Records high double digit revenue growth of 14.6 per cent Continues to report positive Comparable Sales of 5.1 per cent

Mumbai, Feb 03, 2017: Westlife Development Limited (WDL) (BSE: 505533) owner of the Master Franchisee of McDonald’s restaurants in west and south India, today announced its unaudited financial and operating results for the quarter ended December 31, 2016. The results were taken on record by the Board of Directors at a meeting held in Mumbai.

WDL reported 14.6 per cent increase in total revenues ₹2417.5 million from ₹2109.1 million Y-o-Y riding on the restaurant operations of its subsidiary, Hardcastle Restaurants Pvt. Ltd, (HRPL), a master franchisee for west & south India operations of McDonald’s Restaurants

“We are happy to report our sixth consecutive quarter of positive comparable sales of 5.1 per cent, demonstrating consistent performance across all segments in the face of recent volatile macroeconomic challenges. Our bold actions have differentiated the brand in the minds of the consumer across the QSR segment and is testament to the progress we are making too,” said Amit Jatia, Vice-Chairman, Westlife Development Limited.

He further added, “With the revamped MDS app, we are confident of connecting more than ever with consumers and offering them easy, personalized and truly useful features. In fact, our web and mobile platforms contribute over 55% sales to the total McDelivery business for McDonald’s.”

Q3FY17 RESULT ANALYSIS:  WDL reported 14.6 per cent increase in total revenues ₹2417.5 million from ₹2109.1 million Y-o-Y riding on its restaurant expansion. Topline performance growth was driven by restaurant network expansion, addition of new formats, brand extensions and innovative menu additions. 

Y-o-Y gross additions stood at 29; 7 new restaurant openings in Q3FY17; WDL expanded its total network of restaurants to 252 across west and south India. 

System-wide comparable sales (SSSG)[1] grew to 5.1 per cent as against 3.1 per cent in the same quarter of the previous year 

The gross margin is at 60.4 per cent as against 60.5 per cent in corresponding quarter of the previous fiscal. As a percentage of total revenues, gross margin remained flat Y-o-Y 

Restaurant Operating Margin (RoM)[2] stood at ₹290.9 million compared to ₹275.3 million. As a percentage of total revenues, RoM stood at 12 per cent compared to 13.1 per cent in the same quarter of the previous year. Q3FY17 Corporate Communications 

Operating EBITDA in Q3FY17 stood at ₹140.6 million compared to ₹162.7 million. As a percentage of total revenues, operating EBITDA margin stood at 5.8 per cent as against 7.7 per cent in Q3FY16 

Profit/(Loss) After Tax stood at ₹(17.1) million as against ₹2.5 million in the same quarter of the previous year  WDL reported cash profit of ₹148.4 million in the current quarter compared to ₹161.3 million in Q3FY16

The company witnessed headwind on demand, which was also perceptible in eating out segment post cash crunch. Westlife Development took this opportunity and provided ease of ordering via multiple payment options thereby seeing an upward jump in cashless transaction to 50-55 per cent system wide.

WDL invested in increasing footprint of McDonald’s by entering Kollam city in the state of Kerala and opened 7 new restaurants in this quarter by taking the total count to 252 restaurants across 34 cities and 10 states. The company is on track to take its restaurant footprint to 450-500 by 2022.

During the quarter, WDL opened its 100th McCafé in a span of 3 years and overall increased its footprint to 104 restaurants by adding 11 new outlets. WDL is on track to double its McCafé base by FY17.

Our results reflect the balance of our brand portfolio, geographic footprint, consistent marketplace execution and a relentless focus on productivity.

While facing the challenges of a volatile macro environment, we continued to make thoughtful investments in our 20 years brand journey communication, introduction of our premium Share Shakes, an LTO at McCafé and riding on the popular Mexican and Lebanese McAloo Tikki fest and Mexican Cheesy Fries.

By making such investments in product innovation and expansion, we have fortified our business for sustained growth.