- Simbisa Brands' energy costs more than doubled in Q1 FY2025 due to a 54% hike in electricity tariffs
- The company mitigated the impact of increased energy costs by spreading them across its expanded network, following the opening of new stores in Zimbabwe
- Simbisa Brands plans to open an additional 31 stores throughout the remainder of the financial year
Harare- Simbisa Brands, the leading quick-service restaurant (QSR) operator in Zimbabwe, reported a significant rise in energy expenditures, which more than doubled year-over-year (YoY) in Q1 FY2025.
This uptick was primarily driven by a 54% hike in electricity tariffs and exacerbated by frequent power outages.
However, the company effectively mitigated the impact of these increased costs by spreading them across its expanded network, following the opening of new stores in Zimbabwe.
The company's Zimbabwe operations expanded significantly, with a total of 330 stores operational at the end of Q1 FY2025.
This expansion was accompanied by a 12% YoY increase in customer counts, serving 12.1 million patrons in Q1 FY2025. This surge in customer traffic translated to a 4% revenue uptick in Zimbabwe.
During the quarter, the company continued to execute its expansion strategy, opening a net of 5 new company-operated counters.
Simbisa Brands has plans to open an additional 31 stores throughout the remainder of the financial year, primarily in Zimbabwe and also plans to refurbish and refresh 44 counters throughout the year, aimed at further enhancing the customer experience.
At the group level, Simbisa Brands reported a 6% YoY revenue growth, accompanied by a 7% rise in customer counts. Regional operations posted a 12% YoY revenue increase, while the group's total store count reached 720, comprising 606 company-operated counters and 114 franchised outlets.
Simbisa Kenya's operations achieved a 13% YoY increase in USD revenue, driven by a 25% surge in real Average Spend. However, socio-economic unrest in the Kenyan market led to trade disruptions, shop damage, and a 10% decline in customer footfall.
In response to these challenges, the company plans to focus on modernizing its existing store network through refurbishments and upgrades. This strategic initiative aims to enhance the customer experience and drive business growth.
In Eswatini, turnover fell 3% YoY in USD terms, with customer counts down 10% and real Average Spend increasing 8%. To revitalize this market, a counter refurbishment program will be implemented throughout the financial year.
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