investment banking i industry spotlight - 53.com · q3 2018 restaurants i q3 2018 investment...
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1
Restaurants I Industry Spotlight
Q3 2018
Restaurants I Q3 2018
Investment Banking I Industry Spotlight
2
Introduction to Fifth Third Investment Banking
SENIOR BANKERS
RECENT M&A ADVISORY TRANSACTIONS
DIVERSIFIED INDUSTRIALS
TECH-ENABLED BUSINESS SERVICES
CONSUMER & RETAIL
HEALTHCARE COKER CAPITAL
Business Services
Staffing
has been recapitalized by
Healthcare
Senior Living
has been recapitalized by
SUN CITY IMAGING
Healthcare
Radiology
has been acquired by
a portfolio company of
a division of
Industrials
Distribution
has been acquired by
a portfolio company of
Consumer & Retail
Consumer Products
has been recapitalized by
Industrials
Automation
has been acquired by
a portfolio company of
Healthcare
Behavioral Health
has been acquired by has been acquired by
Healthcare
Behavioral Health
FULL SERVICE INVESTMENT BANKING PLATFORM
Fifth Third Investment Banking provides Merger & Acquisition (M&A), capital raising and
other strategic and financial advisory services to Fifth Third’s corporate and financial
sponsor clients
SERVICES PROVIDED
Sell-Side M&A Advisory
Buy-Side M&A Advisory
Acquisition Strategy
Capital Raising
Corporate Finance Advisory
Strategic Alternatives Review
TYPICAL M&A CLIENT
EBITDA of $3 - $50+ million
Private or Financial Sponsor-Owned
Within Fifth Third Bank Footprint
Within Core Industry Verticals
CHARLIE HURT
Consumer & Retail
DAN DAVIDSON
Healthcare
ALAN MCCLURE
Business Services
JOHN SHOFFNER
Consumer & Retail
JAMIE HEIDBREDER
Healthcare
JIM PARRINO
Buy-Side Advisory
JOE CARSON
Diversified Industrials
BO HINTON
Healthcare
MICHAEL HO
Buy-Side Advisory
JEREMY EBERLEIN
Diversified Industrials
JOHN REIBOLDT
Healthcare
ROB TYNDALL
Corporate Finance
ROB BOHN
Diversified Industrials
MCNEILL WESTER
Healthcare
MELINA AUDINELLE
M&A Execution
3
Restaurants I Industry Spotlight
Q3 2018
85%
90%
95%
100%
105%
110%
115%
120%
125%
130%
Sep-17 Nov-17 Jan-18 Mar-18 May-18 Jul-18 Sep-18
Consumer & Retail Sector Dashboard
Returns by Sector (LTM)
Consumer Sentiment
Relative Performance (LTM)
Retail Gas Prices ($/gallon) Case Schiller Index % Δ Disposable Income (YoY)
Source: Bloomberg
LTM YTD
S&P 18.9% 10.7%
Cons. Staples 3.9% (2.5%)
Cons. Discretionary 30.3% 17.6%
43.1%
38.6%
37.9%
21.8%
19.5%
12.9%
5.6%
3.1%
(1.7%)
Apparel
Retail - Multiline
Retail - Specialty
Personal Products
Retail - Food
Restaurants
Beverage
Food
Household Products
60
65
70
75
80
85
90
95
100
105
Au
g-1
3
Feb
-14
Au
g-1
4
Feb
-15
Au
g-1
5
Feb
-16
Au
g-1
6
Feb
-17
Au
g-1
7
Feb
-18
Au
g-1
8
1.50
2.00
2.50
3.00
3.50
4.00
Au
g-1
3
Feb
-14
Au
g-1
4
Feb
-15
Au
g-1
5
Feb
-16
Au
g-1
6
Feb
-17
Au
g-1
7
Feb
-18
Au
g-1
8
120
130
140
150
160
170
180
190
200
210
May
-12
No
v-1
2
May
-13
No
v-1
3
May
-14
No
v-1
4
May
-15
No
v-1
5
May
-16
No
v-1
6
May
-17
No
v-1
7
May
-18
(6%)
(4%)
(2%)
0%
2%
4%
6%
8%
Jun
-12
Dec
-12
Jun
-13
Dec
-13
Jun
-14
Dec
-14
Jun
-15
Dec
-15
Jun
-16
Dec
-16
Jun
-17
Dec
-17
Jun
-18
4
Restaurants I Industry Spotlight
Q3 2018
Same Store Sales (SSS) Growth
Consumer Spending as a % of Real GDP
