Guzman Y Gomez Ltd reported a 30% rise in underlying net profit after tax to AUD 53 million for the first half of fiscal 2026, driving shares up 6.63% to USD 25.56 on Tuesday. The company’s underlying diluted earnings per share climbed 33.9% to AUD 0.521, outpacing analyst expectations and lifting the stock from its 52-week low of AUD 15.06.
Network sales increased 18% year-on-year to AUD 1.4 billion, while underlying EBITDA rose 29% to AUD 85 million, with margins expanding to 6.2% from 5.7% in the prior period. Comparable sales in Australia grew 5.3%, driven by transaction volume rather than price increases, as menu pricing remained below 2% despite broader inflationary pressures.
The company declared a fully franked final dividend of AUD 0.406 per share, including a special dividend of AUD 0.144 per share, representing a 90% payout ratio on underlying earnings. AUD 120 million in total shareholder returns were approved, alongside an extension of the AUD 100 million share buyback program. Operating cash flow from continuing operations reached AUD 98 million, with a cash conversion rate of 120%.
Expansion remained a key focus, with 32 new restaurants opened in Australia during the half, including 26 drive-throughs. Total drive-throughs in the network rose to 143, with average unit volumes for drive-throughs reaching AUD 6.9 million at margins near 22%. The company now has 117 board-approved sites in its pipeline, 85% of which are slated as drive-throughs. Franchisee median AUVs grew to AUD 5.8 million, with margins expanding to 21% and ROI at 47%.
Guzman Y Gomez also outlined plans to open 35 new restaurants in Australia during fiscal 2027, targeting an EBITDA margin of 6.7%–6.9%. Medium-term guidance includes a cadence of approximately 40 new openings annually, with a long-term ambition of reaching around 1,000 restaurants in Australia. The company expects franchise royalty rates to trend toward 10% and G&A as a percentage of network sales to stabilize near 5%.
The U.S. operations, now in the process of discontinuation, reported a trading loss of USD 15.2 million and one-off closure costs of USD 32.8 million, with total cash exit costs expected not to exceed USD 15 million. Labor inflation remained manageable at around 5%, while digital and delivery orders accounted for nearly half of network sales, supported by partnerships with Uber Eats and Apple CarPlay integration.
