Fried chicken boosts Restaurant Brands profit

Restaurant Brands sales rose to $89.1 million in the 12 weeks ended May 25 from $77.7 million in the year earlier period, the Auckland-based company said in a statement. Photo: Christine Cornege.

Restaurant Brands New Zealand, the country's largest listed fast food operator, boosted first-half profit 17 per cent on increased sales of fried chicken at KFC and more Carl's Jr stores.

Profit rose to $13.4 million in the 28 weeks ended September 14, up from $11.5 million in the same period a year earlier, the Auckland-based firm said. Total store sales rose 13 per cent to $210 million, while on a same-store basis sales increased 6.7 per cent to $192 million. It had a total of 180 stores across its KFC, Carl's Jr, Starbucks Coffee and Pizza Hut brands, six more than a year earlier.

The board declared a first-half dividend of 8.5 cents per share, up from 7.5 cps a year earlier.

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Its KFC brand, which makes up more than two thirds of revenue, increased earnings before interest, tax, depreciation and amortisation 18 per cent to $30.9 million.

Restaurant Brands has been refurbishing stores and spending more on marketing, including KFC's successful promotion of the Double Down option and the Family Favourites Bucket.

Carl's Jr, the company's newest brand, reported static ebitda of $100,000. The company doubled the number of stores to 18, as it opened new shop fronts and brought back stores under its management, buying them from franchisees.

Pizza Hut ebitda fell 13 per cent to $2.8 million. The company is exiting stores in line with its plan to sell underperforming outlets to franchisees, and had reduced its total to 44 at balance date from 49 a year earlier.

Starbucks ebitda rose 6.9 per cent to $2.2 million, as the chain benefited from better value and improved customer experience initiatives implemented over the past two years, it said.

Restaurant Brands said the momentum in the first half had continued through to the third quarter, and it expected annual profit would be in excess of $24 million. In April the company reported annual profit rose 19 per cent to $23.8 million.

The shares last traded at $4.16 and have gained 20 per cent over the past 12 months.

See the Restaurant Brands directors report here: