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Kentucky Fried Chicken (Bermuda) Limited Report to Shareholders

Hamilton, Bermuda, April 23, 2007 - In an announcement made to the Bermuda Stock Exchange (BSX) Kentucky Fried Chicken (Bermuda) Limited Reported to Shareholders that net income for the year ended 31st January 2007 amounted to $392,588 compared with $511,731 in the year ended 31st January 2006, a 23.3% decrease.  Sales in the year ended 31st January 2007 were lower than those for year ended 31st January 2006 by $55,291, which was a 1.2% decrease.  Due to control over the cost of the menu items, gross profit only fell $17,307 over the previous year.  Operating expenses increased by $114,789 from the previous year, largely due to a $38,886 increase in salary and wage costs in 2006/07 to $1,653,175.  Electricity amounted to $124,586 compared to $105,808 in the previous year.   Insurance increased by $21,806 due to increased coverage and rate increases.

 

Dividend payments were as follows:

 

Payment date             Shareholders of record date             Amount

15th April 2006                           31st March 2006                     $0.20 per share

15th July 2006                           30th June 2006                        $0.10 per share

15th October 2006                     30th September 2006               $0.10 per share

15th January 2007                      31st December 2006              $0.10 per share

 

No shares of the Company were repurchased during the year.  It is still our intention, however, to continue to repurchase shares from time to time to reduce the shares outstanding to a more acceptable level.

 

At 31st January 2007 cash resources amounted to $1,817,029 compared with $1,675,791 last year and total liabilities amounted to $292,233 compared with liabilities of $315,073 at 31st January 2006.  Shareholders' equity at 31st January 2007 amounted to $2,487,603 or $4.20 per share compared with shareholders' equity of $2,390,965 or $4.04 per share at 31st January 2006.

 

On behalf of the Board I would like to thank Iris Kehler who assisted us until May 7, 2006 as Training Officer and Operations Manager.  Her knowledge and experience certainly added to our ability to serve our customers efficiently.  The Board would also like to pay tribute to all our staff for their hard work.  I would particularly like to thank Frank Seuss, General Manager, Tracy Robinson, Assistant General Manager, and Jerome Talbot, our new Operations Manager, who have worked hard to improve sales and earnings.  I would also like to express our appreciation to Graham Redford, Marketing Consultant, for his help and advice.

 

In April 2007 we closed the store for nine days for further improvements to our facilities.

 

We look forward to the 2008 fiscal year with optimism and hope that the steps we are taking to continuously upgrade our facilities will generate increased sales and profits in the future.

 

My personal thanks to Llewellyn Petty and my fellow Executive Directors, Crayton Greene, Susan Wilson, Bill Thomson and Kevin Gunther for their contribution and assistance during the past year.

Donald P. Lines, OBE, FCA, JP

Chairman

 

April 15, 2007