Westlife Foodworld (505533) Q1 24/25 earnings summary

Executive summary

• Q1 FY25 revenue reached ₹6,164 million (₹61,632.87 lakhs), up slightly year-over-year, with subdued in-store business and stable off-premise sales; 6 new stores opened, expanding the network to 403 restaurants in 66 cities.

• Same-store sales growth (SSG) declined 6.7% year-over-year, while off-premise business grew 6% and contributed 42% of sales.

• Digital engagement remained strong, with 3 million monthly active app users, 69% of sales from digital channels, and app downloads up 34 million life-to-date.

• Vision 2027 targets 45-50 new stores in FY25, focusing on South India, smaller towns, and drive-through formats, with a long-term goal of 580-630 stores by CY27.

• Continued focus on value and menu innovation, including McFiesta range, new entry-level chicken burger, and McCafe expansion.

Financial highlights

• Q1 FY25 revenue was ₹6,164 million (₹61,632.87 lakhs), up 0.3% year-over-year; total income reached ₹62,144.31 lakhs.

• Operating EBITDA was ₹800 million, down 24.1% year-over-year, with a margin of 13.0%; restaurant operating margin was 19.1%, down from 23.0% in Q1 FY24.

• Gross margin improved to 70.8%, up 21 bps year-over-year, despite a focus on value platforms.

• Cash Profit After Tax stood at ₹463 million (7.5% of sales), down 30.9% year-over-year; profit after tax for the quarter was ₹325.46 lakhs.

• Extraordinary expenses of ₹12.5 million were incurred for asset write-offs and a one-time ESOP charge.

Outlook and guidance

• H2 FY25 is expected to show sequential improvement and higher average daily volume, with margin expansion anticipated as average unit volume recovers.

• Vision 2027 targets 18-20% operating EBITDA margin and aggressive expansion in South India and smaller towns.

• FY25 margin likely to remain flattish, with improvement anticipated in H2; network expansion plan unchanged.