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Famous Brands Limited - Another saucy quarter for Famous Brands

Release Date: 02/12/2005 12:00
Code(s): FBR
Wrap Text

Famous Brands Limited - Another saucy quarter for Famous Brands Famous Brands Limited (Incorporated in the Republic of South Africa) (Previously Steers Holdings Limited) (Registration number 1969/004875/06) Share code: FBR & ISIN code: ZAE000053328 ANOTHER SAUCY QUARTER FOR FAMOUS BRANDS * Average system wide turnover improves 18% * Debonairs Pizza grows revenue 30%, opens 200th restaurant and optimises business model * "Sleeping Giant" FishAways delivers 75% growth in turnover * Group"s Airport restaurants produce record growth * Food Services division commences take on of Wimpy business Johannesburg, 02 December 2005: The quarter commencing September 2005 has been an eventful one in the build up to Famous Brands" (FBR) peak trading holiday season. For the review period, system wide turnover increased 18% reflecting robust growth from existing restaurants, complemented by revenue achieved from the addition of a further 45 restaurants over the past three months across the group"s franchise network. Highlights for the quarter include a 30% improvement in system wide turnover at Debonairs Pizza and the opening of the brand"s 200th restaurant, located in the Sandton City shopping mall, an event which is particularly noteworthy, since the brand was initially launched in 1991 as a home delivery offering. Kevin Hedderwick, Famous Brands" Chief Operating Officer says: "Debonairs Pizza"s home delivery concept is as strong as ever, but we are witnessing a parallel development which is the robust growth of these restaurants in prime shopping malls." Vigorous double-digit turnover growth was experienced across the group"s brand portfolio, but particularly noteworthy was the 75% improvement in system wide revenue reported by FishAways. Hedderwick comments: "While this growth is off a low base, the potential for this brand is enormous. Seafood is gaining momentum as a category - it offers a healthy, convenient protein option. We are confident that with the brand"s increased footprint and accessibility, growth will be exponential." FishAways has opened 15 restaurants over the past 12 months, recently reaching the 50 outlet milestone. The review quarter witnessed another interesting trend, with the group"s airport restaurants delivering record performances. Hedderwick explains that the competition between low cost airlines has dramatically increased the number of consumers at airports. He notes that the success of the group"s existing and recently opened restaurants at airports nationwide will ensure that further prospective sites are vigourously explored. On 16 November Famous Brands announced the acquisition of 38 Bimbo"s franchise agreements relating specifically to Engen sites, with a view to converting these to Steers restaurants. Hedderwick says: "Good progress is being made in securing the necessary franchise conversion agreements, a condition precedent of the deal. We are confident that once converted, these restaurants have the potential to double their existing turnover." The anticipated revenue stream is twofold, namely standard franchise fees from the restaurants, and secondly, the addition of a new market for the group"s Food Services division which will supply the basket of products required by these Steers franchises. Over the past quarter, significant advancements have been achieved in preparing the group"s Food Services division for the take on of the Wimpy food services supply business. "Enhancements in this division have enabled us to start manufacturing a selection of Wimpy sauces, which were previously supplied by third party vendors. This marks the commencement of our take on of the Wimpy food services business," says Hedderwick. Hedderwick concludes: "Increasingly retailers are reporting that they are beginning to experience a subtle slowdown, as trading activity shrinks. While it is likely that the very high levels of growth on top of growth may not be sustainable, we are satisfied that the food service categories in which we participate still offer substantial upside growth potential." He says: "Famous Brands has had an inspiring quarter, exceeding expectations and laying solid foundations for the peak season and the new year. We are bullish about trading performance in December and January." Rosebank 2 December 2005 Sponsor Java Capital (Proprietary) Limited Fax: +27 (0) 86 686-8447 Date: 02/12/2005 12:00:06 PM Supplied by www.sharenet.co.za Produced by the JSE SENS Department

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