BurgerFuel may be finding more hungry buyers for its fast food products, but the company is blaming the harsher lending criteria environment for a lack of new stores over the past six months.The company reported a loss of $296,000 for the six months endin
BurgerFuel may be finding more hungry buyers for its fast food products, but the company is blaming the harsher lending criteria environment for a lack of new stores over the past six months.
The company reported a loss of $296,000 for the six months ending September, an improvement on the loss from the previous period of $669,000.
It reported an annual loss of $710,000 in June.
Group revenue was also on the rise, improving from $3.4 million in 2008 to $4.2 million, with New Zealand recording unaudited sales of $13.3 million, up 17.5% on the previous year, and Australian sales up by 14.9% to $1.2 million.
But while sales at its New Zealand and Australian stores continue to grow, chairman Peter Brook conceded in the half yearly report that new store openings have been “virtually non-existent,” in part due to banks being more careful about who they lend money to.
He said the lack of store openings was caused by more difficult lending criteria being applied by banks to prospective franchisees, combined with those franchisees becoming “more risk adverse in the changing economic climate.”
Just one new franchise store – in Auckland’s Mission Bay – opened during the half-year.
Mr Brook said store roll-out in New Zealand over the next six months remained uncertain due to the current trading environment.
Despite the lack of new local stores, the company is continuing to invest elsewhere, with more effort going into BurgerFuel’s grab for market share in Australia and new stores now under construction in the Dubai and Saudi Arabian markets.
“On the Australian operations, management continues to consolidate the position of the two BurgerFuel stores in Sydney prior to opening any further stores,” said Mr Brook.
Its global plans have seen BurgerFuel recently appoint Josef Roberts as chief executive of the Australasian operations, while Chris Mason was appointed chief executive of the international markets and business development division, where he is focusing on the Middle East rollout.
The company is hoping to have those stores up and running by the end of March.
