Famous Brands Savours Fruits Of Labour

Famous Brands Savours Fruits Of Labour                                          
FAMOUS BRANDS LIMITED                                                           
(Incorporated in the Republic of South Africa)                                  
(Registration number 1969/004875/06)                                            
Share code: FBR             ISIN code: ZAE000053328                             
("Famous Brands")                                                               
FAMOUS BRANDS SAVOURS FRUITS OF LABOUR                                          
-    System wide retail sales up 22%                                            
-    Like-on-like retail sales up 16%                                           
-    Food Services division turnover up 42%                                     
-    Catering Services division turnover up 31%                                 
Johannesburg, 18 August 2006:  Famous Brands (FBR) has delivered another        
impressive performance for the four months commencing 01 March 2006, with the   
benefits of initiatives implemented over the past year impacting on this period.
Chief Operating Officer, Kevin Hedderwick says:  "Whilst a very slight softening
in turnover was experienced, the group continued to benefit from the            
indisputable trend which is rapidly establishing quick service restaurants and  
casual dining as a way of life in South Africa.  The impact of two interest rate
hikes and dramatic petrol price increases only marginally cooled consumer       
sentiment in July, and not sufficiently to dampen large scale demand for the    
group"s offering."                                                              
FRANCHISING                                                                     
For the review period, system wide retail sales (including new restaurants) rose
22% on the prior comparative period, while like-on-like retail sales grew 16%   
across the franchise network.   Amongst the group"s mainstream brands, Debonairs
Pizza grew system wide sales by 31% and like-on-like sales by 22%, whilst Steers
and Wimpy improved system wide sales by 22% and 21% respectively and like-on-   
like sales by 16% and 15% respectively.  These results were achieved on the back
of sub-inflationary menu price increases.                                       
The restaurant network grew by 44 stores nationwide over the period, with the   
addition of amongst others, 19 new Steers, 7 Debonairs Pizza- and 6 FishAways   
restaurants.  The total network now comprises 1 199 restaurants, and the group  
is on track to meet its target of 80 net additional outlets for the year.       
Hedderwick says that during the review period the group successfully converted  
four Whistle Stop sites, situated on Shell forecourts in Middelburg and Midrand 
to Steers Diners.  Turnover at these re-branded Steers Diners has improved on   
average between 30% and 50%, off an initial high sales base.                    
"This commendable achievement was driven by Steers" brand equity and the        
position of these prime convenience sites.  We are confident that the success of
this preliminary phase augurs well for the conversion of a further seven        
restaurants before the end of 2006," comments Hedderwick.                       
Innovation continues to drive the group"s strategic imperatives.  Debonairs     
Pizza is currently trialling a pioneering technology aimed at simplifying ease  
of conducting businesses with the brand"s restaurants.  If successful, this     
programme will be rolled out to a further seven restaurants in the short term.  
Wimpy"s "Nutrition Mission" centered on "the choice is yours" concept is geared 
to accommodate health conscious consumers requiring detailed product nutrition  
information.  Initiatives include specifically designed menus and educational   
take-home leaflets.                                                             
Hedderwick says:  "Our philosophy has always been to provide fast food but good 
food, facilitated by our quality ingredients and healthy preparation.  This     
Nutrition Mission initiative empowers our customers to make informed choices.   
The response has been extremely positive."                                      
Hedderwick comments:  "Of particular excitement to us are our plans for the     
coffee category.  Wimpy"s Premium Blend campaign, which was introduced to       
complement the brand"s existing offering, has attracted a wide range of new     
consumers."                                                                     
Hedderwick adds:  "Furthermore, we aim to pioneer a new coffee category when we 
re-launch the "revolutionised" Brazilian brand in September.  This brand has    
undergone a complete overhaul - the new look Brazilian will be a `brand with    
attitude" - managed by a new team and delivering a superior quality "grab and   
go" offering.  We are confident that this brand has the potential to support a  
network of 100 restaurants."                                                    
"We are also supporting our mainstream brands with aggressive electronic media  
campaigns," says Hedderwick, "and feedback shows that these are achieving       
excellent consumer recognition levels."                                         
FOOD SERVICES, CATERING SERVICES AND RETAIL SERVICES                            
The group recently re-engineered its business model along functional lines,     
creating stand-alone divisions in food services, catering services and retail   
services.                                                                       
"Our efforts at streamlining the business are starting to pay off," notes       
Hedderwick.                                                                     
Benefitting from increased retail sales, further integration of Wimpy"s supply  
business and successful optimisation of capex, turnover from the Food Services  
division rose 42% for the period.  Capacity enhancement in the group"s bakery   
and meat processing plant has been completed and the sauce production plant     
expansion will be completed by the end of August.                               
Hedderwick adds:  "Despite a particularly cold, wet winter, the group"s fruit   
juice and ice cream businesses, Trufruit and Baltimore, have turned in          
creditable performances, with turnover up 27% and 39% respectively.  We are     
employing this typically quieter period to ensure capacity is in place to       
captialise on the peak trading season, commencing in November."                 
"When we announced our year end results we undertook to focus on improving      
margins and to address the return on investment in the Food Services" division. 
The improvement in turnover and early indications of an upward trend in margins 
is a rewarding start," says Hedderwick.                                         
PROSPECTS                                                                       
For the period ahead, Hedderwick notes that 24 existing Bimbos sites will be    
converted to Steers restaurants by the end of October, with a further two       
scheduled for conversion by March 2007.  This programme will extend Steers"     
footprint as a convenience offering given their prime locations.                
Hedderwick concludes:  "Our business model is now optimally structured to       
capitalise on opportunities across the group, and the fruits of our labour are  
reflected in these results.  We are however mindful that to continue to grow    
this business and entrench our leadership role in our participant categories    
means that we have to continue to innovate and pioneer.  Focus on product       
accessibility and affordability, complemented by asset-sweating will help us to 
deliver a similar performance in the forthcoming period. "                      
18 August 2006                                                                  
Sponsor:  Java Capital (Pty) Ltd                                                
Date: 18/08/2006 09:27:15 AM Supplied by www.sharenet.co.za                     
Produced by the JSE SENS Department