Company Presentation January 2013

Transcription

1 Company Presentation January 2013

2 Cautionary Statements Forward-Looking Statements This presentation may include forward-looking statements. These statements reflect the current views of the Company s senior management with respect to future events and financial performance. These statements include forward-looking statements with respect to the Company s business and industry in general. Statements that include the words expect, intend, plan, believe, project, forecast, estimate, may, should, anticipate and similar statements of a future or forward-looking nature identify forwardlooking statements for purposes of the federal securities laws or otherwise. Forward-looking statements address matters that involve risks and uncertainties. Accordingly, there are or will be important factors that could cause the Company s actual results to differ materially from those indicated in these statements. The statements made herein speak only as of the date of this presentation. Non-GAAP Financial Measures This presentation contains certain non-gaap financial measures. A non-gaap financial measure is defined as a numerical measure of a company s financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with GAAP in the statements of income, balance sheets or statements of cash flow of the company. The Company has provided a reconciliation of non-gaap financial measures to the most directly comparable financial measure in the Appendix to this presentation. The non-gaap financial measures used within this presentation are Adjusted EBITDA and Restaurant-Level EBITDA. The Company s guidance for 2012 EPS growth is also based on non-gaap measures. These measures are presented because management uses this information to monitor and evaluate financial results and trends and believes this information to also be useful for investors. For additional information about our non-gaap financial measures, see our earnings releases and filings with the Securities and Exchange Commission. 2

3 Senior Management Presenters Steve Hislop President and Chief Executive Officer Jon Howie Chief Financial Officer 3

4 If you ve seen one Chuy s, you ve seen one Chuy s! Chuy s is Tex Mex Unchained! Leave the cookie cutters to the other guys. Each Chuy s has genuine character: a noisy, sprawling Tex Mex hacienda full of feel-good drinks and home-cooked foods. 4

5 Chuy s Highlights Fresh, Authentic Mexican and Tex Mex Inspired Cuisine Considerable Dining Value with Broad Customer Appeal Upbeat Atmosphere Coupled with Irreverent Brand Helps Differentiate Concept Flexible Business Model with Industry Leading Unit Economics Deep Rooted and Inspiring Company Culture Highly Experienced Management Team 5

6 Industry Leading Historical and Targeted Results Unit CAGR (1) 40.0% Historical Growth Metrics 40.0% Revenue CAGR 40.0% Adj. EBITDA CAGR 2011 Average Unit Volume (2) $6.0 Operating Metrics LTM RL EBITDA Margin 25.0% Targeted Cashon-Cash Return 45.0% Targeted Growth Metrics 2012 Unit Growth (1) 30.0% 2012 EPS Growth (3) 50.0% 30.0% Long-Term EPS Growth 37.2% 37.2% 35.5% $ % 25.8% ~42.0%* ~25.0% ~40.0% 14.1% 34.2% $ % 35.0% 20.4% 0.0% 13.4% 11.9% 5.2% 5.2% 2.2% 0.0% 20.6% 20.6% 14.7% 8.8% 8.5% 0.0% 25.7% 20.7% 16.4% 6.9% Source: Company financials, equity research estimates and Bloomberg. Note: RL = Restaurant Level. (1) Represents Company guidance and system-wide units except for IRG for which Company guidance was unavailable and is based on equity research. (2) Dollars in millions. (3) BBRG, TXRH and CHUY based on Company guidance. IRG, BWLD and BJRI based on equity research. BJRI and CHUY adjusted to normalize for 52 week operating years in 2011 and 2012, respectively. * CHUY, BBRG and BWLD have a 53 operating week year in BJRI had a 53 week operating year in $0.0 $5.0 $3.9 $3.4 $3.0 $ % 18.6% 18.3% 18.2% 16.8% 25.0% 29.7% 28.1% 25.7% 25.4% Actual 0.0% 13.9% 10.8% 9.9% 8.1% 6.8% 0.0% 34.0% 17.6%* 15.0%* 7.3% 3.8%* 0.0% 21.0% 20.1% 15.5% 14.6% 6

