BFG Preliminary announcement of full year results FY22

0




Burger Fuel Group Limited
Preliminary Full Year Results
For The Year Ended 31 March 2022


Results for announcement to the market
Name of issuer Burger Fuel Group Limited
Reporting Period 12 months to 31 March 2022
Previous Reporting Period 12 months to 31 March 2021
Currency NZD
Amount (000s) Percentage change
Revenue from continuing operations $ 20,972 0.01%
Total Revenue $ 20,972 0.01%
Net profit/(loss) from continuing operations $ 576 (19.2%)
Total net profit/(loss) $ 576 (19.2%)
Interim/Final Dividend
Amount per Quoted Equity Security Not Applicable
Imputed amount per Quoted Equity Security Not Applicable
Record Date Not Applicable
Dividend Payment Date Not Applicable
Current period
Prior comparable
period
Net tangible assets per Quoted Equity Security $0.17 $0.15
A brief explanation of any of the figures above necessary to
enable the figures to be understood
The results reflect a second year of considerable
COVID disruption including temporary store closures
both during and after periods of lockdown. In
addition, substantial costs associated with
establishing our new brands (Winner Winner and
Shake Out) were also incurred as well as exit costs
associated with the termination of the Master
License of the UAE and ongoing development
assessment costs for that region.

Authority for this announcement
Name of person authorised to make this announcement Mark Piet
Contact person for this announcement Mark Piet
Contact phone number 021 453 333
Contact email address Mark.Piet@Burgerfuel.com
Date of release through MAP 30/05/2022

1



Burger Fuel Group Limited
Preliminary Full Year Results
For The Year Ended 31 March 2022

Chairman and Chief Executives’ Review

Burger Fuel Group Ltd Preliminary Full Year Results for the 12 months ended 31st March 2022

Overview – FY22

The Directors of Burger Fuel Group Limited (BFG) present the results for the 12 months to 31 March 2022.
The audit of these results is in the process of being finalised.

Net Profit after tax for the period was $575,869 representing a 19.2% decrease on the previous year.

The results reflect a second year of considerable COVID disruption including temporary store closures both during and
after periods of lockdown. In addition, substantial costs associated with establishing our new brands (Winner Winner
and Shake Out) were also incurred as well as exit costs associated with the termination of the Master License of the
UAE and ongoing development assessment costs for that region. These and other operating costs were partly offset with
some Government support received by the Group.

As at 31 March 2022 the Group had no debt, and cash reserves of $6.8M.

BurgerFuel Group (unaudited) Total System Sales (all three brands, all regions) increased by 6.22% to $94.2M on the
same period last year. The increase in sales is mainly due to benchmarking against reduced sales in April 2020 when the
total system was closed for a month due to COVID. There were also reduced sales due to COVID store closures in
FY22 (August & September) but not to the same extent. We had also opened the BurgerFuel Whangarei store in March
2021, and that store continues to perform well.

Total income for the Group increased by 0.01% to $21.0M.

BFG RESULTS FOR THE PERIOD 1 APRIL 2021 TO 31 March 2022

31 March 2022 31 March 2021
$000 $000

Operating Revenue * 19,275 18,654
Interest Income – IFRS 16 non-occupied leases 1,267 1,381
COVID Government wage subsidy 430 934
Total Income 20,972 20,969

Operating Expenses ** (17,689) (16,941)
Depreciation Expense – IFRS 16 occupied leases
(780) (699)
Interest Expense - IFRS 16 non-occupied leases
(1,267) (1,381)
Interest Expense - IFRS 16 occupied leases
(488) (481)
Transfer from foreign currency reserve on
windup of subsidiary
- (131)
Total Expenses
(20,224) (19,633)


Net Profit (Loss) Before Tax 748 1,336
Net Profit (Loss) After Tax *** 576 713



* Revenue includes: Operating revenue and interest income but excludes COVID related Government support.
** Expenses include: Operating expenses, depreciation, amortisation and interest expense but excludes the transfer from
foreign currency reserve on windup of subsidiary.
*** The New Zealand entities had taxable income and were unable to utilise the foreign tax losses. The overseas entities had
minimal tax.

