Good morning, everybody, and welcome on behalf of myself and Lebo to our end February 21 Financial Results Presentation. I'm hopeful that you're familiar with the 2 of us, for the analysts who follow us. And really thank you again for your interest that you've shown to register for this audio webcast. A special welcome to our board colleagues on the Famous Brands Board and to the members of the new audit team that hopefully have dialed in. And a special welcome to all of the Famous Brands family that would have dialed in.
This is really your hard work that's on display here. So thank you and hopefully you're as proud as we are to present these results. We do humbly apologize for the delay in moving the results out by a week. We do hope that the journey continues or you see the journey continuing in terms of improved disclosures. We think yet again, we've helped to give you some more insights into the business and we'll always welcome feedback from shareholders and potential shareholders as we have done over the past 12 months.
We know it's never enough. There's always a need, particularly in turbulent times like these. We probably have held back a little bit around competitive information. So probably slowed a little bit, but I'm comfortable when the IRR comes out on the 22nd June that you will also have some more disclosures that are helpful in managing the business and managing your investments. With this, so you're mindful, we'll split the presentation into about 50 minutes of presenting and then allow 10 minutes for questions at the end.
Just excuse the short statements at times. We'll try and be brief. There will be probably a fair bit of commentary around the 3 big themes and that's, I suppose, IFRS again, relatively new and still coming through the business, the likes of IFRS 16, very new this year, discontinued operation we hear a lot about and then of course COVID-nineteen, which has impacted all of our lives, not just our business. There's a lot of usual information that we've relegated to the supplementary section. So when the presentation is uploaded to the website afterwards, you will pick up some of that old familiar stuff that we might normally present to you.
In terms of the agenda, which you should have in front of you, The first part will be myself and then I'm going to hand over to Lebo to do Section 2 and then I will cover the balance of the presentation and then Lebo and myself will handle Q and A. In terms of where we are right now, if I could just ask you to just look at your screen to just make sure you've got the ability to ask questions if you want to. So those questions you can ask throughout and we'll pick them up at the end of that of the presentation in that 10 minute section. So let me get on with it. Just in terms of the operating context and I think important before we start that you're going to see lots of pictures of franchise partners throughout this presentation.
And really, this is testament to them and the hard work and the bravery that they've shown over this past 12 months. They are the lifeblood of our business. On the screen there, you have Tarbone patients, you have various Devenez and Steers outlets in the south of Johannesburg and really proud of the work they've done. They actually I think could actually do a bit of a side job on modeling actually looking at the 2 of them there and you'll see lots of franchisees through this presentation that have really pulled a lot of hard work and hardships this year trying to get their businesses back on track and we're very, very proud of them and the work that they've done. So just building on that operating context, I think it's important to understand broadly the operating implications of COVID-nineteen.
I mean, most of them are probably obvious and they jump out to you as being fairly normal because that may have impacted your own personal life. It goes without saying that the food services industry has been severely impacted, very difficult safety measures. We've had to reassess certain assets in our supply chain because the basket of goods has changed. And as you've seen with most businesses and most people's own lives having to preserve cash, very narrow focus on our geography in terms of expansion given the difficulties in traveling and of course realigning our strategy. And in terms of the impact on Signature Brands, it has been quite severe, particularly at the top end of the business.
But there's 2 things that jump out there for me that have really been key in terms of our business. The one is protecting our core business in terms of our franchisees and I'll talk about that through the presentation. And we've had to do whatever we've had to do and they've had to do whatever they've had to do to protect their businesses. And I think that we are well on track in terms of a recovery plan. The second one was GBK being placed under administration.
And I think that the route that we followed in hindsight around that has been the right one. And I'm really comfortable to present these results and drawing a line under GBK. And Lebo will talk a bit more about that. But I mean, it was key part of the year and the year has gone by so quickly. I think we forget about the hard lockdown in April and the challenges that we face as a business.
But that was a particularly poignant time in Famous Brands' life and the decisions that the board made around that have turned out to be the right ones. Just building on some information around COVID-nineteen, there's a lot on your hand, it's very colorful. But I really just wanted to talk you through some research implications in terms of our business, because we need to understand what we've experienced or what the consumer is experiencing and how we are benefiting and losing from that and to try and understand what we're seeing in our research. And of course, research has been thrown out completely. I spoke about that at half year.
So we've had to put in different measures of research. And this is an internal product called the Food Fans Panel. So we really had to adapt like everyone else has to give our team some insights in terms of what's happening out there. So what this slide says to you very briefly is what the dipsticks have shown you over key points. I've chosen key months there and around have used and that really talks to our brands and the convenience or non convenience formats that we have.
And the bottom key indicates the type of channels that they would be using typically, which are the broad channels, other than none being a smaller number. So just to put into context there, if you take the shift from August through to March around sit down, the encouraging part for me is if you look at that trend, it's heading upwards to a point where we are now and given the 3rd wave now that that number would obviously change, but it certainly gives you some insight that we're on the right trajectory on sit down. I've on delivery, which I think has got lots of hype and talk in the marketplace, you can see that is substantiated there through an ongoing trend upwards around delivery. So no surprise there and you can delve into those others yourself around some of those trends. And again, most importantly, the sit down under pressure, which I think is where we are.
