Moscow, 7 October 2010
ROSINTER RESTAURANTS HOLDINGCompany Presentation
VTB Capital
Investment Forum RUSSIA CALLING
2
Disclaimer
This presentation contains "forward-looking statements" which include all statements other than statements of historical fact.
Such forward-looking statements can often be identified by words such as "plans", "expects", "intends", "estimates", "will",
"may", "continue", "should" and similar expressions. Such forward-looking statements involve known and unknown risks,
uncertainties and other important factors beyond the Company's and/or its Management control that could cause the actual
results, performance or achievements of the Company to be materially different from future results, performance or
achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on
numerous assumptions regarding the Company's present and future business strategies and the environment in which the
Company will operate in the future. By their nature, forward-looking statements involve risks and uncertainties because they
relate to events and depend on circumstances that may or may not occur in the future. These forward-looking statements
speak only as at the date as of which they are made, and the Company and/or its Management does not intend and has no
duty or obligation to supplement, amend, update or revise any of the forward-looking statements contained herein to reflect
any change in the Company's and/or its Management expectations with regard thereto or any change in events, conditions or
circumstances on which any such statements are based. The information and opinions contained in this presentation are
provided as at the date of this presentation and are subject to change by the Company's own discretion without notice of any
kind and form.
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Agenda
1. Rosinter in brief
2. Russian restaurant market
3. Strategic focus and 1H 2010 highlights
IL Patio 40%
Planet Sushi 37%
TGIF 9%
SibirskayaCorona
4%
1-2-3 Café 2%
Others 8%
Rosinter today
Leading Casual Dining operator and franchisor in Russia, CIS and
the Baltic states with presence in 40 cities and 9 countries1
15 million guests (approx. 40,000 per day) in 2009 in our
corporate restaurants
359 restaurants1 (255 corporate and 104 franchised) + 26 Costa
Coffee outlets
Two proprietary brands IL Patio and Planet Sushi are segment
leaders and among the most recognized brands in Russia
Exclusive development rights for T.G.I. Friday’s in 19 countries,
including Russia and CIS
Restaurant count growth
Casual Dining chains in Russia²
Franchised
Corporate
Locations by brand¹
4
52 74101
129 140169
263 255 255
34
63
74 95 104
5479
114
147
174
232
337350 359
18
13
52
2002 2003 2004 2005 2006 2007 2008 2009 Aug
2010
2002-2009 CAGR
Corporate: 26%
Franchise: 74%
[1] As of 31 August 2010[2] End of year 2009
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We offer the most popular cuisines with unmatched coverage
[1] As of 31 August 2010 and not including Costa Coffee outlets
Wide geographical presence with well recognized brands:
IL Patio 4.9x next competitor in size and 7.6x in cities covered
Planet Sushi 1.5x next competitor in size and 1.6x in cities covered
T.G.I. Friday’s 2.1x next competitor in size and 2.0x in cities covered
Robust franchise operations for IL Patio and Planet Sushi:
12 cities in addition to Moscow and Saint Petersburg
28 franchise partners, 14 in Moscow with 75 stores and 14 with 29
stores in our other markets
Growing presence in airports and transportation areas:
Pulkovo airport in Saint Petersburg
Sheremetievo airport new terminal D and terminal H
Domodedovo airport
Riga airport
Kursky Railway Station
Locations by region1
Moscow 50%
Russian Regions
32%
CIS 11%
Europe 7%
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Board of Directors
Founder and Chairman of the Board
Rostislav Ordovsky-Tanaevsky Blanco
Pedro M.
Burelli
Vice
Chairman of
the Board
Non Executive
Marcus
Rhodes
Chairman of
Audit Committee
Non Executive
David
Fitzjohn
Chairman of
Compensation
Committee,
Member of Audit
Committee
Non Executive
Vitaly
Podolsky
Member of
Compensation
Committee,
Member of Audit
Committee
Non Executive
The first Russian businessman to be awarded Person of the
Year award
Won the semi-final of the Ernst & Young Entrepreneur of the
Year® contest in 2006
Rostislav was named Best Operator by Carlson Restaurants
Worldwide Inc. for the development of T.G.I. Friday's chain
Vladimir
Mekhrishvili
Member of Audit
Committee
Non Executive
Richard
Snead
Member of
Compensation
Committee
Non Executive
Strong corporate governance
Maurice
Worsfold
Advisor
Non Executive
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Agenda
1. Rosinter in brief
2. Russian restaurant market
3. Strategic focus and 1H 2010 highlights
Market with a substantial growth potential
Per Capita Annual Spending on Dining (USD), 2009
• 20 years ago:
A visit to a restaurant was their dream!
• Today:
They come to restaurants to have breakfast, lunch,
dinner!
• Tomorrow:
It will be a part of their life!
