Tortilla reports UK lfl revenue growth of 16.4% on FY19 as FY22 performance in line with market expectations: Tortilla, the UK’s largest fast-casual Mexican restaurant brand, has reported UK like-for-like revenue growth of 16.0% on FY19 and a FY22 performance in line with market expectations. Group revenue increased 20% to £57.7m (FY21: £48.1m; FY20: £26.8m) while FY22 UK like-for-like revenue increased 16.4% versus FY19. This growth was driven by a net increase of 18 sites in FY22, taking the group total to 82 at the year end. The company said: “We have an outstanding brand and customer proposition, which continues to be in high demand across all our sites, and we have a strong pipeline of new site openings. New sites set to open in FY23 include Derby and Greenwich (London) in the spring, with a healthy pipeline of further openings planned for later in the year. The board remains confident in the outlook for FY23 and beyond, and the group’s ability to continue to implement its proven growth strategy.” Tortilla said its performance remained highly resilient throughout the year, driven by the ongoing strength of its customer proposition and demand for its sector-leading brands, alongside the continued expansion of its site portfolio. It said trading since its last update in early October has been strong, with fourth quarter UK like-for-like revenue growth of 16.0% versus FY2019. “Some favourable changes in input costs, together with actions taken by management and the strong trade in the majority of the fourth quarter, give the board confidence that FY22 revenue and profit will be in line with market expectations,” it said. New openings in 2022 have continued to perform strongly, with Durham and Canterbury opened most recently, while five sites have opened in higher education venues since the signing of a franchise deal with Compass Group. Several new franchise sites are in the pipeline for 2023, including the expansion of the Compass Group partnership and further planned openings at rail stations with SSP Group. The strategic acquisition of Chilango in May 2022 strengthened the group’s market position in London and added a complementary premium brand of eight stores, five of which were rebranded to Tortilla while three continue to trade under the Chilango brand. Delivery demand remained stable as Tortilla expanded its delivery kitchen partners with Growth Kitchen and Karma Kitchen, while the group retains a strong cash position, enabling it to self-fund its site rollout growth strategy. Tortilla chief executive Richard Morris said: “We have a proven and highly popular customer proposition. During difficult economic times, restaurants that offer great, consistent food at competitive price points will be the winners, and we sit comfortably in this space. We continued to achieve excellent strategic progress during 2022, in line with our long-term growth strategy. We have successfully opened a number of new sites across the UK – including Durham, Coventry, Canterbury and Leicester – showing the excellent demographic diversity in which the brand can operate. This is further testament to the nationwide popularity and appeal of our brand. We have also strengthened our market position in London through our strategic acquisition of Chilango. Looking ahead, we remain as motivated and enthusiastic as ever about Tortilla's significant organic growth opportunities in the UK, with the added excitement of growing our already successful franchise partnerships both in the UK and abroad.”
Blue Book of Turnover and Profit shows almost 60% of companies in profit:
The Propel Blue Book of Turnover and Profit, to be sent to Premium subscribers this coming Friday (13 January), shows almost 60% of the 692 largest sector companies are now in profit. The Blue Book shows 406 companies in profit and 286 reporting losses. Blue Book of Turnover and Profitability is updated each month and ranks companies by turnover, profit and profit conversion, listing directors’ earnings for the past five years. Propel is to add a fifth major database to its Premium service this month this month. The Who’s Who of UK Food and Beverage
will be the first time full profiles of the UK’s top 700 food and beverage operators will be available in one place. 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 has taken 16 months to pull together, merging Companies House information, interviews and other public information to provide an easy to reference and exhaustive guide to the sector. Premium subscribers also receive access to three other databases: the Propel Multi-Site Database
, produced in association with Virgate; the New Openings Database
and the UK Food and Beverage Franchisor Database
. Premium subscribers are also to be given exclusive access to the recording and slides to Propel Multi-Club Conferences. 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 single subscription rate is £445 plus VAT for operators and £545 plus VAT for suppliers. Email email@example.com to upgrade your subscription
. Subscribers also receive access to Propel's library of 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.
