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Restaurant Monthly Update - January 2017

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December marked the ninth month out of the past ten with declining sales for the restaurant industry. Both same-store sales and traffic growth deteriorated from November’s results, officially marking 2016 as the worst year of industry performance since 2009. Despite challenges in the sector, private equity investors with significant dry powder and strong, relatively inexpensive credit, will likely continue to fuel investment in innovative and rapidly expanding restaurant concepts.

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Restaurant Monthly Update - January 2017

  1. 1. 1 J a n u a r y 2 0 1 7 Restaurant Monthly Update
  2. 2. Duff & Phelps Restaurant Monthly Update | January 2017 Market Update K E Y I N F O R M A T I O N QSR continued to be the top performing segment during December for the tenth consecutive month December same-store sales and traffic declined -4.3% and -6.4%, respectively The restaurant industry will likely face many difficulties reversing unfavorable traffic and SSS trends in 2017 Innovative restaurant concepts will remain an attractive investment for private equity and strategic investors December marked the ninth month out of the past ten with declining sales for the restaurant industry, as the latest survey data indicated a -4.3% decline in same-store sales and -6.4% decline in traffic. Both same-store sales and traffic growth deteriorated from November’s results, officially marking 2016 as the worst year of industry performance since 2009. California was once again the best performing region in the last month of the fourth quarter, logging same-store sales of -0.9% in December alongside declining traffic of -3.9%. The worst performing region of the month was the Midwest, which reported same-store sales and traffic declines of -6.3% and -8.0%, respectively, upending Texas and the Southwest for the worst performance during the period. Based on same-store sales performance, QSR (Quick Service Restaurants) continued to be the top performing segment during December for the tenth consecutive month. Upscale casual and family dining also notched positive sales growth during December and, along with QSR, were the only three restaurant segments with positive same-store sales growth in 2016. While certain segments of the restaurant industry continue to perform better than others, none of the reported segments generated an increase in overall guest counts for the year. Restaurant operators faced a number of challenges in 2016, including the continued increase in menu prices relative to those of grocers across the country, restaurant oversupply driven by new entrants, and increased options from nontraditional formats. With grocer prices declining nearly 1.2% year-over-year, consumers have increasingly favored eating at home over visiting their favorite restaurants. Additionally, unit growth and the large number of new participants in recent years has led to an oversupply of restaurants, particularly within the fast-casual and coffee, breakfast, and snacks categories. Increased options from nontraditional formats, such as home-cooked meal delivery services Blue Apron, Plated and Hello Fresh, have attracted customers with higher levels of innovation and more convenience than traditional casual dining concepts. While the industry is expected to continue facing similar challenges in 2017, concepts with compelling unit economic models will increasingly entice investors. Given the decline in traditional brick-and-mortar retail, both private equity and strategic investors will look to restaurants with strong growth profiles as an attractive investment option within the Consumer sector. Source: Nation’s Restaurant News, TDn2K’s Black Box Intelligence, and The WSJPage 2
  3. 3. Duff & Phelps Restaurant Monthly Update | January 2017 Restaurant Traffic Expected to Remain Weak Restaurant Industry Trends to Watch for in 2017 Source: Nation’s Restaurant News, TDn2K’s Black Box Intelligence, Morningstar and The WSJ A number of trends are expected to prevail in the restaurant industry over the coming year. Beginning with labor, operators will face an overall increase in costs due to minimum wage hikes in more than 20 states at the start of 2017. Consumers will likely see increased prices in numerous sectors of the industry as a response to this legislation, as labor typically represents 25-35% of the cost of owning a restaurant. Regarding traffic, restaurant operators will look to reverse declining trends in the coming year through nontraditional vehicles, such as catering and delivery services. The proliferation of third-party delivery services, such as Seamless, Amazon, Postmates and UberEATS, have expanded the opportunity for restaurant operators to meet consumers’ growing interest in delivery. Consumers have also been driven toward concepts that offer reward and loyalty programs for all customers, not just the most frequent buyers. A recent report by NDP Group found that super light and light buyers, characterized by customers who visit restaurants one time or fewer per week, account for nearly 47% of overall restaurant customers in a year. By focusing on regular discounts, loyalty, and rewards programs, concepts can tap into a new customer segment to vastly improve traffic trends in the coming year. Additionally, offering apps and other digital promotional items can help operators convert Millennial customers into frequent visitors. Improving menu offerings and overall operational efficiencies can drive traffic while providing restaurants with cost improvements. The M&A and financing markets are expected to remain bifurcated in 2017. M&A activity and growth equity investments for growth-oriented concepts with compelling unit economic models are expected to remain robust and continue at premium valuations. Private equity investors with significant dry powder and strong, relatively inexpensive credit, will continue to fuel investment in innovative and rapidly expanding restaurant concepts. At the same time, mature concepts will likely appeal to a more consolidation-minded, value-oriented set of strategic acquirors and financial investors at decidedly more modest valuations. As traffic and labor challenges continue to plague the industry, we may see an increasing number of middle-market businesses considering a sale in 2017 and an uptick in consolidation amongst mature concepts in order to gain economies of scale and overhead cost synergies. Page 3 After facing its worst year of traffic in six years, the restaurant industry will likely face similar difficulties in 2017, according to NPD Group, which studies U.S. eating patterns. The market research firm expects that the industry will continue to feel pricing pressure from grocers and convenience stores, which have largely benefited from depressed food costs over the past few years. Restaurants, on the other hand, are much more labor intensive than grocers, forcing operators to engage in aggressive price hikes in the face of rising labor and occupancy costs. This gap is widely credited as one of the major causes of traffic and SSS slowdown seen throughout 2016. While consumers continue to eat nearly 80% of all meals at home, restaurants will have to find additional ways to increase traffic in the face of increased menu prices, driven by rising labor costs. According to Fitch Ratings, restaurant prices are expected to increase in the 2-3% range in the coming year, leading experts to believe that the malaise in restaurant traffic will remain throughout 2017. As overall traffic remains depressed, many sectors of the restaurant industry will continue trading market share with one another as a result of heavy concentration. Limited service restaurants are expected to continue gaining market share from casual dining, as emerging concepts attract consumers with greater convenience, higher levels of innovation and differentiated menu offerings than traditional dine-in restaurants. Additionally, both full service and limited service chains will look to non- traditional vehicles, such as catering and delivery services, to drive sales and offset traffic declines in dine-in eating, which has struggled to spur traffic amidst the current market conditions. This dynamic will be particularly visible in the casual space, where restaurant supply largely outweighs consumer demand. As traffic and same-store sales results continue to decrease, despite low unemployment and rising wages, innovation will be a large differentiator for these concepts. Overall, NPD Group expects full service restaurants to face traffic declines of up to 2% in 2017 as a result of these dynamics, while limited service restaurants are expected to grow 1% over the same period.
