Food franchise operator Restaurant Brands told shareholders today it expects to make an annual profit, excluding non-trading items, of about $12 million.
"The current economic environment, whilst challenging, has not impacted our sales as adversely as originally anticipated," chairman Ted van Arkel said in a speech to the annual meeting.
The company reported net profit after tax of $11.7 million in its 2008/09 year, up $1.4m on the previous year.
"There is life in a recession and Restaurant Brands' performance in 2008/09 is testimony to that," said chief executive Russel Creedy.
The profit was driven by a strong performance by the KFC chain.
The company has previously reported sales in the 12 weeks to May 25 totalled $72.8m, up 4.3 percent on the same time last year.
Mr van Arkel said the year's trading had started well with the first quarter's sales results.
"Continued improvement in bottom-line profit requires the momentum of the KFC brand to be maintained and the other two brands to demonstrate a solid turnaround in earnings performance."
The company also runs Pizza Hut and Starbucks franchises.
Mr van Arkel noted that the company's share price has risen from 57 cents to $1, but said "even at today's price the shares remain well below consensus analysts' valuations".
The stock rejoins the NZX50 next week.
"What the current year holds for Restaurant Brands is hard to fathom, although the signs are that the recession will ease by Christmas and that the economy will slowly return to normal," Mr Creedy said.
He said a new agreement with franchisor Yum! Restaurants International allowed much more flexibility in closing under performing Pizza Hut stores.
It also introduced the option of selling off individual stores to franchisees.
"The new arrangement allows us to rationalise the network for better profitability, but still provides Restaurant Brands with the day-to-day control and direction of the brand."