Westlife Foodworld (505533) Q2 25/26 earnings summary

Executive summary

• Q2 FY26 revenue grew 3.8% YoY to ₹6.42 billion, despite a 4%-6% decline in industry food consumption frequency; on-premise sales rose 5% YoY, off-premise remained stable.

• Digital sales contributed 75% of revenue, up 300 bps YoY, with app downloads at 47 million and 3 million monthly active users.

• Store network expanded to 450 restaurants across 72 cities, with 8 new openings and a focus on drive-thru and modern formats.

• Launched Protein Plus Slice and Big Yummy Burgers, with strong consumer response and robust innovation pipeline.

• CFO Hrushit Shah stepped down after contributing to key initiatives.

Financial highlights

• Consolidated revenue for Q2 FY26 was ₹6,419 million, with gross margin at an all-time high of 72.4% (up 270 bps YoY).

• Restaurant operating margin improved 60 bps YoY to 19.2%; operating EBITDA margin was 11.8%, down ~100 bps YoY.

• Cash PAT was ₹809 million (12.6% margin); adjusted Cash PAT was ₹421 million (6.6% margin) after exceptional items.

• Same-store sales growth declined by 2.8% YoY.

• Exceptional gain of ₹581 million from a property redevelopment and a loss of ₹121 million from investment impairment/write-off.

Outlook and guidance

• Gradual improvement in operating environment expected, with optimism for December and festive season.

• Target to double McDelivery sales in two years, potentially adding 3%-5% to system-wide same-store sales growth.

• Vision 2027 on track: 580-630 restaurants by December 2027, with long-term potential for over 1,000.

• Margin guidance for Vision 2027 maintained, with focus on operating margin improvement.