Karen Jones in talks to join Whitbread board: Dame Karen Jones, who has held a multitude of boardroom posts in Britain's leisure industry, is in advanced talks to join the board of Whitbread. Sky News reports that Jones, once dubbed ‘the pub superwoman, is in advanced negotiations about becoming a non-executive director of the company behind the Premier Inn hotels chain. City sources said her appointment, if finalised, could be announced within days. Dame Karen, who was a member of a council of business advisers to Boris Johnson during his tenure as prime minister, recently stepped down as executive chair of Prezzo, the restaurant chain. Her current boardroom roles include posts at The Crown Estate, Deliveroo, Hawksmoor and Mowgli, while previous positions include Asos, the online fashion retailer, and Virgin Active, the gyms chain. The businesswoman’s other notable leisure industry milestones include co-founding Café Rouge. She earned her nickname after engineering deals including the merger of Spirit, the pubs group she ran, with Punch Taverns, in 2006. Her arrival on the board of Whitbread would come as its new chief executive Dominic Paul takes the reins from Alison Brittain, the new Premier League chairwoman. As well as Premier Inn, Whitbread owns Beefeater, Brewers Fayre and Cookhouse Pubs. A Whitbread spokesman declined to comment.
Curious answers the call of Wild Beer Co: Luke Johnson’s Curious Brewery will double in size after acquiring the brands of Wild Beer Co, the Somerset brewer that went bust last month. The Times reports the Wild brands will be brewed at the state-of-the-art Curious brewery in Ashford, Kent, where the current production capacity of five million pints has the potential to expand to more than 15 million pints a year. Mark Crowther, the Curious chairman, said that as well as strong brands, the deal brought “impressive distribution in both the on and off-trade, as well as a significant direct-to-consumer e-commerce operation”. Curious had been part of the Chapel Down wine business until the latter called time on its foray into beer two years ago and sold the business to Risk Capital Partners, Johnson’s private equity firm, via a pre-pack administration. Following the entrepreneur’s latest deal, which is due to be announced today, Wild Beer brands, led by Wild IPA, will sit alongside Curious’s lager and IPA, made using champagne yeast, and its apple cider. As well as listings in hotels, bars and pubs, Curious products are sold in Harrods, Majestic Wine and the Royal Opera House. The Wild Beer Co brewery was founded in 2012 and at its peak sold beer in 22 countries. Almost 2,000 investors took part in a £1.8m crowdfunding round in 2017 via the Crowdcube platform to finance the building of a new brewery and restaurant in Shepton Mallet, Somerset. The process valued the business at £25m but the project failed to get off the ground and all the equity is now gone. The company blamed adverse trading conditions, in particular the impact of the pandemic, for its demise. The deal with Curious Brewery involves the beer brands and intellectual property of Wild Beer Co but excludes the craft brewery and production facilities in Somerset.
