Issue link: https://maltatoday.uberflip.com/i/1472080
3 NEWS 30.6.2022 FROM PAGE 1 Premier Capital is engaged in the oper- ations of McDonald's restaurants in Esto- nia, Greece, Latvia, Lithuania, Malta and Romania. Group revenue in 2021 rose to €405.4m, up from €319.0m in 2020, predominantly driven by both an increase in revenue per store together with a net increase in the number of stores which from 146 stores in the beginning of FY19 increased to 166 as at year end FY21. All operating markets within the Group experienced significant improvement fol- lowing the business disruption caused in 2020 by the onset of COVID-19. e region reporting the highest im- provement during FY21 was Greece, which registered a relative increase of 38%. Romania reported an increase in revenue of 30%, while the Baltic Coun- tries and Malta each registered a 19% in- crement. e Group anticipates to generate €502.8m in revenues during FY22, an in- crease of 24% over 2021. Portfolio In 2021, the Group continued to grow its portfolio, increasing the total number of restaurants to 166, up from 159 in 2020. Of these restaurants, 92 are operated in Romania, 40 in the Baltic Countries (col- lectively, Estonia, Latvia and Lithuania), 25 in Greece, and nine in Malta. Premier Capital plans to invest over €28m in its restaurant footprint during the course of 2022. 50% of this is ear- marked for new restaurant openings, with the rest targeted to restaurant capital expenditure and digital upgrades. e largest extent of investment is tar- geted at Romania and Greece (50% and 23% respectively). Investment in the Bal- tic countries and Malta will account to the residual 20% and 7%, respectively. All of the investment strategy is planned to be funded without any additional lever- age. Over the last three financial years, the Group has invested a total of €31.6m on new stores and spent €2.5m on the re- modelling of old stores. e Group has also spent a total of approximately €19.9m on capital expenditure relating to the maintenance of existing stores from FY19 to FY21. Routine maintenance and remodelling capital expenditure averaged €46.6k per store in 2021, and represents an average of 2.1% of sales. e Group opened eight new restau- rants during FY21; five in Romania, one in Lithuania and two in Greece. During the same year, the Group also closed one store in Greece. A further 16 existing res- taurants were upgraded to accommodate McDonald's newest service and digital platforms, allowing for the roll out of ta- ble service and self-ordering kiosks. By the end of 2021, a total of 156 restaurants had deployed McDelivery. In 2022, Premier Capital plans to open 10 additional stores, bringing the total number to 175, with a planned total cap- ital expenditure of €14m expected to be incurred on these new stores in the same year with a capital expenditure per new store projected to average circa €1.4m. Profit and costs e Group's gross profit improved to €92.4m in FY21 from €65.9m in FY20, with this resulting into an improved gross profit margin of 22.8% (FY20: 21.2%). In 2022, Premier Capital is projecting gross profit to amount within the region of €106.4m, reflecting an overall im- provement of circa 15.1% on a compara- ble basis. Operating expenditure represents costs directly related to the business activity of each store, apart from raw materials. It mainly includes staff costs, advertising, utilities and other administrative ex- penses. e Group's total net operating ex- penditure rose to €336.5m in 2021, up from €267.4m in FY20. is is expected to increase to €429.7m in FY22, reflecting the overall increase in revenue which is expected to be gener- ated by the Group throughout the year. In line with previous expectations, net finance costs tapered down to €5.9m during FY21, with these expected to amount higher to €6.8m during FY22, predominantly as a lower level of finance income will be received on intercompa- ny loans now repaid. Taking all these factors into consider- ation, Premier Capital reported a net profit after tax figure of €34.3m for FY21, up from €17.7m in 2020. For 2022, the Group is projecting a net profit of €35.4m. Cash flow With the positive financial perfor- mance registered by the Group during FY21, cash flow from operations im- proved to €65.4m from €38.7m in 2020. Cash flow from operating activities are projected to amount to €63.1m in FY22. In 2021, cash flow used in investing activities during FY21 amounted to €32.6m, with this being higher in com- parison to previous expectations. And although the Group still plans to invest in the opening of the new stores during FY22, cash flows used in investing activities are expected to fall to €19.3m. Premier Capital to generate €502.8m in revenues in 2022, up 24% over 2021