2







Overview – FY22 (continued)

As at 31 March 2022 there were 58 BurgerFuel restaurants operating in NZ and 12 operating in the Middle East
excluding third party “ghost” kitchens operating in the UAE. From the 1
st
April 2022 the UAE now only has the World
Trade Centre store in operation, taking the MENA region store count to 9 stores.

There are 3 Shake Out and 4 Winner Winner restaurants operating in NZ.

The Year’s Results and Group Outlook

New Zealand

Total systemwide sales across New Zealand (65 restaurants, all 3 brands) increased by 5.67% on the previous year.

The COVID Alert Level 4 lockdown resulted in FY22 having 35 less days of trade in the Auckland region and 14 in the
rest of the country. All stores were closed between 18 August

and 31

August 2021, with the Auckland stores reopening
on 22 September 2021. We also had reduced store hours across the system in the tail end of FY22 due to COVID staff
shortages.

Shake Out total store sales increased by 6.3% in FY22 and we expect this increase to continue into FY23 with the
introduction of online delivery options now being trialled. Delivery is also now available with the Winner Winner
brand.

Winner Winner total sales increased by 6.8%. Winner Winner has a larger mix of dine-in customers and the constantly
changing Alert Levels had a greater negative impact on Winner Winner, more so than our other two brands. The
company owned store in Takapuna continues to remain challenging, however we remain optimistic about sales
improvement in this store in FY23, providing COVID does not once again impact the Auckland region.

For the entire financial year, the two new brands represented 6.5% of total NZ sales for the group.

The establishment of new brands takes considerable time and financial investment and accordingly this investment has
affected our bottom line. Unfortunately, with the ongoing impact of temporary COVID store closures and reduced hours
we were unable to gain much traction with these brands in FY22. We do however believe that both brands have a future
in New Zealand, however significant resources in terms of cash and management will need to continue in FY23. The
future development of these brands in FY23 is very much dependant on the impact of COVID as well as general market
conditions.

The Middle East

The Middle East sales improved in FY22 with total sales up 10.0%. The drop in the Group’s royalty revenue from the
Middle East reflects COVID support provided to our Middle Eastern partners.

As announced on 25 March 2022 our United Arab Emirates Master License holder AKI Group, ceased operating the
BurgerFuel brand in the UAE on 1 April 2022. At present we continue to operate in the UAE with a single store at the
World Trade Centre in Dubai and by way of third party “ghost” kitchens. Ultimately, we anticipate the operation of
BurgerFuel Middle East will occur under, a yet to be finalised Development Agent (DA) agreement. This structure
effectively appoints a Master Licensee for the entire region to one company that assumes responsibility for the
appointment and operations of individual stores and regional franchisees.

BFG earnings from the Middle East have been diminishing for some years, but particularly since the arrival of COVID.
The Group doesn’t anticipate generating any material income from the UAE region or the wider Middle East in the next
couple of years, while this proposed new DA structure is embedded and tested. It should be noted that the Group
incurred costs in FY22 in relation to both exiting the Master License agreement with AKI Group, as well as the ongoing
assessment of this region for further growth.

BurgerFuel Saudi Arabia sales were up on FY21 even after closing two underperforming stores and the “ghost” kitchen
operations. A new location was opened at Faisaliyah in December 2020 which contributed to these increased sales.

The future of the Middle East business remains uncertain. This territory will need to be completely redeveloped and
although we have made an initial commitment to move forward on this, there can be no certainty of future returns from
this region for some time yet.

3



Summary and Outlook

The FY22 year was another very challenging year under COVID. The hospitality sector was hit hard by the pandemic
but given these circumstances we believe the Group turned in a reasonable performance, in that it was still able to
maintain a profit for the year. At this stage the Group Performance over the next 12 months remains uncertain both with
COVID but also with the current worsening economic conditions. Like every business in New Zealand, we are
experiencing rapidly escalating cost pressures both in the supply chain, but also labour costs and shortages. We cannot
see an end to this at present and believe that these increased costs are permanent and therefore will lead to increased
prices as the year progresses. Price increases are set to occur right across our sector and also in the wider economy in
general.

