Tortilla Mexican Grill, the UK's largest Mexican restaurant chain, has reported a slowdown in sales growth, citing weak consumer confidence as the primary cause. Despite nearly 70 stores across the UK and franchised outlets in the UAE, the company's like-for-like sales are projected to increase by only 3.7% year-on-year, falling below previous forecasts.
The company is strategising to boost growth by focusing on expansion in high-traffic areas and enhancing brand recognition outside London. This approach aims to elevate its revenue by nearly 14% to £66 million this year.
Challenges such as reduced dining out interest, particularly in the last quarter, coupled with rising food and electricity costs and the hike in the national minimum wage implemented in April, have added to Tortilla's financial strain.
In response to these pressures, Tortilla anticipates an adjusted earnings range between £4.5 million and £4.6 million for the year. Richard Morris, the 58-year-old CEO, emphasised the team's commitment to adapting to market shifts, noting Tortilla's success in areas where its brand is strong.
The brand continued its expansion this year, opening seven new outlets, including a notable one in Belfast, and closing two delivery kitchens, bringing its total global presence to 87 locations. Despite strong performance in London stores, a nationwide decrease in high street foot traffic has impacted overall sales.
Tortilla also announced a key executive change, appointing Maria Denny, 46, from Signify, and formerly of Müller UK and Ireland, as the new CFO. She replaces Andy Naylor, 39, who transitions to the role of UK Managing Director.
Founded in 2007 by Brandon Stephens and publicly listed in 2021 at a value of £70 million, Tortilla Mexican Grill experienced a 9.8% drop in share price.
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Image Source: https://www.tortilla.co.uk/