  4. 4. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 Restaurant Sector Monthly Same-Store Sales and Traffic Growth Source: Nation’s Restaurant News, TDn2k’s Black Box Intelligence December marks nine out of the past ten months with negative same-store sales and traffic growth Page 4 6.5% 2.1% 1.5% 2.2% 1.6% 2.3% 2.0% 2.1% 1.4% 0.0% 0.6% 0.7% (0.8%) 0.7% (0.5%)(0.8%) 0.0% (1.1%) (1.4%) (0.6%) (1.1%) (0.9%) (1.3%) (4.3%) 2.4% (1.0%) (1.7%) (1.0%) (1.8%) (1.1%) (0.6%) (0.6%) (1.0%) (2.5%) (1.5%) (1.9%) (3.1%) (1.1%) (2.4%) (3.2%) (2.3%) (3.5%) (3.9%) (2.7%) (3.5%) (3.4%) (3.3%) (6.4%) (8.0%) (6.0%) (4.0%) (2.0%) 0.0% 2.0% 4.0% 6.0% 8.0% 1/2015 2/2015 3/2015 4/2015 5/2015 6/2015 7/2015 8/2015 9/2015 10/2015 11/2015 12/2015 1/2016 2/2016 3/2016 4/2016 5/2016 6/2016 7/2016 8/2016 9/2016 10/2016 11/2016 12/2016 Same-Store Sales Traffic Same-Store Sales
  5. 5. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 Quarterly Same-Store Sales Performance – Last 2 Years Source: SEC filings, Capital IQ, MergerMarket, Company Press Releases, and various news sources (e.g. NY Times Dealbook, the Deal, Wall Street Journal, etc.) Same store sales represents the change in year-over-year sales for restaurants that have been open for at least 18 months. Represents most actively traded public restaurant companiesPage 5 2014 2015 2016 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Mass Casual Cracker Barrel Old Country Store, Inc. 3.3%  7.9%  5.2%  3.8%  2.5%  0.6%  2.3%  3.2%  1.3%  Brinker International, Inc. Chili's Grill & Bar 2.3%  4.2%  2.2%  0.1%  (1.1%)  (2.1%)  (3.6%)  (1.8%)  (1.4%)  Maggiano's Little Italy 0.6%  2.3%  0.1%  (0.1%)  (1.7%)  (1.8%)  0.2%  (1.7%)  (0.6%)  Bloomin' Brands, Inc. Bonefish Grill 2.6%  0.7%  0.9%  (4.6%)  (6.1%)  (5.4%)  (2.7%)  0.9%  1.7%  Carrabba's Italian Grill (1.2%)  0.3%  1.9%  0.9%  (2.0%)  (4.0%)  (2.0%)  (4.8%)  (2.1%)  Fleming's Prime Steakhouse & Wine Bar 4.8%  3.4%  3.0%  3.2%  (0.6%)  (0.3%)  1.3%  (0.8%)  (1.9%)  Outback Steakhouse 4.8%  6.4%  5.0%  4.0%  0.1%  (2.2%)  (1.3%)  (2.5%)  (0.7%)  DineEquity, Inc. Applebee's 1.7%  2.8%  2.9%  1.0%  (0.5%)  (2.5%)  (3.7%)  (4.2%)  (5.2%)  IHOP 2.4%  6.1%  4.8%  6.2%  5.8%  1.4%  1.5%  0.2%  (0.1%)  Bob Evans Farms, Inc. 0.0%  3.8%  2.1%  (0.3%)  (3.2%)  (3.6%)  (3.0%)  (3.2%)  (1.8%)  Biglari Holdings Inc. 2.6%  2.9%  6.0%  4.8%  3.0%  3.6%  1.8%  (0.7%)  0.2%  Denny's Corporation 2.4%  4.7%  7.2%  7.3%  6.1%  2.9%  2.5%  (0.5%)  1.0%  Red Robin Gourmet Burgers Inc. 1.4%  4.3%  3.8%  3.6%  3.7%  (1.6%)  (2.2%)  (3.2%)  (3.6%)  Ruby Tuesday, Inc. 1.1%  (1.0%)  (0.3%)  (1.7%)  0.6%  0.8%  (3.1%)  (3.7%)  (2.7%)  Luby's, Inc. 0.4%  0.2%  3.1%  (1.0%)  0.2%  1.2%  3.1%  (0.6%)  0.7%  Ignite Restaurant Group, Inc. Brick House Tavern + Tap 7.5%  5.7%  5.4%  2.8%  (0.7%)  (2.8%)  (4.5%)  (6.3%)  (8.9%)  Joe's Crab Shack (4.4%)  (4.5%)  (3.8%)  (4.0%)  (6.6%)  (2.9%)  (1.3%)  (6.8%)  (6.5%)  Famous Dave's of America Inc. (2.3%)  (4.0%)  (4.9%)  (9.2%)  (9.8%)  (10.6%)  (7.7%)  (6.4%)  (1.0%)  Median 2.0%  3.2%  3.0%  1.0%  (0.6%)  (2.0%)  (1.7%)  (2.2%)  (1.2%)  Mean 1.7%  2.6%  2.5%  0.9%  (0.6%)  (1.6%)  (1.2%)  (2.4%)  (1.8%) 
  6. 6. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 Quarterly Same-Store Sales Performance – Last 2 Years Page 6 Source: SEC filings, Capital IQ, MergerMarket, Company Press Releases, and various news sources (e.g. NY Times Dealbook, the Deal, Wall Street Journal, etc.) Same store sales represents the change in year-over-year sales for restaurants that have been open for at least 18 months. Represents most actively traded public restaurant companies 2014 2015 2016 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Specialty Casual Darden Restaurants, Inc. Bahama Breeze 1.1%  (0.6%)  3.2%  1.7%  1.8%  2.4%  9.9%  5.4%  3.9%  The Capital Grille 3.9%  5.0%  6.1%  4.4%  7.2%  1.5%  5.3%  1.5%  (1.2%)  Eddie V's 2.5%  4.9%  9.6%  5.2%  5.1%  1.1%  4.1%  0.9%  (1.7%)  LongHorn Steakhouse 2.8%  2.6%  5.4%  5.2%  4.4%  2.6%  5.2%  1.1%  0.6%  Olive Garden (1.3%)  0.5%  2.2%  3.4%  2.7%  1.0%  6.8%  1.6%  2.0%  Seasons 52 (0.3%)  1.2%  5.2%  3.1%  3.9%  4.5%  5.7%  3.7%  0.7%  Yard House 2.3%  3.7%  5.4%  3.2%  3.4%  1.7%  3.9%  1.4%  0.0%  Texas Roadhouse, Inc. 5.8%  6.8%  8.7%  8.0%  7.0%  4.4%  4.3%  4.5%  3.4%  Buffalo Wild Wings Inc. 5.8%  5.5%  6.5%  3.3%  2.6%  1.0%  (2.0%)  (2.1%)  (1.7%)  Dave & Buster's Entertainment, Inc. 8.7%  10.5%  9.9%  11.0%  8.8%  6.0%  3.6%  1.0%  5.9%  BJ's Restaurants, Inc. 0.3%  1.2%  3.2%  0.5%  2.3%  0.7%  0.6%  (0.2%)  (3.4%)  Chuy's Holdings, Inc. 3.0%  3.8%  1.9%  3.2%  4.2%  3.2%  3.2%  1.0%  0.3%  Median 2.7%  3.8%  5.4%  3.4%  4.1%  2.1%  4.2%  1.3%  0.5%  Mean 2.9%  3.8%  5.6%  4.4%  4.5%  2.5%  4.2%  1.7%  0.7% 