Personal Expenditure – Primary Consumer Segments
Restaurant Sector Insights
Source: S&P Capital IQ, Company Filings, Technomic, TDn2K
Same Store Sales (SSS) Growth Continued to Grow in Q2
Restaurants have now experienced three consecutive quarters with positive SSS growth
August was a strong month for restaurant same-store sales, which had the highest growth rate recorded since September 2015
Continued momentum in improving household income after two years of lag has led to a positive consumer outlook
Restaurant operators are still challenged by declining guest counts year-over-year, which have been offset by increasing guest checks
Keeping Restaurants Fully Staffed is Still a Key Challenge Faced by Operators Today
The US unemployment rate averaged at 3.9% over the last four months, which has led operators to scramble for hourly workers
– In addition, staffing is even more challenged in certain parts of the country as 20 states reported unemployment of 3.6% or less
In light of the problem, turnover rates for both managers and hourly employees dropped slightly during the summer period
Looking ahead, top performing brands will continue to implement best-in-class people practices and training programs to increase employee retention and guest satisfaction
“Ghost Restaurants” Set to Disrupt Traditional Eatery Industry
Increasing wages and falling foot traffic has created innovated eateries that skip the storefront and bring food straight to consumers by delivery
“Ghost restaurants” offer little to no direct contact between the customer and kitchen, rather food is ordered via a third-party food-delivery company
The model allows brands to be more agile and adapt easily to new dining trends and shifting consumer preferences
64%
65%
66%
67%
68%
69%
70%
71%
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
95%100%105%110%115%120%125%130%135%140%
Au
g-1
3
Dec
-13
Ap
r-14
Au
g-1
4
Dec
-14
Ap
r-15
Au
g-1
5
Dec
-15
Ap
r-16
Au
g-1
6
Dec
-16
Ap
r-17
Au
g-1
7
Dec
-17
Ap
r-18
Au
g-1
8
Apparel Food & Beverage
Personal Care Food Services
Jewelry & Watches
(4.0%)
(2.0%)
0.0%
2.0%
4.0%
6.0%
8.0%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2015 2016 2017 2018
Full Service Restaurants Limited Service Restaurants
5
Restaurants I Industry Spotlight
Q3 2018
10.0x
15.0x
20.0x
25.0x
30.0x
Sep-13 Sep-14 Sep-15 Sep-16 Sep-17 Sep-18
Full Service Restaurants Limited Service Restaurants S&P 500
(10.0%)
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
Sep-13 Sep-14 Sep-15 Sep-16 Sep-17 Sep-18
Full Service Restaurants Limited Service Restaurants S&P 500
Public Equity Market Valuation Trends
5-Year Forward P/E Performance [1] 5-Year Share Price Performance
Sub-Sector Indices’ Share Price Performance [1]
Source: S&P Capital IQ as of September 28th, 2018 * Each index is comprised of the companies noted on page 12 [1] Forward P/E multiples in charts do not match the table, as 5-year performance chart is market capitalization weighted
+72.5%
+46.9%
+51.7%
17.0x
19.0x
23.7x
Median
Number of Enterprise Value Median EV Multiple Median Multiple
Sector/Sub-Sector Companies $ in Millions Revenue EBITDA LTM P/E Revenue EBITDA Forward P/E
