KFC franchise records after-tax losses
Published 22/11/2010 | 05:00
THE company that operates the Kentucky Fried Chicken (KFC) franchise across Ireland made a loss last year after rental income on property investments fell.
And its Belfast-based parent also suffered a £2.2m (€2.6m) loss after tax despite revenues holding steady at £64.5m.
Accounts just filed with the Companies Office show that Herbel Restaurants (Ireland) Ltd -- which operates 18 KFC outlets in Ireland -- sustained after-tax losses of €469,722 in 2009.
The losses came after the company recorded a 10pc drop in operating profits from €5.1m to €4.6m to the end of December last, and on foot of bank loan repayments of €3.5m and the loss of €1.1m on the sale of a fixed asset were recorded.
The directors said that "despite the economic conditions, the KFC franchise business continues to trade well". Sales were down 4.5pc, from €24.4m to €23.3m.
Revenues from the KFC restaurant business were up slightly, from €20.7m to €20.8m. In a note to the accounts directors said the fall in revenue was a result of a decrease in rental income from the company's €90m property investment portfolio. Rental income fell €1.1m from €3.6m to €2.5m.
The group's two directors are Belfast businessman Michael Herbert and his wife Leslie.
The accounts show that the company had accumulated profits of €8.7m with shareholder funds of €40.3m. Employee numbers increased by 14 to 232 last year and staff costs reached €6m.
Separate accounts filed by parent company, Herbel Restaurants Ltd, to the Companies House in the UK show that it recorded a post-tax loss of £2.2m for the Herbel group last year.
The Belfast-based group is the largest KFC franchise in Europe operating in the Republic of Ireland, Northern Ireland, England, Scotland and the Isle of Man.
The group's revenues -- which include the Irish performance -- were flat last year at £64.5m, but the group more than doubled its operating profits from £2.9m to £7.5m. The group employs 962.