AmRest | Financial Results

Record sales for a first quarter

Revenues in Central and Eastern Europe (CEE) reached 244 million Euro, an increase of 49% compared to the same period in 2021 and 31% compared to 2019.
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Revenues in Central and Eastern Europe (CEE) reached 244 million Euro, an increase of 49% compared to the same period in 2021 and 31% compared to 2019.

AmRest Group, a leading European multi-brand restaurant operator continued a growth trend by achieving an all-time high consolidated sales for a first quarter amounting to 507 million Euro, an increase of 33.4% year-on-year and 14% compared to the same quarter in 2019 (pre-pandemic period). In terms of the comparable same-store sales index the level stood at 127.8%.

In a statement, AmRest explains: “The excellent evolution registered, especially in the dine-in channel, continues to be highly correlated with the easing of pandemic restrictions in most of the countries the Group operates, except for China. This channel accounted for 37% of sales in the period compared to 15% in the same period of 2021, showing a growing acceleration during the quarter.”
 
The Group’s EBITDA reached 75.3 million Euro during Q1 2022, which was 51.7% higher than in the same period of 2021. Sales leverage, together with the continuous advances in digitalization and efficiency actions have allowed the EBITDA margin for the quarter to stand at 14.9%. Finally, net debt reached Euro 484.1 million and cash levels stood at Euro 179.5 million.
 
Since the last part of the quarter, the Russian invasion of Ukraine has impacted economic activity affecting pricing dynamics and commodities prices, thus increasing the already high inflationary pressures and stress on global supply chains.
 
According to Eduardo Zamarripa, Chief Financial Officer for AmRest Holdings SE, “The figures we achieved in Q1 2022 further prove resilience and sustainability of AmRest business model. Gradual releasing of the pandemic related restriction that we have seen across the markets has led to a very strong business performance, helping us deliver the all-time record for first quarter revenue. We also executed our opening plan having 11 new restaurants this quarter. With a continued opening of economies, we expect positive business dynamics in the next months”.

Revenues and Profitability by segments

Revenues in Central and Eastern Europe (CEE) reached 244 million Euro, an increase of 49% compared to the same period in 2021 and 31% compared to 2019. EBITDA generation reached 45 million Euro, an increase of almost 60% compared to the same period in 2021 and 18% higher than in 2019. The EBITDA margin stood at 18.4%, higher than in the same period of 2020 and 2021, despite increased pressure on costs. The number of restaurants remained broadly stable in the region. All of them were operational at the end of the quarter.

In Western Europe, revenues amounted to 186.6 million Euro during the quarter, an increase of 24% compared to the same period of 2021 and practically recovering the level of revenues recorded in 2019. In this regard, the markets that suffered the greatest impacts during the pandemic, such as Germany, are the ones showing the best year-on-year performance. Nonetheless, in the case of Germany, it is still performing below 2019 figures. EBITDA generated was 22.7 million Euro, representing an EBITDA margin of 12.2%. This is 5.2 percentage points above the 2021 record, highlighting once again the remarkable recovery in Germany.

Although this is still below 2019 figures, leaves behind the negative margins of the last two years. All restaurants were operational at the end of the quarter and the portfolio recorded a net decrease of 4 units following the restructuring of certain businesses, mainly concentrated in Spain.
In mid-March the Group decided to initiate the process of temporarily suspending operations in Russia. Since then, AmRest has engaged in close and constant conversations with the brands owner, stopped investments in that country, and is currently in negotiations with the franchisor to transfer its Pizza Hut operations in Russia to a local operator.

Sales in China have been affected by the lockdown decreed in the Shanghai area, which has restricted mobility, commercial activity and has led to the temporary closure of 19 of the restaurants. As a result, revenues stood at 21.5 million, virtually the same levels as during 2021 but with a decline in EBITDA generated which stood at 4.3 million Euro, representing an EBITDA margin of 20%, 6 percentage points lower than the same period in 2021.

However, the total number of restaurants increased to 80 units following the opening of 2 new company-owned restaurants and a third franchised restaurant. Only 76% were in operation at the end of the quarter.
About AmRest

AmRest Group is a leading European multi-brand restaurant operator with a portfolio of world-known brands across 25 countries. AmRest operates over 2.400 restaurants under franchised brands such as KFC, Starbucks, Pizza Hut and Burger King as well as proprietary brands like La Tagliatella, Sushi Shop, Blue Frog and Bacoa. In addition, the company also has in its portfolio several virtual brands.

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