Full Service Restaurants 21 $1,494 1.1x 10.4x 21.1x 1.1x 10.1x 20.2x
Casual Dining 14 2,778 1.4x 11.5x 21.8x 1.3x 10.5x 20.6x
Fine Dining & Polished Casual 7 210 0.9x 9.3x 20.4x 0.9x 9.7x 19.7x
Limited Service Restaurants 25 1,709 2.7x 14.7x 17.8x 2.8x 14.2x 23.5x
Coffee & Specialty 3 8,796 4.2x 16.1x 17.8x 5.0x 16.7x 25.3x
Fast Casual 6 674 1.2x 16.5x NM 1.2x 15.3x 37.7x
Quick Service 12 2,744 4.8x 13.4x 20.0x 4.3x 13.1x 21.7x
Franchisees 4 494 0.7x 9.3x 14.3x 0.6x 7.4x 15.1x
S&P 500 500 NM 2.6x 13.1x 27.5x 2.4x 11.2x 17.0x
Median TEV/LTM Multiples Median TEV/Forward Multiples
6
Restaurants I Industry Spotlight
Q3 2018
13.3%
20.0%
13.6%
11.8%
13.4%
19.7%
28.1%
8.1%
27.5%
12.8%
9.6%
7.9%
1.9%
(0.2%)
1.7%
(0.0%)
(0.5%)
4.1%
25.3x
37.7x
21.7x
20.6x
19.7x
15.1x
16.7x
15.3x
13.1x
10.5x
9.7x
7.4x
Public Equity Market Valuation Trends (Cont’d)
Source: S&P Capital IQ as of September 28th, 2018 * Each index is comprised of the companies noted on page 12
EV / 2018P EBITDA 5-Year Est. EPS Growth LTM EBITDA Margin P / 2018 EPS
Fast Casual
Coffee & Specialty
Quick Service
Casual Dining
Franchisees
Fine Dining & Polished
Casual
3-Year Avg. SSS Growth
Median: 11.8x Median: 21.1x Median: 0.9% Median: 11.2% Median: 13.5%
(0.5%)
(0.0%)
(0.2%)
7
Restaurants I Industry Spotlight
Q3 2018
$0
$200
$400
$600
$800
$1,000
$1,200
'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17'18(1)
Venture Capital Buyout Growth Other Private Equity*
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
$2,000
'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18
Positive Conditions in the Broader M&A Market
We are in the 9th year of the post-Great Recession recovery
Typical expansion lasts 7 years
M&A deal flow and transaction volume have declined for 3 straight years, though still above pre-recession levels
We expect 1 – 2 more years of strong M&A market conditions
Tax reform and the de-regulatory environment provide a boost after several years of ~2% growth
The labor market is tight, but job-seekers may be tempted to return after low participation
Interest rates are stabilizing, but are expected to continue rising
Financial leverage is at cyclical highs, representing a risk
It is still a seller’s market given:
Record levels of un-invested private equity capital
Healthy corporate profits and strategic buyer balance sheets
U.S. Middle Market M&A Activity
Market Conditions Today Make the Environment a “Sellers’ Market”
M&A Market Commentary
(1) As of June 30, 2018
* = “Other Private Equity” includes balanced, co-Investment, co-Investment multi-manager, direct secondaries, and turnaround funds Source: Pitchbook, Prequin, and S&P Capital IQ
Private Equity Dry Powder by Fund Type Strategic Buyer (Corporate) Cash
Private equity firms continue to sit on a built up level of dry powder, driving a need to deploy it for acquisitions
U.S. corporate cash balances remain at record levels and are driving activity in strategic buyer M&A
Historically, M&A cycles have not extended past seven years; 2017 was the 8th year of the current cycle
2017 demonstrated signs that the buyout cycle is slowing, however, numerous positive drivers remain
