We ended the fiscal with several significant milestones and
record-breaking performances.
Overview
I would like to begin with a quote by Robin Sharma - 'Starting Strong
is Good. Finishing Strong is Epic.' It gives me pleasure and confidence to share that FY
22-23 was an epic year for us. We ended the fiscal with several milestones and
record-breaking performances. Our execution excellence strategy, which focused on menu,
meals, and branding, generated growth and strengthened our brand, establishing a new
baseline to build on.
We reported record-breaking revenue of H22.7 bn, up 44% from the
previous year. This was substantially higher than India's economy and the QSR sector,
showing your brand's irreplaceable appeal. Store openings hit an alltime high, and
same-store sales growth stood at 36%. The company's commitment to capital efficiency grew
with its revenue, yielding an Operating EBITDA margin of 17.3% (up 300 bps). Cash PAT
increased 97% to H2.5 bn, and Cash PAT margin improved by 11.2%. Restaurant Operating
Margin also grew 400 bps to 23.2%.
Growth across the board
We sustained this momentum across the board, even in a year of
unprecedented inflation, demonstrating our consistent ability to provide a superior
customer proposition. Our increasing sales validated the success of our brick-and-clicks
multichannel multi-day part strategy, which gave customers more occasions and choices to
experience us. We improved margins through utilities, robust supply chain, and increased
productivity. Our consistent focus on the right network and economics, cost management,
profitability, and quality service across the customer journey led to a robust debt-free
business model and enhanced stakeholder trust.
Our compelling value proposition and modernised restaurants delivered
unforgettable customer experiences, propelling our performance. We strengthened our
technology platforms further with the launch of our new McDelivery app, offering an
unmatched user experience and a capacity to manage significant order volumes. The launch
of the global favourite Chicken Big Mac in India, along with other launches, bolstered our
menu offerings. Simultaneously, we augmented our brand positioning around 'meals and
family' through several brand campaigns. These measures led to the three pillars - burger
meals, chicken, and McCafe - delivering outstanding outcomes.
We continued to invest in our people through training and development
interventions, upholding a strong culture of learning, agility, and performance. We set up
a strong leadership team with the appointment of Saurabh Kalra as the Managing Director,
Saurabh Bhudolia as CFO, Rohit Kumar as CHRO, and Sohel Nalwalla as Supply Chain Head to
steer the company's roadmap, strengthening our market dominance and set new benchmarks.
Our people efforts were recognised with the prestigious 'Great Place to Work' Laureate
Award for being in the top 100 list for 10 consecutive years.
Building the future with Vision 2027
We created a bold vision for ourselves in FY 22-23, setting a roadmap
for the next five years under the aegis of Vision 2027. With this strategy, we seek to
double sales and add about 300 restaurants in the next five years, while fortifying market
leadership and delivering a return on capital of over 40%. With an investment of over H14+
bn in the network, we expect this expansion to deliver a high single-digit SSSG, 18-20%
operating EBITDA margin, over 40% return on capital employed, over 25% plus return on
equity, and over 60% plus free cash flow conversion. We aim to drive this strategically
through our most potent business drivers - meals, omnichannel customer engagement, network
expansion and financial outperformance. Our meal strategy will focus on protecting market
leadership through menu innovation and marketing. To improve seamlessness of the customer
experience, our omnichannel strategy will integrate channels and touchpoints into a single
McDonald's platform. Additionally, as a part of our commitment to accelerate network
expansion, the business will strengthen its position in existing markets and expand into
underserved niches. These initiatives will not only improve our business performance but
also help realise this vision.
Pursuing purpose-driven growth
The concept of purpose-driven growth, which upholds inclusivity
sustainability, reflective of changing employee and stakeholder needs, serves as the
foundation of our growth strategy. We are focused on priorities that influence long-term
growth and priorities that enable us to expand our purpose of feeding and fostering
communities.
In addition to delivering accelerated business results and building a
resilient growth business, our priorities include social responsibility, risk management,
and sustainable stewardship of our People, Food and Planet. To
accomplish this, we are constantly integrating environmental, social, and governance (ESG)
priorities into our business strategy and implementing responsible practices that are
consistent with our purpose, vision, and values.
What lies ahead
As an organisation, we made remarkable progress across our strategic
growth levers, which included driving profitable growth, increasing wallet share,
exploring whitespace opportunities, expanding our geographic footprint, and increasing
market penetration. I believe we are on a strong growth trajectory and will continue to
build on our competitive strengths and widen our business advantage.
Vision 2027, our velocity growth plan, provides us with a consistent
framework, and we are geared up to make sure our go-forward strategy also reflects the new
operating environment and consistent support from well-wishers like you. We are ready to
address the opportunities of the future through the institutionalisation of this vision
and are committed to aggressive footprint expansion, modernising restaurants, and
unlocking new growth prospects. We will consistently drive innovations in our menu, and
efficiencies in our operations leading to enhanced profitability.
We wrapped FY 22-23 with outstanding performance. We are energised and
confident about accelerating our growth in FY 23-24 to deliver an industry-leading
performance and maximise shareholder value. As I say, the best is yet to be.
In closing, I would like to thank our shareholders, for your continued
investment, our customers for your continued support and enjoyment, and the entire
Westlife Foodworld team for all you do every day to serve customers and communities across
West and South India.