Restaurant Brands third quarter sales rise, buoyed by new Carl’s Jr burger chain
Restaurant Brands [NZX: RBD], New Zealand's largest fast food operator by sales, said third -quarter sales growth accelerated to 5.4 percent this year, compared with just 0.5 percent growth in the same period a year earlier.
Sales rose to $76.2 million in the 12 weeks ended Dec. 2, from $72.2 million in the same period a year earlier, even as it had two fewer stores, the Auckland-based company said in a statement. On a same store basis, sales edged up 0.2 percent.
Chief executive Russel Creedy is counting on new brands such as burger chain Carl's Jr to drive future earnings growth. To improve profitability in its legacy businesses, the company is refurbishing and adding to its KFC outlets, which account for about three quarters of sales, exiting low performing Pizza Hut stores and closing its worst performing Starbucks Coffee outlets.
Restaurant Brands said the Carl's Jr chain, which it opened in November last year, was the largest contributor to the third quarter sales increase. The burger chain added $4 million to sales in the latest quarter, compared with just $90,000 in the year earlier period as the number of stores swelled to eight from just one.
Sales at KFC slipped 0.1 percent in the quarter to $55.3 million even as it added two new stores from the year earlier as the brand focuses on 'value' promotions.
Pizza Hut sales slipped 0.4 percent to $11 million, lagging last year's 3.5 percent increase. The company had eight fewer stores in the latest period as part of its strategy to sell regional and lower volume stores to independent franchisees.
The Starbucks Coffee unit increased sales 2.7 percent to $5.8 million even with three fewer stores as it continues to close non-performing outlets.
Restaurant Brands didn't provide an updated profit forecast. In October, the company said improved trading in the second half of the financial year would see full-year earnings of between $18 million and $19 million, up from $17.7 million a year earlier.
Shares in Restaurant Brands last traded at $2.80, having gained 6.1 percent this year.