Sphera Franchise Group sees profits plunge in Q1 2025

Business Forum
Sphera Franchise Group reported consolidated sales of approximately €72.52 million (RON 362.6 million) in Q1 2025 across its network of fast-food restaurants, a slight decrease of 0.9% compared to the same period in 2024. Net profit for the quarter stood at approximately €1.56 million (RON 7.8 million), a 63.6% decrease compared to Q1 2024.

The combination of flat sales and increased expenses resulted in a contraction of profitability by roughly one-third for restaurant operating profit and EBITDA. 

The group's expenses reached €70.42 million (RON 352.1 million) in Q1 2025, marking a 4% increase compared to the same period last year. The most substantial rise in expenses, at 12.4%, was attributed to payroll and employee benefits, primarily due to the increases in the minimum wage in July 2024 and January 2025. 

KFC Romania's sales reached €51.96 million (RON 259.8 million), down by 3.4% year-over-year, influenced by external factors and the challenge of matching an exceptionally strong performance in the first quarter of the previous year. 

Pizza Hut's contribution to total sales was €5.44 million (RON 27.2 million), a modest 1% decrease compared to the previous year. However, the network optimization efforts initiated at the end of 2023 continue to yield positive outcomes, with the company reporting a restaurant operating profit of €0.1 million (RON 0.5 million), a turnaround from a loss in Q1 2024. Taco Bell reported sales of €4.82 million (RON 24.1 million), a 15.6% increase, and doubled its profit compared to the same quarter last year. 

International markets also contributed to Sphera's results, with KFC Italy generating €8.94 million (RON 44.7 million) in sales, a 3.3% increase. KFC Moldova continued its growth trend, with sales increasing by 23.2% to €1.36 million (RON 6.8 million).

“We are navigating an atypical environment characterized by multiple disruptive factors. Our focus remains on strengthening our existing business and making judicious investments in high-potential areas,” stated Călin Ionescu, CEO of Sphera Franchise Group.

In the first quarter of 2025, delivery orders continued to grow, accounting for 20% of the group's total sales. Delivery sales reached €14.7 million (RON 73.5 million), an increase of 5.5% year-on-year.

The group owns over 170 restaurants in the three markets and employs around 5,000 people. 

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Business Forum  |  15 May, 2025 at 7:25 PM
Business Forum  |  15 May, 2025 at 12:12 PM