TH Investor Conference for Website (02!26!2014)

7/21/2019 TH Investor Conference for Website (02!26!2014)

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Investor Conference 2014


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Scott BonikowskyVice-President Corporate Affairs & Invest

Introduction


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Welco


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AgendaMorning Session

Topic Presenter

Introduction/Housekeeping Scott Bonikowsky, Vice-President Corporate Affairs & Investor Re

Winning in the New Era Marc Caira, President & Chief Executive Officer

Trends & Insights Bill Moir, Chief Brand & Marketing Officer

Questions & Answers

Lunch


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AgendaAfternoon Session

Topic Presenter

Strategic Pillars & The Ultimate Guest Experience David Clanachan, Chief Operating Officer

Canada: Lead, Defend & Grow Roland Walton, President, Tim Hortons Canada

U.S.: Must-Win Battle Mike Meilleur, Executive Vice-President, Tim Hortons U.S

International: Grow, Learn, Expand Jill Sutton, Executive Vice-President, General Counsel, &

Questions & Answers

Break

Supply Chain & Productivity Cynthia Devine, Chief Financial Officer

Financial Strategy & Outlook Cynthia Devine, Chief Financial Officer

Enabling Execution Steve Wuthmann, Executive Vice-President, Human Res

Strategic Plan Summary Marc Caira, Chief Executive Officer

Executive Group Q&A


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Safe harbor statement

Certain information in todays presentations, particularly information regarding future economic performance, finances, an

aspirational goals, plans, expectations and objectives of management, and other information, constitutes forward-looking i

the meaning of Canadian securities laws and forward-looking statements within the meaning of the Private Securities Litigof 1995. We refer to all of these as forward-looking statements. Various factors including competition in the quick service sfood service industry, general economic conditions and others described as risk factors in our 2012 Annual Report on Fo

February 21, 2013, our Quarterly Report on Form 10-Q filed on November 7, 2013, and our 2013 Annual Report on Form be filed on February 25, 2014 with the U.S. Securities and Exchange Commission and Canadian Securities Administratorsactual results and cause such results to differ materially from those expressed in, or implied by, forward-looking statemenreaders are cautioned not to place undue reliance on forward-looking statements contained in these presentations, which managements expectations as of the date hereof.

Forward-looking statements are based on a number of assumptions which may prove to be incorrect, including, but not limassumptions about: (i) prospects and execution risks concerning our growth strategy; (ii) the absence of an adverse event

damages our strong brand position and reputation; (iii) the absence of a material increase in competition or in volume or tyactivity within the quick service restaurant segment of the food service industry; (iv) the cost and availability of commoditieof an adverse event or condition that disrupts our distribution operations or impacts our supply chain; (vi) continuing positirelationships with the majority of our restaurant owners; (vii) the absence of any material adverse effects arising as a resuno significant changes in our ability to comply with current or future regulatory requirements; (ix) our ability to retain our seteam and attract and retain qualified personnel; (x) our ability to maintain investment grade credit ratings; (xi) our ability toon favorable terms; and (xii) general worldwide economic conditions.

We are presenting this information for the purpose of informing you of managements current expectations regarding thes

information may not be appropriate for any other purpose. We assume no obligation to update or alter any forward-lookingthey are made, whether as a result of new information, future events, or otherwise, except as required by applicable law. P

full Safe Harbor Statement at www.timhortons.com/en/about/safeharbor.html.


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Marc CairaPresident & CEO

Winning in thNew Era


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Rejuvenated Canadian growth engine

Scalable, profitable U.S. business

Established, growing international presence

Enhanced capabilities and talent

Above market-average total shareholder return (TSR)

2014-2018


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Bold

DifferDari


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Our Promise

We will delight evconsumer who co

in contact with o

by providing supe

quality products/and the ultimate

guest experience


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Well positioned Tremendous growth trajectory

2,5352,855

3,3293,639

4,095

4,5194,904

5,2965,623

6,042

6,4456,804

2013

A unique pbenefitingstakehold

Investors, ROwners, Coand the Cor

SYSTEMWIDE SALES ($M)

+9% CAGR

20122011201020092008200720062005200420032002


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Well positioned Key accomplishments

Sustained leadership inCanada

Unparalleled consumerreach and loyalty

Continuing to outgrowthe market

Over a decade of double-digit sales growth

Brand awareness,convenience in our

largest markets

Emerging sbase in theCooperatio

U.S.CANADA INTERNATI


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Well positioned The undisputed Canadian beve

TOTAL CAFFEINATED BEVERAGES% SHARE OF QSR SERVINGS

Source: NPD Crest, 12 months ended November 2013. All trademarks, copyrights and other forms of intellectual property belong to their respective owners.