But that's what people are saying they have used through the pandemic. If you talk about what they're avoiding at the moment, which I think is a flip side of this other picture, I mean, the obvious that jumps out there is that they're avoiding sit down. The encouraging thing for us and we're seeing it in behavior is that they're avoiding it a lot less than they were a few months back and you can see that number consistently dropping over those months. Now that's very encouraging for us and it really does start to talk about a return to some normality. The other part of that is you'll see that delivery has consistently grown, but the gap is not there and it is something too that people are avoiding.
So it's not immune to the perils of sit down restaurants. So I think, again, data can be a bit skewed, but we've seen the growth in delivery. And I think that that has stabilized. And I know that you will have different views around what's permanency, but our view is that you will start to see some return. And the next slide really just does talk to that.
So when we start to ask people what they're likely to use in the near future, bear in mind, if you go back to August, no one knew where we would be in March. So you can see that data is evolving over time. And it's showing the right sort of picture that we are looking for in our business, in our particular industry. So again, what jumps out there is if you say what people are going to likely use is the dependency on delivery is going to drop, which is a good thing for parts of the business. But the real winner there would then be the casual dining part of the business.
So we play in both spaces. So we need to manage that. But again, the encouraging term for me is really around getting back to normality. And it looks like there is an ability to return back to some sort of normality. And if you look in January, the at the restaurant drop, again, it makes sense is that in January they thought, well, unlikely because you were in the middle of the second wave.
So I don't want to belabor the issue around research. I'll start to wind it up now. But this is just to look at the channel behavior. So the type of channels that we talk about in that presentation and what's the kind of relative size through the COVID pandemic. And you can see on the far right there is that sit down in the outlets is really not necessarily something that's a preference and has taken quite a hammering.
If you look at the calibration of those graphs, you'll see on the next slide how that changes and moves through. So what's hurt us the most is really the sit down in the outlets on the casual dining side, although we have benefited in the QSR side from the other aspects. So if you move on and say, what's your anticipated behavior going to be like post COVID-nineteen? Again, you can see that sit down in outlets has dropped significantly from the previous slide. And even currently at that level, the primary reasons for avoiding in the anticipated behavior still relate to COVID-nineteen.
So you can interpret what you like from research and marketing people tend to, but what we're seeing is the trends heading in the right direction. But also, we've been able to capitalize on COVID as we've needed to. So in terms of that, what are the kind of trends that we've seen broadly and I'm talking very broadly around the operating context. I've put them all up there across certain categories from consumer behavior right through to technology. But I suppose to really share with you what we've noticed and has jumped out broadly in our business.
So the first one being social media. I mean, it's an obvious one in terms of the digital transition that COVID forced, but we're definitely seeing different patterns and different behavior and tone on social media, which sometimes is helpful, sometimes harmful in terms of how you manage the business. And it's a lot more spread out through the week. Typically, we used to see Facebook feedback sort of peak on a Sunday as people were coming back and complaints or compliments increased and that type of behavior has changed. There's a lot more aggression than they used to be.
Kneel time is definitely blurring. So we're seeing that and that has positive and negative impact on the business. But that also is driven by curfews right now. And we've seen it as curfews were hard at certain times last year, those changes impacted on mealtimes. Home dining, an obvious trend, and we have benefited from that with home delivery, but we've also seen it through our retail business.
But we'd also like to see a return to people going out and moving around the country and that's probably got the biggest benefit for us in terms of the recovery. High food inflation is something that is really related to H2 rather than H1. Food inflation, I think people were having a great time in the first part of lockdown. There was actually an element of prices decreasing. But certainly H2 and where we are currently, that is starting to come through.
And I think retail has probably seen it before we've even seen it. It's probably not as severe as we anticipated back in October when we presented our results. But we're fairly comfortable with managing it. But it's certainly going to push prices through to consumers. As we said before, I mean, it's not anything you didn't know, but the food aggregators have really started to increase their presence in the marketplace.
And again, we have a relationship with them, but we also have a relationship that we continue to push ourselves in terms of driving market share in that same space. And again, we've all seen the move from e commerce and contactless payments and we're seeing it more and more and more in our business. And it's really becoming part of the customer journey. And I'm comfortable to say that we are adapting as well as anybody else to those changes. So I'm just going to briefly talk you through some of the context in terms of various trends.
And I suppose from our perspective, we've always looked at value offerings, but that had to be changed through COVID, different pack sizes, as you would have seen in retail, different price points. So it's not just about saying you didn't have value before, you had to adjust value. We've had to up our game in technology across the digital and social media spheres. And the big one is really being where franchisees have dug deep and that's increasing and improving our own delivery capacity. So it's really being a scale game and really working hard around those areas of the business.
And our franchise partners have done a phenomenal job there. And of course, your own delivery channel is more profitable, but it's also delivery either way is the least profitable channel across the business. And menus, again, I think as people have adapted their lifestyles through COVID, we've also adapted in terms of healthier options, which was a pre COVID trend, but has accelerated. Of course, environment is gaining momentum for the right reasons. And COVID has helped people to think and we're having to adapt the same way.
And of course, safety protocols continue to be a key part of COVID, but also we're comfortable to say we had strong protocols going into this and they had to be adapted for COVID rather than having to work off a new base. So overall, I'm comfortable that we responded well when one looks back on the year to say how we responded to the various trends. So I'm going to pause there and try and draw a line on the COVID and let Levoy talk you through the financial results and then I'll come back and give you a little bit of insight around where the business has performed at.
