Further falls in revenue from Sizzler restaurants have contributed to a $23 million half year loss for its parent company.
Collins Foods said sales dropped 8.4 per cent in the six months to October 12, forcing it to revise its forecasts for Sizzler and incur a $33 million impairment charge on the business.
That charge has offset improved earnings in the company's other business, operating 170 KFC restaurants.
"Overall revenue for the first half of the year for Sizzler Australia was below expectations," Collins Foods said.
Sales at Sizzler have fallen each year since Collins Foods listed on the share market in 2011.
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The company recently rolled out a "new look and feel" in its 26 Sizzler restaurants, and more substantial refurbishments in three Queensland restaurants which, it said, were so far producing signs of a recovery in the business.
But the company will conduct a strategic review of Sizzler at the end of summer, with the outcome to be announced before the end of April.
"We need now to see how the brand trades through the summer period to get a better understanding of the sustainability of these initiatives," chief executive Graham Maxwell said.
Sales in the 128 Queensland KFC restaurants operated by Collins Foods rose three per cent, while the 42 KFC restaurants Collins Foods recently bought in the Northern Territory and Western Australia posted 4.3 per cent sales growth.
That contributed to a 43 per cent rise in Collins Foods' half year underlying profit to $10.7 million and the company has increased its interim dividend 11 per cent to five cents per share.
Collins Foods shares gained three cents to $2.27.