74.5

4.6

9.6

All OtherQSR

11.4 76.6% Cold Specialty Coffee

76.0% Hot Tea

75.9% Brewed Coffee

64.6% Hot Specialty Coffee


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A New Era is facing consumer and restaurant co

(1.1)%Canadian QSR traffic growth

6.U.S. U

Source: NPD Crest, November 2013; U.S. Bureau of Statistics, January 2014

Heightened consumer demands

Changing demographics

Low growth environment

Evolving market forces

Sweeping technology changes

Intensified competition


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The New Era presents many transformational oppo

Coffee, Beverages and Snacks,A Destination for Meals

North America, Global

In our Restaurants, Plus

Insightful, proactive and agile

Known for Coffeeand Baked Goods

Canada

In our Restaurants

Opportunistic

From To

Consumer-centric: Winning GuBuilding Restaurants


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Significant opportunities across our portfolio

Defend the core

Narrow the averagecheque gap

Capture new demandspaces

Extend our brand reach

Lead, Defend & Grow

Core and priority marketAUV growth

Optimize box and capitaldeployment model

Focus on select core andpriority markets

Must-Win Battle

Grow and

Validate stbeyond GC

Redeploy r

Positioned market(s)

Grow, Lear


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Several critical enablers will underpin our succes

Forward looking

Rapid ideato launch

Nutrition, Healthand Wellness

In-depth

understandingData drivenpursuit of"DemandSpaces"

Operational

ExcellenceConsumerLoyalty

In

Co

Pla

Focused and

accountableDedicated to theultimate guestexperience

Differentiated

Innovation Engaged Employees

Driven by Consumer

Insights

Mak

Diff

LeverageTechnology for

Advantage
http://www.google.ca/url?sa=i&rct=j&q=&esrc=s&frm=1&source=images&cd=&cad=rja&docid=rdmNUbs8lmgM3M&tbnid=eIQ6eatd1aE9AM:&ved=0CAUQjRw&url=http://www.apa.org/divisions/div46/&ei=kqoDU-W7M4rhsATU0oDYCQ&bvm=bv.61535280,d.dmQ&psig=AFQjCNEKdx9tn5v39SnCznvwIC75yFNXeQ&ust=1392835494581524http://www.google.ca/url?sa=i&rct=j&q=&esrc=s&frm=1&source=images&cd=&cad=rja&docid=Fld6oOkKMAe0-M&tbnid=cz3MFA0_gRwyCM:&ved=0CAUQjRw&url=http://theessayexpert.com/blog/tag/grammar-tips/&ei=UKsDU-izIonOsASMo4DICw&bvm=bv.61535280,d.dmQ&psig=AFQjCNH2j3xGYzNHMJJwFsPVmjJWmwolGQ&ust=1392835693219789


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St


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ValueAbomarTSR

Operati

improve

Respon

and effi

use of c

Sustainagrowth

Creation

Strong


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Trends andInsights

Bill MoirChief Brand and Marketing Officer


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Position of strength

#1Most TrustedCoffee Retailer BrandIpsos Read

#6Most Influential BrandIpsos ReadUndisputed

Coffee

Leader

#6Most Beloved BrAPCO InsightWorldwide

in C


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Strong foundation across categories and daypart

UndisputedCoffee Leader

Most Popular

Most Preferred

Best Tasting

Snacking leaderVariety andpremiumization

Mix of health andindulgence

1/3 of breakfastsout of the home

Over half at QSR

We outsellcompetitors by 2-1

Gain& sh

AppeDeli Sand

Lead

Coffee Baked Goods Breakfast Lunch


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Mega trends are reshaping the industry

Menu

Evolution

Behavioral &

Demographic shifts

Technolo

Converge


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Menu evolution

Quality of IngredientsNutrition, Health & Wellness

New Flavours & Customization Green & Sustainable

i i h l h ll


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Nutrition, health & wellness

94%

eating is impo

71%healthffood is

when d

52%more likrestaurahealthie

Insights


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January 2014Turkey SausageBreakfast Sandwich

May 2014

Frozen Green Tea L


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November 2013

Jalapeno BiscuitBreakfast Sandwich

August 2013

Extreme ItalianSandwich

Tim Hortons dark roast


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Tim Hortons dark roast

83% 39%24%

Light/Mild Dark/BoldMedium/Regular

Current Blend Dark Roast

TC

co

1ro

Consumed in the past 4 weeks?

Source: NPD Crest

Behavioural & demographic shifts: Redefining the


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Behavioural & demographic shifts: Redefining the

Convenience on the gMillennialsAging Boomers

Ethnic Diversity Trading DownTrading Up

Resonating across demographic segments


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Resonating across demographic segments

Source: Tim Hortons Brand Tracking, Canada, year ended Q3 2013

Total 18-24 25-34 35-49 50+ Female

96106105 104 103Index

PAST 4 WEEKS USAGE - TIM HORTONS (%)

Total

58 60 60 6155

60


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Technology convergence sweeping the industry


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Multi-C

Half of cuse Smdevice o

Orders

Paymen

Coupon



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Social


The digis drivin

Gather

Connec

Engage

Digitally Connected


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Digitally Connected

All trademarks, copyrights and other forms of intellectual property belong to their respective owners.