Thank you, Darren. Good morning, ladies and gentlemen. Earlier on, Darren reminded us
of
the harsh and unprecedented reality we had to contend with during the first part of the financial year. In context of the COVID-nineteen storm, we had to navigate with a strong commercial conviction that this too shall pass and that we would come out stronger. The picture before you tell the story of a resilient business model whose fundamentals remain intact. Given the loss of a full month's trading being April 2020, which is typically a key trading month for us due to the Easter holidays, as well as operating within the context of the various lockdown restrictions. The decline in our various performance matrices, as you see, were to be expected.
What could not have been anticipated with certainty at the time we published our interim results in October last year were the following 2 matters amongst others. 1, would the business be profitable in the second half of the year? And just to recap, at half year, we were PBIT neutral if one were to exclude GBK's half year loss. And 2, how much reliance would we have to place on our debt facilities to fund the business given the impact of COVID-nineteen on the business? I trust that you are just as pleased as I am that the group was indeed profitable in the second half of the year, as evidenced by the BRL 193,000,000 operating profit before non operational items and that the business generated BRL574 1,000,000 for the full year from operations, of which BRL518 1,000,000 was generated in the second half alone.
The business could thus self fund without having to rely on debt. Instead, we were able to voluntarily repay an additional R91 1,000,000 in the second half despite the various COVID-nineteen related challenges. This is testament to how highly cash generative the business remains. The full impact of the group's investment in GBK is reflected in the EPS number. We had indicated at interims that the group no longer has control of GBK as the business was placed into administration in line with the U.
K. Insolvency Act. As a result, you may have noticed that our income statement has been split into 2 this year, being the portion that relates to continuing operations as well as the cutting out of GBK's result in a note for discontinued operations. You can find this note in our full app, it's note 19. From a JSE perspective, we are required to still report the EPS and HEPS numbers on an all in basis, which is the picture depicted on this slide.
The
R4.7 billion revenue from continuing operations represents 72% of the pre COVID revenue, that's the F 2020 revenue. At PBIT level, this translated to 32% of F 2020 PBIT. The question that Darren and I often get is how long do we think it will take us to see a recovery to the F 2020 levels? As you can imagine, this is challenging to pin down given how fluid the COVID-nineteen situation is. The transition to lockdown level 2 just 2 days ago in response to the reality of us being in a 3rd COVID-nineteen wave is a case in point.
We will unpack the revenue and operating profit lines when focusing on the segmental performance in the next two slides. The non operational items figure of RMB193 1,000,000 is non cash. It relates to the impairment of some of our brands, mainly Signature Brands, which we cautioned the market about in a trading statement published in May. A breakdown of our net finance costs of RMB176 1,000,000 is provided in note 30 of our condensed consolidated financial statements, which are also available on our website. The majority of the interest relates to our debt facility.
There is also some interest relating to April 16 lease liabilities, about ZAR31 1,000,000. On the face of it, one would have expected our tax expense line to not be negative, given the loss before tax. This is not the case mainly as a result of the impairment. Our effective tax rates recon provided in Note 18 of our full financial statement provide a breakdown of the different items that had an impact on our tax line. Our SA business reported a 30% decline in revenue to 4,300,000,000.
Leading brands revenue declined to RMB491 1,000,000. Consistent with recent years, the group's quick service restaurants brands being Steers, Debonis Pizza, Fishaways and Milky Lane outperformed the casual dining brands, Langley, Wimpy and Mug and Bean. Our Signature Brands portfolio comprises a wide range of bespoke casual dining offerings. Their performance with revenue down 60% to ZAR76 1,000,000 reflects trading conditions, which were particularly harsh on this dine in trading format, including capacity restrictions, cap use and alcohol bans. Total volumes across supply chain declined due to lower demand on the front end brands division.
Combined revenue of 3,300,000,000 was reported compared to 4,500,000,000 in the prior year. Our retail business, which produces condiments, coffees and frozen meat products has operated for a full financial year as a standalone business unit, reporting revenue of RMB151,000,000. This business unit experienced an increase in sales during the year as consumer demand for at home consumption increased. The U. K.
Experienced severe economic hardships as lockdown restrictions were only lifted in August with certain of these restrictions still in place. Wimpy U. K. Turnover down 8% with revenue in rent terms reported at a 112,000,000 which is pleasing in context of the hardships. In context of the less stringent COVID-nineteen trading restrictions in the AME region though, the AME business units delivered solid results.
Combined revenue reported for the region was BRL 316,000,000, which is in line with prior year. The operating profit for leading brands was down 55 percent to R200 1,000,000 for the year. Signature Brands posted an operating loss of R31 1,000,000 this year. Our supply chain division was negatively impacted by lower volumes with operating profit coming in at R169 1,000,000 compared to the R457 1,000,000 last year. In South Africa, operating profit fell by 70% to R250 1,000,000 this year.
In our U. K. Business segment, we reported a loss of R87 1,000,000. There were no further operating losses impacting the group's results from the date on which GBK entered administration. The AME division delivered a pleasing operating profit of R30 1,000,000.
