Famous Brands FY dil HEPS up 15% to 272c

Headline earnings per share were up 15% to 278 cents.

Revenue was up 15% to R2.15 billion, while operating profit grew 15% to R413 million.

A final dividend per share of 120 cents was declared from 85 cents previously.

Despite talk of early signs of economic recovery in the country, the period under review remained challenging for retailers, the company said.

"Notwithstanding these testing conditions, Famous Brands has delivered creditable results for the year ended 29 February 2012, achieved through intensified focus and improvements in the front and back ends of the business," it added.

The group's Local Franchising division, which comprises operations in South Africa and 15 African countries, reported a satisfactory performance in an extremely competitive environment.

In South Africa system-wide sales across the brand portfolio increased by 8%, while like-on-like sales grew 5%; the group's African market improved system-wide and like-on-like sales by 21% and 7% respectively.

Combined revenue for the South African and African operations increased 14% to R440 million, while operating profit in this division rose 13% to R265 million.

"The operating profit margin was 60.2% compared with 60.9% in the prior year, slightly lower, effectively a function of investing in newly acquired and developing brands in advance of royalty collections," Famous Brands said.

The results delivered by the group's International Franchise division, comprising Wimpy United Kingdom, were a reflection of the dire trading conditions experienced in that country, it said.

Revenue in sterling declined 19%, and in rand terms by 13% to R82 million and operating profit decreased 30% to R8 million.

Consolidated revenue grew by 17% whilst operating profit rose 21% in the retailer's Supply Chain division.

Meanwhile, its manufacturing division increased revenue by 13% to R747 million.

Famous Brands' Logistics division reported a 20% increase in revenue to R1.52 billion and operating profit rose 37% to R53 million, producing a record margin of 3.5%.

Looking ahead, the company said consumer disposable income would remain pressured by escalating electricity tariffs, fuel costs and general food inflation.

"Despite the negative effect which these factors will have on the industry, the group's all-encompassing business model, exceptional personnel and best- in-class leisure brands position Famous Brands for continued growth," it added.