Sapphire Foods Releases Q2 FY26 Earnings Call Transcript, Highlights Mixed Performance
Sapphire Foods released its Q2 FY26 earnings call transcript. KFC showed underlying growth, Pizza Hut struggled nationally but thrived in Tamil Nadu, and Sri Lanka recovered strongly. Management sees positive Q3 macro trends.
This announcement provides detailed financial results, strategic updates for key brands and geographies, and management's forward-looking commentary, all of which are critical for investor analysis and decision-making.
The company reported mixed results with overall profitability declining, yet highlighted strong performances in specific segments (KFC ex-Navratri, Pizza Hut in Tamil Nadu, and Sri Lanka) and expressed optimism for improved consumer sentiment and Q3 performance.
* Sapphire Foods India Limited released the transcript of its earnings call held on Friday, 17th October 2025, concerning the financial results for the quarter and half year ended 30th September 2025. * Q2 FY26 Financial Overview: * Overall revenue grew 7% year-on-year to ₹740 crore. * Consolidated restaurant EBITDA declined 12% year-on-year, with a margin of 11.3% (down 240 basis points). * Adjusted EBITDA was ₹45 crore, declining 24% year-on-year, with a margin of 6.1%. * Consolidated PAT resulted in a loss of ₹12.8 crore (-1.7%). * Brand Performance: * KFC India: Revenue grew 7%; excluding the impact of Navratri, growth was double-digit. Same-store sales growth (SSSG) was -3% for the quarter but flat when adjusted for Navratri, with positive same-store transaction growth (SSTG). The 'Taste the Epic' campaign for core buckets and hero innovation products showed positive transaction trends. The company added 19 KFC restaurants, inaugurating its 1000th Sapphire restaurant in Gummidipoondi. Management anticipates slightly better SSSG in Q3. * Pizza Hut India: Revenue declined 6% with negative SSSG. However, in the Sapphire-exclusive territory of Tamil Nadu, the brand achieved double-digit revenue growth and a mid-teens performance delta (SSSG and SG), validating its dine-in forward omni-channel strategy, innovation (Ultimate Cheese Pizza, Cheesy Pocket, Cold Coffee range), and mass media advertising. Dine-in contribution improved due to value offerings like Buy 1 Get 3, 4-course meals starting @₹99, and Unlimited Pizza Fridays. Restaurant EBITDA was 1.8%. * Sri Lanka Business: Demonstrated strong recovery and growth, with revenue increasing 18% in LKR terms (23% in Indian rupees) and SSSG at 14%. Restaurant EBITDA recovered significantly to 15.4% (from 12.7% in Q1), mitigating the impact of a 27% minimum wage increase. Sri Lanka maintained its #1 QSR position. * Management Commentary: * Mr. Sanjay Purohit, Whole-Time Director & Group CEO, noted it was a
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