The group's overall operating margin was a record low of 3.8%, reflecting extreme margin pressure across the business. The operating margin in Signature Brands was 41% negative, down from 12% positive in the prior year. This reflects the lockdown restriction levels relating to restaurant capacity and alcohol ban during a portion of the year. In the supply chain division, the operating profit margin declined to 5% due to rising food inflation and a decision by the group to support financially stressed franchise partners through partially absorbing price increases and deferring passing this on to our franchise partners. The U.
K. Operating margin of negative 19.4 percent reflects the poor margin performance that came through the GBK business in the period that we were still consolidating for. The group's balance sheet remains solid with an asset base worth R3 1,000,000,000. The decrease in the net asset position is largely attributable to the impairment and subsequent disposal of GBK. While our equity position was eroded from R1.8 billion last year to R391 1,000,000 this year, It is comforting to see how the business was able to absorb GBK's R1.5 billion impairment without going into negative equity.
Although our gearing rose to 3 51%, as you may have noticed on the salient features slide, this was largely driven by the impact of the impairment on our equity position. Overall, we are comfortable with our level of our total gross borrowings of ZAR1.5 billion. This slide provides a snapshot of our net working capital position at the end of the year, which we continue to monitor as part of our overall balance sheet and liquidity management. Thank you and well done to my colleagues who did a fantastic job at this. In my introduction, I mentioned that the fundamentals of the business remain intact.
This picture before you is testament to that. We went into the 1st wave of the COVID-nineteen pandemic with robust cash reserves of R486 million and concluded the financial period with a strong R444 1,000,000 cash position. This puts the business at an advantage with regards to weathering the 3rd wave. We closed the period with RMB400 1,000,000 of our RCF facility unutilized. In addition, we have access to RMB200 1,000,000 overdraft facility, which we haven't used.
Our solid relationship with our primary lender Nedbank offers additional comfort in how we think about our liquidity position. And for that, we are grateful. In conclusion, I would like to thank our ever resilient franchise partners without whom the picture before us would not have been possible. Kudos too to my colleagues across the business. The agility you displayed in navigating the 1st and second waves illustrates that our core values are not just words on walls.
Lastly, thank you to our shareholders whose conviction in the business' prospect remained unshaken even as the market and our operating environment behaved as it did over the past few months. One of our shareholders encouraged us to always remember to let the main thing be the main thing. With this in mind, I can reassure our shareholders that our continued focus on cash and working capital management is and always will be top of mind to ensure that we prioritize the main thing being the main thing, which for us is our vision to be the leading innovative branded franchised and food services business in South Africa and selected markets. With that, I will hand back to Darren.
Great. Thanks, Lebo. Hopefully, I can share a bit around the business now and we can put a line under the numbers as we move forward, but that's very encouraging to see. And I think we're in a great position to tackle this year of recovery. So I think when one looks at those results on the face of it, not necessarily something one would want to present or be proud of, but I think it's important to unpack that, as I'll do now, around the microcosms of the business and the understanding below that, because I think you'll sense a pride coming out of us in terms of the work that's being done.
And we understand what the impact of these numbers are, particularly around GBK, which I said earlier, we've drawn a line under. Just in terms of group wide, I think it's important to look at those four factors. There is an overarching theme around what we did and what we had to do to keep the business going. And again, our primary focus, as I said earlier, was to assist and protect our franchise partners. And I mean, lots of people would try and want the detail of that.
And again, it's a relationship. So each franchise partner is different and unique. And you've seen this dynamic play out about QSR and CDR being very differently impacted. And we obviously have a recovery program. But just roughly, we typically assist franchise partners every year for different things.
And that's really in the form of royalty relief and marketing relief. And it's quite difficult to quantify the number because there is a base. But roughly, we estimate that through the crisis, we've probably provided around ZAR70,000,000 worth of royalty relief, which is related directly to the COVID program rather than typical business programs. Now bear in mind, we operate on a percentage and percentage of a lower number doesn't mean you can easily extrapolate that number going forward. But roughly, for those of you who have models, you'll get a sense of that contribution.
We've been focused on resetting the business and bringing in more agility, which we think we've done. And of course, that has resulted in some trauma around rightsizing, reducing costs and obviously managing cash and getting that flexibility over the next 3 years. So not all easy, but the business has responded well to those challenges. And of course, through that, we think we've improved operational efficiencies, but there's always more we can do. Menu rationalization has been a key part of surviving COVID.
And of course, as I said earlier about delivery capacity and third party aggregators have really been an accelerator of surviving this process. In terms of the SA context, I mean, we are primarily an SA business. So I think important to focus that. It's really critical to understand that come 1st May, we weren't able to operate the whole business. But a lot of people were very brave and jumped in and got the business going and got moving.
And that was a key part of what we had to do. The casual dining has experienced a much slower recovery. I mean, that's really being impacted by restrictions and not as easy to navigate as the QSR segment because delivery typically tends to favor QSR. And of course, the knock on affects the supply chain, as Lebo said. When you lose demand at the front end, it pulls all the way through.
So the plants that have serviced QSR have benefited a lot better than those primarily focused casual dining, and I'll show you those numbers just now. And the half food inflation in H2 wasn't immediately passed on. We've seen that coming through more in the March April menu cycle. So we absorbed as much as we could within reason in that particular cycle. In the AME space, many restaurants were closed and we've had to offer similar financial support.
