Collins Foods shares have jumped more than 17 per cent after the company said its underlying full-year profit rose 5.1 per cent to $47.3 million.
Revenue for the 53 weeks to May 3 climbed 8.9 per cent to $981.7 million, as Australians flocked to its trusted KFC brand during unsettled times.
Its statutory profit was down 20.1 per cent to $31.3 million, mainly reflecting the impact of new accounting standards regarding leases.
At 1136 AEST, Collins Foods shares were up 17.3 per cent to $9.81.
“KFC Australia has once again shown that it is a safe and trusted brand that customers can rely on during uncertain times,” said chief executive Drew O’Malley.
“Research has shown that customers gravitate to known and trusted brands during uncertain times – attributes strongly associated with the KFC brand in Australia,” the company said in a presentation.
Same-store sales grew 3.5 per cent in Australia, with second-half sales growth of 2.3 per cent despite the impact of COVID-19.
KFC Australia was able to recapture lost sales from dine-in channels by quickly pivoting towards takeaway and delivery, Mr O’Malley said.
Across its network 137 of its 240 restaurants now offer delivery, he said, up from around 100 at the half year.
Sales were more severely impacted in Europe, but are recovering, he said.
During the year Collins opened six new Taco Bell restaurants in Queensland and two in Victoria, bringing its total to 12, as well as nine new KFC restaurants.
Its Sizzler restaurants were most severely impacted by the pandemic, with revenues down 17.9 per cent to $38.3 million amid dine-in restrictions and three of its 12 restaurants forced to close.
Collins said it reduced its net debt from $212.5 million in fiscal 2019 to $203.2 million at the end of fiscal 2020, leaving it with plenty of headroom in its debt facility of around $400 million.
The company declared a final dividend of 10.5 cents per share, fully franked, the same as last year.
COLLINS FOODS RESILIENT DURING PANDEMIC
* Revenue for the 53 weeks to May 3 up 8.9pct to $981.7 million
* Underlying net profit after tax up 5.1 pct to $47.3 million
* Statutory net profit after tax down 20.1pct to $42.2 million.