  7. 7. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 Quarterly Same-Store Sales Performance – Last 2 Years 2014 2015 2016 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Polished Casual The Cheesecake Factory Incorporated 2.1%  1.4%  4.2%  2.8%  2.2%  1.1%  1.7%  0.3%  1.7%  J. Alexander's Holdings, Inc. J. Alexander's/Redlands Grill N/A N/A N/A N/A (0.2%)  1.4%  (3.0%)  (1.8%)  1.4%  Stoney River Steakhouse and Grill N/A N/A N/A N/A 4.7%  6.2%  0.7%  1.8%  1.8%  Kona Grill Inc. 2.7%  3.1%  2.2%  1.0%  1.6%  3.2%  3.6%  2.5%  0.7%  Bravo Brio Restaurant Group, Inc. Bravo! Cucina Italiana (6.7%)  (3.9%)  (1.7%)  (2.1%)  (3.1%)  (5.2%)  (4.1%)  (8.4%)  (8.0%)  Brio Tuscan Grille (5.2%)  (4.2%)  (1.0%)  (1.6%)  (3.8%)  (4.3%)  (2.1%)  (6.4%)  (3.7%)  Median (1.6%)  (1.3%)  0.6%  (0.3%)  0.7%  1.3%  (0.7%)  (0.8%)  1.1%  Mean (1.8%)  (0.9%)  0.9%  0.0%  0.2%  0.4%  (0.5%)  (2.0%)  (1.0%)  Fine Dining Ruth's Hospitality Group Inc. 4.8%  5.0%  2.8%  4.2%  3.3%  3.2%  3.1%  1.5%  2.1%  Fogo de Chao, Inc. N/A N/A N/A 4.2%  2.8%  3.5%  1.1%  (1.6%)  0.6%  Del Frisco's Restaurant Group, Inc. Del Frisco's Double Eagle Steak House 8.4%  4.8%  2.3%  1.0%  (1.4%)  (1.6%)  (0.1%)  (1.9%)  (3.7%)  Del Frisco's Grille N/A N/A (3.5%)  (6.3%)  (3.5%)  (4.5%)  (2.8%)  (2.0%)  (1.4%)  Sullivan's Steakhouse 0.6%  1.8%  4.8%  (3.0%)  1.2%  (1.8%)  (1.8%)  2.9%  (3.2%)  The ONE Group Hospitality, Inc. 5.7%  2.6%  (3.5%)  3.1%  0.3%  (0.8%)  2.8%  (5.2%)  (4.2%)  Median 5.3%  3.7%  2.3%  2.1%  0.8%  (1.2%)  0.5%  (1.8%)  (2.3%)  Mean 4.9%  3.6%  0.6%  0.5%  0.5%  (0.3%)  0.4%  (1.1%)  (1.6%)  Page 7 Source: SEC filings, Capital IQ, MergerMarket, Company Press Releases, and various news sources (e.g. NY Times Dealbook, the Deal, Wall Street Journal, etc.) Same store sales represents the change in year-over-year sales for restaurants that have been open for at least 18 months. Represents most actively traded public restaurant companies
  8. 8. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 Quarterly Same-Store Sales Performance – Last 2 Years 2014 2015 2016 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Fast Casual Chipotle Mexican Grill, Inc. 19.8%  16.1%  10.4%  4.3%  2.6%  (14.6%)  (29.7%)  (23.6%)  (21.9%)  Panera Bread Company 1.4%  3.0%  0.7%  1.8%  2.8%  2.3%  4.7%  2.6%  3.4%  Shake Shack Inc. N/A 7.2%  11.7%  12.9%  17.1%  11.0%  9.9%  4.5%  2.9%  El Pollo Loco Holdings, Inc. 7.9%  7.6%  5.1%  1.3%  0.6%  1.8%  0.7%  2.4%  1.6%  Zoe's Kitchen, Inc. 5.9%  7.8%  7.7%  5.6%  4.5%  7.7%  8.1%  4.0%  2.4%  The Habit Restaurants, Inc. N/A 13.2%  12.6%  8.9%  2.9%  3.3%  2.0%  4.0%  0.2%  Noodles & Company 1.7%  1.3%  0.9%  0.1%  (0.9%)  (1.1%)  (0.1%)  (1.0%)  (0.7%)  Potbelly Corporation 0.5%  3.7%  5.4%  4.9%  3.7%  3.7%  3.7%  1.7%  0.6%  Fiesta Restaurant Group, Inc. Pollo Tropical 5.9%  7.7%  6.4%  4.3%  4.2%  0.4%  0.0%  (1.4%)  (1.0%)  Taco Cabana 3.5%  6.1%  3.8%  5.6%  4.8%  3.3%  1.7%  (3.8%)  (4.1%)  Wingstop Inc. 12.4%  12.5%  10.7%  9.0%  6.3%  5.9%  4.6%  3.1%  4.1%  Median 5.9%  7.6%  6.4%  4.9%  3.7%  3.3%  2.0%  2.4%  0.6%  Mean 6.6%  7.8%  6.9%  5.3%  4.4%  2.2%  0.5%  (0.7%)  (1.1%)  Page 8 Source: SEC filings, Capital IQ, MergerMarket, Company Press Releases, and various news sources (e.g. NY Times Dealbook, the Deal, Wall Street Journal, etc.) Same store sales represents the change in year-over-year sales for restaurants that have been open for at least 18 months. Represents most actively traded public restaurant companies
