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RETAIL FOOD GROUP LIMITED (RFG)

RETAIL FOOD GROUP LIMITED (RFG)

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General Information
Company Name: Retail Food Group Limited
Stock Code: RFG
Website: www.rfg.com.au
GICS Sub-Industry: Restaurants
Market Cap ($M): 272
Equiv. Shares (M): 108

Current Price Data+
Current Price Open High Low Last Close Volume Price Movement
 $ 2.510 $ 2.550 $ 2.560 $ 2.510 $ 2.550 36,935 $ -0.040  -1.569 %

Current Broker Consensus Recommendation more
Recommendation: Buy
Recommendation Date: 1st Dec 2011
12 Month Target Price (average): $3.057
Brokers Surveyed: 3

Company Overview

Business Description:
Retail Food Group Limited (RFG) is an Australian retail food brand manager and franchisor within the retail food industry. There are three major brands: Donut King, Michel's Patisserie and Brumby's Bakery. RFG also owns the franchise system for bb´s café, Donuts Coffee & Muffins and Big Dad´s Pies.

Strategy Analysis:
Eighty percent of outlets are located in high foot traffic shopping centres to take advantage of small change customer spending. Stagnant shopping centre development has forced management to consider non-traditional sites to continue outlet growth. Franchisee health is a focus with efforts centred on the fortification of average weekly sales via menu enhancement and product innovation, and leveraging input suppliers. Management focus is on 'the acquisition and proliferation of retail assets and franchising.´ Retail Food Group reported NPAT up 4.6% to $27.22m for the year ended 30 June 2011. Revenues from ordinary activities were $125.66m, down 6.4% from last year. Diluted EPS was 25.2 cents compared to 25.0 cents last year. Net operating cash flow was $26.84m compared to $29.24m last year. The final dividend declared was 7.5 cents, taking the full year dividend to 14.5 cents compared with 11.75 cents last year.


Financial Summary
Year to Jun NPAT EPS EPS chg (%) PER DPS Yield (%) Franking (%)
2013  F 32.9 30.7 7.6 8.2 18.0 7.2 100.0
2012  F 30.6 28.5 8.6 8.8 16.0 6.4 100.0
2011  A 28.1 26.3 1.8 10.0 14.5 5.5 100.0
Source: Morningstar analyst estimates.

Peer Comparison
EPS Growth (%) P/E (%) Dividend Yield (%)
Company Mkt Cap 2011 A 2012 F 2013 F 2011 A 2012 F 2013 F 2011 A 2012 F 2013 F
Retail Food Group (RFG) $276 M 0.0211 0.0887 0.0998 9.7889 8.9915 8.1757 0.0569 0.0619 0.0691

Market Comparison
Earnings P/E Ratio P/B Ratio P/E Growth P/S Ratio
RFG 0.40 9.14 1.72 0.97 2.16
Market 0.82 12.5 1.38 1.18 1.90
Sector 0.83 11.5 1.51 1.17 1.06

Directors
Name Position Start Date
Mr Anthony James Alford Chief Executive Officer,Managing Director 28 October 2003
Mr Nigel Norman Nixon Corporate Counsel,Executive Director 29 November 2003
Mr Bruce Alan Hancox Non-Executive Chairman 14 December 2007
Mr Colin Archer Non-Executive Director 12 April 2006

Management
Name Position
Damien Peters Chief Financial Officer
Tracey Catter Chief Marketing Officer
Gary Best Chief Operating Officer
Anthony Mark Connors Company Secretary
Gavin Nixon Head of Emerging Markets
Gary Alford Head of Strategy, Franchise

Substantial Shareholders
Holding Name
9,450,000 (8.70%) Thorney Pty Ltd
7,000,000 (6.50%) Gotham City Limited
5,510,867 (5.10%) Brecot Pty Ltd
22,636,385 (20.90%) Mr Anthony (Tony) Alford
12,050,450 (11.10%) Mawer Investment Management Ltd

Calendar of Events
Date Event
23 October 2012 Report (Annual)
14 August 2012 Report (Prelim)
17 February 2012 Report (Interim)
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