Latest news with #FamousBrands
IOL News
2 days ago
- Business
- IOL News
Famous Brand shows financial resilience despite tough year marked by deteriorating infrastructure
Famous Brands, owns Wimpy, Steers and Debonairs among other brands Image: File Famous Brands, Africa's largest restaurant franchisor, reported a resilient financial performance for the year ended 28 February 2025 in its annual report, despite challenging operating conditions marked by a deteriorating infrastructure environment, and cash-strapped consumers. The group, which owns and franchises major South African food brands such as Steers, Wimpy, Debonairs Pizza, Mugg & Bean, and Fishaways, posted a 3.2% rise in revenue to R8.28 billion, up from R8.02 billion the previous year. Operating profit grew by 12.6% to R914 million, while headline earnings per share climbed to 520 cents, from 465 cents in 2024. CEO Darren Hele credited the group's performance to disciplined cost containment, brand resilience, and a robust business model. 'Our financial results are thanks to strong cost control, the enduring appeal of our brands, and the resilience built into our business,' Hele said in the annual report. However, Hele did not shy away from describing the difficulties the company faced. 'South Africa is an increasingly tough market to operate in, with rising costs and failing infrastructure,' he noted. Citing power supply issues, he added that Eskom's electricity tariffs increased by 12.7% in July 2024 and are expected to rise by another 11.3% in July 2025, with future hikes likely. Hele pointed to logistics disruptions at South African ports and poor road conditions as additional threats to operations. 'Delays at ports mean we must hold more stock or source from costlier suppliers to avoid shortages,' he said. 'Infrastructure failures - including potholes and malfunctioning traffic lights - have a knock-on effect on consumer behaviour, leading to reduced late-night foot traffic and earlier dining patterns.' Access to clean, reliable water also emerged as a growing concern. 'Water supply has become increasingly unreliable. We are investing in filtration, recycling, and storage at our plants, particularly where water use is highest,' Hele said. As of year-end, 56% of the group's South African restaurants had secured alternative water solutions. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. 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Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ Despite these obstacles, Famous Brands maintained its expansion momentum. Chairperson Chris Boulle praised the resilience of franchise partners who, he said, continued to open and refurbish outlets despite rising electricity, labour, and input costs. Famous Brands has a healthy pipeline of new restaurant openings planned for 2026. He noted the 2025 financial year was characterised by low consumer spending, especially in the first half. To remain competitive, the group made strategic trade-offs, balancing support to franchisees and affordability for customers. This included carefully deciding which supply chain costs to absorb and which to pass on, all while maintaining viable margins across the system. Famous Brands continues to invest in operational efficiency and scalability. A major milestone was the June 2025 opening of a new cold storage facility at the Midrand Campus, a project completed on time and within budget as part of a broader logistics optimisation plan. The group is also focused on modernising its manufacturing plants over the next three years and enhancing its back-end technology to support cost-effective delivery and front-end customer service.
The Citizen
20-05-2025
- Business
- The Citizen
Famous Brands delivers double-digit dividend growth despite ‘curtailed consumers'
Says there were 'some green shoots' for the 2025 financial year. The company declared a final dividend of 195 cents per share and said its financial performance for the year 'demonstrates resilience'. Picture: Supplied Leading JSE-listed food services franchisor Famous Brands delivered double-digit dividend and headline earnings per share (Heps) growth for the year ended 28 February 2025 on Monday, despite slower revenue growth of 3.2% to R8.3 billion. Last year (FY2024) revenue grew 8%, but the group said FY2025 saw 'economic headwinds in South Africa' which 'significantly curtailed consumer spending'. However, it also highlighted 'some green shoots'. Famous Brands reported a 14.2% jump in dividend per share, 12.6% increase in operating profit (to R914 million), and an 11.9% jump in Heps (to 520 cents) for FY2025, as it upped internal efficiencies and boosted its operating profit margin by 0.9 basis points to 11%. ALSO READ: Here's how you can make four burgers for R50 with retailer's new food deal The group, which counts 16 big brands like Wimpy, Steers and Turn n Tender as part of its quick service and restaurant chains, said 'curtailed spending' meant 'consumers prioritised essential spending and seek value for money. Competition remains fierce, with increasing advertising activity and a higher frequency and depth of value deals and promotions' during FY2025. 'The landscape favours franchised brands over independent restaurants,' the group noted. 'Other challenges include deteriorating infrastructure, including unreliable electricity and water supply and logistics sector issues. However, there were some green shoots for 2025, including the reduction in load shedding, improved consumer sentiment, rand stability, lower inflation and three interest rate cuts,' it added. The company's board declared a final dividend of 195 cents per share and said its financial performance for the year 'demonstrates resilience'. ALSO READ: Chicken, burgers and pizza are SA consumers' take-away favourites Together with the final dividend, total dividends for the year came in at 345 cents per share (FY2024: 302 cents). A total dividend of R345.7 million was paid out of current-year profits, it said. 'Our Leading Brands portfolio performed strongly, with solid performances across the brands. However, our Brands' overall performance did not meet our expectations due to lower consumer spending,' the group noted. 'This subdued demand had a negative impact on our manufacturing and logistics results.' Famous Brands has a restaurant network of 2 979 outlets across 20 countries, over 2600 of which are in its core SA market. The vertically integrated group includes its restaurants and fast-food chains (Brands unit) in addition to manufacturing, logistics and retail business units. It operates franchised and company-owned restaurants, as well as master-licensed brands such as PAUL. Famous Brands's shares traded marginally up on Monday, following the release of its latest results. This article was republished from Moneyweb. Read the original here.