In regard to franchise opportunities in FY23, whist we expect there to be some activity, it is unclear if the current
economic conditions will yield potential suitable franchisees for new locations. Accordingly, we expect growth in new
stores to be modest with perhaps a few new stores across all brands occurring in FY23. On the positive side, once again
the past year has confirmed BurgerFuel’s robustness as a well-established brand within New Zealand and we expect to
at least maintain consumer demand (sales) in FY23 despite increased prices.

BurgerFuel Group in conjunction with its advisors KPMG continue to remain open to any future strategic options that
may present themselves in FY23. The Board will keep the market updated with any material developments should they
occur throughout the ongoing strategic review process.

We would like to thank all shareholders, staff, franchisees, suppliers and of course our valued customers for their
continued support.

Best regards,



Peter Brook Josef Roberts
Chairman Group CEO

4






Burger Fuel Group Limited
Consolidated Statement of Comprehensive Income
For The Year Ended 31 March 2022


2022

2021



$

$





Revenue

19,251,105

18,615,623
COVID Government wage subsidy

430,292

934,020
Operating Expenses

(17,079,428)

(16,322,939)
Transfer from Foreign currency reserve on windup of
subsidiary


-

(130,882)
Profit before Interest, Taxation, Depreciation and
Amortisation


2,601,969

3,095,822





Depreciation on Property, Plant and Equipment

(470,161)

(477,008)
Depreciation on Right of Use Assets

(779,953)

(698,813)
Amortisation

(139,442)

(142,067)



(1,389,556)

(1,317,888)






Profit before Interest and Taxation

1,212,413

1,777,934



Interest Income

23,577

38,816
Interest Income leases non-occupied

1,266,637

1,380,726
Interest Expense

2

(86)
Interest Expense leases occupied

(487,846)

(480,899)
Interest Expense leases non-occupied

(1,266,637)

(1,380,726)



(464,267)

(442,169)



Profit before Taxation

748,146

1,335,765



Income Tax Expense

(172,277)

(622,780)






Net Profit attributable to shareholders

575,869

712,985

Other comprehensive income:

Items that may be reclassified subsequently to profit or loss:


Movement in Foreign Currency Translation Reserve

12,684

12,257






Total comprehensive income

588,553

725,242






Basic Earnings per Share (cents)

1.14

1.37





Diluted Earnings per Share (cents)

1.14

1.37

5




Burger Fuel Group Limited
Consolidated Statement of Financial Position
As at 31 March 2022


2022

2021
Shareholders’ equity $

$
Contributed equity 11,913,499

11,913,499
Accumulated losses (691,166)

(1,267,035)
Foreign currency translation reserve (285,476)

(298,160)
10,936,857

10,348,304
Current assets

Cash and cash equivalents 6,798,362

7,114,119
Trade and other receivables 1,931,950

2,076,126
Income tax receivable - -
Lease Receivable: non-occupied 1,538,383 1,553,671
Inventories 762,383

548,352
Loans 11,034

127,722

11,042,112

11,419,990
Non-current assets


Property, plant and equipment 2,465,244

2,609,570
Right of use asset - leases 7,727,134 8,375,067
Lease receivable non-occupied 18,172,743 20,947,424
Deferred tax asset 576,743

615,988
Loans 63,296 109,928
Intangible assets 1,905,563

2,043,642

30,910,723

34,701,619
Total assets 41,952,835

46,121,609
Current liabilities

Trade and other payables 1,249,455

1,856,625
Contract Liability 234,448 283,965
Lease Liability 615,881 511,735
Lease Liability: non-occupied 1,538,383 1,553,671
Income tax payable 115,649

524,580
Provisions 350,337 438,163
4,104,153 5,168,739
Non-current liabilities
Contract Liability 830,615 1,245,448
Lease Liability 7,867,267 8,371,494
Lease Liability non-occupied 18,172,743 20,947,424
Provisions 41,200 40,200
26,911,825 30,604,566
Total liabilities 31,015,978 35,773,305

