Victoria's appetite for pizza just keeps falling away

Vicki Salmon says warmer weather has affected demand for pizza but coffee sales are still going strong. Picture / Paul Estcourt

Fast food franchise operator Restaurant Brands will further write down its Pizza Hut investment in Victoria as fourth-quarter sales for the brand fall.

Chief executive Vicki Salmon said the operation was still "probably slightly over-valued".

Pizza Hut's Victorian sales of A$5.6 million ($6.3 million) in the quarter to February were down 11.2 per cent on the same period the previous year and sales for the year were down 4.9 per cent at A$25.5 million.

Sales at Pizza Hut New Zealand were down 4.7 per cent for the quarter at $18.8 million, but sales for the year were up 3.6 per cent at $89.1 million, although same store sales were down 2.9 per cent.

Salmon said warmer weather had affected demand for pizza "and we also know we didn't put as much marketing effort [in] over the last quarter that maybe we should have".

New Zealand store numbers reached a new high of 107.

Margins in both Pizza Hut businesses had been affected by tighter trading conditions but these had been largely offset by a stronger profit performance by KFC. Sales at KFC were up 6.4 per cent for the quarter at $41.9 million and sales for the year up 1.1 per cent at $171.8 million.

Salmon said KFC had been in "almost crisis" 2 1/2 years ago, but was now reaping the benefits of operational discipline, store refurbishment and promotion.

Sales at Starbucks Coffee jumped 18 per cent to $7.1 million for the quarter and 14.4 per cent to $27.9 million for the year.

Restaurant Brands reported total sales up 2.8 per cent for the quarter at $74 million and up 2.1 per cent for the year at $316.4 million.

Group profit result for the current year is expected to be down slightly.