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Fri 24th Sep 2021 - Tortilla to float with plan to add 45 sites in five years
Tortilla to float with plan to add 45 sites in five years: Tortilla, the largest fast-casual Mexican restaurant group in the UK, is to float on AIM (Alternative Investment Market). The company has 62 sites worldwide, comprising 50 sites in the UK operated by the group, two sites franchised to Select Service Partners UK in the UK, and ten franchised sites in the Middle East. Emma Woods has joined the Tortilla board of directors as non-executive chairwoman and Laurence Keen as a non-executive director. The company stated: “Emma has extensive experience at board level in multi-site leisure businesses. She is currently a non-executive director for The Gym Group and her hospitality experience includes being the chief executive of Wagamama from December 2018 to June 2021. Laurence is currently chief financial officer of Hollywood Bowl Group. The group has established a track record of strong financial performance driven by consistent expansion of the property portfolio and like-for-like growth. From FY2019 to LTM June 2021, the group generated 250% Ebitda growth and opened eight stores. For the 12 months to June 2021 Tortilla outperformed the Coffer Peach Business Tracker by an average of 46 percentage points. The directors believe the group is strongly positioned to capitalise on further growth opportunities in the post-covid-19 pandemic landscape. The economic challenges facing the hospitality sector have resulted in a dramatically increased number of vacant units on the market with rent levels rebalancing to more sustainable levels, providing Tortilla with an unprecedented opportunity to accelerate its UK rollout strategy. The group is targeting circa 45 new sites over the next five years including building on the success of the existing portfolio of delivery-only ‘cloud-kitchens’. The directors are also targeting further franchising and licencing opportunities.” The company added: “Tortilla has developed a reputation for its freshly prepared, customisable, value-for-money product range of burritos, tacos, and salads which enables the group to appeal to a wide demographic and helps it maintain its loyal and broad existing customer base. The directors believe that Tortilla powerfully addresses many of the key trends that consumer demand is driving across the fast-casual food segment and wider hospitality industry, including: healthy eating; freshness and high provenance; convenience – including eating out and delivery; customisation; and the continuing growing popularity of ethnic food. The group has succeeded with significant geographical spread across the UK, with almost half of the estate and four of the group’s top ten selling stores being located outside of the M25 motorway. In recent months, the group has opened stores in Chessington World of Adventures, Windsor, Edinburgh, and Exeter. Tortilla operates a 5,500 square foot Central Production Unit in Tottenham Hale which provides the group with a robust central kitchen infrastructure, providing it with cost advantages over its direct competitors, giving it flexibility to increase the size of its estate in parallel with its growth strategy, and ensuring product and quality consistency across all of its sites. Admission is expected to take place on or around 8 October 2021.” Chief executive Richard Morris said: “We are delighted to announce Tortilla’s Intention to Float on AIM, which marks an incredibly exciting milestone in our continued growth journey. Since its launch in 2007, Tortilla has established a long-term track record of strong financial performance driven by considered expansion of the property portfolio and like-for-like growth. The business has shown itself to be extraordinarily well positioned throughout the pandemic, as the Tortilla product proposition is well-suited to the growing delivery market and we have proved the brand’s flexibility to operate across a range of locations and formats, including smaller sites and cloud kitchens. We believe that this IPO unlocks our ability to consolidate on this momentum and enables us capitalise on significant long-term growth opportunities in the post-covid-19 pandemic landscape.” The group signed a new financing facility with Santander UK on 14 September 2021 to replace the group’s prior facilities. Santander has provided financing to Tortilla since 2012 and has remained a supportive partner throughout this period. The new Senior Facility Agreement allows the group to access up to £10 million of funds via a Revolving Credit Facility for general working purposes and will provide the group with the balance sheet flexibility to pursue its growth plans. Following Admission, the group anticipates being in a net positive cash position by the end of 2021 and therefore the facility provides significant undrawn cash headroom.

74 multi-site companies set to join updated Premium Database of Multi-Site Companies: A total of 74 new multi-site companies, operating 418 sites, have been added to the next edition of the Propel Premium Database of Multi-site Companies, which will be released on Friday, 1 October, at midday. The updated Propel Multi-Site Database, which is produced in association with Virgate, includes international growth concepts making their UK debut, expanding vegan brands, regional coffee operators and a number of brands growing through franchise. Premium subscribers will also receive a 6,200-word report on the new additions to the database. The comprehensive database is updated monthly and provides company names, the people in charge, how many sites each firm operates, its trading name and its registered name at Companies House if different. Alongside this, Premium subscribers will also receive the third edition of the New Openings Database, which is produced in association with StarStock, on Wednesday, 6 October, at midday. It focuses on newly announced openings and upcoming launches in the sector and is updated every month. Premium subscribers also receive access to Propel’s library of lockdown videos and Friday Wrap interviews and now also have access to a curated video library of the sector’s finest leaders and entrepreneurs, offering their insights on running outstanding businesses in the sector. Premium subscribers also receive their morning newsletter 11 hours early, at 7pm the evening before our 6am send-out plus regular video content and regular exclusive columns from Propel insights editor Mark Wingett. In this week’s Premium Opinion column, which will be sent to subscribers on Friday (24 September) at 5pm, he looks at the next few months ahead, including staffing and pricing issues, with comment from Simon French, managing director, private capital solutions at Panmure Gordon. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £895 plus VAT – whether they are an operator or a supplier. The regular single subscription rate of £395 plus VAT for operators and £495 plus VAT for suppliers remains the same. Email to sign up.

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