Restaurant Brands’ expansion pays off

AUCKLAND: Fastfood operator Restaurant Brands New Zealand lifted secondquarter sales as its expansion to Australia and Hawaii brought in more cash.

Sales increased 12% to $251 million in the 16 weeks ended September 10, the company said. That put firsthalf sales 12% ahead of last year at $431 million.

New Zealand’s largest fastfood operator is expanding into overseas markets to drive earnings growth. The company, which operates the KFC, Pizza Hut, Starbucks Coffee and Carl’s Jr brands in New Zealand, has expanded its business to KFC in Australia and Taco Bell and Pizza Hut in Hawaii. Total store numbers lifted by eight compared with the same period last year after the company acquired a further 13 KFC stores in Australia. They were offset by the sale of five New Zealand Pizza Hut stores to independent franchisees.

Almost half its sales, or 47%, were generated overseas in the latest quarter. Australia was the biggest contributor to growth, increasing sales by 44% to $60.6 million. Sales in Hawaii increased 10% to $57.6 million.

New Zealand sales, which account for 53% of total sales, rose 1.7% to $132.8 million.

Revenue from its local Pizza Hut stores fell 14% to $11.3 million in the quarter, which included four of the five store sales to independent franchisees. Total sales across the Pizza Hut network increased 2.1% to $32.5 million.

The company pulled in $7.3 million of revenue from the 22 New Zealand Starbucks Coffee stores. It is selling the chain to local operators next month after two decades of operation.

The firm’s newest New Zealand brand, burger chain Carl’s Jr, recorded a 7.3% drop in sales to $9.9 million from its 18 stores, one fewer than the yearearlier period.

Restaurant Brands expects to publish its firsthalf earnings on October 18. Its shares last traded at $7.66, and have risen 21% during the past year. —BusinessDesk