Restaurant Brands boosts Q3 sales 9.4% on KFC, Carl's Jr growth

Thursday 17th December 2015

Restaurant Brands lifted third quarter sales 9.4 percent, ahead of the year earlier's 6.4 percent pace, as New Zealand's biggest fast food operator benefited from increased revenue at its largest KFC fried chicken business and expansion at its new Carl's Jr burger chain.

Sales rose to $88.7 million in the 12 weeks ended Dec. 7, from $81.1 million in the year earlier period, the Auckland-based company said in a statement. Excluding changes in store numbers, sales advanced 3.7 percent to $81.5 million, it said.

The company's 91 KFC outlets, which make up almost three quarters of revenue, added $3.8 million to the total increase in sales, while its newest Carl's Jr brand contributed a further $4 million as it benefited from a doubling of store numbers to 18.

KFC sales rose 6.2 percent to $64.5 million, compared with growth of 9.8 percent the previous year. Same-store sales eased back to 3.7 percent growth from an 11 percent pace the year earlier. Successful promotions in the latest quarter included the 'sour cream and sweet chilli' burger and the 'surf safe buckets' which includes a $1 donation to Surf Life Saving New Zealand.

Carl's Jr more than doubled sales to $7.5 million from $3.6 million after it added new stores and brought back some under its management. Same-store sales slipped 2.5 percent to $3.5 million as some stores had positive growth while others returned to more normal levels after high opening period sales last year. It plans to open one new store in the fourth quarter.

Pizza Hut sales fell 3.9 percent to $10.4 million as it reduced store numbers by six to 41, reflecting its strategy to sell lower volume stores to independent franchisees and exit the 'red roof' dine-in restaurant format. On a same-store basis, Pizza Hut sales advanced 4.2 percent to $10.1 million. It now has 47 stores operated by independent franchisees, with total network sales up 7 percent to $20.1 million from the year earlier quarter.

The Starbucks coffee chain's 26 stores increased sales 5.7 percent to $6.2 million, as it benefited from better value and improved customer experience initiatives put in place over the past two years. Same-store sales advanced 6.6 percent to $6.2 million.

Restaurant Brands didn't provide any comment on its earnings outlook. In October, the company said it expected full-year profit before one-time items would be more than $24 million. Last year it reported annual profit excluding non-trading items of $22.5 million and net profit of $23.8 million.

The shares are trading up 0.9 percent today at $4.35.

BusinessDesk.co.nz

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