Scorecard by strategic matter

The following commentary provides an overview of the Group’s achievements in 2023 mapped against our seven key strategic matters.

Score in 2023

1. Improve our operational efficiencies

We must ensure we are highly efficient to safeguard the long-term sustainability of the Group and our franchise partners. This supports our goal of being the leading innovative branded food services business in our markets. We measure our performance by revenue growth and operating profit growth.

2023 | What we did Evaluation
  • Successfully relocated the KwaZulu-Natal Distribution Centre.
  • Improve our manufacturing practices through the ‘Manufacturing Way’ programme.
  • Continued to roll out the new warehousing management system across our distribution centres.
  • Invest in technology, capacity, capability and partnerships.
  • Purchased the Midrand Campus, which will allow for greater operational efficiencies in the medium term.
Material strategic KPIs
2024 | What we will do
  • Continue to invest in technology, capacity, capability and partnerships.
  • Complete the roll-out of the new warehousing management system across all distribution centres.
  • Start process of relocating the Gauteng cold storage facilities to Midrand.

2. Enhance our financial performance

We aim to grow capability, capacity and scale across manufacturing, branded franchised and food services spaces. Trading conditions in all the Group’s markets are incredibly challenging. We need to make strategic choices to ensure our business is optimally structured to be efficient and competitive, achieve our benchmarks and meet the expectations of our stakeholders. We measure our performance against HEPS, return on capital employed (ROCE) and total shareholder return (TSR).

Read our Group Financial Director’s report.

2023 | What we did Evaluation
  • Delivered a strong financial performance across our four divisions.
  • Increased free cash flow, renegotiated a more appropriate debt finance structure and improved working capital management.
  • Continued to invest in lower-risk core local opportunities with a strong outlook for long-term sustainable returns.
  • Continue our AME expansion plans.
Material strategic KPIs

All these three measures are featured in remuneration incentives.

2024 | What we will do
  • Grow our franchise networks in South Africa and selected AME markets.
  • Reconsider the ongoing relevance of Signature Brands in our overall brand portfolio.

3. Lead in the categories we compete in

We are passionate about unique consumer experiences through innovation, flawless execution and continuous improvement. The food services industry is increasingly competitive. In this crowded operating environment, local and international operators compete for a shrinking wallet, and in some cases, for survival. To promote the Group’s continued success, we must ensure our brands are differentiated through their irresistible consumer appeal.

We measure our performance through internal research metrics and like-for-like sales growth.

Read more in our operational review.

2023 | What we did Evaluation
  • Executed Leading Brands and Signature Brands’ annual plans.
  • Invested in technology, capacity, capability and partnerships to remain at the forefront and competitive within the home delivery marketplace.
  • Enhanced the consumer experience across our online platforms and brand applications.
  • Continued to provide value offerings to entice the price-sensitive consumer.
  • Invested in Manufacturing and Logistics capabilities.
  • Introduced 13 new Retail products and gained market share in the frozen chips category.
Material strategic KPIs

This measure is featured in remuneration incentives.
2024 | What we will do
  • Offer incredible value, quality and innovation to appeal to consumers across our markets.
  • Grow the own delivery channel.
  • Continue to invest in technology, capacity, capability and partnerships.
  • Explore new growth opportunities and brand extensions, for example, Steers Fried Chicken.
  • Grow our range of Retail products.

4. Prioritise our franchise partners

Our franchise partners represent our brands, which translates into our success. We work hard to develop close, mutually beneficial relationships with them. Regular interactions are conducted with the national franchise forums for each brand, and set metrics are evaluated. These metrics are strategic and, therefore, not disclosed.

Read more about how we manage the franchise partner relationship.