23%TimHortons.com Growthin the last 12 months

168KFollowers on Twitter

#1Facebook pagein Canada 2.4MLikes on Facebook

Aligning for success


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Talent Advantage

Innovation Imperative

Authenticity

Constant Communication

Brand Affinity

The Brand is

Authenticity, T

Social Conscio




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InnovaImpera

Differeinnova

Robustpipelinunders

the tre

Three core concepts are emerging to sharpen our a


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Three core concepts are emerging to sharpen our a

InnovationCouncil

InnovationLab

DemandSpaces

Innovation Council


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Innovation Council

Insights Pipeline

Development

Executive

Alignment

Go to

Market

Demand spaces


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Demand spaces

Emotional andfunctional drivers

Factors that drive choice

for a specific occasion

Statistically clustered

responses

Common needs ordemand spaces

Areas of growth and opportunity


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Areas of growth and opportunity

Charge

Caffeine fix

$1.3B $0.3B

Breakfast on the run

$1.6B $0.4B

Just feed me

$2.6B $1.7B

Connect

Morning leisure

$1.5B $0.4B

Modest comfort

$2.2B $0.9B

Health aware

$2.9B $1.1B

Family time

$2.4B $1.5B

Source: CCCI Consumer Survey (August - September 2013)

$22.2B $9.0BTotal Market: $$ $$

Defending the core


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g

Leading

Caffeine fix

$1.3B $0.3BBreakfast on the run

$1.6B $0.4BTreat break

$4.0B $1.0BMorning leisure

$0.4B$1.5B

Source: CCCI Consumer Survey (August - September 2013)

$$ $$

Areas of opportunity


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pp y

Just feed me

$2.6B $1.7B

Health aware

$2.9B $1.1B

Modest comfort

$2.2B $0.9B

Family time

$2.4B $1.5B

Satisfy

$3.7

$$ $$

Tims innovation labflexible and nimble


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The change is donewith the restaurant

Strategy team (sub-set) in restaurant daily

Part of the lab team

Many revisions andenhancementsexpected

Staff membersencouraged toexperiment

Try > Learn > Adjust

Progress is revieweddaily/weekly

Operational gapsrapidly fixed

Multi-purpose lab


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MenuboardPricing

ProductAssortment

SubstitutionOptions

ProductEmphasis /Placement

Combos andComboPricing

In-storeMarketingCollateral

Coupons/LoyaltyIncentives

OperationalStandards

EmployeeScripts

ManagerEngagement

ProductAttribut

p p

Be Bold


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Be Bold,

Be DifferentBe Daring

DigitalCoffee Leadership


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Art of Coffee

unique users create

multiple pieces of coffee art

+35,000

Digital activity creating awareness and engagem


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Sidney CrosbyJump the Boa

Engage with the idea like Tim Hortons, uni


PR campaigns and digital /social activity integrat


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The Pre-Cup was created bycoffee lovers, for coffee lovers,to add a fun twist when theyretreating someone to coffee during

RRRoll up the Rim to Win

Pre-Cup

Becoming one of the industrysmost consumer-centric companies


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most consumer centric companies

Deepen our consumer insights

Aggregate consumer insights to drivedecision-making and innovation

Focus on the ultimate guest experience

Build stronger loyalty


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David ClanachanChief Operating Officer

Strategic Pilla& the UltimateGuest Experie

Tim Hortons today


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Undisputed market

share leader

Historically outgrowing

the market

Proven cash flow generator

Strong presence in several

major markets

Double-digit top-line growth

Brand awareness and

convenience created in core

and priority markets

Emerging su

base in the GCooperation

Longer-term

opportunities

3,588locations 859locations 38locations

As of December 29, 2013

CANADA U.S. INT

Coffee Value Freshness Quality Speed Communi


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Rejuvenating and

reigniting Canada

Putting the U.S. on

solid footing to scale

for sustainable,

profitable growth

Gett

estab

inter


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Complexity toSimplicity

Brand Appeal andthe in-restaurantexperience

Embrtechn

OperationalExcellence

Delivering the

UltimateGuest Experien

Operational


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Operationa

exce

Operationalexcellenceunderpins ourability to deliverthe growth

set out in ourStrategic Plan.