Russian Casual Dining Chains by Cuisine, 2009
Source: Business Analytica, Euromonitor8
26,6 34,8 60,0 53,1
141,7 165,2221,6
158,4
103,5138,8
178,1
151,2
2006 2007 2008 2009
Other Segments, Bln. RURCasual Dining Independent, Bln. RURCasual Dining Chain, Bln. RUR
21,3 34,1 32,5
52,2 58,565,6 54,6
42,754,6
64,058,9
17,0
2006 2007 2008 2009
Other Segment, bln. RURCasual Dining Independent, bln. RURCasual Dining Chain, bln. RUR
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We operate in a sizable and growing segment – CD Chains…
+20,0%+21,9% -10,8%
+24,7%
+35,6% -21,1%
14,6%13,0%10,3%9,8%
43,7%48,2%48,8%52,1%
58,3%61,3%59,0%61,9%
2006 2007 2008 2009
Share CD Chains, % Share CD Independent, % Share Total, %
• After 2 years of high growth, in 2009 the restaurant market volume declined 10.8% in Moscow and 21.1% in Russia
indicating significant rebound potential
• Casual dining segment has represented approximately a stable 60% of the market since 2006
• Casual-dining chains market share has been steadily growing in 2006-2009 at the expense of non-chain players
61,9% 59,4% 60,9% 59,6%
22,2%20,8%15,8%15,2%
37,4%40,1%43,5%46,7%
2006 2007 2008 2009
Share CD Chains, % Share CD Independent, % Share Total CD, %
Market Evolution - Russia
Market Evolution - Moscow
0
20
40
60
80
100
120
140
160
2009
Other Chains CD Chains Rosinter CD Brands
… and even in 2009 we managed to increase our market share
10
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2009
Other Chains CD Chains Rosinter CD Brands
19,0%
673
1057
0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
2009
Other Chains CD Chains Rosinter CD Brands
3200
1509
16,5%
74,4
53,1
19,5%
0
10
20
30
40
50
60
70
80
2009
Other Chains CD Chains Rosinter CD Brands
22,5%
32,5
36,3
Russia Chains (Outlets)
Russia Chains (RUB bln)
Moscow Chains (Outlets )
Moscow Chains (RUB bln)
Growth of
market share
+0,7%
2009/2008
Growth of
market share
+2,4%
2009/2008
Growth of
market share
+0,7%
2009/2008
Growth of
market share
+1,0%
2009/2008
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Agenda
1. Rosinter in brief
2. Russian restaurant market
3. Strategic focus and 1H 2010 highlights
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Our strategic focus: profitable growth
Increasing Franchise Component
Prioritize areas for Corporate development:
Selective corporate development in
2010 and building strong pipeline for
future expansion
Increased development pace in 2011+
Development
Consolidation of leadership in F&B operations in
transportation areas:
New Sheremetyevo airport Terminals D
Pulkovo Airport (Saint Petersburg)
TGIF in Sheremetyevo-2 Airport (Moscow)
TGIF in Riga Airport
Costa Coffee in Domodedovo Airport (Moscow)
• Russian cuisine as a future growth area
New business areas
Focus on strengthening our key brands: IL Patio, Planet Sushi and T.G.I. Friday’s
Focus on building revenue and traffic
Operational efficiency
Legal restructuring
Liquidity and capital structure
Team motivation
Current Business – Core focus areas
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In 1H 2010 we have been delivering on our strategic goals
● Operational and financial performance keeps positive trend
● Back to selective corporate development with franchise development
delivering on targets
● New equity of US$ 44.9 mln raised through SPO
● Debt and debt cost reduced
● Major steps of organizational and legal restructuring already completed
● Compensation plan with stock-based incentive plan launched
Positive same store sales dynamics
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Gross sales dynamics SSSG, %
Number of transactions dynamics SSSG, %
Same store sales increased by 6.1% in 2010 YTD on
the back of ongoing economic recovery
Traffic is the key driver of same store sales growth with
6.8% increase in 2010 YTD
Average transaction remains nearly flat as the company
did not make major revisions to it’s prices since mid-
2008
Despite the healthy growth in 2010 there is still
significant room for growth in comparison with 2008 pre-
crisis year
Network expansion and strong development pipeline
As a part of profitable growth strategy the
Company has successfully started corporate
development program following the completion of
SPO
In 2010 we have opened 21 restaurant (8
corporate and 13 franchised) YTD in high-priority
markets
We have 8 closings of non-performing corporate
restaurants so far, including 2 non-core brands in
Moscow, 3 restaurants in regions and 3 outlets in
Europe
As of today we have 12 corporate and 20
franchised restaurants under construction with a
target openings this year and early next year.
