Restaurant Brands Asia Ltd, previously known as Burger King India, reported a wider Q4 loss as it ramped up ingredient spending while expanding in India and Indonesia.
Rising costs of essential ingredients such as cheese and milk have been impacting restaurants in India, leading to increased expenses in recent quarters. Despite a decrease in vegetable prices, other costs remain on the rise for the industry.
Additionally, restaurants are facing a decline in consumer demand due to inflation concerns, further adding to their challenges.
Domino’s franchisee Jubilant Foodworks and KFC-operator Devyani International joined McDonald’s-operator Westlife FoodWorld and Yum Brands franchisee Sapphire Foods in reporting lackluster results earlier today.
Restaurant Brands Asia recorded a wider consolidated net loss of INR 733.7 million (around USD 9 million) for the quarter ended March 31, compared to INR 670.7 million in the previous year.
Driven by the opening of numerous new restaurants to expand into different cities and combat competition, Restaurant Brands Asia witnessed a substantial growth of nearly 29 percent in its revenue from operations, reaching INR 5.14 billion.
Total expenses rose by around 29 percent, overshadowing the company’s top-line growth. It is worth noting that the company also operates Popeyes restaurants in India and Indonesia under Restaurant Brands International.
Restaurant Brands Asia’s shares closed slightly lower on Wednesday prior to reporting its results, falling 4% year-to-date. (USD 1 = INR 81.78)