Burger King's India operator posts wider Q1 loss on higher costs

Restaurant Brands Asia

07/08/2023 06:41

CHENNAI, Aug 7 (Reuters) - Restaurant Brands Asia
 RESR.NS  on Monday reported a steeper first-quarter loss, as
Burger King's India operator incurred higher raw material
expenses while also spending heavily on more stores.
    The restaurant chain's consolidated net loss widened to
504.8 million rupees ($6.1 million) for the quarter ended June
30, from 475 million rupees a year ago, according to an exchange
filing.
    Total expenses increased over 21% to 6.72 billion rupees,
with cost of materials consumed climbing 26% due to rising costs
of ingredients including cheese and vegetables.
    Rising costs have pressured bottom lines at its rivals as
well, including KFC franchisees Sapphire Foods India  SAPI.NS 
and Devyani International  DEVY.NS  as well as Domino's Pizza
 DPZ.N  operator Jubilant FoodWorks  JUBI.NS .
    Earlier this year, Restaurant Brands Asia launched new meals
starting at 99 rupees ($1.20), at a time when global chains in
India doubled down on cheaper offerings to attract consumers
cutting back discretionary spending due to high inflation.
    Revenue from operations rose 25% to 6.11 billion rupees,
helped by the new launch and the company's move to open tens of
new restaurants in both India and Indonesia, where it holds
master franchisee rights, in the previous 12 months.
    Shares of Restaurant Brands Asia, which also operates
Restaurant Brands International's  QSR.TO  Popeyes stores in
Indonesia, were up nearly 2% after the results. For the June
quarter, they were up nearly 20%.

($1 = 82.7175 Indian rupees)

 (Reporting by Praveen Paramasivam in Chennai; Editing by Varun
H K)
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