Fast-food demand bolsters sales at KFC, Carl's Jr, despite Covid-19 restrictions

Thursday, 22 October 2020

Restaurant Brands, which operates KFC, Pizza Hut, Taco Bell and Carl’s Jr in New Zealand, lifted sales in the third quarter.

Sales of fast-food have continued unabated in recent months despite Covid-19 trading restrictions, driving growth for New Zealand franchise-holder Restaurant Brands.

New Zealand made international headlines earlier this year when queues of cars lined up outside KFC and McDonald’s after the country’s Covid-19 alert levels were relaxed to allow takeaways.

Restaurant Brands, which owns the local franchises for KFC, Pizza Hut, Taco Bell and Carl’s Jr, said on Thursday that its third-quarter sales in New Zealand for the three months to September 30 increased 5.4 per cent to $115.9 million, despite the reintroduction of Government-mandated trading restrictions, particularly in the Auckland region from August 12 to the end of September.

On a same-store basis, removing the impact of stores closed because of Covid-19 restrictions, New Zealand sales increased 5.9 per cent, with KFC and Carl’s Jr “continuing to trade strongly”, chief executive Russel Creedy said.

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Some figures looking at the economic hit Covid-19 has had on New Zealand.

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Restaurant Brands has 139 stores in New Zealand, 11 fewer than a year ago, after it sold 12 Pizza Hut outlets to independent franchisees and bought KFC Kapiti from an independent franchisee.

Globally, the company has 348 stores, after buying 69 KFC and Taco Bell stores in California, United States, in September. Total sales across the company increased 13 per cent in the quarter to $239.8m.

For the first month of trading, California sales were US$8.8m (NZ$13.4m), which was ahead of the year earlier and higher than expected, Creedy said.

In Australia, sales for the quarter advanced 9.1 per cent to A$53m (NZ$57.4m), after the company opened two Taco Bell and two KFC stores, taking total store numbers to 65. On a same-store basis, sales were up 3.3 per cent even though most stores were not able to offer in-store dining due to Covid-19 restrictions.

In Hawaii, where the company has 75 stores, sales for the quarter increased 5.1 per cent to US$35m.

“The small downturn in Taco Bell sales arising from the ongoing unavailability of in-store dining was more than offset by strong Pizza Hut sales which continue to benefit from newly enhanced web order and delivery functions,” Creedy said.

So far this year, total sales for Restaurant Brands are up 2.4 per cent to $623.3m, despite the full closure of New Zealand stores for most of April, he said. On a same-store basis, all divisions recorded growth despite disruptions to dine-in trading due to Covid-19.

Restaurant Brands shares were up 0.7 per cent to $12.08 in late morning trading on Thursday.