Collins Foods shares soar on KFC Australia sales growth
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The news: Shares in Collins Foods soared in early trading on the ASX after KFC Australia recorded double-digit sales growth during the fourth quarter.
The numbers: Collins Foods, which operates KFC and Taco Bell restaurants in Australia and Europe, saw its shares rise 12.7% to $8.35 by 11:10am AEDT, having retreated by nearly 30% over the last 12 months.
Overnight, KFC's parent Yum! Brands posted its Q4 results that said KFC Australia, including New Zealand, recorded system sales growth of 11% compared to the prior corresponding period.
It followed growth of 4% in Q1, 3% in Q2 and 2% in Q3 of the 2024 calendar year.
Wilsons Advisory, which retained an 'overweight' rating on Collins Foods, estimated Q4 same store sales growth at around 6% for KFC Australia during the quarter.
The context: Wilsons Advisory analysts noted that New Zealand is outstripping sales stores growth in Australia. However, they believe it is that the states where sales growth has underperformed recently, including New South Wales and Victoria, have started to improve an now outperforming other states, such as Queensland and Western Australia.
The sources: Wilsons Advisory research, Yum! Brands media release
