WFL’s Q2 FY25 Financial Performance
Here is a summary of the key figures reported:
- Total Revenue: ₹618.48 crores
- Sales Growth (YoY): 0.6%
- Gross Profit: ₹431.08 crores
- Restaurant Operating Margin (ROM): ₹114.97 crores
Key Observations:
- The total revenue for Q2 FY25 shows a marginal year-over-year increase, indicating slow but steady growth.
- The gross profit remains relatively stable compared to the same quarter last year.
- The Restaurant Operating Margin (ROM) stands at ₹114.97 crores, showing profitability at the operational level.
Weaknesses:
- Continued Negative SSSG: Despite improvement, Q2 FY25 SSSG remained negative at -6.5%, indicating ongoing challenges in fully recovering to pre-pandemic same-store sales.
- Impact of External Issues: External community-related issues continued to impact some stores, affecting on-premise sales in specific locations. While WFL is actively addressing these issues, their extended duration presents a potential risk.
- Exposure to Macroeconomic Factors: WFL acknowledges the impact of macroeconomic factors, particularly higher inflation and subdued consumer spending, on its business.
Quality of Earnings:
- WFL’s gross margin and cost optimization efforts suggest no relative improvement in earnings quality.
- The continuing negative SSSG and the effect of external issues on on-premise sales raise questions about the sustainability of earnings growth.
- Overall, WFL’s Q2 FY25 results reflect a mixed performance.
Disclaimer: Invested and Biased. Less than 4% of PF. No transactions in the last 30 days. Post purely for study purposes. Consult your advisor before any transactions
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