  9. 9. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 Quarterly Same-Store Sales Performance – Last 2 Years 2014 2015 2016 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Quick Service McDonald's Corp. (3.3%)  (1.7%)  (2.6%)  (2.0%)  0.9%  5.7%  5.4%  3.1%  3.5%  Yum! Brands, Inc. KFC 2.0%  6.0%  7.0%  3.0%  0.0%  3.0%  1.0%  2.0%  4.0%  Pizza Hut (2.0%)  0.0%  (1.0%)  1.0%  0.0%  2.0%  5.0%  0.0%  (1.0%)  Taco Bell 3.0%  7.0%  6.0%  6.0%  4.0%  4.0%  1.0%  (1.0%)  3.0%  Restaurant Brands International Inc. Burger King 3.6%  4.2%  6.9%  7.9%  5.2%  2.8%  4.4%  3.9%  1.7%  Tim Hortons 6.8%  4.1%  8.9%  7.0%  4.3%  5.8%  5.8%  4.8%  2.0%  Domino's Pizza, Inc. 7.7%  11.1%  14.5%  12.8%  10.5%  10.7%  6.4%  9.7%  13.0%  The Wendy's Company 0.8%  1.7%  3.2%  2.2%  3.1%  4.8%  3.6%  0.4%  1.4%  Jack in the Box Inc. 3.1%  4.4%  8.9%  7.3%  6.2%  1.4%  0.0%  1.1%  2.0%  Papa John's International Inc. 7.4%  4.1%  6.5%  5.5%  3.0%  1.9%  0.1%  4.8%  5.5%  Sonic Corp. 3.5%  8.5%  11.5%  6.1%  4.9%  5.3%  6.5%  2.0%  (2.0%)  Popeyes Louisiana Kitchen, Inc. 7.2%  10.7%  7.0%  7.9%  5.6%  2.0%  1.1%  0.7%  1.8%  Bojangles', Inc. 5.3%  7.0%  7.9%  4.4%  4.1%  0.6%  2.0%  0.2%  0.8%  Del Taco Restaurants, Inc. N/A N/A 7.7%  6.0%  5.6%  5.8%  3.2%  3.3%  6.7%  Nathan's Famous Inc. 3.0%  (2.0%)  (2.8%)  (0.7%)  0.5%  (1.3%)  0.2%  (2.2%)  (6.3%)  Papa Murphy's Holdings, Inc. 4.6%  8.4%  5.6%  4.5%  1.4%  (3.1%)  (2.8%)  (4.0%)  (5.8%)  Median 3.5%  4.4%  7.0%  5.8%  4.1%  2.9%  2.6%  1.6%  1.9%  Mean 3.5%  4.9%  6.0%  4.9%  3.7%  3.2%  2.7%  1.8%  1.9%  Page 9 Source: SEC filings, Capital IQ, MergerMarket, Company Press Releases, and various news sources (e.g. NY Times Dealbook, the Deal, Wall Street Journal, etc.) Same store sales represents the change in year-over-year sales for restaurants that have been open for at least 18 months. Represents most actively traded public restaurant companies
  10. 10. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 Quarterly Same-Store Sales Performance – Last 2 Years Page 10 Source: SEC filings, Capital IQ, MergerMarket, Company Press Releases, and various news sources (e.g. NY Times Dealbook, the Deal, Wall Street Journal, etc.) Same store sales represents the change in year-over-year sales for restaurants that have been open for at least 18 months. Represents most actively traded public restaurant companies 2014 2015 2016 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Coffee, Breakfast, and Snacks Starbucks Corporation 5.0%  5.0%  7.0%  8.0%  9.0%  9.0%  7.0%  4.0%  5.0%  Dunkin' Brands Group, Inc. Dunkin' Donuts 2.0%  1.4%  2.7%  2.9%  1.1%  1.8%  2.0%  0.5%  2.0%  Baskin Robbins 5.8%  9.3%  8.0%  3.4%  7.5%  4.4%  5.0%  0.6%  (0.9%)  Jamba, Inc. 3.7%  4.9%  5.0%  (5.9%)  6.6%  5.4%  (2.1%)  4.2%  (1.1%)  Median 4.4%  5.0%  6.0%  3.2%  7.1%  4.9%  3.5%  2.3%  0.6%  Mean 4.1%  5.2%  5.7%  2.1%  6.1%  5.2%  3.0%  2.3%  1.3%  Franchisees Alsea, S.A.B. De C.V. 2.0%  2.4%  6.3%  8.0%  11.4%  10.4%  10.1%  9.6%  9.0%  Domino's Pizza Enterprises Limited N/A N/A N/A N/A N/A N/A N/A N/A N/A Arcos Dorados Holdings, Inc. 7.4%  15.4%  9.4%  8.5%  9.4%  12.0%  15.9%  9.5%  15.6%  Domino's Pizza Group plc N/A N/A N/A N/A N/A N/A N/A N/A N/A Carrols Restaurant Group, Inc. 3.3%  3.6%  8.4%  10.3%  6.5%  5.1%  5.7%  0.7%  0.0%  Median 3.3%  3.6%  8.4%  8.5%  9.4%  10.4%  10.1%  9.5%  9.0%  Mean 4.2%  7.1%  8.0%  8.9%  9.1%  9.2%  10.6%  6.6%  8.2% 
  11. 11. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 -40.0% -30.0% -20.0% -10.0% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 12/31/2015 1/31/2016 2/29/2016 3/31/2016 4/30/2016 5/31/2016 6/30/2016 7/31/2016 8/31/2016 9/30/2016 10/31/2016 11/30/2016 12/31/2016 Mass Casual Specialty Casual Polished Casual Fine Dining Fast Casual Quick Service Coffee, Breakfast, and Snacks Franchisees Indexed Stock Price Performance – Last 12 Months Source: Capital IQ; data as of 12/31/2016. Fast Casual index includes Chipotle Mexican Grill, Panera Bread Company, Shake Shack Inc., Wingstop Inc., Fiesta Restaurant Group, El Pollo Loco Holdings, Zoe’s Kitchen, The Habit Restaurants, Potbelly Corporation, Noodles & Company. Quick Service index includes McDonald’s Corp, Yum! Brands, Restaurant Brands International Inc., Domino’s Pizza, The Wendy’s Company, Jack in the Box Inc., Papa John’s International Inc., Sonic Corp., Popeyes Louisiana Kitchen, Bojangles, Del Taco Restaurants, Nathan’s Famous Inc., Papa Murphy’s Holdings. Coffee, Breakfast, & Snacks index includes Starbucks Corporation, Dunkin’Brands Group, Jamba. Franchisees index includes Domino’s Pizza Enterprises Limited, Alsea S.A.B., Domino’s Pizza Group, Arcos Dorados Holdings, Carrols Restaurant Group. Mass Casual index includes Brinker International, Cracker Barrel