Wendy's Co - FORM 8-K - EX-99.1 - EARNINGS CONFERENCE CALL SLIDE PRESENTATION MATERIALS

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8-K - CURRENT REPORT - Wendy's Co	d533109d8k.htm

2013 Oldemark LLC

First Quarter 2013

Earnings Conference Call

May 8, 2013

Exhibit 99.1

2013 Oldemark LLC

JOHN BARKER

Chief Communications

Officer

Today’s Agenda

CEO Overview

Emil Brolick

Financial Update

Steve Hare

Q&A

Forward-Looking Statements and Non-GAAP Financial Measures

This presentation, and certain information that management may discuss in connection with this presentation,

contains certain statements that are not historical facts, including information concerning possible or assumed

future results of our operations. Those statements constitute “forward-looking statements” within the meaning of

the Private Securities Litigation Reform Act of 1995 (The “Reform Act”). For all forward-looking statements, we claim

the protection of the safe harbor for forward-looking statements contained in the Reform Act.

Many important factors could affect our future results and could cause those results to differ materially from those

expressed in or implied by our forward-looking statements. Such factors, all of which are difficult or impossible to

predict accurately, and many of which are beyond our control, include but are not limited to those identified under

the caption “Forward-Looking Statements” in our news release issued on May 8, 2013 and in the “Special Note

Regarding Forward-Looking Statements and Projections” and “Risk Factors” sections of our most recent Form 10-K /

Form 10-Qs.

In addition, this presentation and certain information management may discuss in connection with this presentation

reference non-GAAP financial measures, such as adjusted earnings before interest, taxes, depreciation and

amortization, or adjusted EBITDA, and adjusted earnings per share. Adjusted EBITDA and adjusted earnings per

share exclude certain expenses, net of certain benefits. Reconciliations of non-GAAP financial measures to the most

directly comparable GAAP financial measures are provided in the Appendix to this presentation, and are included in

our news release issued on May 8, 2013 and posted on www.aboutwendys.com.

2013 Oldemark LLC

EMIL BROLICK

President & CEO

Adjusted EBITDA*

$77.3 mil

vs.

$63.9 mil

Adjusted EPS*

$0.03

vs.

$0.01

Company-Operated

1.0%

vs. 0.8%

SSS

Q1 2013 Highlights

2013

2012

*See reconciliation of Adjusted EBITDA and Adjusted EPS in the appendix.