UK consumers becoming ‘more Americanised’ in eating habits as US QSR outlets take off in a big way: US fast food outlets are taking off in a big way in the UK as we become more Americanised in our eating habits, according to an industry expert. Pizza chain Little Caesers announced its return to the UK last year, following the example of Wendy’s in 2021, while the likes of Taco Bell, Shake Shack and Wing Stop are already staples across the UK. And the first Popeyes Louisiana Kitchen store to open in London, which opened in November 2021, is now the best-performing Popeyes restaurant in the world out of 3,500 sites. “It defies all thoughts that a fried chicken brand could be so busy,” hospitality analyst Simon Stenning told The Telegraph. “As a nation, we are generally becoming more Americanised in our eating habits. There is incredible demand from a younger audience that’s well aware of what these brands are and are keen to get hold of them.” Hospitality consultant Peter Backman said: “We had a wave of franchises come over about 50 years ago – McDonalds, Burger King etc – then really nothing much happened until Five Guys pitched up. Five Guys showed there were still opportunities and has now encouraged these other US brands.” According to John Eckbert, UK chief executive of burger brand Five Guys, the UK is a logical next step for US brands looking for fast growth. “[The UK] is culturally adjacent. We have the same music, a lot of common heritage and the same language,” he said. “Success in the UK means you can make it in Europe, which means you can make it in Asia and the Middle East. It’s like a domino effect.” Little Caesars chief development officer Jeremy Vitaro agreed, saying: “We see the UK within Europe as a powerhouse, a place to be and a place where certainly as an American brand there’s good brand recognition.” The appeal of such brands is likely to intensify as the cost-of-living crisis continues as fast food is generally a cheaper option than traditional sit-down meals. “The average price for a Popeyes chicken sandwich meal is £7.99, and that’s really good value,” says Popeyes UK chief executive Tom Crowley. “We’ve seen it before in recessions where people just can’t afford the casual dining meal – therefore it becomes a QSR occasion.” Little Caesars, meanwhile, has launched by offering a whole ‘hot n ready’ pizza for £5. Stenning says mid-tier sit down restaurants and pubs are the most likely to be affected, because those with cash people are not necessarily cutting down on high end restaurants. He says while there will always be demand for these types of meals from older customers, there is currently a polarisation in the market, which means shoppers are either going for more sociable, value-driven meals or spending on up-market experiences. “What happens if you get caught in the middle? You’ve got to fight for your life,” he added.
Cost-of-living crisis set to last another year: The average British household is only halfway through a two-year cost-of-living crisis with disposable income set to fall by a total of 7% over the next couple of years, a financial report has warned. New analysis from the Resolution Foundation think tank suggests the average household across the country will be left £2,100 worse off by the end of the next financial year. After housing costs, the typical income for a working age family is set to drop by 3% in the year to the end of March, followed by a 4% drop over the following 12 months. It would leave households worse off than they were before the pandemic until 2028, the think tank said. “Britain is only at the mid-point of a two-year income squeeze, which is set to leave typical families £2,100 worse off,” said Resolution Foundation researcher Lalitha Try. “The crisis is already taking its toll on families. Low-income families have been hit hardest by soaring energy bills and food prices, and are most likely to have seen both their financial circumstances.” The warning comes as energy bills are expected to increase by 20% from April 2023. In fact, gas and electricity costs are unlikely to return to ‘normal’ until the 2030s, according to analysis from industry experts Cornwall Insight. The average annual bill is set to rise from £2,500 to £3,000 in April, which means families and businesses will be paying more next winter. Analysts said the price would be as high as £4,174 if the figure was linked to international wholesale prices and not limited by the government’s energy price guarantee.
UK could run out of olive oil amid rocketing prices: Prices of olive oil in the UK have rocketed, with fears the country could run out of supplies by autumn thanks to last year’s drought in southern Europe that ruined the olive season. Between December 2021 and last month, the price of the average bottle of olive oil increased by 11.9%, with the cost of Britain’s bestselling bottle of olive oil, doubling to more than £11. Temperatures in the Spanish province of Andalucía soared to more than 100F (40C) last spring, causing havoc during the early growing season in the region, known for producing more olive oil annually than the whole of Italy. According to the grocery price index, recorded on Trolley, the average price of olive oil products in the UK has increased from £6.62 in December 2021 to £7.41 in December 2022. Managing director of the UK's biggest olive oil brand Filippo Berio UK, Walter Zanre told The Times it was “a disaster”, raising concerns that the country could run out of olive oil by the autumn. He added: “We have had to increase prices by 30 per cent and prices are likely to rise further.” Gary Lewis from the UK’s second-largest olive oil supplier, KTC, told The Times: “Olive oil will become more of a niche product. Rising prices mean consumers have started to move away from it and into sunflower oil already.”