: 20% in dine-in and delivery segments • Restaurant Operations: • Opened 4 new restaurants • Closed 8 restaurants (total: 212)
Management Focus • Enhancing guest experience • Driving same-store sales growth • Exploring brand portfolio expansion
Demand and Growth Insights • Optimism for demand revival, especially in smaller towns • Dine-in volumes grew 20% sequentially • Dum Safar initiative generated Rs. 6.5 crores in revenue
Margin Performance • Margins: Declined from 19% to around 14% • Due to increased promotions and lower price realizations • Phased out aggressive promotions since July • Expected positive impact on margins from restaurant closures starting Q3
Promotional Strategies • Offers vary by market, aimed at value-conscious customers • Weekday sales growth: 28% compared to previous quarter • Long-term same-store sales growth target: 5-7%
Expansion Plans • New Stores: 20 planned for the financial year • Focus on metro and tier 1 cities • Capex per outlet: Rs. 3.0 to Rs. 3.1 crores
Commissary and Staffing Strategy • No new commissaries; reliance on standardized products • Staffing levels consistent despite delivery business growth
Customer Retention and Loyalty • App-based loyalty program contributes ~30% of revenue • 12% to 14% of customers earn loyalty points • 50% of customers are repeat patrons
Seasonal Trends and Cash Flow • Strong growth across all segments • Typical decline of 4% to 5% from Q1 to Q2, but stable current trends
Conclusion • Forward-looking statements and potential risks discussed • Management remains optimistic about recovery and growth strategies.
Barbeque-Nation Q4 FY23 Earnings Conference Call Summary
Company Overview • Date of Call: May 29, 2023 • Submitted Transcript: June 3, 2023 • Key Management: Kayum Dhanani (Managing Director), Rahul Agrawal (CEO)
Financial Performance • Annual Revenue: Surpassed INR 1,000 crores • Revenue Growth: 43.4% increase • EBITDA Growth: 49% rise • Dine-in Segment: Grew by 61.6% • Delivery Revenues: Declined by 16.5%
Future Plans • New Restaurants: 20 planned openings in FY24 • Focus Areas: Enhancing guest experience and optimizing operations • Growth Strategy: Diversified business model including Toscano brand and international operations
Growth Pillars • Key Contributors: Toscano brand, international business, delivery services (25% of total revenues) • Same-Store Sales Growth (SSSG): Currently around 3.5% • Target Markets: Focus on metro areas, with fewer openings in Tier 2 and Tier 3 cities
Management Insights • Competition: Acknowledged localized competition but emphasized high customer satisfaction • Margin Targets: Long-term expectation of 13-14% adjusted EBITDA margins • Expansion Strategy: Cautious approach in Tier 2 and Tier 3 towns, focusing on metro and Tier 1 locations
Challenges and Responses • Demand Fluctuations: Weaker demand compared to FY23, with a significant gap between Q4 sales and full-year average • Margin Pressures: Attributed to new store openings and lower sales per store • Promotional Activities: Implementing pricing rationalization and special offers to boost sales
Positive Trends • Recent Improvements: Month-on-month growth of 15-16% in April and May • Cost Management: 8% reduction in costs despite increased store numbers • Delivery Segment: Promising growth, particularly with the Dum Safar brand
Outlook • Future Projections: Optimistic about recovery and margin improvements if demand continues to rise • Capital Expenditure: Projected at INR 80 crores for new store openings and renovations • Focus: Shift from aggressive expansion to enhancing margins in existing locations and stabilizing new stores
Barbeque-Nation Q3 FY2023 Earnings Conference Call Summary
Date and Participants • Date of Call: February 7, 2023 • Management Present: • Kayum Dhanani (Managing Director) • Rahul Agrawal (CEO)
Financial Performance Highlights • New Openings: 10 new restaurants opened, totaling 212 (3 closures). • Revenue Growth: 14.5% year-on-year, driven by an 18% increase in dine-in business. • Same-Store Sales Growth (SSSG): Declined by 1.2%. • Margins: • Gross margins improved slightly. • EBITDA margins fell to 19.2% from 24.5% the previous year.
Restaurant Performance • New Restaurant Margins: 5.3% with average annualized revenue of Rs. 4.5 Crores. • Matured Portfolio: Expected to achieve Rs. 6.9 Crores in annualized revenue and 20.2% margins. • Digital Revenue: 27.6% of revenues from digital assets, with 5.4 million app downloads.
Expansion Plans • Future Openings: Plans to open 40 new restaurants annually, depending on market conditions. • Overheads: Increased by 20%, expected to remain at Rs. 88 Crores quarterly.
Margin Sensitivity and Concerns • EBITDA Margins: Currently at 10.5%, with potential for 13% in FY2024 if SSSG grows by 5%. • Impact of New Stores: New stores initially lower margins but improve over time.
Market Performance Insights • Store Closures: Primarily in tier two and three markets due to underperformance. • Expansion Strategy: Focus on metro and tier one markets for 70% of future growth.
Financial Overview • Operating Cash Flows: Rs. 30 Crores for the quarter, Rs. 105 Crores for nine months. • Capex: Rs. 110 Crores mainly for new restaurants and specialized projects.
Demand Challenges • Current Demand: Weekday corporate business improved slightly; weekend family dining remains below pre-COVID levels. • Promotional Campaigns: Implemented to stimulate demand amidst inflationary pressures.
Regional Performance • Metro vs. Tier Markets: Metro areas performing well; tier two and three regions struggling, particularly the East compared to the West and South.