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Wed 21st May 2025 - Update: Tortilla, Time Out and inflation jumps |
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Tortilla outperforming market as it reports ‘rejuvenated’ UK operations lead to like-for-like sales turnaround and improved profitability: Tortilla, the UK’s largest fast-casual Mexican restaurant brand, has said it is currently outperforming the UK restaurant market as it reported its “rejuvenated” UK operations led to a like-for-like sales turnaround and improved profitability. The company stated: “First-quarter 2025 UK like-for-like sales increased 5.9%, outperforming the UK restaurant market by eight percentage points. Second-quarter period to date at is up 6.2%, with the UK outlook for the full year in line with management expectations. Four new franchise locations have opened year to date in 2025: Liverpool Street and Victoria station (UK, with SSP) and Silicon Central Mall and Circle Mall (Middle East, with Eathos). Two further openings by our franchise partners are expected in 2025 – one through SSP in the UK, and one with Eathos in the Middle East.” Tortilla also revealed it was poised to begin the conversion of its Fresh Burritos stores in France following the acquisition of the 27-strong business last year. The company stated: “Following the launch of the central production kitchen in Lille during the first quarter, the last step in our integration of the Fresh Burritos business is to convert the stores to Tortilla. Last year, we made the strategic decision to pause the conversion and rebranding of our Fresh Burritos stores as we embarked on a comprehensive brand and interior design refresh. While this initiative was intended to ensure we launched the brand properly in France, we have encountered unforeseen delays due to the complex planning approval processes in France, which means on average a couple of months delay in uplift in sales per store compared with our previous market guidance. We are however pleased to announce that we are now poised to begin the conversion of our French stores to Tortilla with the first conversions scheduled to commence towards the end of the summer. With the enhanced brand identity and improved store designs, we are confident in our ability to achieve our long-term goals in the French market.” It comes as Tortilla reported over the course of last year, UK like-for-like sales recovered strongly, improving from a 6% decline in March to 6% growth by December. Revenue for the year ending 31 December 2024 increased 3.5% to £68.0m (2023: £65.7m), “due to the strategic acquisition of Fresh Burritos in France, the addition of one UK company-owned site and a strong contribution from our franchise network”. Adjusted Ebitda (pre-IFRS 16) of £4.5m (2023: £4.6m), with an increase in the UK to £5.2m (2023: £4.6m), which the company said was offset by the expected early-stage losses from its acquisition of £0.7m (2023: nil). Gross profit margin stood at 76.6% (20223: 77.3%). Tortilla said UK in-store margin improved by 0.5%. However, France contributed a “dilutionary impact as expected prior to the build of our central kitchen in Lille”. The company posted a pre-tax loss of £3.3m (2023: loss of £1.1m), driven by the one-off exceptional cost relating to the acquisition of Fresh Burritos, and an impairment charge recorded in the period in respect of a small number of UK locations. The company said it further strengthened the relationship with existing franchise partners. SSP, focused on travel hubs, achieved 5% like-for-like sales growth in 2024, opened three new stores, and signed a five-year extension to double the estate to 18 sites. Eathos in the Middle East delivered 23.5% like-for-like sales growth, “indicating strong potential for further franchise opportunities in the region”. Chief executive Andy Naylor said: “I am pleased to report good progress over the last 12 months towards our strategic goal of becoming a pan-European fast casual Mexican restaurant business. When I stepped into the chief executive role in April 2024, my first priority was to return the UK business back to in-store sales growth and improve profitability and I am delighted we have seen a turnaround in in-store volume growth and UK market outperformance, through investments in food, brand and technology. The second priority was to commence our European growth plans with the Fresh Burritos acquisition in France last summer. We have made solid strides with the integration: hiring a strong management team, launching a central kitchen in Lille, and converting all corporate owned stores to Tortilla's food offering. However, we have been delayed in our store conversion schedule, largely due to lengthy French planning approvals. These conversions are now due to commence shortly, with the vast majority of stores expected to be converted by the end of 2025.”
