Westlife Development Limited reports earnings for Q1FY22

Westlife Development Limited (BSE: 505533) ("WDL" or "the Company"), owner of Hardcastle Restaurants Pvt. Ltd. ("HRPL"), the master franchisee of McDonald's restaurants in West and South India, announced unaudited financial results for the quarter ended June 30, 2021. The results were taken on record by the Board of Directors at a meeting held today.

HIGHLIGHTS OF THE QUARTER ENDED JUNE 30, 2021

- Total revenue for the quarter stood at % 2591.6 million; a 176% growth over Q1 FY21
- Restaurant Operating Margin stood at 9.8% YoY - a 204% jump over the last year
- Operating EBITDA stood at % 51 million - 100% improvement YoY
- The company's convenience channels of delivery, Drive Thru and 'On the Go' continue to tick up with sales growth of 202% YoY, 33% growth QoQ

* Delivery sales up by 198% YoY, 36% QoQ
* Drive-thru sales up 115% YoY, 52% QoQ

- Take-away sales grew by 41% YoY

- The Company concluded the first dose of COVID -19 vaccination for all its eligible employees

Despite all challenges, WDL clocked a robust revenue growth of 176% YoY at Rs. 2591.6 mn. Business initiatives undertaken across the board ensured that WDL delivered strong same-store sales growth (SSSG) of 183% for the quarter. In the month of July 2021, the Company's revenues recovered to 100% of July '19 levels in all markets except Maharashtra that continued to be under strict regulatory restrictions.

The revenue recovery was strongly driven by the Company's convenience channels of delivery, Drive-Thru and On-the-Go that continued to perform strongly even as dine-in restrictions eased in the month of June. Overall convenience sales jumped over 202% YoY. Revenue from Drive-Thrus that is the Company's key competitive advantage, grew by 115% YoY and 52% QoQ. McDelivery continued its rally and grew close to 200% YoY, achieving its highest ever revenue numbers in June 2021. Even as dine-in restrictions eased in the month of June 2021, the Company did not see a drop in off-premise sales.

WDL complemented its revenue growth with continued cost leadership. The Company maximized its supply chain and operational efficiencies. As a result, it maintained a high Gross Margin of 65.4%, a 218% growth over last year. The Company also charted an improvement of 204% in its Restaurant Operating Margins that stood at 9.8% for the quarter. Consequently, its Operating EBITDA showed a 100% improvement over same quarter last year.

Commenting on the financial results for the quarter ended June 30, 2021, Mr. Amit Jatia, Vice-Chairman of Westlife Development Limited, said, "Our strong performance is a testimony to the commitment and conviction of our teams. Despite all challenges, the business is firmly back on track. Revenues are building strongly, brand trust is rising consistently and our convenience channels are accelerating at an unprecedented pace. We believe that challenges of the last one year are behind us and we are excited to chart the next phase of growth."

Westlife added 7 new McCafé and 11 new Experience of the Future restaurants in this quarter. The total number of restaurants at the end of Q1 FY22 is 305 with a number of new restaurants being under groundbreak. The Company is also planning to expand its network in non-core and emerging cities.

This quarter, the Company also signed on film celebrity Rashmika Mandanna as its brand ambassador and launched a brand campaign for its newly launched - McSpicy Fried Chicken.

The much-anticipated McDonald's global collaboration with sensational Korean boy band BTS kicked off in India in June 2021. The brand launched a special BTS meal along with coveted merchandise as part of this collaboration which was available for Indian consumers till 4'" July across restaurants in West and South India.

Guided by its commitment towards "Scale For Good", the Company has been taking definitive steps to positively impact the environment and the society that it operates in. These include usage of Energy Management Systems, production of bio-diesel from used cooking oil and elimination of all single use customer facing plastic. As a direct impact of these initiatives, in the last financial year alone, the Company has saved close to 7500 tonnes of carbon emission which is equivalent to planting close to 350,000 trees.

To ensure the physical and emotional well-being of its employees, the Company declared a comprehensive COVID care package for its employees. It also launched a COVID-19 vaccination drive for its employees and has successfully administered the first dose to all its eligible employees, as per Government guidelines.

Shares of Westlife Development Ltd was last trading in BSE at Rs. 513 as compared to the previous close of Rs. 523.5. The total number of shares traded during the day was 18781 in over 1417 trades.

The stock hit an intraday high of Rs. 523.9 and intraday low of 507. The net turnover during the day was Rs. 9641764.

Source : Equity Bulls

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