Romanian restaurant operator Sphera revises upward full-year forecast

Sphera Franchise Group (SFG), the owner of the companies operating the KFC, Pizza Hut, and Taco Bell brands in Romania, has improved its budget forecasts for 2020 compared to the estimate issued in May 2020 amid the coronavirus pandemic and the restrictions imposed by the authorities on the activity of restaurants.

The company estimates its revenues will drop by only 30% year-on-year, under the revised forecast, which will allow it to maintain a positive EBITDA.

The upgrade reflects the outcome of the group’s efforts to mitigate the effects of the restrictions by focusing on developing new sales channels, such as collaborating with online order aggregators and promoting Delivery and Drive-Thru channels.

The company also continued to implement the plan to open new restaurants and identify locations for future expansion.

The company now expects its revenues to drop by only 30% year-on-year to RON 670 million (EUR 137 mln), a milder plunge than the 44% drop projected in May.

In absolute terms, the revenues target increased by RON 133 mln, or nearly one quarter compared to the gloomy forecast inked in May.

The updated forecast also indicates the group’s EBITDA will contract by 72.4% to RON 26.5 mln (EUR 5.4 mln), compared to RON 96 mln in 2019.

The initial estimate issued in April pointed to a negative RON 11.3 mln EBITDA this year.

(Photo courtesy of the company)