– 2018 tax policy changes and cash repatriation expected to support continued M&A activity
Over $1.6 trillion ($ in billions) ($ in billions)
Over $1.0 trillion
$264
$168 $156 $166 $197
$225
$266 $270
$208
$140
$227
$283 $294 $295 $328
$304 $263
$245
$180 $191
0
1,000
2,000
3,000
4,000
5,000
6,000
$0
$50
$100
$150
$200
$250
$300
$350
$400
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 YTD9/17
YTD9/18
Implied Enterprise Value ($ in billions) Number of Transactions
8
Restaurants I Industry Spotlight
Q3 2018
Q3 M&A Dynamics Drag
Overall 3Q18 Consumer & Retail deal value and volume decreased compared to 3Q17
Companies are still feeling the effects of the tax overhaul with increased cash on hand
– Active consolidators are increasingly seeking transformational acquisitions to deploy dry powder
Investors Remain Active in Franchisee Consolidation
Spurred by franchisor’s increasing reimage demands and sales of company-operated units
Acquisitions led by large multi-concept consolidators benefit from economies of scale
– Consolidators typically have an established infrastructure that allows them to deliver a level of professional management and leverage fixed overhead costs that smaller franchisees can’t match
Franchisor Activity Driven by Large Sponsors
Apollo Global Management, JAB Holding and Roark Capital have catalyzed the franchise M&A market
Brand acquisitions lead to increasing consolidation in franchise systems
Restaurant Sector M&A Trends
U.S. Consumer & Retail M&A Announced Deal Value ($ in billions) [1,2]
U.S. Consumer & Retail M&A Announced Deal Volume
U.S. Consumer & Retail M&A Closed Deal Average EV / EBITDA Multiple [1,2]
Source: Fifth Third Securities, S&P Capital IQ [1] Middle Market transactions defined by transactions with an enterprise value below $1 billion [2] U.S. Consumer & Retail transactions include Consumer Discretionary and Consumer Staples transactions, and exclude outlier multiples
Median Middle Market: $14.2 Median > $1 Billion: $27.1
Median Middle Market: 10.2x Median > $1 Billion: 11.1x
$0
$100
$200
$300
3Q
201
0
4Q
201
0
1Q
201
1
2Q
201
1
3Q
201
1
4Q
201
1
1Q
201
2
2Q
201
2
3Q
201
2
4Q
201
2
1Q
201
3
2Q
201
3
3Q
201
3
4Q
201
3
1Q20
14
2Q20
14
3Q
201
4
4Q
201
4
1Q
201
5
2Q
201
5
3Q
201
5
4Q
201
5
1Q
201
6
2Q
201
6
3Q
201
6
4Q
201
6
1Q
201
7
2Q
201
7
3Q
201
7
4Q
201
7
1Q
201
8
2Q
201
8
3Q
201
8
Middle Market > $1 Billion
0
200
400
600
800
1,000
1,200
3Q
201
0
4Q
201
0
1Q
201
1
2Q
201
1
3Q
201
1
4Q
201
1
1Q
201
2
2Q
201
2
3Q
201
2
4Q
201
2
1Q
201
3
2Q
201
3
3Q
201
3
4Q
201
3
1Q
201
4
2Q
201
4
3Q
201
4
4Q
201
4
1Q
201
5
2Q
201
5
3Q
201
5
4Q
201
5
1Q
201
6
2Q
201
6
3Q
201
6
4Q
201
6
1Q
201
7
2Q
201
7
3Q
201
7
4Q
201
7
1Q
201
8
2Q
201
8
3Q
201
8
10.0x 10.2x9.5x
10.9x 11.1x9.8x 9.3x
10.2x11.4x
11.0x9.5x
8.2x9.8x
10.6x 11.7x 11.1x12.3x
11.2x10.0x
11.3x
0.0x
5.0x
10.0x
15.0x
2010 2011 2012 2013 2014 2015 2016 2017 3Q2017 3Q2018
Middle Market > $1 Billion
9
Restaurants I Industry Spotlight
Q3 2018 Precedent M&A Transactions: Restaurants
$ in millions
Source: Fifth Third Securities, S&P Capital IQ
Announced Enterprise LTM Financials EV/LTM Include in Comps?