Core focus areas guide our operational excellence


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Coffee Leadership

Speed of Service

Flawless Execution


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Coffee leadershipand our promise

Procuremeroasting, b

and in-res

Consistencfreshness

100/0 the execut

Speed of Service


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Gift of

Time

Speed of service continues to be a key priority


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90%of Canadian a drive-thru a Double-Or5thCar capa

100of targeted s

completed b

In 2013 we doubled-down on improving throughput and capacity

ExpressBeverage Lin

MobilePayment Pla


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Complexity

Simpli

Simplification is a key enabler


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Products

Product Builds

Equipment

Procedures


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AppealBrand

Experience& In-Restaura

Table Stakes

in the New Era


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Changingperceptions


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ReimagiPr

p pof the brand andattracting newdemographics


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In-Restaurant

ExperiHospitality defineTim Hortons expein the New Era


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Understandthe gue

Tim Hortons today is a very contemporary,dynamic brand in the marketplace


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In last five

~50of our restahave the Nerenovations

~80by end of 20

~35renovations

~45in 2014

Embracing Technology


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All trademarks, copyrights and other formsof intellectual property belong to their respective owners.

A

dr

gr

ou

Guest Engagement Technology Strategy


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Guest Services

GUEST CONTACT POINTS

Transaction Data

Psychographics

Basket Data

Demographics

Payments

Digital

Bricks & Mortar

One-to-One Relevance

AGGREGATION INSI

Timmy

Me

Web Social E-Com

Tim Card Co-brand Card Ordering &Payments

POS Restaurants

En

All trademarks, copyrights and other formsof intellectual property belong to their respective owners.

Mobile payments increasingly importantto mainstream guests


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We are innovating at a rapid pace

AddTim Card SelectRestaurant EnterOrderRegister &Sign inOne PlatformOne Engine

Digital Menu BoardsBefore and After


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Breaking newsFirst of its Kind:Tim Hortons Dual-branded Payment Card


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Dual purpose, dual branded payment card

Entry into loyalty

Launch dateMay 2014

On to the next level

We are well positioned to thrive and adapt in the


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Opportunities across our geographic markets

Focusing on what matters to drive relevanceand engagement in the market

Our Ultimate Guest Experience will be drivenby operational excellence done flawlessly


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Roland Walton

President, Tim Hortons Canada

Canada: LeadDefend & Gro

Canada will continue to be our economic engineduring the Strategic Plan period of 20142018

TODAY


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80of resta

90of chai

99*Based on 2013 results

of businoperati

TODAY

Leading QSR


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Leading QSRmarket share

42%27%share of dollars share of trafficMorenext

com

Source: NPD Crest, year ended November 2013

Leading in


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gmultiple QSR

categories

#1Hot beverages

Breakfast

Morning snackAfternoon snack

Evening snack

Challengi

#1 in lunc

Source: NPD Crest, year ended November 2013

Key 2014-2018strategic pillarsf C d Extend


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for Canada

Defendthe core

Extendbrand reach

Capture newconsumer

spaces

Narrow theaveragecheque gap

BaseBusiness

Drive itemcount, items per

order and offerpremium items

Focus againstspecific demandspaces

Win at lunch,attack supper

Build out footprin

Logicaladjacencies

Hold core trafficoperationalexcellence

Drive mix

Categoryleadership

Defend the core


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Defending and protecting our core business

within a slower growth market and more challenging

competitive environment includes four key elements

Operational

excellence

Comp

simp

Category

leadership

Ultim

expe


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Food leadership is a key driver of our Strategic Pl


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Becoming a fooddestinationa key driver ofgrowth

Hot breakfastsandwich

Lunch & otherdayparts

Ownable lunch proposition: Fresh, bolder flavouand significant moves in Health, Nutrition & We

Proprietary food platforms that transcend daypa

Redefine value with premiumization, sizing optiand combos with relevant side orders

Daypart and demand space innovation to drive r

DRIVERS OF CDN SSSG (%)

2014-2018F

Traffic

Mix

Premium

Snackbaked


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Narrothe AveraCheque

Average cheque opportunity spans multiple dayp

TIM HORTONS CHEQUE SIZE LAGS PEERS IN EVERY DAYPART


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4.1

2.6

5.2

2.7

5.7

2.6

5.6

3.3

7.0

4.0

7.9

4.8

Breakfast/Brunch

SupperAfternoonsnack

27%

Eveningsnack

AM Snack Lunch

Rest of QSRTim Hortons

TIM HORTONS CHEQUE SIZE LAGS PEERS IN EVERY DAYPART

Cheque size ($)

23%

27%

32%

28%

45%

Source: NPD Crest, year ended May 2013

Combos are a key focus area and big opportunityin the Canadian business


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15-2Goal

of meal orders

increase from twthree items

Our plan will include initiatives to increasethe number of items per order


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4%

12%

2%

40%

% of total orders

Coffee(s), Tea(s)only

Baked Good(s)only

All OtherMixed Drink(s)

Meal Item(s)only

Almost

60%Goal

5-10of snack orders

from one to two

of ordersinclude onlyone item

Coffee mix drives average cheque gap, but compopportunities exist to narrow the gap

AVERAGE CHEQUE GAP


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6.50

Tims(today)

QSR*

Totalgap

Tims(plan)

AVERAGE CHEQUE GAP

($)

* QSR (excluding Tim Hortons) average cheque. Source: NPD Crest, year-ended November 2013.

