Famous Brands Delivers Stellar Festive Season
Johannesburg; Wednesday, 16 January 2013: Famous Brands has reported exceptional trading results for the month of December 2012, recording highest-ever turnovers by several of its biggest brands including Steers, Debonairs Pizza, Wimpy, Mugg & Bean and FishAways.
System-wide sales across the Group’s total brand portfolio (including South Africa and the Rest of Africa region) grew 13.2% while like-on-like sales increased 9%, up from 6.1% in December 2011. System-wide sales in South Africa alone grew 12.4% in December, while like-on-like sales rose 8.5%. In the Rest of Africa region, system-wide sales increased 25.6%, with like-on-like sales improving 15.1%.
During December, the Group opened 21 restaurants in South Africa and a further 10 restaurants in the Rest of Africa region. Factoring in builders’ holidays which commenced mid-month, this rate equates to two new restaurants opened per day. In South Africa restaurants were opened across the brand portfolio, while in the Rest of Africa region expansion came from the Steers, Debonairs Pizza and FishAways brands.
Famous Brands CEO, Kevin Hedderwick, says, “Given the prevailing difficult trading environment, management’s expectations for the period were cautious. The results delivered by the business in December exceeded our expectations and we are delighted with the Group’s performance. The remarkable turnover numbers reported by our leading mainstream brands is particularly commendable given the sheer size of those restaurant networks and in the case of Steers, our ‘mother’ brand, the mature stage in its life-cycle, having been founded in 1970.
“These robust results are testament to several factors,” comments Hedderwick, “including the strength and popularity of our brands which enjoy support from a loyal and growing customer base. During the period we implemented a range of promotional activities and product innovations to support these brands – all of which were well received by the market.” He adds, “The fact that our restaurants are situated on key strategic sites in shopping malls, entertainment centres, airports and on transit routes across the country, affords our brands widespread exposure nationally.”
Hedderwick notes, “For the first time in several years there was a sense that consumers decided to ‘reward’ themselves and their families after a difficult year – both in terms of going away on holiday and eating out. In contrast to the 2011 December trading period, there was a discernible migration of holidaymakers from Gauteng to the coastal areas. Our restaurants in KwaZulu Natal and the Western Cape outperformed the inland markets, delivering stand-out results. Further reflecting this trend are the record turnovers reported by our restaurants on transit sites, at casinos such as Sun City, and entertainment centres including uShaka Marine World in Durban and the V&A Waterfront in Cape Town.”
Hedderwick says the Group’s strong relationships with its strategic alliance partners ensured that restaurants located on transit sites and routes made a significant contribution to turnover.
“The Group’s niche brands complemented the stellar performance delivered by the mainstream brands,” comments Hedderwick. “tashas reported 30% growth in system-wide turnover during the period, demonstrating sustained endorsement from the top-end of the market. The Group’s first Net Café was opened at Netcare Milpark Hospital in December, and delivered a 30% increase in turnover. Management is extremely optimistic about the planned roll out of this brand over the next year,” states Hedderwick.
“The good weather in December also played a role in growing sales, best exemplified by Milky Lane’s 10.5% like-on-like growth,” he adds.
Hedderwick says that the Pub division’s flagship brand, KEG, reported solid growth. “Aggressive anti-drink and drive campaigns contributed to restricting sales growth to single digits, which we are satisfied with given our strong support for responsible drinking in this country,” says Hedderwick.
The robust performance delivered by the brands at the front end of the business flowed through to the Group’s Manufacturing and Logistics divisions at the back-end, reflected by improved sales growth of 17%.
This announcement has not been reviewed or reported on by the Group’s external auditors.