Restaurant Brands NZ is anticipating a significant decline in its annual net profit for the current fiscal year as it grapples with inflationary pressures, including higher ingredient and wage costs. The company has revised its guidance for the 12 months ending in December, now projecting a net profit ranging between NZ$12 million and NZ$16 million. This marks a sharp decrease compared to the NZ$32.1 million achieved in the previous fiscal year.
The New Zealand business of Restaurant Brands NZ has been negatively impacted by ongoing increases in input costs, surpassing earlier expectations in terms of both scope and size. Additionally, the company has also experienced slower-than-anticipated sales growth in California and Hawaii.
Given the expectation that these factors will persist for an extended period, surpassing initial estimates, the company acknowledges that the recovery in the second half of the fiscal year will likely be weaker than anticipated.
To make matters worse, Restaurant Brands NZ has been unable to fully offset the cost increases by raising prices across its markets.
In the second quarter of the fiscal year, spanning April to June, Restaurant Brands NZ reported total sales of NZ$331.6 million, reflecting a 7.1% increase compared to the same period last year. The growth can be attributed to the company's post-pandemic recovery efforts and the implementation of price adjustments across all markets.
Rest assured, we will continue to monitor the situation and provide updates as necessary.