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Did somebody say profit? Secret herbs and spices behind COVID sales spike

Business

KFC appears to have been the food of choice for a pandemic-hit Australia after Collins Food Group announced double-digit revenue growth at its stores for the six months to October 18.

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Collins reported an 11 per cent increase in revenue to almost $500 million and a 10.5 per cent increase in underlying earnings to $63.7 million. It recorded a non-trading benefit of $4.2 million which lifted its underlying net profit to $27.5 million, a 15 per cent increase.

Same-store KFC sales for the first five weeks of the second half were up 14 per cent.

Its dine-in Sizzler stores, which were all closed by November 15, were heavily impacted by COVID-19 and same-store sales were down 50 per cent.

The company said its take-away channels had more than offset the dine-in option during COVID-19 restrictions.

Shareholders will earn an increased dividend of 10.5 cents a share, up from 9.5 cents in 2020 and its shares jumped almost 7 per cent in early trade. Its fast food rival, Domino’s Pizza, jumped 12 per cent on the market this morning after an investors’ day presentation yesterday.

The Brisbane based companies owns the KFC and Taco Bell brands as well as Sizzler, which it closed this year.

Chief executive Drew O’Malley said the company had effectively managed the impacts of the pandemic.

“KFC Australia was the main driver of the strong growth achieved, demonstrating the power of the KFC brand and benefitting from excellent operational disciplines, as well as growth in digital and delivery channels,” O’Malley said.

“While KFC Europe had to manage through stricter lockdowns and a second wave of restrictions, sales momentum in German remained positive and our Netherlands restaurants saw promising growth in drive-thru sales.”

It said that in its Australian KFC stores, e-commerce sales had doubled while in Europe where its same-store sales fell 4.2 per cent, its drive-thru performance was up 5.8 per cent. Its same-store sales in Europe for the first five weeks of the second half were down 5.5 per cent.

Its Taco Bell stores had recovered to the pre-COVID levels.

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