Retail Food Group profit forecast gets sliced again
BELEAGUERED Gold Coast franchisor Retail Food Group has conceded a bigger slice than it thought had been carved from its bottom line, revising its profit guidance for the first half of the financial year.
But the Southport-based company has not specified the size of the profit downgrade, saying only it would be “less than” the $22 million net profit it foreshadowed in December, which was already 34 per cent down on the previous year.
RFG, which runs Pizza Capers, Brumby’s, Gloria Jeans and other brands, took a halfbillion plunge in value in the wake of allegations by franchisees of damaging business models.
RFG yesterday told the ASX it had finalised master franchise agreements to take its Crust Gourmet Pizza and Donut King Brand Systems to the United Kingdom.
However it said revenue from the sales could not be included in the results for the first half of the year, which it had previously flagged at delivering $22 million net profit.
RFG last month flagged a 34 per cent loss in profit for 1H18 on top of a $445 million plunge in the company’s share value.
The company is yet to release a guidance for the full 2018 financial year and is preparing results for the first half.
Shares in RFG had recovered from the low of $1.60 on December 20 to open at $2.47 yesterday. The share price closed down 15¢ or 6 per cent at $2.32 following yesterday’s announcement.
The company is also facing possible legal action after Bannister Law in December said it was investigating a possible class action on behalf of RFG shareholders.