March 8, 2018 / 7:06 AM / 7 months ago

South Africa's Famous Brands flags up to $34 mln in FY impairment

Johannesburg, March 8 (Reuters) - South African fast-food chain owner Famous Brands said on Thursday that annual earnings would be hit by impairment charges amounting up to 400 million rand ($33.7 million) on its Gourmet Burger Kitchen (GBK) business.

As a result, Famous Brands expects earnings per share to decrease by more than 20 percent for the year ended Feb. 28.

The company, which owns casual dining chain Wimpy UK and fast-food assets such as Steers and Debonairs, bought Britain’s GBK for 120 million pounds ($166.75 million) in 2016.

Famous Brands said it would book an impairment of intangible assets at group level, estimated to be between 241 million rand and 322 million rand and an impairment of property, plant and equipment at GBK, estimated to be between 59 million rand and 78 million rand.

In addition, a provision for property-related expenses at GBK, estimated to be between 37 million rand and 49 million rand, will also be booked.

“The exact valuations of the two impairment figures and the provision will be determined as part of the year-end process,” the firm said in a statement. ($1 = 11.8662 rand) ($1 = 0.7196 pounds) (Reporting by Nqobile Dludla; Editing by Amrutha Gayathri)

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