KFC powers growth with 11 per cent revenue rise; Sri Lanka operations rebound while Pizza Hut sees temporary slowdown
Sapphire Foods India, one of the largest franchisee operators of YUM brands in the Indian subcontinent, reported strong financial results for FY25, delivering an 11 per cent rise in revenue and a 4 per cent increase in ebitda, even as the quick service restaurant (QSR) sector faced economic headwinds.
The company, which operates brands such as KFC, Pizza Hut, and Taco Bell, added 91 new outlets during the year, taking its total footprint to 963 restaurants by 31 March 2025. Consolidated Profit After Tax (PAT) stood at Rs 167 million (0.6 per cent), while Adjusted PAT reached Rs 404 million (1.4 per cent).
KFC Leads Growth, Pizza Hut Faces Headwinds
Sapphire’s KFC business remained the key growth engine, clocking an 11 per cent revenue jump to Rs 19,039 million and achieving a restaurant ebitda margin of 17.3 per cent. The brand crossed a milestone of 500 restaurants, doubling its count in just three years. However, lower average daily sales (ADS), a higher delivery mix, and operating deleverage led to a 240 basis point decline in margins year-on-year.
In contrast, Pizza Hut struggled during the quarter with an ADS of Rs 42,000—lower than the Rs 48,000 average in the previous three quarters. Despite a 5 per cent YoY rise in restaurant sales, ebitda turned negative at -4.6 per cent. The company acknowledged the brand needs a longer runway for recovery, even as it continued investing in innovation, launching a refreshed “Juicylicious” pizza range.
Sri Lanka Rebounds with Strong Double-Digit Growth
The company’s Sri Lanka operations saw a remarkable turnaround, with revenue growth of 14 per cent in LKR terms and 24 per cent in Rs terms. The business posted a healthy restaurant ebitda margin of 15.4 per cent. Notably, Sapphire’s Sri Lanka unit was recognised as the World’s Best Pizza Hut Franchisee for People Practices at the Yum Global Franchise Convention held in April 2025.
Q4 FY25 Snapshot
During the fourth quarter of FY25, Sapphire Foods reported a 13 per cent rise in revenue to Rs 7,099 million, led by strong performances from KFC India and Pizza Hut Sri Lanka. Six new KFC outlets were added in the quarter. While consolidated ebitda grew 3 per cent YoY to Rs 1,133 million, adjusted ebitda declined 7 per cent to Rs 508 million, reflecting margin pressures.
Sustainability and Global Recognition
The company continued to receive global accolades for its performance. It was ranked the No. 1 QSR in India for the second consecutive year on the Dow Jones Sustainability Index and placed 7th among QSRs globally. At the international level, Sapphire was named the World’s Best KFC Franchisee and ranked among the Top 4 Pizza Hut franchisees globally.
With continued focus on expansion into high-traffic locations across key Indian metros and new cities, Sapphire Foods aims to further consolidate its leadership in the QSR segment. Marketing efforts for KFC will centre around the ‘Epic core variety X value’ campaign featuring chicken buckets, Zinger burgers, boneless chicken, and rolls. The company also aims to bolster its own delivery channels for better control and higher margins.
Established in 2015 following the acquisition of around 270 KFC and Pizza Hut outlets, Sapphire Foods today operates 502 KFC and 334 Pizza Hut restaurants in India, alongside 117 Pizza Hut and 10 Taco Bell outlets in Sri Lanka. The company is backed by leading private equity firms and is professionally managed, with a mission to provide great food and great value to customers.
