​Pizza Express Faces Profit Loss Despite Strong Sales Growth

Pizza Express, a prominent player in the casual dining sector, reported a mixed financial performance in 2023. The company saw its revenue rise to £454.6 million, an increase from £422.1 million in 2022, driven by an impressive 8.3% growth in like-for-like sales within its UK and Ireland operations. However, this increase in revenue did not translate into profitability, as the group posted a loss of £7.5 million after tax, a stark contrast to the £9.7 million profit recorded in the previous year.

The company's latest financial accounts, published on Companies House, reveal that adjusted EBITDA for Pizza Express UK & Ireland was £50.8 million for the 52 weeks ending 31 December 2023, down from £57.2 million in 2022. The group's overall adjusted EBITDA, which includes its operations in Hong Kong and the UAE, also fell to £52.3 million from £59.3 million. Similarly, the group's operating profit, excluding adjusting items, dropped to £34.5 million from £42.6 million the previous year.

Pizza Express attributed its financial difficulties to the challenging macroeconomic environment in its primary market, the UK and Ireland. The company faced significant headwinds in 2023, including persistent inflation, rising interest rates, and a broader cost-of-living crisis. These factors contributed to consumer caution, which, coupled with increasing costs in food, labour, and other operational areas, made trading conditions particularly tough.

Pizza Express focused on enhancing its customer experience in response to these challenges. The company invested heavily in its brand, restaurant appeal, and overall service journey. This included significant improvements across its business, from upgrading its loyalty scheme to refurbishing restaurants and investing in its workforce.

Looking to the future, Pizza Express remains optimistic about its prospects in the UK, which remains its primary growth market. The company also sees potential for global expansion through partnerships with strong franchise partners. The group is committed to further investing in its UK restaurant estate, with a substantial refurbishment programme to enhance the customer experience. In 2023 alone, 70 restaurants underwent refurbishment, a trend to continue into 2024.

At the close of 2023, Pizza Express operated 358 restaurants in the UK and Ireland, with one new opening and five closures, bringing its total number of restaurants to 460 globally, an increase of six from the previous year.

The company also reported significant progress in its loyalty programme, reaching a milestone of two million members in October 2023, less than two years after launching the PizzaExpress Club app. Additionally, 2023 saw Pizza Express expand its retail offerings by launching a frozen range of pizzas, pasta, and garlic bread, further diversifying its revenue streams.