Food & Drink Americana opens more stores despite profit slump By Neil Halligan October 31, 2024, 3:45 PM Jeffrey Isaac Greenberg/Alamy via Reuters A KFC restaurant in Dubai. Brand owner Americana has posted a 54% drop in profit in the third quarter Fast-food brand owner in Q3 loss 113 Mena stores opened in 2024 Boycotts related to Israel conflict Quarterly profits at Americana Restaurants have shrunk again, but the Middle East franchise owner for KFC, Pizza Hut and Hardee’s continues to open new stores as its promotional drive spurs a recovery in daily sales. The fast-food brand operator reported a 54 percent drop in profit in the third quarter to $37.4 million, as the boycott of US brands over perceived support for Israel continues to impact operations in the Middle East. The decline in profit followed similar drops of 51 percent in the first quarter and a 41 percent slump in the second quarter. “Topline growth continued to be impacted by lower like-for-like sales due to the evolving regional geopolitical situation and slowness in consumer demand observed in some markets”, the company, which is listed in Saudi Arabia and Abu Dhabi, said in its stock exchange filing. The implementation of corporate tax in the UAE also affected its net profit. Americana’s revenue for the third quarter was $555 million, down 15 percent from the same period a year earlier. It said there was “a noticeable recovery in average daily transactions as well as average daily sales per store compared to Q2 2024”. The company said it will increase transactions and sales through offers and promotions to attract new customers. It will also introduce cost-saving practices and technology to streamline its operations and continue with its store expansion programme. It opened another 50 stores in the quarter, bringing the total number of restaurants it has opened in 2024 to 113. Earlier this year, Americana scaled back plans to open 225 outlets this year and said it is now planning to open between 175 and 185. Americana said it will continue to monitor “its operations across various markets to adapt and navigate through current challenges efficiently”. Kuwait’s Alshaya delays Starbucks franchise stake sale PIF cuts down on Starbucks and goes for chips in US rejig Americana 2023 revenue rises on 300 new store openings Americana’s KFC and Pizza Hut outlets have been targeted with boycotts due to the Gaza conflict, in part because Yum! Brands, the chain’s parent company in the US, has invested in Israeli startups. Shares in the company, which is listed on Saudi Arabia and Abu Dhabi stock exchanges, dropped 24 percent this year. Starbucks, which is operated by Kuwait’s Alshaya Group across the Gulf and broader Middle East region, has also been affected by boycotts over its perceived pro-Israel stance since the war began in October last year, a claim it denies. However, the total number of Starbucks outlets in the region rose by approximately 7 percent, from 1,870 to 1,997, according to the company’s data in August. It was reported in March that Alshaya Group had cut staff numbers by around 2,000.