2023 | What we did Evaluation
  • Supported Casual Dining franchise partners where necessary through the recovery phase with targeted Covid royalty and marketing fund relief.
  • Assisted our franchise partners with rental renegotiations with landlords.
  • Provided advice on operating efficiently and reducing energy consumption during higher levels of load shedding.
  • Where possible, absorbed product price increases in Manufacturing to allow for more competitive pricing for restaurants.
2024 | What we will do
  • Provide financial support to South African franchise partners to assist them in coping with higher load shedding levels.
  • Consider the impact of load shedding when designing or revamping restaurants.
  • Support own delivery and continue to roll out the delivery hub concept in South Africa.

5. Ensure regulatory compliance

We understand that compliance with all relevant regulations and strong relationships with industry authorities allows us to operate and enhances our reputation as a responsible corporate citizen among our stakeholders. In 2023, we received no fines or penalties related to non-compliance.

2023 | What we did Evaluation
  • Made progress against developing the regulatory compliance framework.
  • Reviewed and updated POPIA Policy and framework to cater for data protection legislation across all territories.
  • Monitor and ensure POPIA compliance through training and regular reviews which was provided to a number of subsidiaries in SA and in some AME entities.
  • The appointment of POPIA information officers in these entities.
  • Maintained and improved our National Occupational Safety Association of South Africa (NOSA) gradings (3 and 4).
  • Joined new Producer Responsibility Organisations to ensure continued compliance with Extended Producer Responsibility regulations.
2024 | What we will do
  • Complete and implement the regulatory compliance framework.
  • Monitor new regulatory developments, including the Employment Equity Amendment Bill.
  • Continue implementation of data protection activities across all AME entities territories, including training.
  • The drafting and implementation of a Retention of Records Policy.
  • Review and update the Promotion of Access to Information Act (PAIA) manual.

6. Develop our people; ongoing commitment to transformation

We are a team of results-oriented people operating in a high-performance culture. Human capital is considered a core corporate asset at Famous Brands, and the quality of our people is critical to our success. Mutually beneficial relationships stem from ensuring our people are developed, recognised and rewarded appropriately. We measure success in this category through our annual morale engagement survey, amount of training conducted and completed and B-BBEE rating.

Read more in our human capital report and our transformation report.

2023 | What we did Evaluation
  • Maintained our Voice Your View overall employee engagement score of 77% (2022: 77%).
  • Secured SETA funding of R3 million for our training programmes.
  • Ensured that all training and development momentum was back at pre-COVID-19 levels at a minimum.
  • Increased the net promoter score from 19.6 to 21.4.
  • Successfully implemented the SAGE 300 People system.
  • Introduced a mentorship programme.
  • Partnered with the Youth Employment Service (YES) programme.
  • Improved our scores across three of the five B-BBEE scorecard elements.
Material strategic KPIs
2024 | What we will do
  • Improve our ready now succession score to 60%.
  • Increase SETA funding for training programmes to R3.5 million.
  • Improve net promoter score by 5% to 22.5.
  • Maintain our Level 2 B-BBEE rating.
  • Monitor the implications of the Employment Equity Amendment Bill, effective 1 September 2023.

7. Optimise capital management

We focus on organic and acquisitive growth in South Africa and other selected markets. Following a series of acquisitions in 2016, the Group’s capital structure includes a high debt level. We need to ensure that capital is correctly deployed to meet operational requirements, service debt, support future growth and pay dividends to shareholders when appropriate.

2023 | What we did Evaluation
  • Renegotiated our borrowings with our primary lender to a more appropriate debt finance structure in line with our current requirements and strategy.
  • Improved working capital management and increased free cash flow.
  • Tightly controlled the capital investment programme and made sound capital investment and budgeting decisions. This included placing some projects on hold.
  • Increased investment in inventory holdings to mitigate local and global supply issues and secure better pricing on key commodities.
Material strategic KPIs
2024 | What we will do
  • Continue to pay down interest-bearing debt.
  • Seek an appropriate long-term finance or fit for purpose lease arrangement for the Midrand Campus.
  • Continue to improve our working capital management.
* Excludes discounted operations.