Date Target Acquirer Target Sub-Sector Value (EV) Revenue EBITDA Revenue EBITDA
Sep-18 Sonic Corp. (SONC) Inspire Brands (Roark Capital Group) QSR $2,270 $434 $146 5.2x * 15.6x
Aug-18 Zoe's Kitchen (ZOES) Cava Group & Consortium of Investors Fast Casual 300 333 18 0.9x 16.7x
Aug-18 Jamba Juice (JMBA) FOCUS Brands (Roark Capital Group) Coffee & Specialty 205 78 4 2.6x 56.9x *
May-18 Pret A Manger JAB Holding Fast Casual 2,000 1,188 133 1.7x 15.0x
May-18 Barteca Restaurant Group Del Frisco's Restaurant Group (DFRG) Fine Dining 325 128 32 2.5x 10.3x
Mar-18 Bravo Brio Restaurant Group (BBRG) Spice Private Equity Casual Dining 101 505 27 0.2x * 3.7x *
Feb-18 Fogo de Chao (FOGO) Rhone Capital Casual Dining 560 311 53 1.8x 10.6x
Feb-18 Huddle House Elysium Management Casual Dining - - - - -
Dec-17 Qdoba Restaurant Corporation Apollo Global Management (APO) Fast Casual 305 457 38 0.7x 8.0x
Nov-17 Buffalo Wild Wings (BWLD) Inspire Brands (Roark Capital Group) Casual Dining 2,885 2,061 255 1.4x 11.3x
Nov-17 Au Bon Pain Corporation Panera Bread Co. (JAB Holding) Fast Casual - - - - -
Oct-17 Ruby Tuesday (RT) NRD Capital Management Casual Dining 314 1,046 37 0.3x 8.5x
Aug-17 Bruegger's Enterprises Caribou Coffee Company Coffee & Specialty - - - - -
Jun-17 Ignite Restaurant Group (IRG) Landry's Casual Dining 55 550 17 0.1x * 3.3x *
Apr-17 Back Yard Burgers Axum Capital Partners Fast Casual - - - - -
Apr-17 Panera Bread Co. (PNRA) JAB Holding Fast Casual 7,500 2,885 424 2.6x 17.7x
Mar-17 Cheddar's Scratch Kitchen Darden Restaurants (DR) Casual Dining 780 - 75 - 10.4x
Mar-17 Checkers Drive-In Restaurants Oak Hill Capital Partners QSR 525 - - - -
Feb-17 Popeyes Louisiana Kitchen (PLKI) Restaurant Brands International (QSR) QSR 1,815 267 89 6.8x * 20.5x *
Jan-17 Bob Evans Farms (BOBE) Golden Gate Capital Casual Dining 565 - - - -
Oct-16 Pacific Island Restaurants Restaurant Brands New Zealand Franchisee 105 120 19 0.9x 5.5x
Oct-16 Red Lobster Master Holdings Thai Union Group Public Company Casual Dining 1,265 2,479 144 0.5x 8.8x
Sep-16 Jimmy John's Franchise Roark Capital Group Fast Casual - - - - -
Sep-16 Wetzel's Pretzels CenterOak Partners Coffee & Specialty - - - - -
May-16 Kalaha Corp. MTY Food Group (TSX:MTY) Casual Dining 302 729 - 0.4x -
May-16 Krispy Kreme Doughnuts (KKD) JAB Holding Coffee & Specialty 1,298 519 73 2.5x 17.8x
Dec-15 Taco Bueno TPG Growth Fast Casual 185 188 33 1.0x 5.7x
Oct-15 Smashburger Jollibee Worldwide Fast Casual 99 - 7 - 13.3x
Jul-15 Cote Restaurants BC Partners Casual Dining 391 172 38 2.3x 10.4x
May-15 Frisch's Restaurants (FRS) NRD Capital Casual Dining 173 216 24 0.8x 7.3x
Mar-15 Del Taco Holdings Levy Acquistion Group (n/k/a TACO) Fast Casual 500 385 59 1.3x 8.5x
Median 0.9x 9.0x
Average 1.2x 9.9x
10
Restaurants I Industry Spotlight
Q3 2018 Middle Market Private Equity Activity
U.S. Private Equity Deal Flow ($ in billions)
U.S. Consumer & Retail Private Equity Deal Flow ($ in billions)
U.S. Consumer & Retail Private Equity Exits ($ in millions)