Old Country Store, Bloomin’ Brands, DineEquity, Bob Evans Farms, Biglari Holdings, Denny’s Corporation, Red Robin Gourmet Burgers, Ruby Tuesday, Luby’s, Ignite Restaurant Group, Famous Dave’s of America. Specialty Casual index includes Darden Restaurants, Texas Roadhouse, Buffalo Wild Wings, Dave & Buster’s Entertainment, BJ’s Restaurants, Chuy’s Holdings. Polished Casual index includes The Cheesecake Factory, J. Alexander’s Holdings, Kona Grill, Bravo Brio Restaurant Group. Fine Dining index includes Ruth’s Hospitality Group, Fogo de Chao, Del Frisco’s Restaurant Group, The ONE Group Hospitality. Represents most actively traded public restaurant companiesPage 11 Post-Election Market
  12. 12. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 Public Restaurant Valuations Source: Capital IQ as of December 31, 2016 Represents most actively traded public restaurant companiesPage 12 ($ in millions, except per share data) Stock Enterprise Value as a Multiple of LTM Price % of Market Enterprise Revenue EBITDA EBITDA % Franchised 31-Dec-16 52 Wk High Value Value LTM 2016E 2017E LTM 2016E 2017E Margin Mass Casual Brinker International, Inc. 40% $49.53 88.7% $2,459 $3,871 1.19x 1.19x 1.19x 8.1x 8.2x 8.8x 14.8% Cracker Barrel Old Country Store, Inc. 0% 166.98 95.4% 4,014 4,305 1.47x 1.46x 1.42x 11.6x 11.3x 10.7x 12.7% Bloomin' Brands, Inc. 11% 18.03 90.2% 1,900 3,078 0.72x 0.72x 0.70x 7.2x 7.1x 7.1x 10.0% DineEquity, Inc. 100% 77.00 77.9% 1,393 2,695 4.14x 4.21x 4.11x 10.3x 10.2x 10.2x 40.3% Bob Evans Farms, Inc. 0% 53.21 96.5% 1,052 1,409 1.07x 1.07x 1.06x 11.7x 9.9x 9.7x 9.1% Biglari Holdings Inc. 30% 473.20 96.2% 978 1,171 1.36x 1.34x 1.31x 20.5x 18.5x 17.4x 6.6% Denny's Corporation 90% 12.83 97.5% 941 1,183 2.36x 2.33x 2.24x 12.8x 12.0x 11.3x 18.5% Red Robin Gourmet Burgers Inc. 16% 56.40 81.8% 725 1,026 0.79x 0.79x 0.75x 7.1x 7.5x 7.0x 11.2% Ruby Tuesday, Inc. 12% 3.23 57.4% 191 346 0.32x NA NA 5.0x NA NA 6.4% Luby's, Inc. 37% 4.28 83.9% 124 160 0.40x NA NA 8.3x NA NA 4.8% Ignite Restaurant Group, Inc. 1% 0.54 12.1% 14 127 0.27x 0.28x 0.31x 6.4x 5.5x 5.4x 4.3% Famous Dave's of America Inc. 75% 4.95 70.2% 34 41 0.40x 0.41x 0.42x 9.5x 8.1x 7.0x 4.2% Median 86.3% $960 $1,177 0.93x 1.13x 1.12x 8.9x 9.1x 9.3x 9.6% Mean 79.0% $1,152 $1,618 1.21x 1.38x 1.35x 9.9x 9.8x 9.5x 11.9%
  13. 13. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 Public Restaurant Valuations Source: Capital IQ as of December 31, 2016 Represents most actively traded public restaurant companiesPage 13 ($ in millions, except per share data) Stock Enterprise Value as a Multiple of LTM Price % of Market Enterprise Revenue EBITDA EBITDA % Franchised 31-Dec-16 52 Wk High Value Value LTM 2016E 2017E LTM 2016E 2017E Margin Specialty Casual Darden Restaurants, Inc. 3% $72.72 91.6% $8,950 $9,274 1.33x 1.32x 1.29x 10.0x 10.2x 9.2x 13.3% Texas Roadhouse, Inc. 17% 48.24 95.5% 3,402 3,381 1.72x 1.69x 1.53x 12.9x 12.6x 11.2x 13.4% Buffalo Wild Wings Inc. 49% 154.40 88.2% 2,810 2,896 1.46x 1.44x 1.31x 9.4x 9.5x 8.5x 15.5% Dave & Buster's Entertainment, Inc. 0% 56.30 97.1% 2,367 2,631 2.71x 2.62x 2.29x 11.5x 11.1x 9.7x 23.7% BJ's Restaurants, Inc. 0% 39.30 82.6% 914 997 1.04x 1.00x 0.95x 7.8x 8.0x 7.5x 13.3% Chuy's Holdings, Inc. 0% 32.45 85.9% 546 532 1.65x 1.60x 1.36x 13.1x 12.6x 11.0x 12.6% Median 89.9% $2,589 $2,764 1.56x 1.52x 1.33x 10.7x 10.7x 9.5x 11.9% Mean 90.1% $3,165 $3,285 1.65x 1.61x 1.45x 10.8x 10.7x 9.5x 11.3% Polished Casual The Cheesecake Factory Incorporated 5% $59.88 93.0% $2,726 $2,759 1.25x 1.22x 1.16x 9.9x 9.5x 9.5x 12.7% J. Alexander's Holdings, Inc. 0% 10.75 88.8% 158 177 0.80x 0.80x 0.72x 8.3x 7.5x 6.2x 9.6% Kona Grill Inc. 0% 12.55 72.7% 132 151 0.92x 0.88x 0.74x 12.6x 11.2x 7.9x 7.3% Bravo Brio Restaurant Group, Inc. 1% 3.80 39.7% 56 107 0.26x 0.26x 0.26x 4.2x 4.6x 3.8x 6.2% Median 80.8% $145 $164 0.86x 0.84x 0.73x 9.1x 8.5x 7.0x 8.4% Mean 73.6% $768 $798 0.81x 0.79x 0.72x 8.7x 8.2x 6.9x 8.9%
