TIDMMEX
RNS Number : 9973L
Tortilla Mexican Grill PLC
09 January 2023
9 January 2023
Tortilla Mexican Grill PLC
("Tortilla" or the "Group")
FY & Q4 Trading Update
FY22 performance in line with market expectations* supported by
Q4 UK LFL revenue growth of 16.0%
Tortilla Mexican Grill PLC, the largest and most successful
fast-casual Mexican restaurant group in the UK, provides a Trading
Update in respect of the financial year ended 1 January 2023 (the
"Period").
Financial Highlights
-- Tortilla's performance remained highly resilient throughout
the year, in the face of ongoing macroeconomic challenges. This was
driven by the ongoing strength of our customer proposition and
demand for our sector-leading brands, alongside the continued
expansion of our site portfolio in line with our long-term growth
strategy.
-- Group revenue increased 20% to GBP57.7m (FY21: GBP48.1m; FY20: GBP26.8m):
o FY22 UK LFL revenue increased 16.4% vs. FY19.
o Growth driven by a net increase of 18 sites in FY22, taking
the Group total to 82 at Period end.
-- Trading since our last update in early October has been
strong with Q4 UK LFL revenue growth (vs. FY19) of 16.0%. This was
despite challenging trading conditions in December due to the
combined impact of poor weather and multiple train strikes. Some
favourable changes in input costs, together with actions taken by
management and the strong trade in the majority of the fourth
quarter give the Board confidence that FY22 revenue and profit will
be in line with market expectations*.
Strategic Highlights
-- FY22 was a year of significant growth and strategic progress for Tortilla:
o New sites were opened across the UK at an ambitious but
disciplined rate, taking advantage of the favourable rental market.
New openings in 2022 have continued to perform strongly, with
Durham and Canterbury opened most recently.
o Strategic acquisition of Chilango in May 2022 strengthened the
Group's market position in London and added a complementary premium
brand. Eight stores were added to the portfolio; five of these
sites were rebranded to Tortilla and three continue to trade under
the Chilango brand.
o Commenced new franchise relationship with Compass Group plc
within the Higher Education sector, with five sites now open.
-- Delivery demand remained stable as the Group expanded and
diversified delivery partners to now include Uber Eats, Just Eat
and Deliveroo. The Group also expanded with delivery kitchen
partners Growth Kitchen and Karma Kitchen, with these sites
performing well and further growing the reach of the Tortilla
brand.
-- Several new franchise sites are in the pipeline for 2023,
which will enhance the diversity of our locations, including the
expansion of our existing partnership with Compass Group plc, and
further planned openings at rail stations with SSP Group plc.
-- Strong cash position remains, enabling the Group to self-fund
its site rollout growth strategy.
Current trading and outlook
Despite the ongoing uncertainties impacting the market and wider
sector in the short term, LFL sales growth in Q4 remained strong
and we remain confident of finding efficiencies in our supply chain
to aid profitability.
We have an outstanding brand and customer proposition, which
continues to be in high demand across all our sites, and we have a
strong pipeline of new site openings. New sites set to open in FY23
include Derby and Greenwich (London) in the spring, with a healthy
pipeline of further openings planned for later in the year.
The Board remains confident in the outlook for FY23 and beyond,
and the Group's ability to continue to implement its proven growth
strategy.
Richard Morris, Chief Executive Officer of Tortilla,
commented:
"We have a proven and highly popular customer proposition.
During difficult economic times, restaurants that offer great,
consistent food at competitive price points will be the winners,
and we sit comfortably in this space.
"We continued to achieve excellent strategic progress during
2022, in line with our long-term growth strategy. We have
successfully opened a number of new sites across the UK - including
Durham, Coventry, Canterbury and Leicester - showing the excellent
demographic diversity in which the brand can operate. This is
further testament to the nationwide popularity and appeal of our
brand. We have also strengthened our market position in London
through our strategic acquisition of Chilango.
"Looking ahead, we remain as motivated and enthusiastic as ever
about Tortilla's significant organic growth opportunities in the
UK, with the added excitement of growing our already successful
franchise partnerships both in the UK and abroad."
* Company-compiled consensus (FY22: revenue GBP58.4m, Adjusted
EBITDA GBP4.0m) (FY23: revenue GBP69.8m, Adjusted EBITDA GBP5.0m).
Adjusted EBITDA defined as statutory operating profit before
interest, tax, depreciation and amortisation (before application of
IFRS 16 and excluding exceptional costs) and reflects the
underlying trading performance of the Group.
Note - all figures are subject to FY22 audit
ENQUIRIES
Tortilla Mexican Grill PLC Via Hudson Sandler
Emma Woods, Non-Executive Chairwoman
Richard Morris, CEO
Andy Naylor, CFO
Liberum Capital Limited (Nominated Adviser, Tel: 020 3100 2222
Sole Broker)
Andrew Godber
Edward Thomas
Nikhil Varghese
Hudson Sandler (Public Relations) Tel: 020 7796 4133
Alex Brennan Tortilla@hudsonsandler.com
Wendy Baker
Charlotte Cobb
For further information , visit tortillagroup.co.uk
NOTES TO EDITORS
About Tortilla Mexican Grill plc
Tortilla is the largest and most successful fast-casual Mexican
restaurant group in the UK specialising in the sale of freshly made
Californian-inspired Mexican cuisine. The Group has 82 sites
worldwide, comprising 65 sites in the UK operated by the Group, 4
sites franchised to SSP Group in the UK, 5 sites franchised to
Compass Group UK & Ireland and 8 franchised sites in the Middle
East.
The Group was founded in 2007 by Brandon Stephens, originally
from California who, upon his arrival in London in 2003, found it
difficult to satisfy his desire for quality burritos and tacos. As
a result, Brandon established Tortilla with a mission of offering
customers freshly prepared, customisable, and authentic
Californian-inspired Mexican food.
The brand is synonymous with an energetic, vibrant culture, and
with providing a great value-for-money proposition. It embraces
fast-growing sector trends (including eating out, healthy eating,
provenance, ethnic cuisine, delivery) across a variety of
locations, through a differentiated product offering which is
popular with a broad customer base, and a clearly defined
multi-channel marketing strategy. It benefits from flexible site
locations and formats, and a scalable central infrastructure.
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END
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