So the number I gave you earlier was an all in number across the group. Some exciting parts though, I mean expansion into Oman has been a key point for us. And again, the team could write a book on that on just some of the experiences trying to open a store in COVID in a foreign country. The curfew in Botswana, particularly in Wave 2, was challenging. I think when I reported at half year, we were in a good space in Botswana.
But the second wave curfew and even running through to currently has been quite challenging around that side. And of course, the less stringent restrictions have helped us to deliver solid results. But we are seeing, you'll see a bit of data later, is that the AME recovery seems to be slower than SA recovery. So it wasn't as impacted, but we're starting to see a slow or anticipate a slower recovery. And of course, our strategic alliance partners have been very helpful in giving us opportunities for growth going forward.
So we're very optimistic about our AME business. On the UK side, the GBK recovery, we've spoken a lot about and that almost became impossible with the lockdowns and what happened. And I think in hindsight, if you look at what happened, the 2nd lockdown or 3rd lockdown over November, December, our timing was impeccable around our decisions. The restaurant business there was sold. We weren't necessarily involved in that transaction, but we are delighted that there was an ability through our actions to solve the problem and save some of the restaurants and a lot of jobs.
Obviously, we have no involvement in that process, but now so we don't know how it's gone from there. But we are grateful that we were able to rescue jobs for our colleagues. Wimpey UK continued to trade and has really done a phenomenal job. I can't talk highly enough of what the team has done there and the work they've done at head office and across the franchise network in a very, very tough environment embracing delivery and really proud of how their business has bounced through this. Of course, it's a highly competitive market, so we'll always find it tough.
But really, the future of that business is really optimistic for us. Just trying to give you a sense of numbers. So the numbers are not pretty at all in any shape or form. So if you look at the Signature Brands numbers there, fairly easy to say, well, at 52% drop for the year on like on like, it's compared to the 70% it was at half year, I suppose one has to be quite proud. And the same if you look at leading brands, 29.1% down, but at half year that was 48% down.
So a strong recovery. And in fact, the SA number, which is 32% at half year, was 51.2%. And the AME business, as I said to you, is not recovering as quickly, but wasn't as severely impacted. At half year, that was 31%. Interestingly, the system wide number and the like for like number are very close, which is unusual in our business.
You normally see a bit more daylight in that graph. And that really talks to the closures and the openings, which is not necessarily gaining traction this year. And I'll talk about that just now. In the AME space, on the right hand side, I mean, there are some standout performers there. The Zambia business was only down 11.2% and the Botswana business down 13%.
There's quite a lot of information on that in the supplementary slides if you wish to look afterwards, just around the by country performance. But those are the 2 that have stood out for us. What I thought was interesting here is just from a provincial performance. I mean, in South Africa, we're quite focused around the geographies. And of course, I think COVID has highlighted that to us as the government has reported statistics.
We also couldn't go to our favorite holiday destinations. We're not traveling as much. And of course, that has an impact on our business. I mean, we are very mindful that our business is reliant on people moving around. And the biggest inhibitor to growth right now is lack of movement of people.
And when I say that, you might say, well, we've gone away this weekend. But if you think about church tours, school hockey tours, people just going to birthday parties that they would be typically going to not going to for 50th, flying down to Cape Town for the weekend, that is not happening. That's happening across all LSMs. The ability to go and visit your granny in warm bars for the weekend, it just hasn't happened anymore. So but there are some standout things that I noticed and they're obvious.
But if you talk about Limpopo, in fact, I bumped into a colleague a couple of months back and he'd actually just come back from there and we were building a store up there. And he just said to me, sure, Darren, I don't know what's happening up in Polokwane, but he thinks everybody's moving there. And we can see that reflecting in our numbers. Contrary to that though, quite severely affected has been the Western Cape and this is across our leading brands portfolio. And again, not surprising given the lack of tourism, international tourism that typically drives growth down there and that we have benefited from in the past, particularly at key destinations like the Waterfront, etcetera.
So again, that element of recovery bodes well because we'd like to see that improving. And I'll give you a snapshot about where we are through the same graph a little bit later. In terms of the footprint that I spoke about earlier, again, there's lots of information under supplementary slides. This particular snapshot excludes GBK and Tasha's. The key pressure there and I think the number that will probably jump out at you is firstly stores closed, but let me focus on new stores first, because I'm actually quite chuffed with the number that came out there.
At half year, we were sitting at 51 in terms of new stores and that number has jumped up to 92 as you can see there. And we still managed to put revamps through, which has been a testament to franchisees' conviction and strength of belief in their businesses. The closed stores number on the face of it at 123 dollars is quite a daunting number, but one does need to break it down. If you look at AME where the biggest pain has been felt, 22 of those were Mr. Biggs in Nigeria, which really does still relate to our fix and repair strategy there and we're quite comfortable.
It's never nice to see stores closed, but also the initial COVID wave did certainly impact the business, but we remain confident that we're doing the right thing there strategically. So if you strip those numbers out, it probably takes the shock out. I am comfortable to say that for those of you who run your models, you'll see that the closures are actually quite smooth across the brand portfolio. They are a lot less prominent in casual dining than you think that they would be. I think there might be an expectation that that sort of pain has been felt in casual dining.