Immediatefocus


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CaptuNew ConsDemand

Demand space opportunities

d f


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Just feed me Modest comfortHealth aware FamilSatisfy craving

5-15% $4.9B $5.0B

Source: BCG CCCI Consumer Survey, August/September 2013

Lunch Supper

OUR CURRENT SHARE OPPORTUNITY


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We have continued runway for unit developmentbut format mix will shift in outer years of the Str


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RESTAURANT T

33%

Standard

67%

Historical

2013 18,900

2018 17,100

West

20132018

Canada

2013 17,600

2018 15,800

Qubec

2013 8,100

2018 8,500

East

2013 11,400

2018 11,300

Ontario

* Population per standard restaurant

Runway for more

than 600 units

Canada

We believe we also have a compelling opportunitnon-standard and captive audience channels


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70

90

110

170

470

~55

~410

~1200

~1480

~1100

Transportation

Business & Industry

Hospitals

Education

Petroleum

Existing units,year-end 2013

Remaining chanopportunity (uni

Development shifts in later yearsof strategic plan to reflect new formats

ExpressUrban


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p

Self-Serve

Brand leverage and channel extension provideincremental opportunity

Retail Roast & ground Single-serve coffee


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channels

Commercialchannels

Office

Roast & groundcoffee

Single-serve coffee

Vending

Canada remains the profit enginethroughout the plan period

However, the business is at a

critical inflection point

Lead, Defe

& Gro


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critical inflection point

Strategic planning process has

highlighted many growth avenues

Vision for 2018: Rejuvenated

Canadian business

& Grow


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U.S.Must-Win Batt

Mike MeilleurExecutive Vice-PresidentTim Hortons U.S.A


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By 2018, a $50M EBIT buready to scale for profitasustainable growth

Tim Hortons U.S. strategic evolution


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Profitably Grow Concept

Establish Foundation

Aggressively Sca

Establish brand identity

Build a foothold

in key markets

Drive awareness

and convenience

AUV growth within

current footprint

Focus on select core

and priority markets

Optimize box and capital

deployment model

Solidify position ac

multiple dayparts

Pursue bolder mov

multiple new mark

Contribute meanin

to corporate perfo

20082013

20142018

2018STRATEGIC PLAN FOCUS


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17%Tim Hortons StandardRestaurants AUVgrowth over 2008

3

Average unit volumehave grown significa

Yeg

Competing effectively in a big & growing segmen

TIM HORTONS BREAKFAST GROWTH


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+17%Year ended 2013+106%Growth over 2008

We are takinshare in ourstrongest da

* Standard restaurants


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95% 79%Drive AUV improvementacross all dayparts


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95%of population* isaware of Tim Hortons

79%of population* findsTim Hortons convenient

*in core and priority markets

We have created significant awareness and conv

Our opportunity is to grow frequency and convert traffic to other da


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Aware

Convenient

Visited

Visit multiple

Visit regularly

ALL DAYPARTSCORE AND PRIORITY MARKETS

LUNCHEXCLUDING BUFFALO

Aware

Convenient

Considered

Visited

Visit multiple

Visit regularly

22

48

68

79

95

4

13

22

26

76

95

% of surveyed population responding positively

Enhance loyalty and spend at breakfast


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Increase unitFrequency

Drive averagecheque with meals

Increase trialwith coffeeand beverages

Furthebreakfinnova

Drive consideration beyond morning daypart

Drive AUV


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improvementthrough

innovationand marketing

Demand space opportunities

EXISTING STRENGTHS

Breakfast on the runCaffeine fix

OPPORTUNITIES

Just feed me Health aware Satisfy craving


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Morning leisure

AM guests trade upto meal occasion

1in15

Family timeModest comfort

AM guests return afternoon snack

CaptureFair Sha

AM guests returnfor lunch

1in25

Treat break

Disciplined growth

Traditionaldevelopment with

Infill developmentwith moderate


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development withcorporate realestate control

with moderatecapitaldeployment

Local developmentwith franchisee

real estate control

Strategicdevelopment

with partners

Non-standard & non-capital

A larger percentage of mix to build out our brand presence


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Non-StandardRestaurant

StandardRestaurant

Capital

Non-Capital

Capital

Non-Capital

Non-StandardRestaurant

StandardRestaurant

HISTORIC PLAN

New development agreements


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Youngstown

Fargo/Minot

St. Louis

Fort Wayne

5-yeardevelopment targets

St. Louis 40

Youngstown 25

Fort Wayne 15

Fargo/Minot 15

* Combination of standardand non-standard.

