Westlife Foodworld Limited, the owner-operator of McDonald’s restaurants across West and South India, announced its financial results for the third quarter of FY25. The company demonstrated resilience and strategic focus amid challenging environments.
The company achieved Q3 sales of Rs. 6.54 billion, marking a year-on-year (YoY) growth of 9%. Same-store Sales Growth (SSSG) improved to 2.8% YoY, a significant recovery compared to -6.5% in Q2 FY25. This growth was driven by gradually improving footfalls and a stable average check. The momentum was broad-based, with both On-Premise and Off-Premise businesses growing at 9% YoY. Off-premise channels, which contributed 42% to total sales, remained stable and aligned with the past two-year average.
The quarter saw strong progress in several key areas. Cash PAT stood at Rs. 520 million, representing 8% of sales. Digital channels contributed over 70% of total sales during the quarter, fuelled by increasing adoption of Self-Ordering Kiosks (SOK) and a growing base of My M Rewards Loyalty program enrolments. The cumulative app downloads exceeded 39 million, with a 13% YoY increase in monthly active users.
The Everyday McSaver Meals platform and the newly launched McSaver Combos programs continued to enhance affordability scores and drove foot traffic, reinforcing the brand’s commitment to value. Meanwhile, the #ShordaarCrunch campaign for McCrispy burgers resonated strongly with customers, driving premiumization and elevating brand engagement. The company further expanded its product portfolio with the launch of Chicken Surprise, a new entry-level burger that bolstered its Chicken platform.
Westlife Foodworld also made strong strides in restaurant expansion, adding 15 restaurants in Q3 FY25, taking its total presence to 421 restaurants across 67 cities (as of December 2024). With a sharp focus on South India, smaller towns, and Drive-Thrus, the company is poised to open 45-50 stores annually, aligning with its vision of 580-630 restaurants by 2027.
Despite soft consumption trends and inflationary pressures on key inputs such as oil, coffee, and cocoa, Westlife Foodworld demonstrated a commitment to operational efficiency. Gross margins improved sequentially to 70.1%, supported by a portfolio-level price hike of about 50 basis points. The company remains focused on maintaining stable gross margins at ~70% levels in the near term. However, Restaurant Operating Margins and Operating EBITDA margin were lower by around 200 basis points YoY due to operating deleverage and higher advertising and promotional spends. Profitability is expected to improve with higher volumes, and the company remains steadfast in its goal of delivering 18-20% Operating EBITDA margin by 2027.
Amit Jatia, Chairperson, Westlife Foodworld, said “Our performance in Q3 FY25 underscores the effectiveness of our strategy and our agility in navigating a challenging market landscape. With the improvement in Same Store Sales Growth and the success of one of our biggest initiatives, like the McCrispy campaign, we have strengthened our foundation for future growth. As we continue to expand our network and innovate our offerings, we are poised to achieve sustainable growth through strategic execution and delivering exceptional customer experiences.”
