Sphera Franchise Group estimates sales of RON 1.64 billion and a 20% higher profit in 2024

Sphera Franchise Group, the largest group in the food service industry in Romania, budgeted for 2024 double-digit increases for the main financial indicators. The company aims to reach restaurant sales of over RON 1.64 billion, up 12.2% compared to 2023, due to a combined effect of same-store sales growth and opening of new units. Profitability indicators are expected to improve significantly, with an increase in normalized net profit of 20.1%, to RON 95.7 million and normalized EBITDA higher by 28.3%, of RON 189.8 million.

„The remarkable previous results and the good prospects we currently anticipate for our business in 2024 make us confident that we will achieve our set targets. We expect a more predictable year, although not without challenges, so we aim to continue the fast-paced growth of recent years. Our priorities remain development in line with sustainability principles, value creation for our shareholders and healthy profitability. In this sense, we will diligently follow the proven strategy of network expansion, tailored customer approach through relevant offers and smart pricing, efficient cost management, and investments in Sphera team”, said Calin Ionescu, CEO, Sphera Franchise Group.

The company estimates that in 2024 food and material cost growth will also remain below that of sales, while energy costs will be predictable and in line with those recorded in 2023. The share of normalised general and administrative (G&A) expenses in total sales in 2024 will be lower than in 2023, due to the inelasticity of these costs in relation to the increase in activity volume.

Regarding the Group’s free cash flow, it is estimated at RON 116.8 million, exceeding by 7.4% the level recorded in 2023.

Sphera Group allocates around RON 69 million for development this year, which includes the opening of 6 new KFC restaurants in Romania, remodelling existing units, and also investments in technology, such as implementing kiosks in stores.

The proposed budget, approved by the Board of Directors, will be subject to approval at the Annual General Shareholders Meeting on April 26, 2024. It was drafted under the presumption of a normal course of business and considering an average inflation of 6%.

Sphera Franchise Group is the largest group in the food service industry in Romania, owning the companies that operate in a franchise system the KFC, Pizza Hut, and Taco Bell brands in Romania and KFC in Chisinau, Republic of Moldova, and in certain areas in Italy. The group owns over 160 restaurants in the three markets and employs approx. 5,000 people. Sphera Franchise Group has been listed on the Bucharest Stock Exchange since 2017, under the symbol SFG, being the only HoReCa company included in the main BET index, as well as in the FTSE Global Microcap, MSCI Frontier and Romania Markets Small Cap.