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Burger King Korea has showed strong improvement in financial performance over the past five years after private equity (PE) firm Affinity Equity Partners acquired the fast-food chain in 2016.

Affinity acquired 100% of BKR Corp, which operates Burger King Korea, for 210 billion won ($179 million) from Seoul-based VIG Partners in 2016. The PE firm financed 130 billion won of the total from its own fund, with the remaining 80 billion won funded from debt financing.

After being acquired by Affinity, BKR’s revenue has continued to increase. It recorded revenue of 253.2 billion won in 2016 and exceeded 400 billion won in 2018, and 500 billion won in 2019. It posted revenue of 571.4 billion won last year, up 13.6% year-over-year. Its operating profit was down more than 50% to 8.2 billion won in the same period, but has continued to be in the black.

It is notable that BKR has continued its growth despite a series of difficulties such as the overall slowdown in the restaurant industry and occurrence of hemolytic uremic syndrome (HUS), widely known as "hamburger disease” here, contracted by a girl after eating an undercooked McDonald's hamburger.

Affinity has continued effort to increase the value of Burger King Korea, focusing on store restructuring, marketing and menu development.

The U.S. hamburger franchise overtook its bigger rival McDonald's in Korea by the number of outlets for the first time. Burger King Korea runs 411 franchise restaurants in South Korea as of the end of March, outnumbering McDonald's 404 outlets. Burger King has 18,800 outlets across the world, about half the McDonald’s 38,000 outlets.

Burger King Korea has stronger profitability compared to its bigger rival. McDonald’s recorded revenue of 791 billion won in 2020, but it continued to operate in the red, posting an operating loss of 48.4 billion won and a net loss of 66.1 billion won.

Burger King Korea’s marketing focus has shifted from high-end burger to cheaper menus, which helped boost sales and its brand power. It has strengthened delivery services, while opening more drive-through stores. It also has introduced kiosk and mobile app ordering services as well for customer convenience. (Reporting by Gyoung-tae Kim)