BurgerFuel still bullish on prospects for growth in the US
BurgerFuel Worldwide narrowed its first- half loss and says it wants to buy more stores and is still looking to expand into the US — though its sales and option and collaboration agreements with investor Franchise Brands have ended.
The net loss was $ 115,328 in the six months ended September 30, from $ 487,533 a year earlier, the Auckland- based company said. Group operating revenue rose 7 per cent to $ 10.4 million, largely from long- term recurring royalties and sales. Total system sales, which includes sales by franchisees and new and existing stores, climbed 3.4 per cent to $ 48.3m.
The company has 51 stores in New Zealand, where it is the third largest burger concept in the market.
System sales gained 16.5 per cent in Australasia, the company said, with strong sales growth in New Zealand at $ 8.9m, up from $ 7.5m a year earlier.
BurgerFuel bought the Takapuna store from its franchisee in October, adding to its existing portfolio of two and providing more training facilities for its global expansion, it said. The company plans to make more “key BurgerFuel restaurant purchases”, and had no debt and cash reserves of $ 6.5m as of September 30.
“We have worked hard to reduce our operating costs in order to achieve our goals, and this will continue for the remainder of FY17,” the notes said. “The directors remain very positive about BurgerFuel’s future and have management focused on opening in the US as well as continued expansion in other markets.”
In Australia, revenue dropped to $ 226,000 in the first half from $ 527,000 the previous year. In the Middle East, sales and royalty income dropped to $ 1.3m, from $ 1.7m a year earlier. However, BurgerFuel has opened three new stores this financial year, including re- opening in Baghdad, and has 26 outlets in the region.
BurgerFuel said it still sees many opportunities in the US, where it expects to announce its first store location shortly.