Finance.detik.com reports that amidst mounting losses and falling sales, PT Fast Food Indonesia – the sole franchisee for the Kentucky Fried Chicken (KFC) Chain of restaurants is closing many outlets and firing thousands of employees.
KFC opened in Indonesia in 1979 with a single outlet in Indonesia’s capital Jakarta. The company expanded quickly to other cities across Indonesia, with the Salim Group becoming a majority shareholder in 1990.
In May 1993, the company trading as FAST launched an IPO on the Indonesian Stock Exchange and sold 20% of its shares at Rp. 5.700 per share. In early November 2024, the price of a single share of FAST had sunk, trading at Rp. 366 per share.
Financial reports released on Friday, 08 November 2024, saw the company record a loss of Rp 557.08 billion through the end of Q3. That loss is a 266.59% increase southward from the Rp. 152.41 billion loss compared to the same three quarters in 2023.
Industry observers are blaming a slow and incomplete recovery from the business downturn occasioned by the COVID-19 pandemic and adverse market conditions, including a global boycott of the KFC Brand linked to the continuing Israeli military action against Palestine.
Quoting from FAST’s financial statement: “This condition is a prolonged impact of group recovery from the COVID-19 pandemic, in which sales have not reached the level expected by management, and a worsened market situation due to the impact of the Middle East crisis. These two problems have hurt the group’s financial results for the nine-month period, which ended on September 30, 2024.”
In the face of its worsening finances, KFC in Indonesia is urgently seeking to efficiently rationalize its operation by closing underperforming outlets and terminating the employment of many of its workers.
The Q3 financial report on 30 September 2024 revealed that 47 KFC outlets have been closed, leaving 715 outlets in operation. Similarly, the KFC workforce has been trimmed to 13,715 workers after the termination of 2,274 employees from its former total team complement of 15,989.
Online sources list 25 KFC outlets operating on the Island of Bali. It is unclear if any outlets on the Island have been affected by company cutbacks.
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