  14. 14. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 Public Restaurant Valuations Page 14 Source: Capital IQ as of December 31, 2016 Represents most actively traded public restaurant companies ($ in millions, except per share data) Stock Enterprise Value as a Multiple of LTM Price % of Market Enterprise Revenue EBITDA EBITDA % Franchised 31-Dec-16 52 Wk High Value Value LTM 2016E 2017E LTM 2016E 2017E Margin Fine Dining Ruth's Hospitality Group Inc. 54% $18.30 93.1% $561 $595 1.55x 1.54x 1.43x 10.2x 10.0x 9.3x 15.3% Fogo de Chao, Inc. 0% 14.35 80.2% 404 531 1.86x 1.87x 1.67x 7.7x 9.6x 8.8x 24.3% Del Frisco's Restaurant Group, Inc. 0% 17.00 91.9% 400 399 1.15x 1.14x 1.05x 8.7x 8.8x 7.9x 13.2% The ONE Group Hospitality, Inc. 0% 2.22 64.7% 56 69 0.97x 0.91x 0.76x NM 10.1x 5.0x NM Median 86.1% $402 $465 1.35x 1.34x 1.24x 8.7x 9.8x 8.3x 15.3% Mean 82.5% $355 $398 1.39x 1.36x 1.23x 8.8x 9.6x 7.7x 17.6% Fast Casual Chipotle Mexican Grill, Inc. 0% $377.32 69.6% $10,923 $10,564 2.73x 2.69x 2.32x 38.1x 47.9x 17.9x 7.2% Panera Bread Company 54% 205.09 91.5% 4,798 5,152 1.87x 1.84x 1.72x 13.2x 12.6x 11.5x 14.1% Shake Shack Inc. 48% 35.79 81.4% 1,297 1,273 5.17x 4.79x 3.61x 46.1x 28.4x 21.8x 11.2% Wingstop Inc. 98% 29.59 88.5% 851 1,004 11.52x 10.96x 9.82x 33.3x 29.1x 25.3x 34.6% Fiesta Restaurant Group, Inc. 11% 29.85 77.5% 798 863 1.20x 1.20x 1.12x 9.1x 9.2x 8.3x 13.2% El Pollo Loco Holdings, Inc. 57% 12.30 79.7% 473 574 1.54x 1.51x 1.38x 9.1x 8.9x 8.4x 16.8% Zoe's Kitchen, Inc. 2% 23.99 57.4% 467 485 1.82x 1.75x 1.47x 20.7x 20.9x 17.6x 8.8% The Habit Restaurants, Inc. 4% 17.25 70.6% 449 436 1.61x 1.54x 1.28x 15.8x 14.4x 12.4x 10.2% Potbelly Corporation 6% 12.90 86.1% 325 296 0.74x 0.73x 0.64x 7.5x 7.7x 6.7x 9.8% Noodles & Company 14% 4.10 30.0% 114 196 0.41x 0.40x 0.39x 7.9x 7.6x 7.2x 5.3% Median 78.6% $636 $718 1.71x 1.65x 1.43x 14.5x 13.5x 11.9x 10.7% Mean 73.2% $2,050 $2,084 2.86x 2.74x 2.37x 20.1x 18.7x 13.7x 13.1%
  15. 15. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 Public Restaurant Valuations Page 15 Source: Capital IQ as of December 31, 2016 Represents most actively traded public restaurant companies ($ in millions, except per share data) Stock Enterprise Value as a Multiple of LTM Price % of Market Enterprise Revenue EBITDA EBITDA % Franchised 31-Dec-16 52 Wk High Value Value LTM 2016E 2017E LTM 2016E 2017E Margin Quick Service McDonald's Corp. 82% $121.72 92.2% $101,082 $124,822 5.01x 5.07x 5.52x 13.5x 13.2x 12.7x 37.1% Yum! Brands, Inc. 77% 63.33 68.8% 23,242 29,597 2.30x 4.63x 5.16x 9.9x 14.2x 14.5x 23.2% Restaurant Brands International Inc. 99% 47.66 94.9% 11,158 23,827 5.82x 5.75x 5.45x 13.6x 12.9x 11.9x 42.7% Domino's Pizza, Inc. 97% 159.24 92.2% 7,656 9,857 4.12x 4.05x 3.67x 21.0x 20.3x 17.9x 19.6% The Wendy's Company 90% 13.52 96.1% 3,321 5,528 3.48x 3.86x 4.73x 13.8x 13.9x 14.0x 25.1% Jack in the Box Inc. 75% 111.64 98.5% 3,627 4,605 2.88x 2.83x 2.84x 13.8x 13.6x 12.1x 20.9% Papa John's International Inc. 85% 85.58 94.6% 3,157 3,471 2.05x 2.02x 1.91x 18.0x 18.1x 16.8x 11.4% Sonic Corp. 89% 26.51 72.9% 1,238 1,238 2.10x 2.09x 2.59x 7.3x 7.4x 7.9x 28.7% Popeyes Louisiana Kitchen, Inc. 97% 60.48 95.8% 1,254 1,403 5.26x 5.21x 5.12x 16.2x 15.9x 14.6x 32.5% Bojangles', Inc. 58% 18.65 92.6% 680 864 1.66x 1.62x 1.47x 10.8x 10.7x 9.9x 15.4% Del Taco Restaurants, Inc. 45% 14.12 92.2% 553 712 1.64x 1.58x 1.49x 11.5x 10.1x 9.3x 14.2% Nathan's Famous Inc. 98% 64.90 97.6% 271 347 3.57x NA NA 12.8x NA NA 27.9% Papa Murphy's Holdings, Inc. 90% 4.22 32.6% 72 183 1.46x 1.41x 1.29x 8.4x 9.4x 8.9x 17.4% Median 92.6% $3,157 $3,471 2.88x 3.34x 3.26x 13.5x 13.4x 12.4x 23.2% Mean 86.2% $12,101 $15,881 3.18x 3.34x 3.44x 13.1x 13.3x 12.5x 24.3%
  16. 16. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 Public Restaurant Valuations Page 16 Source: Capital IQ as of December 31, 2016 Represents most actively traded public restaurant companies ($ in millions, except per share data) Stock Enterprise Value as a Multiple of LTM Price % of Market Enterprise Revenue EBITDA EBITDA % Franchised 31-Dec-16 52 Wk High Value Value LTM 2016E 2017E LTM 2016E 2017E Margin Coffee, Breakfast, and Snacks Starbucks Corporation 47% $55.52 89.9% $81,584 $82,988 3.89x 3.81x 3.50x 17.0x 15.7x 14.0x 22.9% Dunkin' Brands Group, Inc. 100% 52.44 93.4% 4,810 6,980 8.54x 8.43x 8.21x 16.5x 15.3x 14.6x 51.8% Jamba, Inc. 92% 10.30 74.2% 158 144 1.75x 1.82x 1.84x NM 21.6x 12.4x NM Median 89.9% $4,810 $6,980 3.89x 3.81x 3.50x 16.7x 15.7x 14.0x 37.3% Mean 85.8% $28,851 $30,037 4.73x 4.68x 4.52x 16.7x 17.5x 13.7x 37.3% Franchisees Domino's Pizza Enterprises Limited 77% $47.00 80.5% $4,265 $4,457 6.67x 5.87x 4.86x 38.4x 29.3x 22.8x 17.4% Alsea, S.A.B. De C.V. 0% 2.88 81.5% 2,408 3,048 1.74x 1.69x 1.49x 12.6x 12.2x 10.5x 13.8% Domino's Pizza Group plc 98% 4.45 89.0% 2,301 2,314 5.53x 5.09x 4.61x 22.8x 20.6x 18.4x 24.3% Arcos Dorados Holdings, Inc. 26% 5.40 81.8% 1,138 1,639 0.57x 0.56x 0.52x 5.8x 7.5x 6.7x 9.7% Carrols Restaurant Group, Inc. 0% 15.25 99.7% 668 873 0.94x 0.92x 0.86x 9.8x 9.7x 8.8x 9.6% Median 81.8% $2,301 $2,314 1.74x 1.69x 1.49x 12.6x 12.2x 10.5x 13.8% Mean 86.5% $2,156 $2,466 3.09x 2.83x 2.47x 17.9x 15.9x 13.4x 15.0%