Net assets 10,936,857 10,348,304

6




Burger Fuel Group Limited
Consolidated Statement of Financial
Position As at 31 March 2022





2022 2021


Net tangible assets per share ($ per share)


0.17


0.15
For and on behalf of the Board who approved these financial statements for issue on 30th May 2022.

Director Director

7



Burger Fuel Group Limited
Consolidated Statement of Changes in Equity
For The Year Ended 31 March 2022


2022
Contributed
Equity
Foreign Currency
Translation
Reserve
Accumulated
Losses Total Equity
$ $ $ $




Balance as at 1 April 2021

11,913,499 (298,160) (1,267,035) 10,348,304
Movement in foreign currency translation
reserve recognised in other comprehensive
income

- 12,684 - 12,684
Net Profit for the year ended 31 March 2022
- - 575,869 575,869
Total comprehensive income
- 12,684 575,869 588,553


Balance as at 31 March 2022
11,913,499 (285,476) (691,166) 10,936,857


2021

Contributed
Equity
Foreign Currency
Translation
Reserve
Accumulated
Losses Total Equity
$ $ $ $




Balance as at 1 April 2020

13,594,825 (441,299) (1,980,020) 11,173,506
Buyback and cancellation of ordinary shares
(1,681,326) - - (1,681,326)
Reclassification of FX translation reserve on
windup of USA subsidiary

- 130,882 - 130,882
Movement in foreign currency translation
reserve recognised in other comprehensive
income

- 12,257 - 12,257
Net Profit for the year ended 31 March 2021
- - 712,985 712,985
Total comprehensive income
- 12,257 712,985 725,242


Balance as at 31 March 2021
11,913,499 (298,160) (1,267,035) 10,348,304

8


Burger Fuel Group Limited
Consolidated Statement of Cash Flows
For The Year Ended 31 March 2022



2022

2021

$

$
Cash flows from operating activities


Receipts from customers
19,286,019 18,552,954
COVID Government wage subsidy
445,301 445,133
Interest received
23,577 38,816
Goods and services tax
84,103 (79,859)
Payments to suppliers & employees
(18,502,590) (15,587,996)
Interest
2 (86)
Interest on leases
(459,677) (452,073)
Taxes
(541,965) 187,245
Net cash flows provided from operating activities
334,770 3,104,134


Cash flows from investing activities

Repayments from suppliers & staff 163,320 70,816
Sale of property, plant and equipment 77,576 122,015
Acquisition of intangible assets
(1,364) (7,264)
Advances to franchisee and staff
- -
Acquisition of property, plant & equipment
(383,584) (690,933)
Net cash flows applied to investing activities
(144,052) (505,366)


Cash flows from financing activities

Lease Liability
(505,496) (397,744)
Share buyback & cancellation
- (700,000)
Net cash flows applied to financing activities
(505,496) (1,097,744)


Net movement in cash and cash equivalents
(314,778) 1,501,024
Exchange gains / (loss) on cash and cash equivalents
(979) 42,928
Opening cash and cash equivalents
7,114,119 5,570,167
Closing cash and cash equivalents
6,798,362 7,114,119

9



Burger Fuel Group Limited

SEGMENT REPORTING

Operating Segments

The Group operates in four operating segments; these operating segments have been divided into the following
geographical regions, New Zealand, and International markets. All the segment’s operations are made up of franchising
fees, royalties and sales to franchisees. The segments are in the business of Franchise Systems - Gourmet Burger
Restaurants. New Zealand’s segment result is also due to the amortisation of intangible assets.

The amounts provided to the Board with respect to total liabilities are measured in a manner consistent with that of the
financial statements. These liabilities are allocated based on the operations of the segment.

