Famous Brands continues expansion into Africa - CNBC Africa

Famous Brands continues expansion into Africa

Earnings

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Famous Brands will make its maiden entry into Abu Dhabi in November with the opening of a Steers restaurant. PHOTO: Unvegan

The integrated food services business also said that system-wide sales reported in Africa, excluding South Africa, grew by 15.5 per cent, while like-on-like sales increased 8.9 per cent, and that it now contributes 8.6 per cent of total franchise system-wide sales.

“The group trades in 16 countries in this region. Fourteen restaurants were opened during the period, and a further 32 are planned for the balance of the year, including Debonairs Pizza’s maiden entry into Angola,” Famous Brands said.

(READ MORE: S.Africa to get a taste of local pizza war)

“Significant progress has been made across the recently acquired Mr Bigg’s business in Nigeria. In addition, a range of opportunities have been identified to enhance efficiencies and upgrade skillsets which will deliver good gains in the near future.”

In South Africa, its franchised brands traded in a highly challenging and fiercely competitive environment with system-wide sales, including new restaurants, increasing 9.1 per cent and same store sales increasing 3.4 per cent.

[DATA FBR:Famous Brands], which holds a number of brands including Steers, Wimpy, Debonairs Pizza, Mugg & Bean, FishAways and tashas, further stated that the strength of its integrated business model is evident in the results reported for the period.

“Management’s focus was on two key strategic interventions – institutionalisation of the Fit 4 Purpose business transformation model designed to optimise the group’s relationship with its franchisees and consumers, and implementation of the Product Platform Expansion strategy,” it said.

“Fit 4 Purpose has already started to deliver substantial benefits and the Product Platform Expansion strategy, although still in the initial phases of the programme, is anticipated to secure the group’s long-term growth ambitions.”

The group saw revenue growth of 14 per cent to 1.57 billion rand in the interim 2014 period from 1.37 billion rand for the same period in 2013.

Operating profit increased by 19 per cent during the six months while profit before taxation for the period grew to 220 million rand from 180 million rand in 2013.

Basic earnings per share grew 18 per cent to 212 cents in the 2014 period from 180 cents in 2013 and dividends per share increased by 19 per cent to 155 cents.

(READ MORE: Famous Brands expands its Middle East and North African footprint)

“Despite constrained consumer discretionary income, management has high expectations for the forthcoming peak trading period. The foodservice sector will continue to grow, fuelled by the demand for convenience,” said Famous Brands.

“As reflected in these results, the integrated supply chain plays a vital role in underpinning the success of the brands and profitability of the business as a whole.”

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