Restaurant Brands' Q4 sales fell 5.5%, annual sales down 5%

Wednesday 7th March 2012

Fast food company Restaurant Brands' fourth quarter sales fell 5.5 percent to $69.8 million with most of the decline reflecting the closure of earthquake-affected stores in Christchurch and the continuing sell-off of its Pizza Hut stores.

However, same-store sales, sales through stores open 12 months or more, were also down 1.8 percent. The one bright spot was same-store sales through its Starbucks Coffee stores rose 4.3 percent in the quarter.

Restaurant Brands said of the $4.1 million quarterly decline in sales, $1.1 million was attributable to earthquake-affected stores and $1.8 million reflecting Pizza Hut stores being sold to franchisees.

That took annual sales to $308.2 million, down 5 percent, while same-store sales fell 2.5 percent in the year.

The company closed one of its flagship KFC stores during the year, taking store numbers to 88, and its Pizza Hut store numbers fell by 11 to 71 with eight sold and three closed. Its Starbucks stores fell two to 35.

KFC sales fell 1.6 percent to $54.2 million in the 12 weeks ended February 27, Pizza Hutt's were down 19.3 percent and Starbucks slumped 10.2 percent.

The company said one KFC and three Starbucks stores in Christchurch city remain inaccessible in the central city “red zone” and the KFC store has been closed permanently.

The 1.9 percent same-store sales decline at KFC in the fourth quarter followed a 2.6 percent decrease in the previous year's fourth quarter.

Restaurant Brands said without the impact of the earthquake, KFC's annual sales would have risen about 1.4 percent rather than the actual 0.2 percent annual increase.

The company said Starbucks' sales have been improving since the latter half of last year.

It will announce its annual profit details on April 3.

Restaurant Brands shares fell 3.5 percent to $1.92. The shares have been trending lower from $2.75 in May last year.

BusinessDesk.co.nz

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