2022 New Zealand International Consolidated

$ $ $
Revenue

Sales 8,035,134 42,140 8,077,274
Royalties 4,933,041 45,580 4,978,621
Franchising fees 236,599 249,754 486,353
Training fees - - -
Property management fees 57,000 - 57,000
Advertising fees 3,507,309 - 3,507,309
Foreign exchange gain (2,749) (10,972) (13,721)
Sundry income 2,016,172 327 2,016,499
Rent Relief on Non-Occupied Leases 141,770 - 141,770
Interest received 23,551 26 23,577
Interest Leases 1,266,637 - 1,266,637
COVID Government wage subsidy 430,292 - 430,292
Total Revenue 20,644,756 326,855 20,971,611



Interest Expense 2 - 2
Interest Expense Leases Occupied 487,846 - 487,846
Interest Expense Leases non occupied 1,266,637 - 1,266,637
Depreciation 463,451 6,710 470,161
Depreciation Leases 779,953 - 779,953
Amortisation 139,442 - 139,442

Segment Result before Income Tax 634,351 113,795 748,146
Income Tax Expense 172,277 - 172,277

Segment Assets 41,724,930 227,905 41,952,835
Segment Liabilities 30,960,790 55,188 31,015,978

Acquisition of Property, Plant & Equipment & Intangible Assets


Other 384,948 - 384,948

10


Burger Fuel Group Limited

SEGMENT REPORTING (CONTINUED)


2021 New Zealand International Consolidated

$ $ $
Revenue

Sales 7,728,400 47,595 7,775,995
Royalties 4,662,874 158,807 4,821,681
Franchising fees 242,742 55,262 298,004
Training fees 30,000 - 30,000
Property management fees 57,000 - 57,000
Advertising fees 3,340,587 435 3,341,022
Foreign exchange gain 97,739 (68,014) 29,725
Sundry income 1,841,177 36,283 1,877,460
Rent Relief on Non-Occupied Leases 384,736 - 384,736
Interest received 38,050 766 38,816
Interest Leases 1,380,726 - 1,380,726
COVID Government wage subsidy 934,020 - 934,020
Total Revenue 20,738,051 231,134 20,969,185

Interest Expense 153 (67) 86
Interest Expense Leases Occupied 480,899 - 480,899
Interest Expense Leases non occupied 1,380,726 - 1,380,726
Depreciation 474,279 2,729 477,008
Depreciation Leases 698,813 - 698,813
Amortisation 142,067 - 142,067

Segment Result before Income Tax 1,532,323 (196,558) 1,335,765
Income Tax Expense 622,780 - 622,780

Segment Assets 45,754,882 366,727 46,121,609
Segment Liabilities 35,649,636 123,669 35,773,305



Other 698,197 - 698,197

11


Burger Fuel Group Limited
Company Directory
As at 31 March 2022

Registered Office Accountants
Grant Thornton New Zealand Limited Grant Thornton New Zealand Limited
152 Fanshawe Street Level 4
Auckland 1011 152 Fanshawe Street

Auckland 1011
Company Number

1947191 Bridgepoint Group Accounting Pty Ltd

Suite 301, 8 West Street,
North Sydney
Date of Incorporation NSW 2060
14 June 2007 Australia

Directors Citrin Cooperman
Peter Brook - Chairman (Independent) 529 Fifth Avenue
Alan Dunn (Independent) New York, NY 10017
Josef Roberts (Executive) USA
Tyrone Foley (Non-Independent)


Board Executives
Mark Piet (Chief Financial Officer / Company Secretary)
KPMG
Business Headquarters
18 Viaduct Harbour Avenue,
Auckland 1140

66 Surrey Crescent
Grey Lynn
Auckland 1021


Bankers
Auditor ASB Bank Limited
Baker Tilly Staples Rodway CBA Bank Limited (Australia)
Level 9, Tower Centre Emirates NBD (UAE)
45 Queen Street Bank of America Merrill Lynch (USA)
Auckland 1010




Solicitors
Dentons Kensington Swan, 18 Viaduct Harbour Avenue, Auckland 1011.
Buddle Findlay, PwC Tower, 188 Quay Street, PO Box 1433, Auckland 1140.
Wiggin and Dana LLP, Two Liberty Place, 50 S. 16th Street, Suite 2925, PA, 19102, USA.
Corporate Counsel Limited Solicitors, P.O Box 37-322, Parnell, Auckland 1151.
Wynn Williams PO Box 2401, Shortland Street, Auckland 1140.
EMA (Employers & Manufacturers Association) 145 Khyber Pass Road, Grafton, Auckland 1023.

