News

Kotipizza parent reports profitable 2018 results, presses ahead with brand, franchising growth

March 20, 2019

Kotipizza Group Oyj — parent of Kotipizza, No Pizza, Social Burgerjoint, Chalupa and others — said its 2018 fiscal year ended with comp net sales growth of 15 percent, while in Q4, EBITDA grew 10 percent over the previous year's fourth quarter, making it clear that the brand's intentions to develop its portfolio will be well funded.  

The brand its emphasis will be on a topnotch customer experience and growth of its franchising business model as it moves forward, according to a news release. The multi-restaurant company said its business is being mostly greatly influenced today by increasing urbanization and digitalization, as well as the ever-escalating home delivery business.

Key fiscal year results for 2018 include: 

• Chain-based net sales grew 17.2 percent. 
• Comparable net sales grew 14.6 percent to 91.5 million euros or nearly $104 million.
• Comparable EBITDA grew 10.2 percent to 9.39 million euros or $10.6 million.
• Net sales grew 14.8 percent to 96.5 million euros or $109.6 million.

Key Q4 2018 results for the period ending January 2019 include: 

• Chain-based net sales grew 17.6 percent. 
• Comparable net sales grew 14.7 percent to 24.1 million euros or $27.4 million.
• Comparable EBITDA grew 10 percent to 2.26 million euros or $2.57 million. 
• Net sales grew 16.2 percent to 25.4 or $28.8 million. 

During the review period, investments were primarily made in two key areas including leadership in digital and home delivery. Kotipizza's new online store which opened in Q3 2018 continued to present strong growth and is now providing 15 percent of the chain's total sales. The number of home deliveries and restaurants offering it have also increased as well. 

In a statement released with the financials, Kotipizza Oyj said:

"We believe that the financial development of the restaurant business and the consumer trends support Kotipizza Group's investment in the fast casual concept. ... We estimate for the full financial year started Feb. 1, 2019, that both the total chain sales of our restaurant concepts and that comparable EBITDA will increase as compared to previous year."

"The chain will continue to develop its No Pizza brand in the proof-of-concept restaurant that opened last June in Helsinki, as well as building on the Social Burgerjoint brand acquired in FY2017 into a franchisee chain. In the 2018 fiscal year, the company put $1 million EU into its non-Kotipizza concepts."

As final result of Orkla ASA's voluntary public cash tender offer in early February, the company said Orkla's shares represented approximately 99.30 percent of all the shares and votes in Kotipizza Group. Orkla's objective is to acquire all of Kotipizza's shares, the company said.

On Jan. 23, 2019, Orkla filed an application with the Redemption Board of the Finland Chamber of Commerce to initiate compulsory redemption proceedings for the remaining Kotipizza shares under the Finnish Companies Act. Orkla  also intends to cause the shares of Kotipizza to be delisted from Nasdaq Helsinki Ltd. as soon as permitted and practicable under applicable laws, the release said.