Reducing initial investment costs

20142015Cafe & Bake Shop


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Reduced sizeof prototype

Decreased buildingcosts by 8%

Gained efficiencies

with equipment

Costs reducedby 6%

Additional1015%costreductionswith new

fit for U.S.purposeprototype

Becoming ameaningfulcontributor toconsolidated

f


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performance

Famous for

Cafe & Bake Shop

AUV growth in

current footprint

Drive increased

trial & loyalty

Enhan

reduci

deploy


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100 120GrowLearnExpand


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SaudiArabia

Oman

UAE

Qatar

Kuwait

Bahrain

100 120restaurants targeted toUAE, Qatar, Bahrain, K

restaurants targetedto open in Saudi Arabia

TOTAL NUMBER OF RE

5

24

38

2011 2012 2013

At year-end

Filtering process has been instrumental to our su


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Criteriaby whichmarkets areevaluated

Importanceof partner

Optimal basemodel todrive positivecash flows

Ddi

GrowLearnExpand


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GCC Model

Royalties License andFranchise Fees

Supply Chain

Partner Capital

Oversight

We expect the GCC business to continue to genermeaningful increases in chain sales over the plan

TIM HORTONS GCC CHAIN SALES Chain sales drive


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Brand has marke

Development, in

estate access &

Local marketing/

media knowledg

Operational exce

2015 2016 2017 20182014

GrowLearnExpand

We will validate our internationalexpansion strategy in 2014


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Guiding principles

Macro factors

Core brand strengths

expansion strategy in 2014

Guiding principles

Expand concept globally and profitably

Overall


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Core brand will notbe comprised, howeveradaptations will bemade for local markets

Entry with strong localpartner that has thecapability to invest

Select a model that willdeliver positive cashflows within five years

Dedicated resourcesand executive teamrepresentatives

Brand

Financial

Entry

Management

Macro factors

Macro


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Political andeconomicenvironmentcoupled withthe competitivelandscape are

key considerationsin enablingsuccess

Popu

GDP

Politic

Urba

Coffe

Fast f

Ease

Integlangu

Cana


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GrowLearnExpand

Our intpath fo


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path fo

Continugrow in

Validate2014 be

Redeploresourc

Internabeyond

Positioned to enternew markets in 2015


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Cynthia DevineChief Financial Officer

Supply Chain Productivity

Supply Chain overview

ObjectivesProcurement & Logistics Manufacturing

Protect Leverage scale


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Warehouse & Distribution

Protectproprietary

products

Leverage scale

Realize

systemwidebenefits

Important

contributor toprofitability,with relativelymodest capitalinvestment

Significant opportunities exist in our supply chain

3-channel Delivery Warehouse


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3 a1 truck

yEfficiencies

a ouSimplification O

Manitoba

BritishColumbia

Tim Hortons operates a hybrid distribution mode


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Qubec

Ontario

AlbertaManitoba

Saskatchewan

Michigan

Ohio

Newfoundland& Labrador

NewYork

Maine

Indiana

Pennsylvania

Virginia

Kentucky

WV

NovaScotia

VT

Maryland

NJ

NH

Mass.Conn.

Delaware

PEINewBrunswick

During our Strategic

Plan, we will explorevarious alternatives forfull 3-channel deliveryacross the system

Summary


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Moderate investment,

attractive returns

Committed to delivering value

to restaurant owners

Driving efficiencies and effectivenessover the life of the strategic plan

We protect and invest in those areas of our supply chain w

view as strategic. Other areas we view as transactional an

for the most efficient, effective models including outsourcin


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Cynthia DevineChief Financial Officer

Financial Stra& Outlook

Our strategic plan builds on our substantial financia

Buildingon our track record


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Increasingcash flows enable

reinvestment and return of value

Investingin 2014 to create

sustainable long-term growth

2015 to 2018 aspirational targets

One of the industrys strongest financial perform

$3.3B~$8B $6.


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Year ended December 29, 2013, except as otherwise noted, CAD(1) As at February 22, 2014(2) Franchised restaurant sales are reported to us by our restaurant owners. Franchised restaurant sales result

in royalties and rental revenues, which are included in our franchise revenues, as well as distribution sales.(3) Free cash flow is a non-GAAP measure. Refer to slide 153 for information about the use of this non-GAAP

measure, as well as a reconciliation to its closest GAAP measure.

$353M$621MFree Cash Flow3Operating Income

$3.3B~$8BTotal Revenues Franchised SaleMarket Capitalization1

$6.