7 Industry Leading Average Unit Volumes Track record of high average unit volumes LTM comparable restaurants generated average unit volumes of $5.0 million Highest volume restaurant generated $7.9 million Serve approximately 400,000 customers per location per year, on average Sales per square foot of approximately $625 Strong average LTM restaurant-level EBITDA margins at comparable restaurants of 21.2% Average Unit Volume ($Millions) $10.0 Full-Service Mexican Concepts Select Best-in-Class Concepts $8.0 $6.0 $4.0 $6.3 $5.0 $3.5 $3.5 $3.2 $2.6 $5.8 $4.8 $4.6 $3.9 $2.0 $0.0 7 Source: Company data, public filings and 2012 Technomic Top 500 report for competitors.

8 Proven Concept with 30-Year History 31 new restaurants opened and 7 new states entered during the last 56 months Pre-2008 Restaurants Restaurants Opened Since Founded in Austin, TX by Mike Young and John Zapp 2006 Acquired by Goode Partners in November Steve Hislop joined as President and CEO Total Restaurants at End of Period 2008 Onset of growth initiatives 2009 Opened first location outside Texas (Nashville, TN) 2010 Opened restaurants in AL, KY and TN 2011 Opened restaurants in IN, KY, TN and GA 2012 Opened restaurants in OK, TN, OH, FL and KY 8

9 Fresh, Authentic Mexican Cuisine Offer authentic Mexican food using only the freshest ingredients Recipes and cooking techniques originated from friends and family of our founders, who are from Mexico, New Mexico and Texas Commitment to made-from-scratch, freshly prepared cooking Generous portions support value priced offering Customizable food offering is core to the Chuy s concept 9

10 Note: Prices above represent menu prices in Texas and Oklahoma, which may vary from prices in other states. We Take One Thing Seriously: Our Food! Tex Mex Ranchero Hatch Green Chile Green Chile Tomatillo Deluxe Tomatillo Creamy Jalapeno Homemade Sauces Chicka-Chicka Boom-Boom Freshly-roasted, hand-pulled chicken & cheese with Boom- Boom sauce, made with cheese, roasted New Mexican green chiles, tomatillos, green onions, cilantro and lime juice. Served with choice of Mexican or green chile rice & refried or charro beans Price: $9.49 Big As Yo Face Burritos A homemade, 12 flour tortilla stuffed with refried beans, cheese and choice of beef or chicken. Served with choice of sauce & choice of Mexican or green chile rice Price: $ $9.29 Texas Martini Served shaken, not stirred, this south-of-the-border martini features tequila, Patrón Citrónge, fresh lime juice and a jalapeño-stuffed olive Three drinks for the price of one Price: $

11 Exceptional Dining Value Significant value proposition to customers Only 3 out of 49 menu items priced over $10.00 Average check of $13.06 $30.0 Average Check $25.0 $21.50 $19.10 $20.0 $15.0 $12.44 $13.00 $13.06 $14.89 $19.33 $23.07 $25.13 $20.00 $16.25 $10.0 $5.0 $0.0 Source: Company filings as of Fiscal Year end Refers to LTM 9/23/12 data for Chuy s. 11

12 Chipotle vs. Chuy s Fast Casual Dining 1,350 Total Restaurants in Over 40 U.S. States ~13% 2012E Unit Growth ~$10.00 Average Check (~1.0% Alcohol Mix) Sample Offerings: Full Service Dining 39 Total Restaurants in Eight U.S. States ~26% 2012 Unit Growth $13.06 Average Check (19.4% Alcohol Mix) Sample Offerings: Entrée: Chicken Burrito $6.25 Chips & Salsa: $ Entrée: Big As Yo Face Burrito Oven-Roasted Chicken $8.99 Includes a side of Rice & Beans Chips & Salsa: Unlimited & Complimentary Total: $8.00 Total: $ Note: Chipotle and Chuy s sample offerings represent menu items and prices from restaurants in the same geographic region. Source: Company data, public filings and equity research.