  17. 17. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 6.2x 8.1x 9.7x 7.1x 8.2x 8.2x 7.4x 5.3x 10.8x 16.4x 10.0x 9.3x 11.6x 13.2x 11.2x 12.8x 8.8x 10.5x 8.6x 11.0x 9.4x 10.4x 9.6x 9.3x 5.0x 7.0x 9.0x 11.0x 13.0x 15.0x 17.0x 19.0x Mass Casual Specialty Casual Polished Casual Fine Dining 2007 2012 2013 2014 2015 LTM Source: Capital IQ; LTM values as of 12/31/2016 Segments weighted based on market cap values at period end Represents most actively traded public restaurant companies Mean: 11.1x Mean: 9.4x Mean: 9.1x Mean: 9.2x Historical Public Restaurant Trends Enterprise Value as a Multiple of EBITDA Page 17
  18. 18. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 17.6x 10.9x 10.7x 8.9x 12.9x 10.2x 15.8x 11.2x 19.7x 11.3x 18.9x 13.8x 19.9x 11.5x 16.7x 13.3x 14.8x 13.5x 19.8x 16.2x 20.4x 13.1x 16.8x 14.1x 7.0x 9.0x 11.0x 13.0x 15.0x 17.0x 19.0x 21.0x 23.0x 25.0x Fast Casual Quick Service Coffee, Breakfast, and Snacks Franchisees 2007 2012 2013 2014 2015 LTM Enterprise Value as a Multiple of EBITDA Historical Public Restaurant Trends Page 18 Mean: 11.7x Mean: 16.5x Mean: 12.9x Mean: 17.5x Source: Capital IQ; LTM values as of 12/31/2016 Segments weighted based on market cap values at period end Represents most actively traded public restaurant companies
  19. 19. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 Recent Restaurant M&A Transaction Activity AP Franchised Concepts Invests in The Kebab Shop On January 10, 2017, AP Franchised Concepts, a restaurant and retail growth equity company, announced its completion of an investment in The Kebab Shop, a California-based Mediterranean chain. Founded in 2007, the fast-casual concept operates eight units in the Greater San Diego and Northern California markets. The company plans to utilize the investment to double its company-owned store footprint in the Los Angeles and Northern California areas over the next three years. Cheddar’s Scratch Kitchen Acquires Largest Franchisee On January 5, 2017, Dallas-based casual dining concept Cheddar’s Scratch Kitchen announced the completion of its acquisition of 44 restaurant locations owned by its largest franchisee, Greer Restaurant Operation Entities. Cheddar’s financed the transaction by taking on $370M in new debt. There are currently 164 company-owned and franchised Cheddar’s locations in 29 states. Greer owns the Cheddar’s locations within the Midwest and Southern regions of the U.S., which comprise about a quarter of all Cheddar’s outlets. Lee Equity Acquires K-MAC Enterprises On January 3, 2017, Lee Equity acquired K-MAC Enterprises, the Fort Smith, Arkansas franchisee and operator of 294 Taco Bell, KFC, Long John Silver’s and Golden Corral locations. Founded in 1964, K-MAC has over 7,500 employees across the U.S. and was acquired by Brentwood Partners and Arlon Capital in March 2011. The acquisition was the second restaurant acquisition by Lee Equity in 2016 and comes after the completion of a $315M raise for its second fund. GPS Hospitality Acquires 194 Burger King Units On December 19, 2016, GPS Hospitality, the Atlanta, Georgia-based franchisee and operator of Burger King restaurants, added another 194 locations in the South to its unit total count. Founded in 2012 by former Arby’s CEO Tom Garrett, the company previously operated Burger King locations in Indiana, Kentucky, Ohio, Georgia, and West Virginia. The transaction brings GPS Hospitality’s total Burger King store count to 424 locations across the country, as it looks to grow the company to $1 billion in system-wide sales by 2022. Source: MergerMarket Group IntelligencePage 19 CITIC, Carlyle, TPG acquire McDonald’s Chinese Business for $2.1B On January 9, 2017, Chinese state-backed conglomerate CITIC and Carlyle agreed to acquire the majority of McDonald’s China and Hong Kong business for $2.1B in cash. Under the deal, CITIC will own about 52% of the business while