Americana Restaurants income surges 27.1% in 2022

Company's popular brands KFC, Pizza Hut deliver strong double-digit revenue growth in 2022


Muzaffar Rizvi

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Published: Thu 23 Feb 2023, 5:55 PM

Americana Restaurants International and its subsidiaries on Thursday recorded 27.1 per cent year-on-year increase in net income for 2022 as its reputable international brands for quick service segment registered strong double-digit growth in business last year.

The largest out-of-home dining and quick service restaurant operator in the Middle East & North Africa (Mena) and Kazakhstan, which listed on Abu Dhabi Securities Exchange (ADX) and Saudi Stock Exchange (Tadawul), said its net income rose to $259.2 million from $204 million in the same period last year.

In its first announcement of financial results since its historic concurrent dual listing on the ADX and the Tadawul, the newly-listed company said its annual revenue climbed 15.9 per cent to $2.38 billion in 2022 from $2.05 billion in the corresponding period of 2021 as its popular fast food brands registered strong revenue growth with the revival of economic activities after the temporary slowdown due to Covid-19 pandemic.

The company registered 17.7 per cent increase in KFC revenues to $1.455 billion last year compared to $1.236 billion in 2021 while Hardee’s and Pizza Hut posted 15.2 per cent and 11.8 per cent revenue growth, respectively, last year. Hardee’s revenue rose to $403 million from $350 million while Pizza Hut revenue increased to $264 million from $237 million in 2021.

Americana Restaurants board announced second half 2022 dividends at $103.5 million or the equivalent of $0.0123 per share in line with its previous guidance. The dividend will be subject to shareholders approval at their annual general meeting.

Power brands delivered

KFC contributed approximately 61 per cent of the company’s revenues in 202, crossing a record 100 million transactions for the first time. The brand delivered strong like-for-like sales growth of 17.9 per cent, cementing KFC’s position as the #1 brand in the chicken segment. In 2022, KFC opened 54 gross new units, with expansion primarily focused on Saudi Arabia, Morocco and the UAE.

Hardee’s contributied approximately 17 per cent of the company’s revenues and it delivered solid performance in all key markets, particularly Saudi Arabia, Kuwait and UAE. Hardee’s added 18 gross new stores in 2022, reaching a total of 391 stores across 10 operating markets.

Pizza Hut accounted for approximately 11 per cent of Americana Restaurants’ revenues in FY2022. Americana Restaurants relaunched Pizza Hut in Saudi Arabia in June 2022, acquiring country-wide franchise rights (excluding Jeddah). The brand footprint has grown successfully in the kingdom, with 30 stores opening in the second half of 2022.

Krispy Kreme contributed approximately four per cent of annual revenues, generating $90 million in sales, supported by its opening in Jordan and accelerating growth in Egypt. During 2022, Krispy Kreme enhanced product innovation by collaborating with major confectionary brands such as KitKat and Lotus. It opened 68 gross new units, with off-premise focused footprint expansion primarily in Saudi Arabia.

“As a pioneer with over 50 years of heritage across the Middle East and North Africa, 2022 was a landmark year. Americana Restaurants elevated its global presence as a publicly listed company, in readiness for its next chapter as one of the most profitable, growth-oriented and diversified F&B operators,” said Mohamed Ali Rashed Alabbar, chairman of Americana Restaurants.

He said the Mena region remains uniquely attractive for out-of-home dining, with strong macroeconomic tailwinds, a growing youth population and soaring urbanisation.

“These dynamics, coupled with the cultural internationalism of our target markets, provides our business with a springboard for growth across Mena and Kazakhstan,” he said.

Near-term focus

Americana Restaurants closed 2022 with 2,183 operating restaurants, including 186 gross openings for its ‘Power Brands’ KFC, Pizza Hut, Hardee’s and Krispy Kreme. With its omnichannel platform continuing to grow in strength and scale, home delivery contributed 39 per cent of total revenue, followed by Takeaway (24 per cent), dine-in (21 per cent), drive-thru (10 per cent) and others (six per cent).

Top-line growth was driven by robust like-for-like sales growth of 13.6 per cent, and 220 gross new store openings. The company generated adjusted EBITDA of $536 million, increasing by 15.4 per cent versus 2021, and a healthy EBITDA margin of 22.5 per cent.

Alabbar said Americana Restaurants’ near-term focus will be to leverage the strength of its platform to increase the penetration of existing brands, enter new categories and expand geographically both organically and inorganically by entering new markets.

“The company will also continue to invest in restaurant redesigns and organisational efficiency to minimise capital recovery periods and maintain cost discipline,”he said.

Americana Restaurants maintains a very healthy balance sheet and strong overall financial position. With adjusted Free Cash Flow for the period of $179 million and a cash conversion ratio of 49.3 per cent, the company is well positioned to meet its growth and capital expenditure commitments and support its dividend policy.

Looking ahead, Americana Restaurants is ready to capitalise on opportunities to improve profitability by maintaining a sharp focus on revenue growth and margin expansion. Management will continue to execute and refine the Company’s long-term strategy across the Middle East, North Africa and Kazakhstan in pursuit of industry-leading shareholder value creation.


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