Source: Fifth Third Securities, PitchBook ND – No Transaction Values Disclosed *3Q18 preliminary PitchBook data
U.S. Private Equity deal flow was up on a value basis and down on a volume basis during the third quarter of 2018
A handful of large buyouts drove total deal value, including Keurig Green Mountain’s completed buyout of Dr. Pepper Snapple Group
Median deal sizes are expected to continue to increase, with larger fund sizes pushing fund managers to pursue larger deals, along with lofty purchase multiples
Deal flow is expected to be continually strong throughout 2018 driven by current dry powder levels and easy access to debt financing
Inspire Brands Continues to Consolidate the Restaurant Industry
Inspire Brands will acquire Sonic Corp. (a quick-service drive-in restaurant) for $2.3 billion
With the addition of Sonic to Inspire Brand’s portfolio of companies, the Company will operate more than 8,000 restaurants and have combined system sales in excess of $12 billion
Zoe’s Kitchen Goes Private through Cava Group’s Acquisition
Calculated move to leverage scale and a larger footprint to expand investments in people, culinary, and tech innovation
0
500
1,000
1,500
$0
$50
$100
$150
$200
1Q
12
2Q
12
3Q
12
4Q
12
1Q
13
2Q
13
3Q
13
4Q
13
1Q
14
2Q
14
3Q
14
4Q
14
1Q
15
2Q
15
3Q
15
4Q
15
1Q
16
2Q
16
3Q16
4Q
16
1Q
17
2Q
17
3Q
17
4Q
17
1Q
18
2Q
18
3Q
18*
Deal Value ($) # of Deals Closed
$67.4 $100.0 $85.0 $70.0 $123.6
$71.0 $92.5 $101.0 $72.0
$345.9 556 671755 704 817 941 862 858
232 177
2010 2011 2012 2013 2014 2015 2016 2017 3Q2017 3Q2018
Median Deal Size ($) # of Exits
$46.5 $54.4 $58.1$72.4
$62.9
$131.9
$64.3 $70.1$29.9
$49.6
556 671 755 704 817941 862 858
232177
2010 2011 2012 2013 2014 2015 2016 2017 3Q2017 3Q2018
Capital Invested ($) # of Deals Closed
11
Restaurants I Industry Spotlight
Q3 2018 U.S. Middle Market Loan Market Trends
Loan Volume: Level of Supply Regains Momentum in 2Q 2018 After Relative Stability in 1Q, B-rated Yields Widen in 2Q 2018[1]
Middle Market Covenant-Lite Volume Remains Flat in 2Q 2018 Middle Market LBO Leverage Levels Stay Consistent Around 6.0x
($ in billions)
($ in billions)
Note: This data represents the entire U.S. middle market (all industries) Note: The middle market is defined as deal size < $100 million and borrower sales < $500 million [1] Includes both non-sponsored and sponsored transactions; sufficient data not available for MM NR loans in 1Q15, 1Q17, and 1Q18 Source: Bloomberg, S&P Capital IQ LCD, and Thomson Reuters LPC
$-
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
Non-Sponsored Volume Sponsored Volume
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
MM B-rated MM NR
6.72%
6.37%
$0.0
$1.0
$2.0
$3.0
$4.0
$5.0
$6.0
$7.0
$8.0
$9.0
$10.0
MM Covenant-Lite Volume
0.0x
1.0x
2.0x
3.0x
4.0x
5.0x
6.0x
7.0x
1st Lien Debt to EBITDA Junior Debt to EBITDA
12
Restaurants I Industry Spotlight
Q3 2018 Appendix: Key Disclosures
Casual Dining
BH – Biglari Holdings Inc.
BJRI – BJ’s Restaurants, Inc.
BLMN – Bloomin’ Brands, Inc.
CBRL – Cracker Barrel Old Country Store, Inc.
