File Image: Famous Brands, the owner of Steers, published its annual financials this week.

JOHANNESBURG - Famous Brands said that trading conditions in the South African market declined further for the first six months of the financial year in light of continued economic pressure on disposable income and sustained socio-political uncertainty. 

This is despite Famous Brands increased system-wide sales in South Africa by 7%, while like-on-like sales grew by 1.8 % during the five months under review. Famous Brands will publish its results for the six months ended 31 August in October.

System-wide sales refer to sales reported by all restaurants across the network, including new restaurants opened during the period while like-on-like sales excluded new restaurants.

The group owns Wimpy, Mugg & Bean, Europa, Tasha’s, Steers, Debonairs Pizza, Fishaways, Milky Lane, The Bread Basket, and many other restaurants.

The chain restaurant owner said consumer confidence remained at low levels both in South Africa and in the rest of Africa and Middle East region, under-performing management’s expectations.

In the United Kingdom market, Famous Brands said consumer confidence declined in the context of increasing political uncertainty surrounding Brexit negotiations and recent terror attacks and the general economic slow-down featuring rising inflation and limited wage increases. 

Competition in the trading landscape also intensified and supply currently exceeds demand, resulting in the recent closure of several competitor branded food businesses.

Famous Brands opened a total of 52 restaurants in South Africa, eight in the rest of Africa and Middle East region, and six in the UK. The Group’s entire network comprised of 2,801 restaurants as at 31 July 2017.

The group said it anticipates that trading conditions in its local and international markets will remain challenging for the coming year, reflected by constrained consumer demand and intensified competition.

 - African News Agency (ANA)