Guzman y Gomez (GYG) demonstrated why it lanced the boil in the US in May, reporting significant increases in annual sales in Australia and Asia and an underlying net profit increase of just shy of 30 per cent for the full 2026 year.
But the improvement was eliminated by a $30 million bill to exit the US which, with losses prior to the closure included in the figures, saw the business record a statutory loss of $26.7 million, figures which it said highlighted the core earnings power of the business.
“Our Australia segment has reported network sales of $1.4 billion, up 17.9 per cent on last year, demonstrating continued consumer demand for clean, fresh, made-to-order food, loaded with flavour and prepared at speed,” said founder and CEO Stephen Marks in a results filing.
“This momentum has translated into strong earnings growth, with underlying EBITDA up 28.7 per cent (to $85 million), highlighting the strong operating leverage embedded in our business.”
Most notably in Australia, average transaction value rose faster than the 5.3 per cent comp-store sales improvement, with sales building momentum throughout the year. That growth came across all channels, led by breakfast and after 9pm sales, underpinned by improved lunch and dinner sales momentum during the second half of the year.
GYG increased its footprint by 35 restaurants
“In Australia, our comp sales growth momentum during the year was supported by new and exciting menu innovation, marketing, daypart expansion and strong operational execution by our teams. We continued to prioritise value for our guests and were rewarded for this with transaction growth outperforming sales comp growth and an improvement in guest frequency,” said Marks.
While the 20-year-old company says it kept retail price rises below the increased cost of business, the overall network restaurant margin expanded 20 basis points to 20.3 per cent. “Drive-thrus delivered an average restaurant margin of 21.6 per cent.”
GYG ended the year with 284 restaurants in Australia, Singapore and Japan, an increase of 35 during the year and a forward pipeline of 117 – the majority drive-thrus – for which commercial terms have been agreed. Of those, 62 will be in Australia.
Marks said the company’s franchisee restaurant economics remain “very healthy”, with a median franchisee return on investment of 47 per cent and a median franchise restaurant margin of 20.8 per cent, up 90 basis points over a year ago.
Looking ahead, Marks expects the AI technology currently being rolled out will make it easier for crews to prepare food to the highest standard, consistently and quickly. The company forecasts that will help drive comp-sales growth in the mid-single digits for the 2027 financial year, with that figure already exceeded during the first seven weeks of the period.
This article was first published on Inside Retail.