Long track record of revenue growth

REVENUES ($CDN B)

7.9% CAGR1


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(1) CAGR is calculated using Total Revenue from 2008 to 2013. (2) 2009 results consist of 53 weeks.(3) Sales include distribution sales, Company-operated restaurant sales and sales from consolidated

non-owned restaurants.

1.51.7 1.8

2.02.2 2.3

0.10.1 0.1

0.1

0.1 0.2

0.6

0.60.7

0.7

0.80.8

2008 20092 2010 2011 2012 2013

Sales3

Franchise Fees

Rent &Royalties

2.22.4 2.5

2.93.1

3.3

Strong earnings and free cash flow growth

EPS (DILUTED) ($CDN)

12.7% CAGR

FREE CASH FLOW1 ($CDN M)

13.0% CAGR


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(1) Free cash flow is a non-GAAP measure. Refer to slide 153 for information about the use of this non-GAAP measure,as well as a reconciliation to its closest GAAP measure.

1.55

2.82

2008 2013

192

353

2008 2013

Industry leader in financial returns and performa

OPERATING MARGIN (%) RETURN ON ASSETS (%) RETURN ON INVESTED CAPITAL


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Source: FactSet. Industry figures based on the average of 25 major North American restaurant companies and 10 major Canadian retail companies from their most recently cofilings for the last 12 months as of February 2014. Tim Hortons figures based on application of FactSet definitions to reported results up to and including fiscal 2013 year end.list of companies in each peer group and definitions of the measures used by FactSet to calculate Operating Margin, Return on Assets and Return on Invested Capital.

Tim H

N.A.

Cana

24.8

14.9

18.0

9.3

19.1

15.6

5.2

8.6

12.2

20142018Moving confidentlyinto the future on soundfinancial footing.

20142018Moving confidentlyinto the future on soundfinancial footing.


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gg

Three key priorities drive our capital allocation de

Focus on organic growth

Invest in the business


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Maintain financial strength and flexibility

Dividend growth

Diligently and predictably returncapital to shareholders

Strong and flexible

balance sheet to

support future growth

Maintain investment

grade rating

Share repurchase

180 to221

Reinvest in the business prudently to drive futureCapital intensity reduces in outer years of strategic plan

CAPITAL SPENDING (CDN$ M)1


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177187

180 to230

221

150 to170

Capital highligh

Higher capital sp

2013 to 2015 to

enhanced renova

program

More moderate c

spending beyond

Corporate

U.S.

Canada

(1) Excludes capital investment by Ad Fund (2011$4, 2012$49, 2013$22)

2011 2012 2013

2014to

2015

2016to

2018

TOTAL DEBT IN THECAPITAL STRUCTURE (%)

ADJUSTED EBITDATO INTEREST COVERAGE

ADJUSTED TOTAL DEBT/ADJUSTED EBITDAR

Capital structure remains strong

flexibility increases over life of strategic plan

2

fo


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~2.9x

~11x

~82%

Adjusted Total Debt to Adjusted EBITDAR and Adjusted EBITDA to Interest Coverage are non-GAAP measures. For more information and a reconciliationof 2013 Pro Forma figures to the nearest GAAP measure, please refer to slide 155. 2018 estimates are for illustrative purposes only.

2012 2013 2013 2018E 2012 2013 2013 2018E 2012 2013 2013 2018E

fo

e

t$

Iin

o

I$

ProForma

ProForma

ProForma

Demonstrated commitment to return value to shar

QUARTERLY DIVIDEND HISTORY

Dividend


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* Percentages rounded

Plan imeanincreain paybeyon

$0.05

$0.10

$0.15

$0.20

$0.25

$0.30

$0.35

2010 2013

24%

31%

2011 2012 2014

23%

24%

Dividend

2009

30%

20-25% 30-35% 35-40% Payout Range

Demonstrated commitment to return value to shar

SHARE REPURCHASE HISTORY ($CDN M)


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Recapi

Normarepurchdeploy beyond

Meaninto EPS

*~$40 million of the 2014/2015 program is expected to be purchased in January and February of 2015

>$2Bin sharerepurchasessince 2009

2010 2011 2012 2013 20142009

191

400

2010 2011 2012 2013 2014

130

570

225

720

63140*

2009

240

YTD

Approved

TARGETS

2014 Key Highlights & Targets

Solid improvement Same-store Sales Growth Restaurant Developm

HIGHLIGHTS


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Solid improvement

in 2014 despitelow growthenvironment

Investment year tobuild sustainablelonger-term

growth

Canada

CAPEX

p

Tax Rate

1to 3%

U.S.

2 to4%

Canada

140to160

EPS

$180M to$220M(including US$30M in U.S.)

