The parent company of several Burnaby restaurants is reporting a significant drop in sales amid the coronavirus pandemic.
Recipe Unlimited Corp. – which operates the Keg and Swiss Chalet in Burnaby - saw system sales plunge 28 per cent in its most recent quarter as the pandemic continued to be a drag on the restaurant chain amid dining room closures and seating restrictions across Canada.
The Vaughan, Ont.-based company, which also operates brands like Harvey's and St-Hubert, says system sales in the first quarter totalled $537.6 million, down from $747.2 million in the same quarter the previous year and $850.7 million in 2019, before the COVID-19 pandemic.
E-commerce sales for the 13 weeks ended March 28 increased 75 per cent from a year earlier to $149.8 million while retail and catering sales were up 15.4 per cent to $87.6 million.
Net earnings in the quarter were $13 million or 22 cents per share, compared with a loss of $41.2 million or 73 cents per share in the prior year.
It attributed the increase to higher operating profits, an increase in the fair value of Exchangeable Keg Partnership units of $43.9 million, lower depreciation and amortization and a decrease in impairment charges of $16.3 million.
Adjusted profits decreased to $3.2 million or six cents per share, from $7.3 million or 13 cents per share in the first quarter of 2020 and 18.3 million or 29 cents per share in the same period in 2019.
The company expects after the pandemic that there will be fewer restaurant seats in the market from competitors that won't reopen and from changes in consumer behaviour. Recipe also says it will close underperforming locations identified in 2019 earlier than originally planned.
- With files from the Canadian Press