We commit to a strict focus on 3 core brands (IL
Patio, Planet Sushi and TGIF) in our portfolio
Restaurant Network Expansion
31.12.09 Openings Closings 31.08.10
Corporate 255 8 8 255
Franchised 95 13 4 104
Total 350 21 12 359
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1H 2010 Performance summary
Net Revenue, Rub mln EBITDA, Rub mln
Net Profit, Rub mln Operating Cash Flow, Rub mln
3 773
88
4 012
4 439
122
4 692
Revenue of Restaurants and Canteens
Revenue from Franchise Consolidated Revenue
1H 2009 1H 2010
+17.7%+16.9%
+38.9%
216
453
295
-27
Operating CF before change in working capital Net Cash from Operations
1H 2009 1H 2010
36.7%
358 8.9%
491
10.5%
EBITDA EBITDA margin
1H 2009 1H 2010
+37.2%
-101
-2.5%
111
2.4%
Net Profit Net Profit margin
1H 2009 1H 2010
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1H 2010 Income Statement
(RUB thousand) 1H 2010 1H 2009
Revenue 4 691 904 100,0% 4 011 944 100,0%
Cost of sales (3 568 300) -76,1% (3 070 874) -76,5%
Gross profit 1 123 604 23,9% 941 070 23,5%
SG&A (741 251) -15,8% (678 655) -16,9%
Start-up expenses for new restaurants (24 628) -0,5% (21 038) -0,5%
Other operating expenses, net (69 171) -1,5% (71 845) -1,8%
Profit from operating activities before impairment 288 554 6,2% 169 532 4,2%
Reversal/(Losses) from impairment of operating assets 4 363 0,1% (16 840) -0,4%
Profit from operating activities after impairment 292 917 6,2% 152 692 3,8%
Financial expenses, net (105 472) -2,2% (135 063) -3,4%
Foreign exchange losses, net (9 296) -0,2% (32 025) -0,8%
Share of joint venture's and associates' losses (21 275) -0,5% (11 388) -0,3%
Profit/(Loss) before income tax 156 874 3,3% (25 784) -0,6%
Income tax expenses (45 749) -1,0% (75 144) -1,9%
Net profit/(loss) for the year 111 125 2,4% (100 928) -2,5%
EBITDA 490 851 10,5% 357 797 8,9%
Consolidated revenue increased
by 16.9% following positive
dynamics in SSSG and growing
contribution of restaurants opened
since 2H 2008
Moderate increase in Gross profit
margin was driven by savings in
rent expenses partially invested in
food and beverage cost
SG&A expenses decreased by
1.1% as percentage of revenue
driven by savings in payroll and
rent expenses, partially offset by
higher marketing expenses
Decrease in debt level and interest
rates resulted in reduction of
financial expenses by 1.2% as
percentage of revenue
More stable US$/RUB rate led to
decrease in foreign exchange
losses by 0.6% of revenue
In first half 2010 the effective tax
rate reached 29.2% to which
contributed positively our ongoing
legal restructuring
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1H 2010 EBITDA margin walk-forward
0,9%
1,6%
0,5%
0,3%
0,6%
0,1%
0,3%
0,7%
8,9%
10,5%
7,0%
7,5%
8,0%
8,5%
9,0%
9,5%
10,0%
10,5%
11,0%
1H 2009A F&B Payroll Rent Other COS HQ Marketing Impairment Other OpEx 1H 2010A
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1H 2010 Cash Flows
Operating cash flow before changes in
working capital increased by 36.7% in
1H 2010 as compared to 1H 2009
Reduction of accounts payable allowed
to rebalance working capital in 1H 2010
Net cash used in investing activities
increased 21.7% driven mainly by the
number of openings in each period and
an investment in acquiring shares in
subsidiaries in amount of RUB 33.1 mln
in 1H 2010
As at June 30 2010, we had received
RUB 776.1 mln as partial proceeds from
SPO for the shares already subscribed
and fully paid
In 1H 2010 we used RUB 125.3 mln for
purchase of treasury shares as part of
Share Appreciation Rights Program
(SARP) for key employees
(RUB thousand) 1H 2010 1H 2009
Operating Activities (27 275) 452 927
Operating cash flow before movements in working capital 294 780 215 604
Changes in working capital (322 055) 237 323
Investing Activities (136 975) (112 536)
Net cash used in investing activities (136 975) (112 536)
Financing Activities 262 782 (346 892)
Net cash from/(used in) financing activities 264 430 (343 250)
Effect of exchange rate on cash and cash equivalents (1 648) (3 642)
Net increase/(decrease) in cash and cash equivalents 98 532 (6 501)
Cash and cash equivalents, bop 113 243 174 334
Cash and cash equivalents, eop 211 775 167 833
53.1% 55.2%45.9%
46.9%
44.8%
54.1%
31 December 2009 30 June 2010 31 August 2010
Long-term debt Short-term debt
US$ 72.7MRUB 2,200M
US$ 59.5MRUB 1,855M
US$ 46.2MRUB 1,417M
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Debt evolution
[1] Management accounts as of August 31, 2010
Debt Portfolio Reduction1
Average Interest Rates
In 1H 2010 Gross debt decreased by 15.7% to
RUB 1,855 mln, leading to a Net debt/EBITDA
of 1.89x as at 30 June 2010 in comparison with
2.97x as at 31 December 2009
In order to secure access to long-term financing
our Company has registered on MICEX a bond
issue for a nominal amount of 1,500 million
rubles
We have committed to a long-term corporate
credit rating regular process, which led recently
to a “B-“ rating initiation by Standard&Poor’s
with stable outlook
-15.7%
-23.6%
16,5%
10,4% 10,2%
31 December 2009 30 June 2010 31 August 2010
Please contact us for further queries
Investor Relations Team
Ilya Nemirovskiy
Head of Investor Relations
Alexey Teslo-Danilov
Investor Relations
E-mail: [email protected]
Tel.: + 7 495 788 44 88
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