Papa John's Report

8/3/2019 Papa John's Report

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Papa John's

Depreciation and Amortization Schedule Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Jun-11 Dec-11 Dec-12

Depreciable PPE, Gross 386 408 388 412 426 375 463 500

Intangible Assets,net - - - - - - - -

Total Depreciable & Intangible Assets 386 408 388 412 426 375 463 500

Depreciation and Amortization 27 32 33 33 32 33 36 39

Depr & Amort Percent Depreciable & Intang Assets 7.0% 7.8% 8.5% 8.0% 7.5% 8.8% 7.8% 7.8%

Forecast


5/9

Papa John's (NASQ: PZZA)

Working Capital Schedule Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Jun-11 Dec-11 Dec-12

Receivables 23 23 24 22 25 26

Inventories, net 27 19 17 16 17 16

Deferred income taxes 6 7 7 8 10 8

Other current assets 7 6 5 4 3 4

Total Operating Current Assets 63 55 53 50 55 54

Accounts payable 29 31 29 21 32 30

Accrued liabilities 57 56 54 54 53 50

Other current liabilities 15 11 - - - -

Total current liabilities 101 98 83 75 85 80

Net Working Capital (38) (43) (30) (25) (30) (26) (37) (38)Revenues 1,002 1,064 1,132 1,106 1,126 1,153 1,208 1,239

NWC Percent Revenue -3.79% -4.04% -2.65% -2.26% -2.66% -2.29% -3.1% -3.1%

( NWC (5) 13 5 (5) 4 (11) (1)

Forecast


6/9


Free Cash Flow Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Jun-11 Dec-11 Dec-12

Revenues 1,002 1,064 1,132 1,106 1,126 1,153 1,208 1,239

Revenue Growth 6.19% 6.39% -2.30% 1.81% 2.40% 7.3% 7.5%

Margins and Expense

Gross Margin 28.5% 37.7% 19.7% 21.6% 23.3% 23.0%

Selling, general & administrative expenses 17.6% 26.2% 10.7% 11.7% 13.1% 12.9%

Otheroperating expenses 1.2% 6.5% 3.4% 1.4% 2.4% 2.6%

OperatingMargin 9.8% 5.0% 5.6% 8.6% 7.7% 7.5% 7.3% 7.3%

Free Cash Flow to Firm

Operating Income (EBIT) 98 53 63 95 87 86 89 91

Effective Tax Rate 34.4% 28.3% 35.1% 32.2% 32.9% 32.9% 32.6% 32.6%

NOPAT 64 38 41 64 58 58 60 61-NWC 5 (13) (5) 5 (4) 11 1

-Capital Expenditures (39) (31) (29) (34) (31) (27) (37) (38)

Capex % Rev 3.9% 2.9% 2.6% 3.1% 2.8% 2.3% 3.0% 3.0%

+Depreciation & Amortization Expense 27 32 33 33 32 33 36 39

Free Cash Flow to Firm 44 32 58 64 60 70 63

Terminal EV Dec 2011 1,149Enterprise Value 1,123

Cash and equivalents 20

Total Firm Value 1,143

Short-term debt -

Long-term debt 48

Pensions and other benefits -

Minorityinterest -Other long-term liabilities 12

Total Debt and Liabilities 60

Equity Value 1,083

Sharesoutstanding 26

Stock Value 41.65

Current Stock Price 33.81

Forecast


7/9


Residual Income Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Jun-11 Dec-11 Dec-12

Revenues 1,002 1,064 1,132 1,106 1,126 1,153 1,208 1,239

Revenue Growth 6.19% 6.39% -2.30% 1.81% 2.40% 7.3% 7.5%

Net Margin 6.3% 3.1% 3.3% 5.2% 4.6% 4.4% 4.5% 4.5%

Net Income 63 33 37 57 52 51 54 55

Dividends Paid - - - - - - - -

Dividend Payout Rate 0% 0% 0% 0% 0% 0% 0% 0%

Addition to Retained Earnings 63 33 37 57 52 51 54 55

Stockholders Equity 146 127 130 177 199 224 253 309

Equity Capital Charge 13 11 11 16 18 20 22

Residual Income 20 26 46 36 33 34 33

Terminal Value Dec 2011 572

PV Residual Income 557

Stockholders Equity 224

Equity Value 781

Shares Outstanding 26

Stock Value 30.05


Forecast


8/9

Papa John's (NASQ: PZZA) Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Jun-11 Avg

Profitability

ROA 8.7% 9.2% 14.8% 13.1% 12.3% 11.6%

ROE 22.6% 29.1% 43.8% 29.4% 25.6% 30.1%

ROIC 15.3% 15.1% 24.7% 21.1% 19.4% 19.1%

Gross Margin 28.5% 37.7% 19.7% 21.6% 23.3% 23.0% 25.0%

Operating Margin 9.8% 4.9% 5.6% 8.6% 7.7% 7.5% 7.3%

Net Margin 6.3% 3.1% 3.3% 5.2% 4.6% 4.4% 4.1%

Asset Utilization

Cash % Revenue 1.0% 0.9% 1.8% 3.3% 2.9% 2.0%

DSO 7.89 7.58 7.59 7.62 8.07 7.75

Inventory TO 28.83 50.50 52.55 52.36 54.48 47.74

Total Asset TO 2.72 2.87 2.83 2.77 2.89 2.82

Leverage

LT Debt / Total Capital 39.8% 49.6% 47.5% 35.9% 33.2% 17.6% 36.8%

LT Debt / Equity 66.4% 105.5% 95.4% 55.9% 49.7% 21.4% 65.6%

Times Interest Earned 32.67 4.00 7.88 15.83 17.40 17.20 12.46

Assets / Equity 2.86 3.07 2.55 2.16 1.88 2.51

LiquidityCurrent 0.83 0.69 0.75 0.98 1.23 0.97 0.92

Quick 0.62 0.48 0.52 0.74 0.97 0.72 0.68

DuPont

Margin 6.3% 3.1% 3.3% 5.2% 4.6% 4.4% 4.1%

Turnover - 2.72 2.87 2.83 2.77 2.89 2.82

Leverage - 2.86 3.07 2.55 2.16 1.88 2.51ROE 24.2% 28.8% 37.1% 27.7% 24.1% 28.4%

M t V C it St t J 2011


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Short-term debt -

Long-term debt 48

Total Debt 48 5%


Shares Outstanding 26Market Capitalization 879 95%

Total Capital 927 100%

Yield of 10-year Treasury Note 2%

Market Risk Premium 8%Equity Beta 0.85

Cost of Equity 8.8%

Cost of Debt 5.1%

Tax Rate 33%

WACC 8.52%

Terminal Growth 3%

Mar et Va ue Capita Structure as o June 2011

Capital Costs

Documents

Papa John's Report