It's not the case. It's actually across the portfolio in terms of brand and geography, to be honest. We've seen some pain across all countries. But in the SA context, which is where you've seen the 65,000,000, it does spread across the brand portfolios and not necessarily related to one particular brand. If you go and look at the overall numbers versus last year, you will see that the numbers are quite big because you've obviously got GBK and Tasha's in there, which would come out.
In terms of moving on to supply chain, I think it's just important to just recap here in terms of where we are. So as Lebo has pointed out, I mean, the business has really struggled across the board in terms of lack of volume. But there has been some really nice positive aspects. The one for me is the line at the bottom, which has really been a slowdown in the CapEx. And that has not been to the detriment of the business.
So I think we've been fairly confident in that aspect. But logistics, which I'll talk about just now, has taken the most pain. And if you look at that $13,000,000 right slap bang in the middle there, that looks like a horrific number. But if you think about what that was at half year, it was $46,000,000 at half year because of the pain of the lockdowns and of course, the investment that we had to put in, in terms of running trucks at low capacity and various other things within that. So I think a great recovery on the logistics side is something to be very proud of from our perspective.
In terms of manufacturing, again, the team has done a great job focusing on various aspects. Given that the lack of demand dropping 34% from the front end, we've really had the benefit of certain plants benefiting from QSR, but we've had to manage that capacity. We've also had to keep a focus on safety. And also again, the team is very proud of their safety record with lost time injuries significantly lower than in previous years. In terms of the plant numbers, so I mean overall 23% down on the plants that we own 100%.
And you can see no plant was left unscathed. The plants that typically serve as QSR a little bit more like the source and spice plant probably less impacted. And again, if you think about where they were at half year, the overall number at half year was 44% down. Now the ice cream plant is interesting and that was 58% down at half year. But it is one of those items that we are seeing and is not recovering as quickly.
Those indulgent and impulsive moments haven't come back yet. In terms of the plants that we share with partners, our JV partnerships, those plants were down 21%. And again, some recovery there. You'll see that the cheese plant, which has a probably a slightly more bias to QSR and of course, products that serve well in delivery, bounced back a lot quicker than the others. The beverage business in terms of TRUBEV being bottled water, bottled juices have really found a hard space there.
And I'm sure the retailers would also tell you pack size changes have made a difference. Bulk packs, which we don't play in, have gained preference versus our smaller single packs. The 10 and 10 Central Kitchen, which services the casual dining and Signature brands particularly, has found the recovery a little bit harder. But again, there has been recovery. You will pick up in some of our notes around post balance sheet events is that we have from the 1st May, sold the Great Bakery Company back to the founders and our long standing partners there and that is reported in those results, but there wasn't an F21 event.
On the logistics side, again, very difficult business to operate through these times. We're not out of the woods there yet. But again, we're making progress every month, finding efficiencies. We've had to decommission 2 distribution centers, which fortuitously we were able to do. And again, if you want to look at our supplementary notes around Project Decade, it will give you some insight there.
And the CapEx investment that we did make was very focused around efficiencies and capacity given that we've reduced overall capacity in the business. And route optimization is a real challenge at the moment. And as we enter these waves, franchisees inventory requirements differ, but we have to continue to meet that demand and assist them as much as we can. But that volume is coming back and we're really on the right path right now in terms of that recovery. From a logistics perspective, I think we've seen a better recovery.
At half year, that volume number was 46% down and we're quite comfortable that that spread is really even. You can see again the Western Cape number jumps out a bit more compared to the others and again highlighted that earlier. Mpumalanga 2, although we made a change that was the end of the year, we've closed that facility, it only closed in February and the volume still went through and that really does relate to some of the slowdown in tourism in areas such as the park. And of course, exports relating to Africa business slower than in previous years. Our retail business, which I can't hold back my excitement about, it's something I've spoken about in presentations.
We are reporting it now as a standalone business. And the sales increased 22%. But the CAES sales is actually more because although we operated for a full 12 months, there's a slight difference in the base. So it's not full 12 months versus 12 months, but I'll show you the case sales now. And of course, I'm also excited that we're back to launching new products and products that are being well embraced by our consumers and those 3 there are three examples of what we have launched more recently.
In terms of the retail, I thought it was also just helpful to just give you a bit of insights as to how that business behaved over the year. And of course, it's not always exact because our sales into the retailers may not well be as it goes through the Till. But in terms of Case sales, we showed a 41% growth. That does that's not a price case difference. It's just because there's 1 month in the base that's out on the numbers.
But the SEK 151 1,000,000 is the correct number and these are the correct case growth. And this really is something to be excited about for us. And you can see how things spiked pre lockdown, during lockdown, I think very similar to probably some of the retailer numbers that you've seen. And again, a business that helped us from a cash flow perspective and kept us going. So just a recap on our strategic intent, I mean, Lebo did refer to it.
I think it is important to just remind you of what our focus is, what's kept us going through this year and what's really kept us on a path to recovery and being clear on your strategy, which we were, has helped us. So those 7 pillars there are very, very important. And there's 2 that jump out and that's really the first two being restoring our financial performance and leading in the categories we're competing. And those are the 2 that we are focused on, but the others are there too and they are as important in terms of what has to happen in our business, particularly around prioritizing our franchise partners and optimizing our capital management too. So those are those remain our key strategic objectives.
