May 2015 Contents Introduction 02 Highlights 04 Financial - - PowerPoint PPT Presentation

Interim results presentation for the six months ended 31 March 2015

May 2015

Introduction 02 Highlights 04 Financial Performance 06 Operational Progress 11 Current trading and outlook 16

Contents

INTRODUCTION

Senior management team

HIGHLY EXPERIENCED SENIOR TEAM WHICH HAS SUCCESSFULLY GROWN THE BUSINESS FROM 8 STORES IN 2006 TO OVER 150 TODAY

3  Founder and Chairman of Risk

Capital Partners

 Very significant multi-site

consumer experience as Chairman, grew Pizza Express from 12 to 250 restaurants and a market capitalisation of £500m, between 1992 and 1999

• ther current and previous

leisure investments include Strada, Giraffe and Gail’s

 Joined as CEO in 2006  Has overseen expansion from

8 to over 150 stores

 Highly successful

entrepreneurial background founder of Cash A Cheque group, later sold to the Money Shop has invested in businesses across a number of industries leisure and retail examples include the Greyhound Racing Association

 Joined as Finance Director in

2006

 Has worked with Paul since

1998

 Has advised many companies

• ver the past 15 years in FD

and consultancy roles

 Previous experience includes

roles at two AIM-listed companies

 Chartered Accountant and Tax

Accountant, formerly with EY

Luke Johnson Executive Chairman Paul May Chief Executive Chris Marsh Finance Director

HIGHLIGHTS

4

5

Highlights

• Continued strong growth in revenue, up 22.2% to £43.7m (2014: £35.7m)
• EBITDA, up 23.1% to £8.7m (2014: £7.1m)
• Pre tax profits up 45.0% to £7.0m (2014: £4.8m)
• Net increase in cash of £4.4m with period end cash balances of £3.0m.
• 10 new stores opened in current financial year funded from free cash flow
• Including second motorway service station
• Further expansion in Scotland
• Website re-launched
• Includes “create-a-cake” feature
• Currently trading from 156 sites

FINANCIALS

Financial overview

DELIVERING STRONG GROWTH AND HIGH LEVELS OF CASH CONVERSION WITH THE ABILITY TO SELF-FINANCE NEW STORE ROLLOUT

7

Revenue (£m) Group EBITDA (£m) Cash flow from operations (£m)

7.1 8.7 19.8% 19.9% 6.0% 9.0% 12.0% 15.0% 18.0% 21.0%

• 3

6 9 12 15 18 HY2014A HY2015A EBITDA EBITDA Margin

5.8 9.2 81% 106% 20.0% 40.0% 60.0% 80.0% 100.0% 120.0%

• 2

4 6 8 10 12 HY2014A HY2015A Cash from operations Cash conversion

25.2 28.9 10.6 14.8 35.7 43.7

• 10

20 30 40 50 HY2014A HY2015A Patisserie Valerie Other

Group income statement

6 months ended 6 months ended 31 March 31 March 2015 2014 £’000 £’000 Total Total % Change Continuing inuing oper erations ions Revenue nue 43,68 683 35,74 747 +22.2% Cost of sales (9,940) (8,094) Gros

• ss prof
• fit

it 33,74 743 27,65 653 +22.0% Administrative expenses (26,754) (22,314) EBITDA 8,713 7,078 +23.1% Operating ing prof

• fit

it 6,989 89 5,339 39 +30.9% Finance expense (34) (541) Prof

• fit

it before

• re inco

come me tax 6,955 55 4,798 98 +45.0% Income tax expense (1,460) (1,115) Prof

• fit

it after er tax and total l compr mpreh ehens ensiv ive e inco come me for the year attrib ibutabl utable e to equit ity y holde lders 5,495 95 3,683 83 +49.2% Earnings per share Basic earnings per share (pence) 5.50 4.79 +14.7% Diluted earnings per share (pence) 5.46 4.56 +19.7%

Commen enta tary

• Revenue up £7.9m or 22.2% to £43.7m.
• Gross margin maintained at 77.2% - dilution of

GP from Philpotts acquisition offset by improvements in rest of group.

• EBITDA margin of 20.0% maintained on

enlarged estate.

• Profit before tax up £1.9m or 45.0% to £7.0m
• Tax rate of 21% applied in current period.
• Strong diluted EPS growth of 19.7% to 5.46

pence per share.

8

9

Group Cash Flow

6 months ended 31 March 6 months ended 31 March 2015 2014 £’000 £’000 Cash h flows ws from operating ing activ ivit itie ies Adjusted profit before income tax 6,955 4,798 Adjusted by: Depreciation 1,724 1,473 Net finance charges in the consolidated statement of comprehensive income 34 541 Other non-cash charges 123

• Changes in working capital

404 (1,317) Cash generated from operations 9,240 5,495 Interest paid (34) (276) Income tax paid (1,207) (1,396) Net cash generat ated from operating ing activ ivit itie ies 7,999 4,823 Net cash used in investing ng activ ivit itie ies (3,602) (7,639) Net cash generat ated from financ inancing ing activ ivit ities

• 5,147

Net increas ease in cash h and cas ash h equivale alent nts 4,397 1,331 Cash and cash equivalents at the beginning of the year (1,419) (1,124) Cash h and cash h equivalents alents at the end of the year

2,978

207 207

Commen enta tary

• Cash flow generated from operations remains

strong with £9.2m of cash inflows generated in the period.

• Group remains debt free with no external

borrowings.

