Malta: Premier Capital plc, the Maltese developmental licensee for McDonald’s, last year served 27.2 million customers at its 59 restaurants in five countries, its highest number since it began operations.
According to the group’s annual report and financial statements for the year ended December 31, 2013 that have just been published, Premier Capital plc also registered year-on-year transaction growth in all its markets.
Premier Capital plc is the developmental licensee for McDonald’s in Estonia, Greece, Latvia, Lithuania and Malta.
In 2013, the Estonian, Latvian, Lithuanian and Maltese markets registered increased revenue, with overall group revenue increasing by 7% to €88.9 million. Malta reported the highest growth, growing 12 per cent over 2012. Estonia registered growth of 9.5 per cent, Latvia 8.4 per cent, and Lithuania 9.6 per cent.
After a slow start to 2013, encouraging results were also registered in Greece in the second half of the year. Premier Capital is positive about the outlook for the Greek market and there are clear signals of an initial recovery. Premier Capital plc is confident significant opportunity exists to grow the group’s business in Greece, both within existing and new restaurants.
In 2013, Premier Capital plc continued to grow its portfolio by opening restaurants on Crete, in Sliema and Riga, and by taking over three existing restaurants on mainland Greece, bringing the total number of restaurants to 59. Two other restaurants in the Baltics were remodelled. These projects involved a total investment of €3.6 million. A further €1.8 million was directed towards equipment replacements and upgrades in existing restaurants.
In 2013, Premier Capital plc was able to see the impact of a first full year of operations of the Baltic Distribution Centre on group performance. The facility handles all logistics for the group’s restaurants in the Estonia, Latvia and Lithuania. Operated by a third party before Premier Capital plc took it over in 2012, the distribution centre has enabled the group to realise greater efficiency and cost savings to its restaurants in the region.
Throughout last year, Premier Capital plc concentrated efforts on delivering increased cost efficiency across business units in its five markets. This was a challenge in view of continued pressure from rising raw material and commodity prices and the increased cost of labour and utilities. These efforts had a positive impact on group earnings: EBITDA rose to €7.6 million from €6 million in the previous year.
The outlook for the group’s business across all five markets is positive. Across the Baltics and in Malta, the McDonald’s brand remains the market leader within the Informal Eating Out sector and the company continues to build its market share and broaden its customer base. This indicates that the group should be able to continue to grow its business in the short- to long-term.
In Greece, the positive business evolution being registered in existing restaurants, coupled with the opening of new locations, means increased penetration for the McDonald’s brand and increasing market share. This bodes well for the future of McDonald’s in Greece and for the group’s business in the region.
In 2013, the group registered an operating profit of €2.4 million (2012: €689,000) on revenue of €88.9 million (2012: €83.1 million). After accounting for investment income and finance costs, the group registered a pre-tax loss of €23,703, down from a pre-tax profit of €1.9 million in 2012. The group’s results in 2012 were positively impacted by one-off investment income of €4.1 million. The results for 2013 were negatively impacted by the sluggish, albeit encouraging, Greek operation. The group’s net assets for 2013 amounted to €16.1 million (2012: €16.4 million).
The company, which acts as investment company and service provider to the subsidiaries, registered an operating loss of €668,669 (2012: €420,890). After accounting for investment income and finance costs, the company registered a pre-tax profit of €1.6 million (2012: €1.2 million). The net assets for the company at the end of the year under review amounted to €17.6 million (2012: €15.9 million).
So far this year, Premier Capital plc has inaugurated the first of five restaurants planned across its European footprint in Gharghur. Three more restaurants are due to open in Greece and another in the Baltics before the end of the year.