Restaurant Brands New Zealand (RBD) H1 2025 earnings summary

Executive summary

• Group store sales reached a record $703.2m in 1H 25, up 2.3% year-over-year, driven by strong Hawaii performance and new store openings in New Zealand, despite a challenging retail environment.

• Net profit after tax (NPAT) was $11.9m, down 5.6% from 1H 24, with store EBITDA declining 4.1% to $90.7m, reflecting ongoing macroeconomic challenges and higher costs.

• Sales growth was supported by product innovation, but New Zealand, Australia, and California faced headwinds from cost of living pressures.

• Margins were compressed by higher labor, energy, rental, and aggregator costs, with California particularly affected by a 29% minimum wage increase.

• Store count increased to 522 (380 owned, 142 franchised), a net gain of 16 stores year-over-year.

Financial highlights

• Store sales increased by $16m to $703.2m in 1H 25 compared to 1H 24.

• Store EBITDA fell to $90.7m, a 4.1% decrease year-over-year.

• NPAT declined by $0.7m to $11.9m, a 5.6% drop from 1H 24.

• Total operating revenue rose 2.5% to $743.3m; gross profit declined 2.1% to $119.7m.

• Free cash flow improved to $31m, up from $13m in 1H 24, as investing cash flows were reduced.

Outlook and guidance

• Stronger sales are expected in New Zealand and Australia in 2H 25 as inflation and interest rates ease.

• Management expects continued margin recovery and operational efficiency improvements through 2025.

• Hawaii is projected to maintain strong sales, though margins may be pressured by high energy costs.

• Capex spend will increase in 2H 25 for new stores, refurbishments, and technology.

• Focus remains on disciplined cost management, technology investment, and store development to achieve a $2B sales target.