---

MONDAY, 30 MAY 2022
BURGER FUEL GROUP LIMITED PRELIMINARY FULL YEAR RESULTS FOR THE
YEAR ENDED 31 MARCH 2022
OVERVIEW – FY22
The Directors of Burger Fuel Group Limited (BFG) present the results for the 12 months to
31 March 2022.The audit of these results is in the process of being finalised.
Net Profit after tax for the period was $575,869 representing a 19.2% decrease on the previous
year.
The results reflect a second year of considerable COVID disruption including temporary store closures
both during and after periods of lockdown. In addition, substantial costs associated with establishing
our new brands (Winner Winner and Shake Out) were also incurred as well as exit costs associated
with the termination of the Master License of the UAE and ongoing development assessment costs
for that region. These and other operating costs were partly offset with some Government support
received by the Group.
As at 31 March 2022 the Group had no debt, and cash reserves of $6.8M.
BurgerFuel Group (unaudited) Total System Sales (all three brands, all regions) increased by 6.22% to
$94.2M on the same period last year. The increase in sales is mainly due to benchmarking against
reduced sales in April 2020 when the total system was closed for a month due to COVID. There were
also reduced sales due to COVID store closures in FY22 (August & September) but not to the same
extent. We had also opened the BurgerFuel Whangarei store in March 2021, and that store continues
to perform well.
Total income for the Group increased by 0.01% to $21.0M.
As at 31 March 2022 there were 58 BurgerFuel restaurants operating in NZ and 12 operating in the
Middle East excluding third party “ghost” kitchens operating in the UAE. From the 1st April 2022 the
UAE now only has the World Trade Centre store in operation, taking the MENA region store count to 9
stores.
There are 3 Shake Out and 4 Winner Winner restaurants operating in NZ.
BURGERFUEL GROUP - PRESS RELEASE

BFG RESULTS FOR THE PERIOD 1 APRIL 2021 TO 31 MARCH 2022
Operating Revenue *
Interest Income – IFRS 16 non-occupied leases
Covid-19 Government wage subsidy
31 March 2022
$000
19,275
1,267
430
31 March 2021
$000
18,654
1,381
934
Total Income20,97220,969
Operating Expenses ** (17,689)(16,941)
Depreciation Expense – IFRS 16 occupied leases (780)(699)
Interest Expense - IFRS 16 non-occupied leases (1,267)(1,381)
Interest Expense - IFRS 16 occupied leases(488)(481)
Transfer from foreign currency reserve on windup of
subsidiary
-
(131)
Total Expenses(20,224)(19,633)
Net Profit (Loss) Before Tax
748
1,336
Net Profit (Loss) After Tax ***
576
713
THE YEAR’S RESULTS AND GROUP OUTLOOK
NEW ZEALAND
Total systemwide sales across New Zealand (65 restaurants, all 3 brands) increased by 5.67% on the
previous year.
The COVID Alert Level 4 lockdown resulted in FY22 having 35 less days of trade in the Auckland
region and 14 in the rest of the country. All stores were closed between 18 August and 31 August
2021, with the Auckland stores reopening on 22 September 2021. We also had reduced store hours
across the system in the tail end of FY22 due to COVID staff shortages.
Shake Out total store sales increased by 6.3% in FY22 and we expect this increase to continue into
FY23 with the introduction of online delivery options now being trialled. Delivery is also now
available with the Winner Winner brand.
Winner Winner total sales increased by 6.8%. Winner Winner has a larger mix of dine-in customers
and the constantly changing Alert Levels had a greater negative impact on Winner Winner, more so
than our other two brands. The company owned store in Takapuna continues to remain challenging,
however we remain optimistic about sales improvement in this store in FY23, providing COVID does
not once again impact the Auckland region.
For the entire financial year, the two new brands represented 6.5% of total NZ sales for the group.
The establishment of new brands takes considerable time and financial investment and accordingly
this investment has affected our bottom line. Unfortunately, with the ongoing impact of temporary
COVID store closures and reduced hours we were unable to gain much traction with these brands in
FY22. We do however believe that both brands have a future in New Zealand, however significant
resources in terms of cash and management will need to continue in FY23. The future development
of these brands in FY23 is very much dependant on the impact of COVID as well as general market
conditions.
*Revenue includes: Operating revenue and interest income but excludes COVID related Government support.
** Expenses include: Operating expenses, depreciation, amortisation and interest expense but excludes the transfer from foreign
currency reserve on windup of subsidiary.
*** The New Zealand entities had taxable income and were unable to utilise the foreign tax losses. The overseas entities had
minimal tax.

