Westlife Foodworld, the operator of McDonald’s in India, reports an 88.7% drop in profit for Q1 FY25.
Westlife Foodworld Limited, the franchisee responsible for operating McDonald’s restaurants across West and South India, has reported a significant financial setback for the first quarter of fiscal year 2025 (Q1 FY25). The company’s profit has plunged by a dramatic 88.7%, dropping from Rs 28.83 crore in Q1 FY24 to just Rs 3.25 crore this year. This steep decline reflects a range of operational challenges, despite a slight increase in operating revenues, which edged up to Rs 616.33 crore from Rs 614.54 crore in the same period last year.
The financial strain is further illustrated by a 24.5% year-on-year reduction in EBITDA, highlighting issues such as higher royalty costs and operational inefficiencies. These factors have adversely impacted both operating margins and EBITDA margins, reflecting broader difficulties within the company’s operations.
Despite these challenges, Westlife Foodworld remains committed to navigating through the tough environment with a positive outlook. Chairperson Amit Jatia has highlighted the company’s focus on innovation and enhancing customer engagement as key strategies for overcoming current obstacles and driving recovery. Westlife Foodworld recently marked a significant achievement by surpassing 400 restaurant locations, and it has set ambitious goals for the near future. The company plans to open 45-50 new stores in FY25, with a strategic emphasis on expanding in South India, smaller towns, and introducing more drive-thru formats to cater to evolving consumer preferences.
In addition to its expansion plans, the company has introduced new menu items, including the Chicken Surprise burger, and expanded its McCafé offerings to include a variety of cakes and bakes. These new additions are part of Westlife Foodworld’s broader strategy to diversify its product range and enhance the dining experience. Looking forward, the company aims to achieve an 18-20% Operating EBITDA margin by December 2027. This goal will be pursued through continued strategic expansion, operational improvements, and ongoing innovation, positioning Westlife Foodworld for long-term growth and success despite the current financial challenges.
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