February 22, 2011

KFC - OSK Research: KFCH revenue, core net profit within expectations

Stock Name: KFC
Company Name: KFC HOLDINGS (M) BHD
Research House: OSK

KUALA LUMPUR: OSK Research said KFC Holdings' FY10 revenue and core net profit of RM2522.4 million (up 9.8% on-year) and RM150.2 million (+15.2% on-year) respectively were within its and consensus estimates.

It said on Tuesday, Feb 22 that buoyed by higher average same-store-sales growth, new openings and the introduction of new products, its restaurant segment posted 9.6% growth to RM1496.9 million while the integrated poultry division saw a 10.2% jump in revenue on-year to RM533.4 million.

OSK Research said the FY10 core EBIT margin was 0.2 percentage point better on-year, mainly bolstered by the local KFC operation and integrated poultry division.

'Our FY11 and FY12 net profit forecast is raised by 1.3% - 1.8% to RM164.6 million and RM181.5 million respectively after factoring in a stronger US$/ringgit exchange rate and higher raw material cost. Maintain NEUTRAL,' it said.

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