COLLINS BACK IN THE BLACK

Written on the 4 September 2013

COLLINS BACK IN THE BLACK

KFC’s return to sales growth last financial year pleased Collins Foods Limited (ASX:CKF) CEO and managing director Kevin Perkins, but there is still much work to do on the Sizzler business.

The company’s revenue is up 4.3 per cent to $423.9 million, while earnings per share is 17.6 cents, up 22.2 per cent compared to the previous year. Operating cash flow is up 15.7 per cent to $41.2 million.

The fried chicken restaurant recorded same store sales growth of 4.2 per cent in FY13, a significant improvement from the negative result seen in the previous year.

“The subdued retail environment over the 2013 financial year saw customers increasingly driven to value deals, which have been important in driving sales growth,” says Perkins at the company’s AGM today.

“Importantly, we were able to successfully generate growth in a way that did not cannibalise existing sales, allowing us to sustainably grow revenues.”

Perkins says the company’s summer advertising campaign, headed by its cricket sponsorship, was successful in driving the positive sales trend.

The company is on track with its KFC rollout and 12-store refurbishment program and there are plans for between five and seven new restaurants this financial year, with four scheduled to open before December.

Perkins says new restaurants have performed strongly and the further rollout of new stores will seek to capitalise on the popularity of the popularity of free standing and service station restaurants.

“Food court stores continue to be hampered by the weak retail environment showing signs of improvement during the current year as a result of operational initiatives that have been undertaken.”

Sizzler is still battling a downturn in the casual dining sector and recorded a decline in same store sales growth of 2.4 per cent, an improvement on 2012. There are few signs of improvement in FY14.

“Sizzler same store sales performance has been softer than expected in the first few months of 2014, with price sensitivity and relevance continuing to hamper sales, although restaurants outside the Brisbane region have been performing better.”

Perkins says a strategy for the sustainable growth of Sizzler is in its early stages. It will review the format, layout and design of the restaurants, aiming to build an “investable” business model while reframing the brand.

CKF shares were trading down 1.12 per cent today at $1.77 per unit.


Latest News

HARVEY NORMAN HITS OUT AT 'FALSE NEWS' OF ASIC INVESTIGATION

RETAIL giant Harvey Norman (ASX: HVN) has vehemently rejected reports its accounts are under investigation by ASIC, s...

RARE GOOD NEWS FOR SLATER AND GORDON AS ASIC CLOSES INVESTIGATION

ASIC has cleared Slater and Gordon of deliberately falsifying its accounts after a three-month investigation.

It s...

ADELAIDE DIGITAL MARKETING GURUS CHANGING THE FACE OF ONLINE RETAILING

Frank Grasso, CEO of Adelaide based Dynamic Creative, believes his company's new software will revolutionise Adwo...

Q & A WITH FACEBOOK GURU ANDY MCKEON AS HE JOINS AUSTRALIAN SOFTWARE COMPANY LIVETILES

HE was creative director at Apple under the legendary Steve Jobs, and is now a senior Facebook executive. In his n...

Related News

RAY OF HOPE FOR SLATER AND GORDON AS LENDERS STEP IN

EMBATTLED law firm Slater and Gordon (ASX: SGH) has announced to the ASX that it has launched confidential discussion...

SPROUTX PROVIDES THE SEED FOR AGTECH STARTUPS

AGTECH innovation fund SproutX has opened applications for its first accelerator round, backed by $10 million from...

GAS PRICES MAY FORCE BRICKWORKS TO TAKE MANUFACTURING OVERSEAS

BRICKWORKS Limited (ASX:BKW) chairman Robert Millner says soaring energy prices may force the company to turn to offs...

CHINA CONTINUES TO COLLECT AUSSIE PROPERTY ASSETS

CHINESE coin continues to dominate Australia's offshore real estate investment market, accounting for almost h...

EVENTS COMING UP

 

Contact us

Email News Update Sign Up Contact Details
Subscriptions

PO Box 2087
Brisbane QLD 4001

LoginTell a FriendSign Up to Newsletter