AUCKLAND, New Zealand -- Quick-service franchisee Restaurant Brands believes the news of Domino's Pizza's entry into the New Zealand market has caused its stock to fall for more than a week.
According to the New Zealand Herald, Queensland-based franchisee Domino's Pizza Australia said recently it would open up to eight stores in the New Zealand cities of Auckland, Wellington and Christchurch between July and October.
Restaurant Brands' share price fell 19 percent from $1.55 (U.S. 94 cents) on Feb. 18 to $1.25 (U.S. 76 cents) at the close of trading Feb 27.
The company said the stores in New Zealand were part of a $60 million (U.S. $36.3 million, 50-store Australasian expansion. (See "Domino's to open 50 new sites in Australia in '03.")
Domino's has more than 7,000 franchised and company-owned outlets in more than 50 countries, and has annual sales of $6.8 billion (U.S. $3.8 billion).
Restaurant Brands has 87 Pizza Hut restaurants and takeout stores, and is a KFC and Starbucks franchisee.
Restaurant Brands chief financial officer Grant Ellis said while the overall market has been down, the only factor the company was aware of to account for the fall in its share price was publicity about Domino's expansion. Ellis said the plans had received media coverage in Australia this week, but that they had been known by Restaurant Brands for about six months.
"We're determined to compete and we're ready for them," Ellis said.