KEY POINTS:
Restaurant Brands yesterday confirmed a 47 per cent fall in full-year profits, with Pizza Hut still the mutt among its fast-food brands.
For the 12 months to February 28, net profit for the company - which runs KFC, Pizza Hut and Starbucks in New Zealand - was $6.5 million, down from $12.3 million in 2006.
The drop excluded non-trading charges of $14.4 million, mainly comprising costs associated with quitting its Australian investment in Pizza Hutt Victoria.
Sales at Pizza Hut were down more than 10 per cent at $79.7 million.
Chairman Ted van Arkel said Restaurant Brands was focusing on a "heads down" approach and getting the basics right.
"There are no easy ways to fix a problem, but if you do the basics well then hopefully the rest will follow and the positive news will come out."
He said the company hoped the results of continued KFC store revamps and new Pizza Hut products would be evident after the first sales update in May.
"It's fair to say that KFC and Pizza Hut will tend to get the priority rather than Starbucks for the next 12 months. Capital expenditure will be more directed at those two brands," he said.
Van Arkel has taken a bigger role in the day-to-day running of the business following the sudden resignation of chief executive Vicki Salmon last month. He is being assisted by commercial services director Russell Creedy, currently acting chief executive.
Also weighing on the companies fortunes is uncertainty surrounding a drawn-out sale process.
Earlier this month van Arkel said the board had given the only interested party until the end of the month to decide.
He confirmed yesterday that an update on a replacement chief executive and on the sale will be made on April 30.
Forsyth Barr analyst Guy Hallright said the expectations of a sale had been reduced by the slow progress..
"The share price in the low 90c range is basically saying 'no, there isn't anyone out there that's going to make an offer'."
Restaurant Brands shares closed up 2c at 92c yesterday.
Chief financial officer Grant Ellis said management changes at senior and store level in the Pizza Hut business and the rationalisation of less profitable "red roof" stores would drive profitability in New Zealand.
"It's a pretty tough market and we probably haven't been as quick off the mark in meeting some of those competitive challenges as we could have been, but certainly we're addressing that now."