Carlyle will retain a 20% stake in the Chinese operations. CITIC and Carlyle will look to add more than 1,500 locations in mainland China and Hong Kong over the next five years in response to the increased urbanization and income growth in China. Argosy and MTN Capital Acquire Rita’s Franchise Co. On January 3, 2017, Argosy Private Equity and MTN Capital acquired a controlling take in Rita’s Franchise Co., a Trevose, Pennsylvania-based Italian ice chain. Founded in 1984, the company offers Italian ice, frozen custard, milkshakes, and other frozen treats through its 600 locations across the U.S. Argosy and MTN Capital will look to utilize their deep experience in the restaurant space to expand Rita’s international footprint in the Philippines, Canada, and the Middle East. Imvescor Restaurant Group Acquires Ben & Florentine for $19M On December 20, 2016, Imvescor Restaurant Group, the Canadian-based restaurant franchisee and licensing company, acquired Ben & Florentine, a Saint-Laurent, Canada-based polished casual operator of brunch and dinner restaurants, for $19M in cash. Ben & Florentine was founded in 2009 and now operates 40 locations across Quebec, Ontario and Manitoba. Imvescor will look to utilize the acquisition to expand upon its success in the polished casual franchising category. The multiple for the transaction was 0.71x Ben & Florentine’s LTM revenue of $26.8M. Stripes Groups Invests in Snooze On December 5, 2016, New York-based private equity and venture capital firm Stripes Group completed an investment in Snooze, the Denver, Colorado-based fast casual concept which specializes in brunch and dinner dishes. Founded in 2006, the company is committed to locally sourced ingredients and composting 90% of wastes from each of its stores. Stripes Group will look to continue to expand the concept across the Southwestern market, as well as new geographical areas in the coming year.
  20. 20. Capital Markets Industry Insights | Q1 2016Duff & Phelps Restaurant Monthly Update | January 2017 Selected Recent Duff & Phelps Restaurant Transactions has secured senior debt financing from has been acquired by has been acquired by has been acquired by has completed a going- private transaction. Sell-Side Advisor Sell-Side Advisor Placement Agent Sell-Side Advisor Sell-Side Advisor has been acquired by Board Advisor has been acquired by Sell-Side Advisor has been acquired by Sell-Side Advisor has completed a leveraged dividend recapitalization transaction. Board Advisor has completed a spin-off of Four Corners Property Trust. Board Advisor Page 20 has been acquired by
  21. 21. Duff & Phelps Restaurant Monthly Update | January 2017 Joshua Benn Global Head of Restaurants Retail, Consumer and Food New York +1 212 450 2840 joshua.benn@duffandphelps.com Contact Us For more information please visit: www.duffandphelps.com Duff & Phelps is the premier global valuation and corporate finance advisor with expertise in complex valuation, disputes and investigations, M&A, real estate, restructuring, and compliance and regulatory consulting. The firm’s more than 2,000 employees serve a diverse range of clients from offices around the world. M&A advisory, capital raising and secondary market advisory services in the United States are provided by Duff & Phelps Securities, LLC. Member FINRA/SIPC. Pagemill Partners is a Division of Duff & Phelps Securities, LLC. M&A advisory and capital raising services in the United Kingdom and across Europe are provided by Duff & Phelps Securities Ltd. (DPSL), which is authorized and regulated by the Financial Conduct Authority. In Germany M&A advisory and capital raising services are also provided by Duff & Phelps GmbH, which is a Tied Agent of DPSL. Valuation Advisory Services in India are provided by Duff & Phelps India Private Limited under a category 1 merchant banker license issued by the Securities and Exchange Board of India. About Duff & Phelps Copyright © 2017 Duff & Phelps LLC. All rights reserved. Duff & Phelps Restaurant Monthly | January 2017 Darren Gange Managing Director New York +1 212 871 9429 darren.gange@duffandphelps.com Farzad Mukhi Director Los Angeles +1 424 249 1661 farzad.mukhi@duffandphelps.com Henry Wells Managing Director London +44 207 089 4876 henry.wells@duffandphelps.com

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