13 Upbeat Atmosphere and Appealing, Irreverent Brand 13

14 Growth Opportunities 14

15 New Restaurant Development Strategy Pursue development in established and adjacent markets Flexible real estate strategy Conversions and new prototype construction Proven ability to open successful new restaurants 6 restaurants in restaurants in restaurants in to 9 restaurants to be opened in 2013 Five-year target to open 59 to 64 new restaurants Pre Hub Locations 15

16 New Unit Growth Comparison 40% 37.2% CAGR Projected % Casual Dining Fast Casual 25.8% 24% 16% 8% 13.4% 9.9% 13.9% 11.9% 7.4% 10.8% 8.1% 6.8% 5.2% 5.2% 13.7% 13.0% 7.3% 5.2% 0% Net Restaurant Openings Source: Company data, public filings and equity research. Note: Total restaurants as of most recent public filings Total Restaurants ,350 1,625 16

17 Industry Leading New Unit Economics Target a cash-on-cash return beginning in the third operating year of 40.0% and a sales to investment ratio of 2:1 On average, returns on units opened since 2001 have exceeded target returns in the second year of operations Targeted New Unit Economics New Unit Economics ($000s) LTM Comparable Restaurants Target (7) Actual (6) Average Unit Volume $5,000 $4,200 (1) $4,200 $4,000 $3,900 $5,000 $2,733 Restaurant-Level EBITDA 1, % Margin 21.2% 16.7% 17.5% 20.0% 19.5% 18.6% Average Cash Investment $1,700 (2) $2,100 $2,000 $2,364 $2,775 $3,800 $2,000 Customers Served Per Year (3) ~400, , , , , ,000 Sales to Investment Ratio 2.0x (4) 2.1x 1.7x 1.4x 1.3x 1.4x Cash-on-Cash Return 40.0% (5) 35.0% 29.7% 28.1% 25.7% 25.4% Source: Public filings and equity research estimates. Note: Cash-on-Cash Return defined as Restaurant-Level EBITDA divided by Net Cash Investment excluding Pre-Opening Expense. (1) Represents targeted Year 1 Average Unit Volume. (2) Represents Average Cash Investment based on historical new restaurant openings. (3) Estimated as target Average Unit Volume divided by FY 2011 Average Check. (4) Represents targeted Year 1 Sales: Investment Ratio. (5) Represents targeted Year 3 Cash-on-Cash Return. (6) Based on actual data per most recent filing, except for Average Cash Investment. (7) BBRG unit economics based on average of targeted Bravo and Brio Unit Economics. 17

18 Financial Summary 18

19 Demonstrated Revenue and Unit Growth Revenue ($Millions) $150.0 $120.0 $90.0 $60.0 $42.1 $51.9 $69.4 $94.9 $130.6 $97.3 $126.0 $30.0 $ YTD 3Q 2011 YTD 3Q 2012 Total Restaurants YTD 3Q 2011 YTD 3Q Note: YTD 3Q 2012 and 3Q 2011 represent the thirty-nine weeks ended September 23, 2012 and September 25, 2011, respectively.

20 Strong Comparable Restaurant Sales Momentum 8.0% 7.1% Chuy's KNAPP-TRACK 4.0% 0.0% 2.9% 0.7% 3.1% 1.5% 2.0% 0.9% (4.0%) (1.1%) (3.1%) (2.0%) (0.6%) (8.0%) Cumulative Outperformance of KNAPP-TRACK Number of Comparable Restaurants (5.6%) YTD 3Q % 14.2% 17.8% 19.1% 20.7% % Note: KNAPP-TRACK is a monthly sales and guest count tracking service for the full service restaurant market in the United States. Note: YTD 3Q 2012 represent the thirty-nine weeks ended September 23, Source: KNAPP-TRACK and Company data.

