Restaurant Brands 3Q sales rise as overseas operations grow

Restaurant Brands New Zealand said its third-quarter sales rose 4.7 per cent. Photo / 123RF

Restaurant Brands New Zealand, subject to a partial takeover bid by Mexico's Finaccess Capital, said its third-quarter sales rose 4.7 per cent as its overseas operations continued to grow.

Total sales in the 12 weeks to December 3 were $181.5 million, versus $173.3m a year earlier, the fast-food operator said.

The company, which operates the KFC, Pizza Hut, Starbucks Coffee and Carl's Jr brands in New Zealand also operates KFC in Australia and Taco Bell and Pizza Hut in Hawaii.

New Zealand operations generated sales of $94.7m, down 2.2 per cent in total but up 2.2 per cent on a same-store basis. KFC New Zealand continues to fare well, with third-quarter sales up 4.1 per cent on a same-store basis. Store numbers remained steady at 94 during the quarter, and one higher than a year earlier.

Pizza Hut, however, saw a 6.1 per cent decline in same-store sales. Restaurant Brands-owned store numbers were steady through the quarter and down by five from last year at 29 as five stores were sold to independent franchisees.

Total sales at Starbucks Coffee fell more than 50 per cent due to the sale of 22 stores in the quarter. Same-store sales, however, were up 5 per cent. Restaurant Brands sold its New Zealand Starbucks franchise in the quarter.

At Carl's Jr, same-store sales were down 8.3 per cent. Store numbers remained steady at 18.

Restaurant Brands this week said it will build more than 60 Taco Bell restaurants in New Zealand and New South Wales between 2019 and 2024. It expects to fund the building of the stores from internally generated cash flows. It doesn't expect the brand to make a significant contribution to earnings for several years.

Australian KFC outlets produced sales of $44.3m, up 18.8 per cent on a total basis and up 2.4 per cent in Australian dollars on a same-store basis. Australian store numbers increased by one to 62 during the quarter and total store numbers are three higher than last year.

Hawaiian operations generated sales of $42.5m, up 8.5 per cent on a total basis and 3.6 per cent in US dollars on a same-store basis. Taco Bell stores remained steady at 36 during the quarter, and down one versus last year. Pizza Hut Hawaii sales were steady at 45 during the quarter.

The stock last traded at $8.47, up 11.1 per cent since this week's $9.45 per share offer from Finaccess Capital for 75 per cent of the company.

Restaurant Brands' independent directors have elected to accept the offer and the board unanimously recommends shareholders do likewise, unless a better offer emerges.

The Mexican firm's offer closes on March 12, and acceptances above 75 per cent may be scaled depending on the uptake.

Finaccess has committed to support Restaurant Brands' existing strategy in the near-term to pursue international growth.