Collins Foods Lowers FY25 Earnings Guidance Amid Inflation Pressures

Collins Foods Limited (ASX: CKF), the operator of KFC and Taco Bell stores, has revised its FY25 earnings outlook, projecting underlying margins of 14.2% to 14.7%, down from 15.4% in FY24. The challenging consumer environment and persistent inflation are cited as key factors impacting profitability. Statutory net profit for the first half of FY25 dropped sharply to $24.1 million, compared to $50.5 million a year ago. Full-year interest expenses are expected to rise to $42 million due to lease additions and renewals. Additionally, the fully franked interim dividend was reduced to 11¢, down from 12.5¢. At the time of writing, Collins Foods' shares were trading at $8.21, reflecting a 4.76% decline. The company is focusing on managing costs as it navigates the tough economic landscape.

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