Sizzler drags Collins Foods to FY loss
Franchised restaurant operator Collins Foods swung sharply to an annual loss despite a rise in revenue, after booking an impairment charge for its Sizzler chain in Australia.
The company said it now consider the Sizzler restaurants in Australia, which operate in the increasingly competitive casual dining market, as non-core and it won't be investing further capital in the chain locally.
"We believe this is a necessary course of action in order to pursue more attractive growth opportunities," chief executive Graham Maxwell said.
Collins said Thursday it swung to a net loss of $10.4 million in the 53 weeks to May 3 from a profit last year of $14m. The loss included a $37.5m charge related to the Sizzler Australia operations.
Revenue for the period rose 30 per cent to $571.6m from $440.6m.
Collins Foods is the largest franchisee of KFC restaurants, operating 171 outlets in Queensland, northern New South Wales, Western Australia and Northern Territory. It also operates 26 Sizzler restaurants in the country and another 60 in South East Asia.
The company said revenue at its KFC business was up 47 per cent on-year to $483.1m, driven by recent acquisitions, while Sizzler revenue was down 7.6 per cent to $88.5m.
The company said it would pay a final dividend of 6.5c a share, up on the 6c paid a year earlier.
Source: The Australian, Dow Jones Newswires, June 25th 2015