2013 Oldemark LLC

Adjusted EBITDA

$350 to $360 million

Reaffirm

Adjusted EPS

$0.20 to $0.22

Raising

2013 OUTLOOK:

Expect 2012

Initiatives to

Contribute to

Solid 2013

Right Price Right Size Menu Development

Image Activation Beginning to Support SSS

and Accelerate Re-imaging

Opened 48 Tier I Reimages

Completed Tier II & III

Design Work

Reduction in Number of Restaurants

Serving Breakfast

Negative Impact on SSS

Positive Impact on EBITDA

Ongoing Cost Reduction

G&A Management & Efficiencies

Reduction in Beverage Costs

Packaging Optimization

RFPs with Purchasing Co-op

HIGH

LOW

FUNCTIONAL

EMOTIONAL

BRAND VISION…

COMPETITOR

NEW QSRs

PRICE

New QSR Quality at QSR Price

PRODUCT

Play a different game …

Superior

perceived quality, competitive price

PEOPLE

5-Star Performers

PERFORMANCE

Keeping the brand promise

PROMOTION

Strategically driven, tactically brilliant

PLACE

The complete brand experience

Enabling Profitable Growth

THE RECIPE TO WIN

NEW QSR QUALITY AT QSR PRICE

PLAYING A

DIFFERENT

GAME

PREMIUM

PRICE / VALUE

BUILD BIG BRAND, DRIVE TRAFFIC

2013 Tier II

Columbus, OH

2013 Tier III

Salt Lake City

Tier III

Interior

Core Organic

Growth

Strategies

Shareholder

Value-Enhancing

Initiatives

Todd Penegor to Become

Chief Financial Officer

September 1, 2013

CFO Steve Hare to Retire

from Wendy’s

2013 Oldemark LLC

STEVE HARE

Chief Financial Officer

Wendy’s Q1 2013 Highlights

Company

Restaurant Margin +100bps

Q1 2013 12.8%

Q1 2012 11.8%

Company

Restaurant Margin +100bps

Q1 2013 12.8%

Q1 2012 11.8%

February

March (local)

January

Q1 2013 North America

Same-Store Sales

1-Year

2-Year

Company-Operated 1.0% 1.8%

Franchise 0.6% 1.3%

Q1 2013 Financial Summary

2013

2012

Change

Sales

530.7

519.9

10.8

2.1%

Franchise revenues

73.0

73.3

(0.3)

-0.4%

Total revenues

603.7

593.2

10.5

1.8%

Adjusted EBITDA*

77.3

63.9

13.4

21.0%

Adjusted EPS*

0.03

0.01

0.02

200.0%

($ in millions except per share amounts)

(Unaudited)

*See reconciliation of Adjusted EBITDA and Adjusted EPS in the appendix.

Adjusted Income and Special Items

*See reconciliation of Adjusted Income and Adjusted EPS in the appendix.

(In Thousands Except Per Share Amounts)

(Unaudited)

Per share

Adjusted income and adjusted earnings per share*

13,101

0.03

3,347

0.01

(Less) plus:

Depreciation of assets that will be replaced as part of the Image Activation initiative

(9,068)

(0.02)

Facilities relocation costs and other transactions

(1,900)

(0.00)

(3,808)

(0.01)

Impairment of long-lived assets

(2,783)

(0.01)

Gain on sale of investment, net

17,978

0.05

Total adjustments

(10,968)

(0.02)

11,387

0.03

Net income

2,133

0.01

14,734

0.04

Net income attributable to noncontrolling interests

(2,384)

(0.01)

Net income and earnings per share attributable to The Wendy's Company

2,133

0.01

12,350

0.03

First Quarter

2013

2012

2013 Image Activation Depreciation

Assets replaced are depreciated from the beginning of the year

until closure for construction

2013

# of reopenings

100

# of restaurants

depreciated

100

% of IA depreciation

adjustment

~65%

~25%

~10%

$20M to

$25M

Q1 2013 Cash Flow Highlights

($ in millions)

(unaudited)

Cash flow from operations

32.6

Capital expenditures

40.0

Beginning cash balance

453.4

Change in cash

(24.7)

Ending cash balance

428.7

Q1 2013

Selected Balance Sheet Highlights

($ in millions)

(unaudited)

Cash

429

Senior Debt

1,419

Capital Leases and Other Debt

Total Debt

1,456

TTM Adjusted EBITDA*

347

Total Debt / TTM Adjusted EBITDA*

4.2x

Net Debt / TTM Adjusted EBITDA*

3.0x

March 31, 2013

*See reconciliation of Adjusted EBITDA in the appendix.

•Refinancing of $350M of the $1,119M senior secured Term Loan B into

a new senior secured Term Loan A

•Repricing of the remaining Term Loan B balance of approximately

$769M by reducing the interest rate margin and floor

•Extension of the maturity of the $200M revolving credit facility

by one year

2013 Debt Refinancing Expected to Save

~$20 million in Annualized Interest Expense

$50M

Annualized Net Interest Expense Savings

vs. 2011 from 2012 and 2013 Refinancings

Image Activation Results*

Year 1 average sales

lift exceeded 25%

Sales sustaining at

~20% vs. pre-remodel

volumes

2011

10 concept reimages

Average sales lift

exceeding 25%

since re-opening

Sales sustaining at

~18% vs. pre-remodel

volumes

2012

48 Tier I reimages

* Results exclude 2 non-comparable restaurants in 2011 and 5 non-comparable restaurants in 2012.

