Over FY2014 I recorded a normalised profit of $18.8m and eps of 19.3cps. The share price as at 31st March 2014 was $2.93. This gives a backward looking PE ratio of:
$2.93 / $0.193 = 15.2
Over FY2020 I recorded a normalised profit of $49.8m and eps of 39.9cps. The share price as at 31st March 2020 was $13.30. This gives a backward looking PE ratio of:
$13.30 / $0.399 = 33.3
The PE ratio over this time has approximately doubled. So about half of your share price gains are due to earnings growth and half due to multiple expansion. There is some justification for the PE to ramp up. Back in FY2014 RBD was almost entirely domestically focussed, Since then we have moved into Australia, Hawaii and California to form a 'Pacific International' fast food group.
Obviously the opportunity for growth around the Pacific is far greater than just here. So you might argue a growth in PE is justified. It should please BP too as are we not only reducing the life span of New Zealanders, for some ecological benefit. We are tackling the life spans of those people from those desert areas of Australia and California that are, in environmental terms, more overpopulated than us. Making a good profit for shareholders and doing your thing for the environment sounds like a win/win to me.
SNOOPY