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Press release – Sphera Franchise Group registred record sales in Q3 of RON 284.2 million, and consolidated sales in the first nine months increased by 45% to RON 728.7 million

2021-11-15

Key Events:

• Sphera Franchise Group closed Q3 2021 with record store sales, amounting to RON 284.2 million, up 44% compared to Q3 2020.
• EBITDA for Q3 2021 was higher by 21% compared to Q3 2020, reaching RON 32.1 million, and the net profit advanced by 30%, to RON 22.9 million.
• Sphera closed the first nine months of 2021 with consolidated sales of RON 728.7 million in all three markets, up 45% compared to the similar period of last year.
• Nine-month EBITDA increased to RON 62 million, and net profit reached RON 28.1 million, compared to a net loss of RON 4.7 million recorded in the first nine months of 2020.
In the first nine months of 2021, all brands on all markets improved their performance compared to the similar period of last year.
• At the end of Q3 2021, the Group had 164 restaurants, compared to 157 units in the same period of 2020 and and over 4,700 employees.

Sphera Franchise Group (“Sphera”) continued this year’s positive growth trend in Q3 2021, registering record consolidated sales of RON 284,2 million, 44% higher than Q3 2020. Sales in Romania amounted to RON 247,9 million, Italy contributed RON 33,1 million, while sales in the Republic of Moldova reached the historical value of RON 3,2 million. KFC generated revenues of RON 243,4 million, Pizza Hut – RON 26,7 million and Taco Bell – RON 14 million. Except for Pizza Hut, all brands of the Group registered record sales in Q3 2021.

The Group concluded Q3 2021 with EBITDA of RON 62 million, higher by 21%, while net profit increased by 30% reaching RON 22,9 million. The operating profit of the restaurants increased in Q3 2021 by 24% compared to Q3 2020 reaching RON 35 million. At the end of Q3 2021, the Group had 164 restaurants, compared to 157 units in the same period of 2020.

“Q3 2021 was an excellent quarter for Sphera Franchise Group. We continued the same dynamic of growth on the Romanian and Moldavian markets as in the previous quarter, but we have toped it up with an improved performance in Italy due to the relaxation of restrictions imposed by authorities. Historically, Q3 has always been our strongest quarter which we are happy about as more customers opted for dine-in or takeaway instead of delivery in this period. The performance in the third quarter of 2021 provided us, as well as all our shareholders, with a good indicator of how fast we can recover if the economy is fully reopened and the restrictions are lifted. In addition, it gave us confirmation that our decisions to continue the development of our restaurant network throughout the last 12 months has been a right one,” stated Calin Ionescu, CEO Sphera Franchise Group.

Increasing income at nine months

Sphera Franchise Group closed the first nine months of 2021 with RON 728.7 million in consolidated sales on all three markets, a 45% increase compared to the same period of last year. Sales generated in Romania contributed with 88% to this result, amounting to RON 642.6 million, followed by Italy bringing in the contribution of 11% amid sales of RON 77.3 million, while Moldova generated 1% of total sales, in the amount of RON 8.8 million.

The increase in the revenues on all the three markets and across all the Group’s brands was driven by several positive factors including the almost complete reopening of the local economies across Europe, the return of the indoor dining, good weather as well as overall positive sentiment resulting from the signs indicating potential end of the pandemic and return to normality. Nonetheless, as of the end of September, a new wave of COVID-19 infections in Romania paired with low levels of vaccination hindered this enthusiasm, indicating potential negative impact on the HoReCa industry.

“Q3 2021 continued the positive trend of the quarterly increases which we have been recording since the beginning of this year, with all of our brands registering significant growth. We have continued to keep the costs under control despite the extremely challenging local and international context that has been putting a lot of pressure on the expenses. We are confident but a bit more reserved about the prospects for the last quarter of the year, especially in the context of the introduction of the Green Certificate, which has become mandatory for any indoor access. Since the introduction of this measure, all the economic operators in the HoReCa and retail sectors, us included, have seen a moderate decrease in sales due to lower foot traffic. Nonetheless, even with slightly adjusted forecasts for this year, we are looking at reaching a historical threshold of 1 billion lei, a new benchmark for Sphera Franchise Group,” stated Valentin Budes, CFO at Sphera Franchise Group.

In terms of individual performance, in the first nine months of 2021 all the brands on all three markets of activity improved their performance compared to the same period of 2020 – CFF (Taco Bell) sales increased by 75%, USFN Moldova (KFC Moldova) by 54%, USFN Romania (KFC Romania) by 48%, USFN Italy (KFC Italy) by 36% and ARS (Pizza Hut) by 25%.