Restaurant Brands sales increase

Pizza is weighing down fast food operator Restaurant Brands, while chicken and coffee perk up the company's sales figures.

Figures published today for the 12 weeks to May 22 put total first quarter sales at $74.3 million, up $1.9 million or 2.6 per cent on the same period in 2005. Total same store sales were down $600,000, or 0.9 per cent to $71.5 million.

New Zealand operations were up $2.1 million, but sales in Australia declined by $200,000.

Several agreements were being concluded to sell stores that were part of the Victorian Pizza Hut business, following the decision to sell to smaller and more flexible operators, Restaurant Brands said.

For now Victorian store numbers remained at 50, as some store sales were finalised and new franchisees finished an approval process and training programmes.

The continuing weakness in the Australian pizza market saw sales for the Victorian Pizza Hut business at $6.6 million for the quarter, down 2.7 per cent. On a same store basis, sales were down by 11 per cent.

Sales for Pizza Hut New Zealand fell $1.4 million, or 7 per cent, to $19.2 million. On a same store basis they were down $2.18 million, or 10.6 per cent to 18.3 million.

In response to the challenging pizza environment, a new brand campaign was in its early stages, a major upgrade was being made to the Pizza Hut website, and new product releases were planned, Restaurant Brands said. Store numbers dropped one to 106.

Starbucks Coffee sales were up $840,000, or 13.6 per cent, to $7 million. Same store sales rose $150,000, or 2.6 per cent, to $6.2 million.

New stores were due to be added to the present 44 outlets in the near future.

KFC, which contributed 56 per cent of total sales, increased sales for the quarter by $2.7 million, 7 per cent, to $41.5 million. Same store sales were up $2.2 million, 5.8 per cent, to $40.4 million.

Continuing improvements in operating standards, some successful product releases including Fillers, Wicked Wings and BBQ Chicken, and an increasing number of major store transformations, all contributed to the result, the company said.

Store numbers remained at 88, of which nine had been fully refurbished and work was under way on a further four.

Competition in the chicken fastfood market is growing with Australian chain Red Rooster looking for investors to help fund expansion in this country including opening several more outlets before the end of the year.

Red Rooster New Zealand managing director Mike Ryan said the company now operated four restaurants, with a fifth, in Mt Wellington, to open in early June.

Several more outlets in Hamilton and Auckland were due to open before the end of the year, he said.

Restaurant Brands' share price was up 1c to $1.28 around noon today, having ranged between $1.68 and $1.20 in the past year.

- NZPA