21 Consistent Cost of Sales Management 50.0% Cost of Sales (% of Revenue) 40.0% 30.0% 28.5% 27.8% 26.2% 27.0% 27.7% 27.9% 26.8% 20.0% 10.0% 0.0% YTD 3Q 2011 YTD 3Q Note: YTD 3Q 2012 and 3Q 2011 represent the thirty-nine weeks ended September 23, 2012 and September 25, 2011, respectively.

22 Increasing Restaurant-Level and Adjusted EBITDA Restaurant-Level EBITDA ($Millions) Restaurant-Level EBITDA $30.0 % Margin $25.0 $25.6 $24.0 $18.0 $14.7 $18.3 $19.1 $12.0 $8.6 $10.9 $6.0 $ % 20.9% 21.2% 19.3% 19.2% 19.6% 20.3% YTD 3Q 2011 YTD 3Q 2012 Total Restaurants: % 60.0% 45.0% 30.0% 15.0% 0.0% Adjusted EBITDA ($Millions) $20.0 $18.9 $19.3 $16.0 $12.0 $8.0 $4.0 $0.0 $5.7 $7.3 $10.3 $ YTD 3Q 2011 YTD 3Q 2012 Note: Restaurant-Level EBITDA represents net income plus the sum of general and administrative expenses, the advisory agreement termination fee, the settlement with our former director, restaurant pre-opening costs, depreciation and amortization, interest and taxes. Note: Adjusted EBITDA represents net income before interest, taxes, depreciation and amortization plus the sum of restaurant pre-opening costs, deferred compensation the advisory agreement termination fee, the settlement with our former director, management fees and expenses and special one-time bonus payment. Note: YTD 3Q 2012 and 3Q 2011 represent the thirty-nine weeks ended September 23, 2012 and September 25, 2011, respectively. $

23 Strong 4 th Quarter Financial Performance Comparable restaurant sales growth of 5.2% for the 13 week period ended December 23, % comparable restaurant sales growth excluding the impact of an extra 1.5 operating days in 2012 Opened one restaurant in Florence, Kentucky Revenue ($Millions) $46.7 $33.3 $43.4 4Q Q 2012E Fourth quarter 2012 revenue attributed to the extra week totaled approximately $3.3 million. (1) Year-over-year comparable growth represents revenue growth excluding the extra week in the fourth quarter of (2) Represents preliminary results that remain subject to completion of normal quarter-end accounting procedures and adjustments and are subject to change. (2) 23

24 Key Performance Targets ~20% New Unit and Revenue Growth 1.0% 1.5% Same Store Sales Growth G&A and Operating Leverage Long-Term EPS Growth ~25% 24

25 Appendix 25

26 Adjusted EBITDA Reconciliation Adjusted EBITDA Reconciliation FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 YTD 2011 YTD 2012 LTM Q Net Income $ (0.9) $ 0.2 $ 2.7 $ 3.3 $ 3.5 $ 3.1 $ 2.9 $ 3.2 Income Tax Provision (benefit) - (0.1) Interest Expense Depreciation and Amortization EBITDA $ 2.5 $ 3.6 $ 8.4 $ 11.0 $ 13.9 $ 10.7 $ 14.3 $ 17.5 Deferred Compensation (0.1) Management Fees & Expenses Advisory Agreement Termination Settlement with Former Director Restaurant Pre-opening Special one-time bonus payment Adjusted EBITDA $ 5.7 $ 7.3 $ 10.3 $ 13.4 $ 18.9 $ 14.8 $ 19.3 $

27 Restaurant-Level EBITDA Reconciliation Restaurant-Level EBITDA Reconciliation FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 YTD 2011 YTD 2012 LTM Q Net Income $ (0.9) $ 0.2 $ 2.7 $ 3.3 $ 3.5 $ 3.1 $ 2.9 $ 3.2 Income Tax Provision (benefit) - (0.1) Interest Expense General and Administrative Advisory Agreement Termination Settlement with Former Director Restaurant Pre-opening Depreciation and Amortization Restaurant-Level EBITDA $ 8.6 $ 10.9 $ 14.7 $ 18.3 $ 25.0 $ 19.1 $ 25.6 $