Next Who’s Who of UK Hospitality to be released to Premium Club subscribers on Friday featuring 58 updated entries and 21 new companies: The next Who’s Who of UK Hospitality will feature 58 updated entries and 21 new companies when it is released to Premium Club subscribers on Friday (23 May), at midday. The database now features 922 companies, and this month’s edition includes more than 246,000 words of content. The companies, listed in alphabetical order, will have their most recent results reported as well as broader information around Ebitda, plans and trading style available. The database merges Companies House information, interviews and other public information to provide an easy to reference and exhaustive guide to the sector. Premium Club subscribers also receive access to five other databases: the Multi-Site Database, the New Openings Database, the Turnover & Profits Blue Book, the UK Food and Beverage Franchisor Database and the UK Food and Beverage Franchisee Database. All Premium Club subscribers will be offered a 20% discount on tickets to Propel paid-for events including the Operational Excellence Conference in July and discounts on specialist sector reports. Operators that are Premium Club subscribers are also able to send up to four members of staff to each of our four Multi-Club Conferences for free. Premium Club subscribers receive their daily Propel Info newsletter 11 hours earlier than standard subscribers, at 7pm the evening before. They also receive videos of presentations at eight Propel conference events two weeks after they are held. This represents around 100 videos of industry insight over the course of the year. Premium Club subscribers will be sent a dedicated monthly newsletter that will highlight key updates in the sector and direct subscribers to all the vital content their membership offers. Premium Club subscribers also receive exclusive opinion columns every Friday at 5pm, which include the thoughts of Propel group editor Mark Wingett and a host of industry leaders from across the sector. A Premium Club subscription costs an annual sum of £495 plus VAT for operators and £595 plus VAT for suppliers. Companies can now have an unlimited number of people receive access to Premium Club for a year for £995 plus VAT – whether they are an operator or supplier. Email kai.kirkman@propelinfo.com today to sign up.
Time Out sees full-year customer spend grow 22% across its markets business: Time Out Group, the global media and hospitality business, has said that its markets business continues to grow in line with expectations, as it reported a 22% increase in customer spend to date. Announcing a trading update for the year-ended 30 June 2025, the company said: “The markets business continues to grow in line with the board's expectations. A positive outlook is supported by ongoing portfolio growth and multiple initiatives to drive like-for-like profitability in future.” Time Out said that its markets business has a growing portfolio with six owned and operated and five franchise sites open, with a further six markets contracted to open by 2027, including the recent signing of a new Manhattan site. The company also said it has a strong pipeline of further opportunities, with new site negotiations ongoing such that further announcements are expected in this calendar year. The company said its markets are expected to generate more than ten million annualised transactions from currently open sites, with FY25 divisional Ebitda expected to be in the range of £11m-£13m (FY24 £12m). Time Out stated: “The group remains focused on the contracted growth that the market proposition will deliver. Converting a strong pipeline of potential new market sites, whilst driving like-for-like growth in existing markets through out-of-home advertising, loyalty programmes and a growing and valuable customer database. The goal of which is to double markets Ebitda profit over the next two years. While management reviews the future media strategy, forecast guidance is withdrawn. This review will enable Time Out to deliver sustainable media division profitability, through effective monetisation of unique content and growing global audience, while also driving customers and revenue to our markets.” Chief executive Chris Ohlund said: “We remain focused on driving growth and profitability across our markets while right-sizing the media business to strategically benefit from the shift in audience behaviour, something that has continuously evolved throughout our ownership of this trusted global brand. The synergies between a large and growing, highly engaged real-life audience and media create the potential to develop new and unique propositions for advertisers.”
Inflation jumps to 3.5% as rise in employers’ national insurance contributions and national minimum wage pushes up prices: UK inflation jumped by more than expected last month to 3.5% after dramatic increases in water bills, energy costs and council tax, official figures show. A rise in employers’ national insurance contributions and a boost to the national minimum wage also put pressure on companies to raise prices in April by more than City analysts had forecast. The rise in the consumer prices index recorded by the Office for National Statistics (ONS) came after a decline in the rate over the first months of the year to 2.6% in March. The Bank of England is now likely to rebuff calls for faster and deeper interest rate cuts after the growth in prices proved to be stronger than financial markets expected. A spokesperson for the ONS said: “Significant increases in household bills caused inflation to climb steeply. Gas and electricity bills rose this month compared with sharp falls at the same time last year due to changes to the Ofgem energy price cap.” They added that water bills also rose strongly this year as did vehicle excise duty, “which all pushed the headline rate up to its highest level since the beginning of last year”. April’s rise was dampened by falling oil prices, which brought down the cost of petrol and diesel while heavy discounting of children’s clothes and women’s footwear restricted the rise in clothing costs.
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