The Collins Foods Ltd (ASX: CKF) share price is having a strong session.
In morning trade, the quick service restaurant operator's shares are up 10% to a 52-week high of $11.16.
This follows the release of the ASX 200 stock's half-year results.
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ASX 200 stock jumps on half-year update
Here's how Collins Foods performed for the six months ended 15 October:
- Revenue from continuing operations up 14.3% to $696.5 million
- Underlying EBITDA from continuing operations up 16.7% to $109.9 million
- Underlying net profit after tax from continuing operations up 28.7% to $31.2 million
- Statutory net profit after tax up 359% to $50.5 million
- Fully franked interim dividend up 4.2% to 12.5 cents per share
What happened during the half?
For the six months, Collins Foods reported a 14.3% increase in revenue from continuing operations to $696.5 million. This reflects strong growth across all business units.
KFC Australia reported a 9% lift in revenue to $522.9 million, KFC Europe posted a 36.5% increase in revenue to $148.5 million, and Taco Bell delivered an 18.9% jump in revenue to $25.1 million. This reflects store expansions and same-store sales growth of 6.6%, 8.8%, and 7.9%, respectively.
Things were even better for its earnings, with underlying EBITDA from continuing operations up 16.7% to $109.9 million.
This was driven by its KFC Australia and Europe businesses, which reported an 11.1% and 53% increase in underlying EBITDA, respectively. And while the Taco Bell business continues to post a loss, it improved to just $0.1 million for the six months.
Management commentary
The ASX 200 stock's managing director and CEO, Drew O'Malley, was pleased with the half. He said:
Performance in the first half has highlighted the underlying strength of our business, and the resilience of the QSR sector in challenging economic conditions. Our approach to value has continued to deliver solid topline, same store sales, and earnings growth across the Group. This was underpinned by the strength of our world-class brands, our growing digital channels, and value credentials. As higher cost-of-living pressures continue to impact consumers, offering great tasting food that provides exceptional value has never been more important.
Our restaurant footprint continues to grow with five new builds added across the Group over the first half. We remodelled a further thirty restaurants and continue to innovate format design to support the global shift towards digital and delivery channels. While inflationary pressures remain, we managed short-term cost impacts through margin support initiatives that improved profitability in the first half while prioritising long-term brand health and consumer trust. And as always, we have done this on the foundations of operational excellence at the heart of what Collins Foods stands for.
Trading update
Pleasingly, Collins Foods' positive momentum has carried over into the second half. O'Malley advised:
Sales continued to grow in the first six weeks of the second half with KFC same store sales up +2.9% in Australia, +8.1% in Netherlands, +8.6% in Germany, while Taco Bell continued its positive trajectory with same store sales up +8.7%.
No guidance has been given for the full year.
