Five Guys to push on with expansion following strong lockdown trading

Five Guys will push on with its expansion plans despite the uncertainty of the coronavirus pandemic, with at least three new openings set before the end of the year.

In its financial report to the year end 31 December 2019, the burger brand revealed it had returned to being EBITDA positive for the first time since the pandemic started by May 2020, achieving nearly 65% of its year to date pre-coronavirus sales budget (£50.5m against £77m).

With 83 of its 100 stores trading by the end of May, its newly integrated click and collect channel generated around 38% of sales, delivery made up 57% and in-store sales around 5%.

Having continued to trade successfully through lockdown and returning to profit before its June dine-in reopening, the company has said its expansion can be funded from its operating results.

The business opened 14 restaurants last year, reaching 100 sites at the year end. So far this year it has opened seven of its proposed “ten to 12” new sites, and the group has said it anticipates continued expansion in the UK in 2020.

With investor commitment to top up any shortfall between bank facilities and operating cashflow to the extent outlined within the company’s post-coronavirus projection for the next 12 months – which includes over £30m of uncommitted capital expenditure – and to not request repayment of interest up to June 2021, Five Guys has said it continues to adopt a “going concern” basis, but that it will continue to operate for the “foreseeable future”.

In 2019, the business saw an operating profit for its fourth consecutive year, increasing to £19.1m (2018: £5.8m). Revenue grew 16% to £173.2m (2018:149m), and pre-tax profits reached £696,257.