The positive surprise was mainly due to stronger-than-forecasted Starbucks sales growth, further aided by a turnaround in its Kenny Roger
KUALA LUMPUR: RBH research maintained its buy call on Berjaya Food Bhd
as it believes the momentum of improvement is sustainable on consistent growth in Starbucks and narrowing losses from Kenny Rogers Roasters.
In a Friday note, RHB raised earnings forecasts by 11-13% to account for the stronger performance across Starbucks and Kenny Rogers Roasters in its 3QFY19 results.
The research house increased the target price from RM1.75 to RM2.
Berjaya Food yesterday announced its 9MFY19 results which beat expectations with a core net profit of RM22.3mil, 42% high year-on-year (y-o-y).
Sales for the period grew 6% to RM508.5mil on Starbucks same store sales growth (SSSG) of 4.5% and contributions from new stores.
"We understand that this stems from exciting limited time product offerings including beverages and merchandise, which were well received by consumers," said RHB.
Kenny Rogers Roasters meanwhile recorded a small earnings before interest and tax during the quarter, which helped boost the group's core net profit.
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