• Cash outflow used in investing activities

represents capital expenditure predominately

• n new stores.
• Group cash flows sufficient to fund ongoing roll-
• ut programme.

10

Balance sheet

Commen enta tary

• Strong balance sheet with no long-term debt.
• Working capital movement expected to be

neutral to year end.

• Balance sheet and cash flow supporting

targeted maiden dividend in 2015.

At 31 March At 30 September 2015 2014 £’000 £’000 ASSETS Non-cur urrent nt assets Intangible assets 17,872 17,897 Property, plant and equipment 30,699 28,794 48,571 46,691 Current ent assets Trade and other receivables 9,964 10,552 Inventories 4,118 3,927 Cash and cash equivalents 2,978 484 17,060 14,963 Total l assets ets 65,631 61,654 EQUITY AND LIABIL BILITIES Total l equity 60,474 54,856 Non-cur urrent nt liabilit litie ies Borrowings

• Deferred tax

1,746 1,746 1,746 1,746 Current ent liab abilit ilities Trade and other payables 3,411 3,149 Borrowings

• 1,903

Corporation tax

• 3,411

5,052 Total l liab abil ilit itie ies 5,157 6,798 Total l equity and liab abilit ilities 65,631 61,654

OPERATIONAL PROGRESS

11

Store Roll-out

• Ten new stores opened in the period

across several different formats.

• Strong pipeline of target sites and

confident to achieve year end target.

• One store (Swindon) opened since the

interim date and two due to be opened this month (Hammersmith & Clapham)

• Targeting first new Baker & Spice store

in second half of the year

12

Site Service vice Type pe St Store Type Glasgow - Silverburn Counter service High street Wimbledon Full service High street High Wycombe Full service Shopping centre Hounslow NEXT Counter High street Worcester Full service High street Tunbridge Wells Full service High street Romford Counter service High street Glasgow Royal Exchange Brasserie High street Baldock Counter service Service station York Coppergate Full service Shopping centre

New Developments

• New

w produc

• duct lines

es tested ed in the perio iod d with h encoura

• uraging

ing resu sults ts includ ludin ing gluten en free, ee, season asonal al and d festiv tive range.

• Seaso

asonal al menu trial ialled led with th impr mproveme ement t in sales les from

• m new

w Winter er menu. . Summe mer menu now in plac ace.

• After

ernoo

• on tea

a introduc

• duced

ed in 7 stores with th stron

• ng sales

es and d ver ery positiv tive custome

• mer feedb

edbac ack. . Now w launched hed in 99 stores. es.

13

• Websit

bsite e re-launched in January and now includes virtual tours and a “create-a- cake” feature. Web sales up 20%.

• “Create-a-cake” is now best selling cake and improving online sales.
• Bran

and d aware renes ess con

• nstan

tantly tly improvi ving with th Cake Club b membe bership hip up 41% to 200,00 ,000 memb mber ers s and Facebo book follo lowers s up 60% to 35,000 follo lowers. s.

• Third party

ty relati lations

• nships

ips developed loped includ ludin ing Amaz azon

• n Local

al Busines iness s and d Barcla lays s Private e Clien ients. s.

Patisserie Holdings remains an attractive equity story

ATTRACTIVE MARKET BACKDROP

• UK eating out market estimated to be worth £70bn+
• Patisserie Valerie is favourably positioned across the two

fastest growing sub-sectors; Coffee Shops and Branded Casual Dining

• Coffee shop market forecast to grow by 5% per annum to

2020

• Market growth underpinned by long term socio-economic

changes

VERY STRONG PLATFORM ESTABLISHED

• Critical mass already achieved

trading from 156 stores EBITDA margins of 20% All stores now deliver positive contributions; 60% generate >£100k EBITDA

• Scalable, hub and spoke model perfected

further economies of scale available

• Highly experienced management team with proven sector track

record

• Vertically integrated model with fully owned logistics

A PROVEN GROWTH STORY

• Focused on rollout of 20 new sites per annum
• Historic growth has been strong

number of stores increased from 8 to 156 in 8 years 2014FY EBITDA £15.3m1 2015HY EBITDA £8.7m

• 250+ potential new sites identified by independent research

formulaic new store model, generating payback of 23 months

• vs. target 24 months

Capable of funding new stores through internally generated cash flow

THE PATISSERIE VALERIE CONCEPT

• A leading UK branded café and casual dining group
• All day trading format and affordable proposition
• Five proven brands
• High quality products, almost all made in-house from scratch
• Very wide customer demographic and appeal
• Proven across different store formats and geographies

14 Note 1: Excluding £0.9m of costs associated with admission to AIM and acquisition of Philpotts

Existing estate growth

RANGE OF TANGIBLE, IDENTIFIED, FUTURE GROWTH INITIATIVES ACROSS THE EXISTING ESTATE

15

Development of online delivery channels, broadening routes to market and leveraging production facilities

1

Further development of third party relationships Investment in digital marketing Continued cost control and purchasing synergies Ongoing investment in enhancing the existing estate Full year effect of recently opened stores

2 3 4 5 6 7

New product development

8

Full integration of recent acquisitions

CURRENT TRADING AND OUTLOOK

16

Current Trading & Outlook

17

• Strong first 6 months performance
• On track to open 20 new stores in full year
• Strong pipeline of new sites.
• All new store openings trading well
• Different store formats performing well
• Anticipate maiden dividend at year end

“Confident of another year of strong growth”

18