Sapphire Foods Reports Q2 FY26 Financial Performance

Sapphire Foods India Ltd., a key operator of KFC, Pizza Hut, and Taco Bell in India and South Asia, reported its financial results for the second quarter ended September 2025. The company recorded a net loss of ₹12.7 crore, widening from a loss of ₹3 crore in the corresponding period last year. Total revenue for the quarter increased by 7% year-on-year to ₹742.7 crore. The flagship KFC brand demonstrated resilience, with revenue growing 7% year-on-year, or 10% when excluding the shift of the Navratri festival period into this quarter. However, the same-store sales growth (SSSG) for KFC was impacted by this timing shift. In contrast, the Pizza Hut India segment faced significant headwinds, with a 6% year-on-year revenue decline. Pizza Hut’s SSSG in India fell by 8%, leading to a negative restaurant-level EBITDA of 1.8%, a year-on-year decline of 590 basis points. Notably, the company’s exclusive Tamil Nadu territory for Pizza Hut achieved double-digit growth, validating the regional focus strategy. The Sri Lanka business delivered robust performance, with an 18% revenue increase in local currency (LKR), propelled by strong dine-in recovery and new product initiatives. The region also posted a positive 14% same-store sales growth (SSSG) and healthy same-store transaction growth (SSTG). Operationally, the company continued its expansion, adding 19 new KFC and two new Pizza Hut restaurants in India, alongside one Pizza Hut and one Taco Bell in Sri Lanka. As of September 30, 2025, Sapphire Foods' total restaurant count stood at 997. The results reflect sustained growth in the core KFC brand and strong momentum in the Sri Lankan market, juxtaposed with margin pressures and challenging SSSG in the Indian Pizza Hut segment. Management considers the quarter "reasonable," emphasizing continued strategic expansion despite near-term operational challenges.