Famous Brands' UK burger flop
Finding its feet in the UK fast-food industry and securing its market share have been an uphill battle
Uncertainty over Brexit is one of the many challenges responsible for the poor performance of Famous Brands' UK investment, Gourmet Burger Kitchen (GBK). In a trading statement for the year ended February 28 that was released on Monday, Famous Brands reported a 7% decline in sales at GBK, citing political and economic uncertainty, as well as constraints in consumer spending, as the biggest problems. Famous Brands, which locally owns Debonairs Pizza and Steers, acquired GBK in 2016 for £120m (about R2.3bn) shortly after the Brits voted to leave the EU. This was the biggest transaction in Famous Brands' expansion strategy and it has taken steps to halt the losses, slimming down the business and cutting marginal costs. It has closed 24 GBK outlets and said in October last year that it would restructure and negotiate its property portfolio with creditors. Management expressed optimism that the turnaround strategy for GBK is gaining momentum. The uncertainty over Brexit has had an impact...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.