After years of losses, the owner of Burger King in SA may finally turn a profit
After two years of losses, the embattled Grand Parade Investments will finally report a headline profit for the year.
GPI [JSE:GPL], which owns Grand West casino in Cape Town as well as the Burger King franchise in the country, has been under pressure in recent years, with its share price losing 60% of its value in the past five years.
Its attempts to launch the US fast-food chains Dunkin Donuts and Baskin Robbins failed, and it was forced to close these outlets in recent months. The company also sold a 10% stake in Spur, and most recently announced a deal to sell its 30% shareholding in Sun Slots back to Sun International for R504m.
Unhappy with its financial performance, the group's institutional investors tried to oust the company's chairperson Hassen Adams. He finally resigned as executive chairperson in May this year after selling R60m in shares. But Adams remained on the board.
After headline losses in 2017 and 2018, the company now expects to post a headline profit of between 7.97c and 10.21c for the year to end-June - this is an increase of 171% and 191% respectively from its previous headline of 11.18c, it said in a trading update issued on Wednesday.
A basic loss per share will be between 7.21 and 9.55 cents per share, which equates to an improvement of between 18% and 38% from its previous basic loss, is still expected.
After an initial 2.5% jump following the trading update, the share was trading only 1c stronger at 284c towards the end of Wednesday's trading.
Grand Parade will release its financial results on September 20.