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Romania's Sphera Franchise swings to net profit in H1

Romania's Sphera Franchise swings to net profit in H1 Source: Sphera Franchise Group

BUCHAREST (Romania), August 31 (SeeNews) - Sphera Franchise Group [BSE:SFG], the manager of KFC, Pizza Hut and Taco Bell brands in Romania, turned a net profit of 5.185 million lei ($1.24 million/ 1.05 million euro) in the first half of 2021, compared to a 22.36 million lei net loss in the same period of 2020, it said on Tuesday.

In the first six months of 2021, the group's restaurants registered operating profit of 35.8 million lei, a six-fold increase compared to the same period of last year, Sphera Franchise said in a statement filed with the Bucharest Stock Exchange, BVB.

Restaurant sales rose by an annual 46% to 444.5 million lei, especially due to good performance in the second quarter of the year. Consolidated sales in the second quarter surged by 119% on the year to 233.1 million lei, marking the best quarter in the company's history.

"After a period of instability caused by the Covid-19 pandemic, which severely affected HoReCa industry, this year we see the first signs of stability and recovery. The excellent results recorded in the second quarter give us confidence and optimism in the further investment and development of our network," Sphera general manager Calin Ionescu said in a separate press release.

During the first quarter, restaurant expenses grew by an annual 37%, reaching 408.7 million lei.

In Romania, the group's revenues increased 46% compared to the first half of last year, while sales in Italy increased by an annual 44%, the company added. Restaurants operating in Moldova registered revenues 67% higher on the year during January-June.

"The evolution so far is in line with our expectations, and we therefore maintain our goals in terms of turnover and profit for this year. Despite a difficult 2020, we are satisfied with the accelerated recovery of our business as well as our performance on the Bucharest Stock Exchange," Sphera CFO Valentin Budes said.

As of end-June, Sphera operated 161 restaurants, out of which 140 based in Romania, 19 in Italy and 2 in Moldova. Also, it had 4,392 employees, of which 4,058 in Romania, 253 in Italy and 81 in Moldova.

Sphera swung to a net loss of 2.3 million lei in 2020, from a 64.1 million lei net profit in 2019, due to the COVID-19 pandemic.

Sphera's shares traded 3.50% lower at 17.9 lei as at 1057 CET on Tuesday on the BVB.

(1 euro=4.9349 lei)