Westlife Foodworld slipped 2.47% to Rs 834.70 after the firm reported 88.73% slide in consolidated net profit to Rs 3.25 crore in Q1 FY25 as against Rs 28.83 crore posted in Q1 FY24.
Total revenue from operations rose marginally to Rs 616.33 crore in June 2024 quarter from Rs 614.54 crore posted in corresponding quarter last year.Profit before tax stood at Rs 4.52 crore in first quarter of FY25, down 88.86% from Rs 40.58 crore recorded in Q1 FY24.
Operating EBITDA de-grew 24.06% year on year (YoY) to Rs 79.97 crore in June 2024 quarter. EBITDA margin stood at 16.5% in Q4 FY23 as against 16% in Q4 FY22. However, the company is focused on delivering an 18-20% operating EBITDA margin by December 2027.
Restaurant operating margins and operating EBITDA margin were lower by 388 bps YoY and 416 bps YoY to 19.1% and 13% respectively, owing to operating deleverage and higher royalty costs.
Same-store sales growth stood at negative 6.7% YoY, impacted by subdued in-store business, though the off-premise segment saw positive same-store sales.
The off-premise business grew 6% YoY, contributing 42% to total sales. Digital sales grew 8% YoY, accounting for 69% of the business. Gross margins stood at 70.8%, improving by 62 bps sequentially and 21 bps YoY. This was driven by cost optimization and lower input costs, though the positive impact was partly offset by product mix changes. System-level pricing remained stable during the quarter.
The company added 6 new locations in Q1 and is targeting 45-50 new stores in FY25, with a focus on South India, smaller towns, and drive-thru formats. As part of its Vision 2027 strategy, the company aims to grow its restaurant footprint to 580-630 locations.
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During the quarter, Westlife Foodworld launched a new entry-level Chicken Surprise burger and expanded its McCafofferings by rolling out new range of cakes and bakes.
The company is aiming for a 15-18% contribution of McCafto its business by 2027. It also roped in celebrity Chef Sanjeev Kapoor for its Real Food Real Good Initiative, and embraced the anime-fandom among Gen Z with the launch of 'WcDonald's
Amit Jatia, vice-chairman, Westlife Foodworld, said, While the quarter's results reflect the ongoing challenges in the operating environment, we remain focused on driving guest count and spearheading innovation to fuel our recovery. We are optimistic by the gradual improvement in the overall eatingout trend which bolsters our confidence in our ability to deliver sustained, profitable growth going forward.
Westlife Foodworld focuses on setting up and operating quick service restaurants (QSR) in India through its subsidiary Hardcastle Restaurants (HRPL). The company operates a chain of McDonald's restaurants in West and South India, having a master franchisee relationship with McDonald's Corporation USA, through the latter's Indian subsidiary.
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