~29% $3.1

Capex and EPS in $CDN


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Strategic plan drives significant cash flows

and financial flexibility

Opportunity to returnsignificant value to

EXPECT TO GENERATE ~CDN$2 BILLIONIN FREE CASH FLOW(1)FROM 2015-2018

Unique business model and declining CAPEXrequirements drives improved cash flows


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significant value to

shareholders throughDividends and ShareRepurchase

Plan includes

meaningful increases toDividend Payout Ranover life of plan

CAPEX

Free Cash Flow

Illustrative(1) Free cash flow is a non-GAAP measure. Refer to slide 153 for the underlying calculation methodology.

2015 20182016 2017

Investing in 2014 to create long-term sustainable g

2015-2018 represents a return to stronger growth and cash

Stronger earningsand reduced CAPEX

drive increased free cash flows longer-term


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Plan includes meaningful dividend increases

and dividend payout ratio increases

Increased financial flexibility in laterplan years driven by improved leverage

ratios


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Appendices

Free cash flow

Non-GAAP measure


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Free cash flow is a non-GAAP measure. Free cash flow is generally defined as net income adjusted for amortization and de

requirements to sustain business growth. Management believes that free cash flow is an important tool to compare underl

from core operating activities once capital investment requirements have been met. The Companys use of free cash flow m

measures reported by other companies. The reconciliation of net income attributable to THI, a GAAP measure, to free cash

Free Cash Flow($ in millions, CDN) 2013 2008

Net income attributable to THI 424 285

Depreciation and amortization (excluding VIEs) 150 92

Free Cash Flow Before Investments 574 377

Capex1 221 185

Free Cash Flow 353 192

* All numbers rounded.(1) CAPEX excludes capital expenditures by the Ad Fund.

Operating Margin, Return on Assets,

and Return on Invested Capital

Companies comprising peer groups

Bob Evans Farms Inc.

Brinker International Inc.

Jack in the Box Inc.

Krispy Kreme Doughnuts Inc.

North American Restaurant Peers Operating Margincalculated as OperatingIncome divided by Net Sale

FactSet Metric Definitio


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Buffalo Wild Wings Inc.

Burger King Worldwide Inc.CEC Entertainment, Inc.

Cheesecake Factory Inc.

Chipotle Mexican Grill Inc.

Cracker Barrel Old Country Store Inc.

Darden Restaurants Inc.

DineEquity Inc.

Domino's Pizza Inc.

Dunkin' Brands Group Inc.

Fiesta Restaurant Group Inc.

py g

McDonald's Corp.

Panera Bread Co.Papa John's International Inc.

Popeyes Louisiana Kitchen Inc.

Red Robin Gourmet Burgers Inc.

Sonic Corp.

Starbucks Corp.

Texas Roadhouse Inc

The Wendy's Co.

Yum! Brands Inc.

Canadian Retail PeersAlimentation Couche-Tard Inc.

Canadian Tire Corporation

Dollarama Inc.

Empire Co. Ltd.

Hudson's Bay Co.

Loblaw Companies Limited

Metro Inc.

RONA Inc.

Shoppers Drug Mart Corporation

The Jean Coutu Group Inc.

yRevenue, multiplied by 100

Return on Assetscalculated as Net Incomedivided by the two fiscal peaverage of Total Assets.

Return onInvested Capitalcalculated as Net Incomedivided by the two fiscal peaverage of Total InvestedCapital, multiplied by 100.


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Enabling Exe

Steve WuthmannExecutive Vice-President, Human Res

Tim Hortons people processes and capabilities

Talent & Capabilities Structure & Alignment

Transforming to enable the strategy

Accountability &Performance Mana


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Talent & Capabilities Structure & Alignment Performance Mana


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Structure & Alignment

Organizational alignment will bekey to our success

Align employee incentive plans


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g p y p

Shareholder and restaurant owner-friendly metrics:net income, SSSG, ROA, TSR

Strategy execution measures for executives

Creation of new Strategy Project Management

Office with dedicated senior leadership

Strategic workstreams with direct executiveoversight and accountability

Accountability & Performance Management

Role clarity and individual accountabilitywill be championed

Driving role-clarity and accountability processes


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g y y p

New, highly disciplined objective setting processfor all employees

Strengthened performance management processthat focuses on objective achievement and

alignment of behaviours

Targeted training and development programsto enhance overall performance management


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Marc CairaPresident & CEO

Strategic PSummary

It all comesdown toleadershipand execution


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It all comes down to leadership and execution
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We are committed to

Flawless Execu

Value AbomarTSR

Sustaina

growth

Creation

Strong
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Operati

improve

Respon

and effi

use of c

Bold,DifferentDaring


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g


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Rejuvenated Canadian growth engine

Scalable, profitable U.S. business

Established, growing international presence

Enhanced capabilities and talent

Above market-average total shareholder return (TSR)

2014-2018

TH Investor Conference for Website (02!26!2014)

Documents

Transcript of TH Investor Conference for Website (02!26!2014)