CHUY – Chuy’s Holdings, Inc.
DAVE – Famous Dave’s of America Inc.
DENN - Denny’s Corp.
DIN – DineEquity, Inc.
DRI – Darden Restaurants, Inc.
EAT – Brinker International, Inc.
GTIM - Good Times Restaurants, Inc.
PLAY – Dave and Buster’s Entertainment, Inc.
RRGB – Red Robin Gourmet Burgers, Inc.
TXRH – Texas Roadhouse, Inc.
Fine Dining & Polished Casual
ARKR – Ark Restaurants Corp.
CAKE – The Cheesecake Factory Incorporated
DFRG – Del Frisco’s Restaurant Group, Inc.
JAX - J. Alexander’s Holdings, Inc.
KONA – Kona Grill Inc.
RUTH – Ruth’s Hospitality Group Inc.
STKS – One Group Hospitality, Inc.
Limited Service Restaurants Full Service Restaurants
Fast Casual
CMG – Chipotle Mexican Grill, Inc.
FRGI – Fiesta Restaurant Group, Inc.
HABT – The Habit Restaurants, Inc.
NDLS – Noodles & Company
PBPB – Potbelly Corporation
SHAK – Shake Shack Inc.
Quick Service Restaurants (QSR)
BOJA – Bojangles’, Inc.
DPZ – Domino’s Pizza, Inc.
FRSH – Papa Murphy’s Holdings, Inc.
JACK – Jack in the Box Inc.
LOCO – El Pollo Loco Holdings
MCD – McDonald’s Corp.
PZZA – Papa John’s International
QSR – Restaurant Brands International Inc.
SONC – Sonic Corp.
WEN – The Wendy’s Company
YUM – Yum! Brands, Inc.
WING – Wingstop Inc.
Coffee & Specialty
DNKN – Dunkin’ Brands Group, Inc.
NATH – Nathan’s Famous, Inc.
SBUX – Starbucks Corporation
Franchisees
ARCO - Arcos Dorados Holdings, Inc.
OTCPK:MHGU – Meritage Hospitality Group, Inc.
SAUC - Diversified Restaurant Holdings, Inc.
TAST – Carrols Restaurant Group, Inc.
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Restaurants I Industry Spotlight
Q3 2018 Notes & Definitions
S&P 500 Index- A broad index that includes American Companies. EBITDA- A company's earnings before interest, taxes, depreciation, and amortization, is an accounting measure calculated using a company's net earnings, before interest expenses, taxes, depreciation and amortization are subtracted, as a proxy for a company's current operating profitability. Dry Powder- Refers to cash reserves kept on hand to cover future obligations or to purchase assets. GDP- Gross domestic product is the market value of the goods and services produced by labor and property located in the United States Consumer Sentiment Index- The University of Michigan Consumer Sentiment Index is a consumer confidence index published monthly by the University of Michigan. The index is normalized to have a value of 100 in December 1964 National Unemployment Rate- the percentage of the total labor force that is unemployed but actively seeking employment and willing to work. Non-Farm Payroll- Nonfarm payroll employment is a compiled name for goods, construction and manufacturing companies in the US. It does not include farm workers, private household employees, non-profit organization employees, or government employees . It is an economic indicator released monthly by the United States Department of Labor as part of a comprehensive report on the state of the labor market. Housing Starts- are the number of new residential construction projects that have begun during any particular month. The Economist- offers authoritative insight and opinion on international news, politics, business, finance, science, technology and the connections between them LBO -- leveraged buyout (LBO) is the acquisition of another company using a significant amount of borrowed money to meet the cost of acquisition. The assets of the company being acquired are often used as collateral for the loans, along with the assets of the acquiring company. Industrial Production Index (IPI)- is an economic indicator published by the Federal Reserve Board of the United States that measures the real production output of manufacturing, mining, and utilities Capital Goods Orders. Covenant-lite loans- means that debt is being issued, both personally and commercially, to borrowers with less restrictions on collateral, payment terms, and level of income. IRR-Internal Rate of Return.
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