New Pizza Hut pie helps offset SARS impact in S.E. Asia

Aug. 4, 2003

KUALA LUMPUR, Malaysia -- A representative of KFC Holdings Bhd (KFCH), franchisee of Pizza Hut and KFC in Southeast Asia, claimed the company has recovered from the impact of the severe acute respiratory syndrome (SARS) outbreak this year.

According to The Star Online, though traffic at stores returned to normal in June, overall sales for the year in Malaysia likely will be impacted negatively, according to group managing director Datuk Johari Abdul Ghani. He said KFCH typically sees growth of 5 percent to 10 percent annual growth in a normal year.

The report said the launch of the Cheesy 6 Classic Crust Pizza at the area's Pizza Huts has helped sales rebound strongly. Demand for that pie alone, Johari added, is expected to boost sales by 6 percent over the coming months.

KFCH is struggling to become profitable since purchasing the area franchise rights for Pizza Hut and KFC last year. Despite seeing its sales rise nearly 22 percent in the first quarter of 2003, net profit was down 33 percent, which it blamed on SARS problems and poor performance in its Singapore outlets. Johari predicted those outlets wouldn't be profitable until 2005.

Topics: Marketing

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