GYG sinks 18% after providing 'very soft' guidance
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More news: GYG's share price plummeted more than 18% during the opening minutes of Friday's trading session as analysts fretted over muted growth expectations for FY26.
What they said: In a note to clients RBC Capital Markets analyst Michael Toner said sentiment in the full year result was 'negative' with the company missing consensus expectations on EBITDA growth.
"However, the focus for investors will be the first 7 weeks update for the Australia segment," Toner said, noting comp sales growth of just 3.7% was less than half consensus expectations of 7.60%.
He noted that the "margin outlook is also soft", with GYG guiding between 5.9% to 6.3% for Australia segment underlying EBITDA to network sales. This was compared to the consensus expectation of 6.3%.
The EBITDA loss of $13.2 million in the US was also a 32% miss to RBC's estimates.
"We anticipate consensus downgrades to Australia segment comp sales growth for FY26 given the magnitude of the miss," Toner said.
Guzman y Gomez cracks $1 billion in sales and pays maiden dividend
The news: Guzman y Gomez has cracked $1 billion in sales for the first time, recording $1.18 billion across its network and paid a maiden dividend of 12.6 cents per share.
The numbers: GYG sales grew 23% on FY24, helping to lift EBITDA by 45% to $65.1 million. Net profit came in at $14.5 million.
Network margins declined slightly with GYG saying it was waiting to pass on inflation through its menu prices.
It added 39 restaurants to its network, including 32 in Australia, four in Singapore, two in the US and one in Japan. GYG said it has another 98 in its Australian pipeline as it maintains its 1,000 store long-term target in the country at an annual average cadence of 40 new stores per year.
The fully franked dividend of 12.6 cents per share was enabled in part by GYG's $282 million in cash and term deposits with no debt on the balance sheet.
The context: The result marks GYG's first full year result as an ASX listed company. This result will end the remaining escrow on key shareholders, including TDM Growth Partners and Barrenjoey Private Capital, allowing them to freely sell the bulk of their equity from 26 August for the first time.
What they said: Founder and co-CEO Steven Marks said it was a strong full-year performance.
"That growth flowed through to a 45.5% uplift in EBITDA on a pro forma basis, highlighting the operating leverage embedded in GYG’s business model," Marks said.
“Our franchise partners have also delivered another incredible year. Their passion, hustle, and commitment are at the heart of GYG’s success. With a median ROI of 50%, they’re not just building amazing businesses, they’re helping GYG deliver on our mission to become the best and biggest restaurant company in the world.”
The source: ASX
