**Summary of Tortilla Mexican Grill PLC Half-Year Report (H1 FY25):**
Tortilla Mexican Grill PLC, the UK and Europes leading fast-casual Mexican restaurant chain, reported its unaudited interim results for the 26 weeks ended 29 June 2025. The company highlighted strong performance in the UK, with like-for-like (LFL) sales growth of 5.0%, outperforming the CGA Coffer benchmark by 8 percentage points. This momentum continued into Q3, with LFL sales up 7.0% to date.
**Key Highlights**
1. **UK Performance**
Record UK EBITDA of £2.4mup 33% year-on-year.
LFL sales growth of 5.0%significantly outpacing the market.
Gross margin improved to 78.3% on an underlying basis.
New product launches (e.g., protein pots, seasonal salads) and the Burrito Society loyalty app (200,000+ members) drove growth.
2. **France Expansion**
Conversion project underway, with four sites trading under the Tortilla brand and two more opening by early October.
Central Production Kitchen in Lille fully operational, supporting scale across France and neighboring markets.
Short-term challenges with store conversions, but long-term prospects remain positive.
3. **Strategic Initiatives (Vital 5)**
**UK Profitability** Focus on cost control and estate optimization.
**Brand Investment** Enhanced food quality, menu innovation, and marketing campaigns.
**Team & Technology** Improved manager retention, self-order kiosks (34 sites), and guest experience management.
**Franchise Growth** 37 global franchise sites, with new partnerships and expansion in the Middle East.
**International Development** France conversion progressing, with six sites trading by October and more planned for FY26.
4. **Financial Overview**
Revenue£36.0m (H1 FY24: £31.5m).
Adjusted EBITDA (pre-IFRS 16)£1.2m (H1 FY24: £1.8m), with UK EBITDA offset by France losses.
Loss before tax£2.3m (H1 FY24: £0.2m loss), primarily due to France investments.
Adjusted net debt£9.8m (H1 FY24: £3.3m), with successful refinancing to £12.5m facility.
5. **Outlook**
UK trading slightly ahead of expectations, with Q3 LFL sales up 7.0%.
France conversion delays expected to impact H1 FY25 EBITDA, but long-term scalability remains promising.
Full-year adjusted EBITDA forecast around 10% below previous expectations due to France investments.
**Conclusion**
Tortilla demonstrated resilience in the UK market, achieving record profitability despite sector challenges. While France’s conversion project faces near-term headwinds, the company remains confident in its long-term European expansion strategy. Continued investment in brand, technology, and franchise growth positions Tortilla for sustainable growth.