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Restaurant Brands upsizes profits

NZ Newswire logoNZ Newswire 19/04/2017 Paul McBeth

Fast food operator Restaurant Brands New Zealand has lifted annual profit 7.8 per cent as its local KFC business generated record sales, bolstered by the recently acquired Australian KFC business.

Net profit rose to $26 million, in the 52 weeks ended February 27 from $24m a year earlier, the company said on Thursday.

Underlying earnings rose 26 per cent to $30.6m, within the company's guidance of between $30m and $32m, and Restaurant Brands anticipates that will rise to around $40m from its recent acquisitions.

Because the company issued shares to acquire the Australian business, earnings per share fell from 24.59 cents to 24.08c in the year under review.

Restaurant Brands bought 42 KFC stores in Australia last year, making it the biggest KFC franchisee in New South Wales, and in March was granted approval to acquire the only franchisee for 82 Taco Bell and Pizza Hut stores in Hawaii.

New Zealand operations delivered their "best ever overall sales and profit performance", chief executive Russell Creedy and chief financial officer Grant Ellis said in their report.

There was also strong trading from the KFC Australian business.

The board declared a final dividend of 13.5 cents per share, taking the annual return to 23 cents, up 9.5 per cent from a year earlier.

The shares last traded at $5.35, having gained 5.3 per cent so far this year.

RESTAURANT BRANDS EARNINGS INGREDIENTS:

* The New Zealand KFC division increased earnings before interest, tax, depreciation and amortisation by 7.5 per cent to $61.4m.

* Pizza Hut New Zealand posted a 17 per cent decline in earnings to $4.1m on a 9.8 per cent fall in sales to $40.5m as Restaurant Brands sold stores to independent franchisees

* Starbucks Coffee increased ebitda 8 per cent to $4.8m on a 0.4 per cent decline in sales to $26.7m

* Carl's Jr sales rose 9 per cent to $36.3m and ebitda more than doubled to $1m

* The KFC Australia division continued $97.2m of sales and $15m of ebitda.

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