DP Poland plc
Financial Update
October 2021
Legal Disclaimer
This trading update presentation (the "Presentation") has been prepared by DP Poland PLC (the "Company") in respect of its group (the "Group") and contains inside information as stipulated under the UK version of the Market Abuse Regulation (EU No. 596/2014) as it forms part of UK law by virtue of the European Union (Withdrawal) Act 2018 ("UK MAR").
The financial information referenced in this Presentation has not been audited and does not contain sufficient detail to allow a full understanding of the results of the Group. The information in this Presentation is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to local law or regulation. It is the responsibility of any person publishing or communicating the contents of this document or communication, or any part thereof, to ensure compliance with all applicable legal and regulatory requirements. Nothing in this Presentation should be construed as either an offer or invitation to sell or any offering of securities or any invitation or inducement to any person to underwrite, subscribe for or otherwise acquire securities in the Company in any jurisdiction in which such offer or solicitation would be unlawful, or an invitation or inducement to engage in investment activity under section 21 of the Financial Services and Markets Act 2000 (as amended).
This Presentation includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward- looking terminology, including the terms "believes", "estimates", "plans", "anticipates", "targets", "aims", "continues", "expects", "intends", "hopes", "may", "will", "would", "could" or "should" or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include matters that are not facts. They may appear in a number of places throughout this Presentation and include statements regarding the Directors' intentions, beliefs or current expectations concerning, amongst other things, the Group's results of operations, financial condition, liquidity, prospects, growth, strategies and the industries in which the Group operates. By their very nature, forward-looking statements involve risk and uncertainty because they relate to events, and depend on circumstances, that may or may not occur in the future. A number of factors could cause actual results and developments to differ materially from those expressed or implied by such forward-looking statements, including, without limitation: conditions in the public markets; the market position of the Group; the earnings, financial position, cash flows, return on capital and operating margins of the Group; the anticipated investments and capital expenditures of the Group; changing business or other market conditions; changes in political or tax regimes, exchange rates and clients; changes in governmental policies, and general economic conditions. These and other factors could adversely affect the outcome and financial effects of the plans and events described herein. Forward-looking statements contained in this Presentation, based on past trends or activities, should not be taken as a representation that such trends or activities will continue in the future. Subject to any requirement under the Aim Rules and UK MAR, the Company does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Readers should therefore not place undue reliance on forward-looking statements, which speak only as of the date of this Presentation.
No statement in this Presentation is intended to constitute a profit forecast or profit estimate for any period, nor should any statement be interpreted to mean that earnings or earnings per share for the current or future financial years would necessarily match or exceed the historical published earnings per share of the Company.
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REVIEW OF HY 2021
OPERATIONAL INTEGRATION COMPLETE
Action point | Status | ||
Restaurant conversion | ✓ | signages replaced and makelines purchased and installed | |
✓ fresh dough implemented across the network | |||
- | walk-in chiller rooms upgraded and refrigeration units purchased and installed | ||
✓ stainless steel trays purchased and storage shelves replaced | |||
✓ | all staff trained | ||
Delivery savings | ✓ | New delivery areas designed | |
✓ Economies of scale in management of scooter running cost achieved | |||
✓ Contracts with aggregators renegotiated | |||
Unlocking top line | ✓ | Combined menu built on bestsellers, new items well accepted by customers | |
growth opportunities | ✓ | Increased prices | |
✓ Increase in minimum order value for free delivery | |||
Commissaries | ✓ | Dough production redirected to own commissaries (unit economics improved) | |
✓ CAPEX supporting higher production volumes completed | |||
✓ Logistics outsourced to third party supplier, exceeding expected synergies | |||
Procurement savings | ✓ | Fully refocused supply chain | |
✓ All ingredients and suppliers passed acceptance process with DPI | |||
HQ integration | ✓ | Teams and office integrated as planned | |
Marketing synergies | ✓ | New e-commerce platform launched in March 2021 | |
✓ | New mobile application launched in Jul-Sep 2021 | ||
✓ | Marketing initiatives aligned | ||
Franchise buy-outs | ✓ | Buy-outs completed: 17 stores converted into corporate stores (7 in second half of 2020 and 10 in 2021 YTD) | |
IT integration | ✓ | Fully plugged into DPI's systems allowing for comprehensive analysis of the business and enforcing best practices | |
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UNAUDITED PRO FORMA CONSOLIDATED STATEMENT
6 MONTHS TO 30 JUNE 2021
Unaudited | UnauditedPro-forma unaudited | |||
6 months to | 6 months to | 6 months to | ||
30.06.21 | 30.06.20 | 30.06.20 | ||
£ | £ | £ | ||
Revenue | 13,813,115 | 6,694,745 | 13,686,709 | |
Direct costs | (11,585,559) | (5,040,613) | (11,149,714) | |
Selling, general and administrative expenses - | excluding: | |||
store pre-opening expenses, depreciation, amortisation and share based payments | (2,241,691) | (1,079,240) | (2,348,169) | |
GROUP EBITDA - excluding non-cash items, non-recurring items and store pre-opening expenses | (14,135) | 574,892 | 188,826 | |
Store pre-opening expenses | - | - | - | |
Other non-cash and non-recurring items | 449,185 | 138,708 | 88,335 | |
Finance income | 475,515 | 1,980 | 53,071 | |
Finance costs | (646,244) | (536,933) | (782,162) | |
Foreign exchange gains / (losses) | 288,104 | (2,037) | (41,805) | |
Depreciation, amortisation and impairment | (2,420,718) | (1,345,684) | (2,353,088) | |
Share based payments | (35,541) | - | (80,899) | |
Loss before taxation | (1,903,834) | (1,169,073) | (2,927,721) | |
Taxation | - | - | - | |
Loss for the period | (1,903,834) | (1,169,073) | (2,927,721) |
Basis for preparation
H1 2021 unaudited figures include the business of DP Poland plc as well as Dominium SA.
Comparative unaudited data for H1 2020 is for Dominium S.A. only as accounting acquirer.
Pro-forma data for H1 2020 is unaudited consolidated numbers for both Dominium and DP Poland.
Step change in scale
The acquisition of Dominium has roughly doubled the business of DP Poland by revenue and store number
Benefits of conversion yet to be realised
Conversion completed only on 8 July 2021 - delayed by IT integration with DPI's IT systems
Continued impact of COVID-19
Migration from big cities during lockdowns
Online learning in schools and universities
Home office
No state support for mid-sized businesses in 2021
No EBITDA breakthrough yet
Synergies not yet fully reflected
Substantial one-off integration costs and operating inefficiencies incurred over Jan-Aug 2021
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DP Poland plc published this content on 25 October 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 October 2021 07:23:08 UTC.