The establishment of new brands takes considerable time and financial investment and accordingly
this investment has affected our bottom line. Unfortunately, with the ongoing impact of temporary
COVID store closures and reduced hours we were unable to gain much traction with these brands in
FY22. We do however believe that both brands have a future in New Zealand, however significant
resources in terms of cash and management will need to continue in FY23. The future development
of these brands in FY23 is very much dependant on the impact of COVID as well as general market
conditions.
THE MIDDLE EAST
The Middle East sales improved in FY22 with total sales up 10.0%. The drop in the Group’s royalty
revenue from the Middle East reflects COVID support provided to our Middle Eastern partners.
As announced on 25 March 2022 our United Arab Emirates Master License holder AKI Group,
ceased operating the BurgerFuel brand in the UAE on 1 April 2022. At present we continue to
operate in the UAE with a single store at the World Trade Centre in Dubai and by way of third party
“ghost” kitchens. Ultimately, we anticipate the operation of BurgerFuel Middle East will occur under,
a yet to be finalised Development Agent (DA) agreement. This structure effectively appoints a
Master Licensee for the entire region to one company that assumes responsibility for the
appointment and operations of individual stores and regional franchisees.
BFG earnings from the Middle East have been diminishing for some years, but particularly since the
arrival of COVID. The Group doesn’t anticipate generating any material income from the UAE region
or the wider Middle East in the next couple of years, while this proposed new DA structure is
embedded and tested. It should be noted that the Group incurred costs in FY22 in relation to both
exiting the Master License agreement with AKI Group, as well as the ongoing assessment of this
region for further growth.
BurgerFuel Saudi Arabia sales were up on FY21 even after closing two underperforming stores and
the “ghost” kitchen operations. A new location was opened at Faisaliyah in December 2020 which
contributed to these increased sales.
The future of the Middle East business remains uncertain. This territory will need to be completely
redeveloped and although we have made an initial commitment to move forward on this, there can
be no certainty of future returns from this region for some time yet.

SUMMARY AND OUTLOOK
The FY22 year was another very challenging year under COVID. The hospitality sector was hit hard by the
pandemic but given these circumstances we believe the Group turned in a reasonable performance, in that it
was still able to maintain a profit for the year. At this stage the Group Performance over the next 12 months
remains uncertain both with COVID but also with the current worsening economic conditions. Like every
business in New Zealand, we are experiencing rapidly escalating cost pressures both in the supply chain, but
also labour costs and shortages. We cannot see an end to this at present and believe that these increased costs
are permanent and therefore will lead to increased prices as the year progresses. Price increases are set to
occur right across our sector and also in the wider economy in general.
In regard to franchise opportunities in FY23, whist we expect there to be some activity, it is unclear if the current
economic conditions will yield potential suitable franchisees for new locations. Accordingly we expect growth in
new stores to be modest with perhaps a few new stores across all brands occurring in FY23. On the positive
side, once again the past year has confirmed BurgerFuel’s robustness as a well-established brand within New
Zealand and we expect to at least maintain consumer demand (sales) in FY23 despite increased prices.
BurgerFuel Group in conjunction with its advisors KPMG continue to remain open to any future strategic options
that may present themselves in FY23. The Board will keep the market updated with any material developments
should they occur throughout the ongoing strategic review process.
We would like to thank all shareholders, staff, franchisees, suppliers and of course our valued customers for
their continued support.
Best regards,
Peter Brook
Chairman
Josef Roberts
Group CEO
For further information please
contact: Mark Piet
+64 9 360 6730
communications@burgerfuel.com
www.burgerfuel.com