I think you'd be delighted to see that we are not waiving from our strategy and we continue to be focused. And really to recap on what Lebo had said earlier is that our goal and our vision of being the leading innovative branded franchise and foodservice business in South Africa and selected markets is front and center of what we're trying to do every day in this business and what our teams and our franchise partners are also focused on. So I'm going to end the F21 that you're there, I think on that high note around the vision and how we set to our strategic intent. But I'm not going to close-up because I know that some of you are probably more interested in where we are currently than where we've been because you're able to read financial statements and history is history, but where we are now is quite important. So from the current trading snapshot on March April, as I said to you, we are actually benchmarking ourselves versus 2 years ago, not F21 and I'll show you why just now.
But in terms of the 2 months March April, this is where we are trending from a like on like and system wide at Leading Brands level. So we are 6% down system wide on the same period 2019. So we've got a way to go, but we're actually very encouraged by those numbers. If you think about the lack of activity around COVID, how we would benefit over the Easter period, and of course, the slower recovery in casual dining versus quick service restaurants, we're very happy. And if you'd offered us this number this time last year, we would have grabbed it with both hands.
Signature brands, not as much of a romantic story, but again, compared to where we've been, that recovery is slightly better. But again, also being dragged down by the hospital business, which is performing worse. And that's understandable. There are still stricter restrictions on visitors in hospitals, etcetera. So that business does pull down the overall number.
And there is lots of different activities within Signature Brands around that. The AME business, as I alluded to earlier, is slower to recover. So we're seeing that versus 2019. The base wasn't as hard hit through COVID, but we are seeing a slightly slower recovery through that. Lots of exchange rate differences and challenges in some of those markets, not necessarily related to COVID, but I think some of it around the economic challenges.
And of course, you can see the gap there now with the store closures that we've experienced showing that gap and difference between like for like and system wide. I mentioned it just now, but the provincial snapshot may or may not be useful to you. But again, just to highlight, if you see there from a like for like and a system wide, the gap in Limpopo. So Limpopo is still standing out in Western Cape, slowing down. So even if you compare it to F21 and now we're going back to F2019, those two trends are still the same and those gaps are there.
So you can see, even provincially, we see similar trends. There are some provinces recovering better than others. And obviously, our calibration and size is different in there. But I mean, this is the front and center of the business. This reflects leading brands.
And that is what drives the business. So really encouraging that the engine of the business is starting to drive and get into gear properly, which will flow through the entire business. Just my last slide is just, I suppose, a little bit of a cop out, but to try and end on a high note. If you compare current comparatives to F21, which is actually what we will report on, so although we have been quite tough on ourselves comparing to F 2019, you look at the same provincial snapshot and you can see where we are versus last year. Now that's it is a cop out because we were closed for 1 month, but it just gives you a sense of the kind of numbers that we're going to be reporting and what we are seeing flowing through the business.
So on that, I'm going to close and I'm going to ask Pat and Dean, our franchisees from Moki Lane, Caeserin, to answer the questions. And I'm joking. I will take your questions. I'm asking Ntando, our Group Risk Executive, to go through the questions and to read them out to us. So you know that they've been filtered with a very ethical lens.
Thanks, Daniel, for your comprehensive and insightful presentations. So in the next segment, we'll look to respond to questions from the market. At this point, I think we have 3 or 4 questions. So probably I'll start with the first question from Sean out at Mazi Asset Management. Please comment on covenants on revised debt facilities.
I think that's yours, Neville.
Yes. That's right. Thank you, Minto. Thank you, Sean. So in terms of the covenants on the revised facilities, you would have noticed that we've disclosed that there was no requirement for us to be measured on those.
And the only requirement was in relation to the 250,000,000 liquidity covenant, which we met comfortably. So the first measurement period for the financial covenants from here will be at our next interims for August 2021. Disclosure around our covenants can be found in Note 14 of our long form or summarized financial statements.
Thanks, Lebo. The next question will be from Graeme after Cap Agri. Have your QSR sites at retail fuel sites performed and compared to standalone sites? Actually the question is broken into 2. The next part of the question was to understand if our highway sites performed differently to non highway sites.
Yes. So I mean, I have to answer broad brush strokes. I get the question. So thanks, Graham. Generally, as I said in the presentation, people are not traveling to the same extent that we are accustomed to, particularly over peak.
So if you split fuel into highway, non highway as you've done, generally our performance on those highway sites is down significantly lower than the numbers that I've probably quoted you. And again, but urban sites have probably benefited to some degree where they've picked up delivery business or people are living within their suburbs. So that whole kind of local commutes, local shop localization trend has benefited those. But typically, the highway sites, if you look at a month like December, where they're critical, you look at Easter, we didn't have a great December and we didn't have a great Easter in those trends. People are just not getting out in the same capacity as they used to, particularly bus trade groups, individual traders.
And even when they are traveling, their behavior is different. They're not necessarily wanting to sit down. They're quick in and out and moving around, of course, there's less traffic. So I hope that gives you a sense, but that is an area of the business that we are banking on recovery in and of course will come over time.
Thanks, Darren. The next question will be from David out at Salt Life Capital. Cash flow generation in second half seems strong. Could you share how you are thinking about excess cash deployment?
[SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] Thanks for the question. In fact, to answer that, we need to revisit our revised facility in terms of how it's structured. So just to recap, previously we had a revolving credit facility of R710 $1,000,000 and when we refinanced the current debt structure, we took that up to R1.1 billion dollars the facility. So that gives us an ability to put excess cash towards the FCF, which is what we've been doing.
Thanks, Lemo. The next question will be from Anthony at Smalltalk Daily Research. The stronger rent has assisted in imported food ingredients, but high soft commodity prices are hitting the entire sector now. We have seen many companies warn on input cost pressures. Can you please give us your perspective and what have been your inflationary costs and menu price increases?
Can you fully recover?
Yes. Thanks, Anthony. Yes, you're absolutely right. And we did caution around that in our half year. So if you and I probably over exited half year, to be honest with you.
I used some strong terms. So we were expecting it. It's probably been a little bit softer than we thought and a little bit lighter than we thought. The real pressure has been around proteins and oils. And we've weathered that storm and we think we've managed to absorb that within our menu prices that have gone through.
So what happens over the next couple of months, I'm probably as unsure as you are. We're expecting that to come through. We've taken a variety of menu price increases in sort of April, May. You can see in our supplementary slides, there's information around those numbers. For F21, it was around 3% to 4%, depends on when you look at it.
And we've probably in for around 7% this year in our current outlook, taken in 2 phases, the April, May and then probably November again. But it is quite volatile. So that's not surprising if we came back in 2 months' time and said something's changed. From what we can see, it looks like it's settling. But there is a bubble under the surface now around the maize price issue and where that's going to settle.
So I've probably given you a long answer, but very clear on what you've said. And we are comfortable that we're managing it well. And where we are right now is in a good space in terms of how it's rolled through. Now obviously, because there's lots of variables in our business, we think we've managed it quite well. But I agree with you, there's more pressure coming, but most of it we had anticipated.
Thanks, Darren. The next question is for me, Tumileng from Bangorala Global Fund Managers. What is your medium term target on debt? That is what would be the ideal position management wants to be in, in terms of net debt to EBITDA?
Yes. I'll take that Darren. Thank you, Tumiling. So if we first talk about the gross debt position, what we're comfortable with is around R1 1,000,000,000 to R1.5 billion. You'll have noticed that we closed out at R1.5 billion.
So quite comfortable with where we are even in the short term. In terms of the net debt to EBITDA, the first thing is to meet our financial covenants, which are disclosed in Note 14 again of the long form, but where we would be comfortable is certainly below the level required for us to start getting onto the dividend story.
Thanks, Lebo. In the interest of time, I'll probably take 2 more questions. Okay. We have one question from Alec from biznews.com. After GBK intashes, are there any more sales of brands being planned?
Alec, I think our strategy is very clear right now. So the trimming of the portfolio is probably complete. I mean, there may well be opportunistic things that come along. But I'm comfortable that the Signature Brands portfolio is something now that we can work with. And it may well be something small on the manufacturing side, if things pan out, maybe not, but nothing critical in terms of the core business that is same as it is.
I mentioned the Great Bakery Company sale as an example. But no, I think the Signature Band portfolio is in good shape now.
Thanks, Darren. The last question I'll take is from Nick at Signal AM. Looking ahead, what are your expectations on store closures? What percentage of franchisees are currently not economically sustainable?
Yes. Look, that's always a difficult one because we don't have access to franchisees balance sheet. So we have a good sense of the P and L. But we're not anticipating the kind of year we've had behind us. So we think that that's fairly stable.
I mean, there will always be movement in the base, so don't get me wrong, particularly with relocations. What we don't know is the demographic changes post COVID. So we never provide a projection on that, but we don't we're not anticipating any form of surge or anything that's out of the blue or abnormal. In terms of the franchisee profitability, remember that franchisees have had relief like we've all had in business. So as much as the base has dropped, we've provided relief, government has been helpful around UIF tours, landlords have been very helpful, banks have been very helpful, franchisees have rolled their sleeves up and worked damn hard.
Labor has really lost us in this whole conversation because there's been a lot less hours put through, which has kept the cost down. So the model itself has readjusted to some degree. It's really around now the recovery and how profitable the businesses are. But on the path we're on right now, we're very optimistic.
Thanks, Darren and Lebo on enlightening us on your view of the business. Those are all the questions I have for you, Tim.
Thank you, Thanda.
Okay. Well, thanks, Thanda. I'll close-up now. And really just to say thank you to everybody involved. I mean, we've been through a year end process and to thank the team at KPMG, it will be remissantly not to you, the first time around with our audits and they really have been wonderful to us and helped us through the process.
So thank you to our team at Nedbank who supports us, to our sponsors, Standard Bank, really appreciate the help to Nedbank who've been great to us this year. And to the Famous Brands family, thank you for everything that you've done. And to the Board for the support that you've given, Lebo and I, and to the Chair, Santi Boite, for the personal support she gives me. Always there whenever we need ever something happens. And as you can imagine, in a year like COVID, there's always something happening.
So our reliance on the board has been always pressurizing them, but very thankful for the work that they've done and the support they've given us. So thank you and thanks for listening and we hope to engage with shareholders and investors posters.