EPS has been flat for the last 2 years my feeling is that is because the average weekly sales for the franchisees has been flat for the same time span . THe dividend increase this year does not change the fundamentals apart from having a negative effect on gearing I feel
Still I thought the results would have been worse given the retail market however as some commentators have said there has been a substituition effect happening with diners changing to lower cost meals which is what RFG outlets specialise in I would think some franchisees will be concerned with the lack of transparency with the coffee roasting business which franchisees are obliged to purchase coffee from. RFG does have a well run business plan although there are a few chinks in its armour.
RFG Price at posting:
$2.90 Sentiment: None Disclosure: Not Held
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