Fast food retailer Wimpy UK beefs up Famous Brands
FAST food franchiser Famous Brands' acquisition of Wimpy UK more than doubled its turnover growth.
Wimpy UK is to be used as a springboard for a British invasion of its local chains which include Steers, Whistle Stop, Debonairs Pizza, FishAways, House of Coffees and Brazilian.
The group, which released its full year results yesterday, said its South African franchisees grew revenue by 16percent to break the R1billion revenue barrier and operating profit by 34percent to R202million.
Its new international arm consisting of Wimpy UK and a financial holding company based in Cyprus added R175million revenue and R15million operating profit.
Restaurant expansion slowed to 106 during the year ended February from 151 the previous year.
Besides a slowing economy, the slowdown was due to the national power shortage putting new developments on hold.
Food and other inflation caused the second half to be tougher than the first. Nevertheless, the group managed to widen its operating margin to 18percent during this financial year from 16percent in 2006.
Kevin Hedderwick, Famous Brands chief operating officer, said the group was confident that its "best-in-their-class" brands will hold out in the tightening consumer spending environment "We have resilient brands that deliver high quality, though a lot of luxury foods will come under pressure, people have to eat," Hedderwick said.
"Famous Brands remains a South African-based company and we will continue to leverage the competencies and experience of our home base to enhance and grow our UK network." - Additional reporting by I-Net Bridge