Due to sluggish demand, Pizza Hut India operator Sapphire fails Q4 profit projections

Due to sluggish demand, Pizza Hut India operator Sapphire fails Q4 profit projections

For the quarter ended March 31, the Yum Brands YUM.N franchisee's consolidated net profit dropped 98% to 23.9 million Indian rupees ($286,271.4), its fourth consecutive quarterly profit decline.

India's Sapphire Foods The company that runs the Pizza Hut and KFC restaurant franchises, SAPI.NS, reported its worst earnings decline since going public on Friday, missing projections as consumers who are wary of inflation continued to order in rather than go out.

For the quarter ended March 31, the Yum Brands YUM.N franchisee's consolidated net profit dropped 98% to 23.9 million Indian rupees ($286,271.4), its fourth consecutive quarterly profit decline.

Based on LSEG statistics, analysts had projected a profit of 44.5 million rupees on average.

Following the announcement, the company's shares, which went public in November 2021, dropped as much as 3.3%.

Due to sticky inflation, quick-service restaurants in India had difficulty attracting customers throughout the fiscal year. This year, food inflation in the nation has remained strong, making for about half of the total consumer price basket.

Customers were unmoved by Sapphire Foods's restaurants introducing new goods at reduced costs and value-added meals like Pizza Hut's introduction of Melts, a cheesy pizza sandwich meal priced at 259 rupees and higher.

Costs increased by 15% due to a 9.4% increase in raw material costs. Gains in revenue reached 6.2 billion rupees, up 12.7%.

rival franchisee of McDonald's India, Westlife WEST.Due to weak demand, NS also reported a 96% decline in fourth-quarter earnings.

The country's KFC franchisee, Devyani International DEVY.NS, and Domino's India franchisee, Jubilant FoodWorks JUBI.NS, have not yet released their respective results.