Image Activation Designs Expanding

Franchise Restaurant

San Antonio, TX

International

Restaurants

714 Third Ave

June 2013

New Build

650 Broadway

June 2013

Reimage

85 Nassau St

July 2013

Reimage

Elmsford

August 2013

Reimage

Openings

Image Activation Multi-Year Growth Plan

100

200

100

200

300

2011

2012

2013

2014

2015

Fr. New

Co. New

Fr. Reimage

Co. Reimage

Cumulative

IA Restaurants

301

766

1,331

Image Activation Progress by Year-End 2015:

•50% of Company restaurants

•1 out of 5 restaurants in the Wendy’s System

Note: New Company restaurants were Image Activation building design beginning in 2012; 2 of 45 new Franchise restaurants were

Image Activation in 2012. Estimates based on Company’s current outlook.

Strong Free Cash Flow & Balance Sheet

Accelerating Investment in

Image Activation:

Expect $440 to $500 million 2013 to 2015*

RETURN CAPITAL TO SHAREHOLDERS

* Estimates based on

Company’s current outlook.

$100 million share repurchase program

authorized through 12/29/13

Current dividend yield of 2.7%

(based on share price as of 5/3/13)

CORE GROWTH PRIORITY

2013 and Long-Term Earnings Outlook

Adjusted EBITDA:

$350 to $360 million,

5% to 8% increase vs. 2012

Adjusted EPS:

$0.20 to $0.22,

18% to 29% increase vs.

2012

Average annual

Adjusted EBITDA and

Adjusted EPS

growth rates in

high-single-digit to low-

double-digit range

2013

Long-Term

Estimates based on Company’s current outlook.

2013 Oldemark LLC

JOHN BARKER

Chief Communications

Officer

2013 Events

May 23:

Annual Stockholder Meeting

June:

Begin Image Activation Market Visits with Investors

Aug. 7:

Second Quarter Earnings Release & Conference Call

Investor Relations Calendar

Q&A

Appendix

Reconciliation of Adjusted EBITDA to Net Income

Attributable to The Wendy's Company

(In Thousands)

(Unaudited)

2013

2012

Adjusted EBITDA

77,299

63,881

Less:

Depreciation and amortization

(51,797)

(32,311)

Impairment of long-lived assets

(4,511)

Facilities relocation costs and other transactions

(3,038)

(6,143)

Operating profit

22,464

20,916

Interest expense

(20,964)

(28,235)

Other expense, net and investment income, net

(2,271)

28,931

(Loss) income before income taxes and noncontrolling interests

(771)

21,612

Benefit from (provision for) income taxes

2,904

(6,878)

Net income

2,133

14,734

Net income attributable to noncontrolling interests

(2,384)

Net income attributable to The Wendy's Company

2,133

12,350

First Quarter

Reconciliation of Adjusted Income and Adjusted Earnings Per Share to

Net Income and Earnings Per Share Attributable to The Wendy's Company

(In Thousands Except Per Share Amounts)

(Unaudited)

Per share

Adjusted income and adjusted earnings per share

13,101

0.03

3,347

0.01

(Less) plus:

Depreciation of assets that will be replaced as part of the Image Activation initiative

(9,068)

(0.02)

Facilities relocation costs and other transactions

(1,900)

(0.00)

(3,808)

(0.01)

Impairment of long-lived assets

(2,783)

(0.01)

Gain on sale of investment, net

17,978

0.05

Total adjustments

(10,968)

(0.02)

11,387

0.03

Net income

2,133

0.01

14,734

0.04

Net income attributable to noncontrolling interests

(2,384)

(0.01)

Net income and earnings per share attributable to The Wendy's Company

2,133

0.01

12,350

0.03

First Quarter

2013

2012

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