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Morning Briefing for pub, restaurant and food wervice operators

Tue 22nd Aug 2023 - Itsu reports 59% increase in FY sales, partners with Scoffs Group, plans 20 sites next year
Itsu reports 59% increase in FY sales, partners with Scoffs Group, plans 20 sites next year: Itsu, the healthy Asian food chain founded by Julian Metcalfe, has reported a 59% increase in sales to £138m in the year to the end of 2022, as it saw its “highest group sales in history this July”. Group Ebitda in 2022 stood at £6.5m, up 42% on 2021. Itsu said that its retail business showed a return to pre-covid trading levels, with sales of £101m, up 73% versus 2021. It said that like-for-like sales growth of 123% was complemented by a record number of new restaurant openings. As part of its regional expansion plans, it said that franchisee Heart with Smart Group took the brand to Scotland whilst continuing to convert Pizza Hut locations. Internationally Groupe Bertrand opened the “first of many Itsus” in France; with a second Paris location set to open this winter. At the same time, the business announced it had signed a new partnership with Scoffs Group, the largest Costa Coffee franchisee in the UK, with the first site set to open in Exeter. Itsu said that its grocery division delivered year-on-year sales growth of 37% to record sales of £40.1m, which means the business is on track to surpass £50m in 2023. New ranges and listings drove UK growth with highlights including the launch of the award-winning chilled ‘big’bao’ and over 300% growth in ‘brilliant’broth’ sales. International sales grew 82% versus 2021, and the business said this growth is set to continue with gyoza, bao and broths launching in an increasing number of major European retailers over 2023. Itsu chief financial officer Greg Thorp, said: “A resurgent retail business with strong sales growth across all regions and channels, alongside another year of double-digit sales growth for Itsu grocery. Having celebrated our highest group sales in history this July we’re confident our ‘eat beautiful’ offering is resonating with customers in the UK, Europe and beyond.” Alongside new locations, the business said it “invested significantly” in people and technology. It said it remained at the forefront of hospitality pay, with salaries increased by up to 23% in the 12 months to September 2022. Over £1m worth of benefits to support teams’ health and happiness were also announced. Investment in technology included the launch of the Itsu app and in-store kiosks, with over 60% of customer transactions now coming via digital platforms. The company said that next month’s app update will include the launch of ‘order ahead’, nutritionists’ insights, and in app discounts for the NHS and students. Metcalfe, founder and chief executive of Itsu, said: “Itsu retail is back opening temples to healthier fast food – 20 mega new sites, which will offer even more affordable hot food options thanks to digital innovation, are set to open by 2024. Meanwhile grocery recipes that have been years in development are landing in supermarkets including chilled ‘noodle’soups’ and crystal ‘noodle’cups’. It’s time for change. Healthier food should be a right for the many, not a privilege for the few – it’s what people want and need and Itsu is determined to provide.” On future openings, Metcalfe recently told Propel: “We’re opening in Exeter very soon. We’re opening in Glasgow. We’re opening in Liverpool. We’re opening in Newcastle. And many of our out-of-town northern Itsus are immensely successful. I think one of the most successful Itsus in the world is in Bristol.” The 85-strong brand plans to open ten new sites this year, with outlets recently opened in South Kensington, Bishopsgate and Oxford Street, and new openings in King’s Cross, Liverpool and Windsor set to follow soon. Itsu features in the Propel Turnover & Profits Blue Book. Its turnover of £86,541,000 for the year ending 31 December 2021 is the 80th highest in the database. The Blue Book ranks companies by turnover, profit and profit conversion, listing directors’ earnings for the past five years. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £995 plus VAT – whether they are an operator or a supplier. The single subscription rate is £495 plus VAT for operators and £595 plus VAT for suppliers. Email to upgrade your subscription.

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