How Did GYG Break $1 Billion in Sales and Boost EBITDA 45.5% in FY25?
Guzman y Gomez (GYG) has reported record FY25 results, surpassing $1.18 billion in global network sales and delivering a 45.5% increase in EBITDA. The company also declared its maiden fully-franked dividend, signaling confidence in sustained growth.
- Global network sales up 23% to $1.18 billion
- EBITDA rises 45.5% to $65.1 million on pro forma basis
- Australia segment drives 9.6% comparable sales growth
- US segment shows strong Q4 sales momentum with 57.3% network growth
- Maiden fully-franked dividend of 12.6 cents per share declared
Record-Breaking Sales and Earnings
Guzman y Gomez Limited (GYG) has delivered a standout performance for the fiscal year ended June 30, 2025, reporting global network sales of $1.18 billion, a 23% increase over the prior year and the first time the company has surpassed the billion-dollar milestone. This robust sales growth translated into a 45.5% rise in EBITDA to $65.1 million on a pro forma basis, underscoring the strong operating leverage within GYG’s fast-casual Mexican food business.
Australia Segment Leads the Charge
The Australian market remains the powerhouse for GYG, with network sales climbing 22.4% to $1.09 billion and comparable sales growth of 9.6%. The company opened 32 new restaurants in Australia during FY25, contributing to a total of 256 restaurants worldwide. Notably, 18 Australian locations now operate 24/7, capitalizing on after-hours trading growth. Franchisees continue to enjoy strong economics, with a median return on investment of 50% and average unit volumes rising steadily.
US Expansion Gains Traction
GYG’s US segment, while still in a growth phase, showed promising signs of momentum, particularly in the second half of FY25. The company reported a 57.3% increase in network sales in Q4, driven by operational improvements and enhanced guest experience. Although corporate restaurant margins remain negative due to upfront investments and new openings, management expects significant margin improvements in FY26 as sales momentum continues.
Strong Balance Sheet and Maiden Dividend
GYG’s financial discipline is evident in its strong balance sheet, boasting $282 million in cash and term deposits with zero debt. This liquidity supports aggressive expansion plans, including 98 restaurants in the Australian pipeline. Reflecting confidence in its cash flow generation, GYG declared its maiden fully-franked dividend of 12.6 cents per share, marking a milestone for the company and its shareholders.
Looking Ahead
With plans to open 32 new Australian restaurants in FY26 and continued focus on operational excellence, menu innovation, and digital initiatives, GYG is targeting further margin expansion and comp sales growth. The company’s strategic emphasis on drive-thru formats and franchise growth is expected to drive profitability higher over the next five years, aiming for segment EBITDA margins around 10%.
Bottom Line?
GYG’s record FY25 performance sets a strong foundation, but the challenge will be sustaining momentum amid US expansion and margin pressures.
Questions in the middle?
- How will GYG manage profitability as it scales rapidly in the US market?
- What impact will the end of escrow restrictions have on GYG’s share liquidity and price?
- Can franchisee economics remain robust amid rising costs and expansion?
