Retail Food Group Limited

Underlying revenue was $99.6 million, down 3% year over year. Underlying EBITDA was $20.3 million, within guidance, and second-half underlying EBITDA was $11.1 million, up 20.9% from the first half. Gross profit declined to $64.3 million, and underlying NPAT was $7.8 million; statutory NPAT improved to $1.1 million versus a $14.9 million loss in FY'25. Domestic network sales were $490 million, down 3.1%, and same-store sales declined 0.7%; domestic outlets ended at 665, down 29 from December 2025. Operating cash flow was $9.3 million, cash at year-end was $24.2 million including $14.4 million unrestricted cash, and net debt was $26.8 million. For FY'27, management expects March coffee price increases and better procurement to support gross margins, cost initiatives to deliver $5 million to $7 million of savings, and continued cash flow improvement. They also expect 3 additional Firehouse Subs restaurants by December this year and 15 total by December next year, while continuing to invest $4 million per year over the next 2 financial years.

Peter George framed the year as a reset toward a simpler, more accountable operating model centered on franchise partner economics. He said the company had previously lost focus on the core business and that recent actions were designed to repair that and restore it as the #1 priority. His tone was cautiously optimistic: he highlighted stronger second-half earnings, early proof points across Gloria Jean's, Donut King, Brumby's, Crust and Firehouse Subs, and said FY'27 starts with a more focused portfolio and clearer priorities.

Ryan Chellingworth emphasized that the reported results were shaped by coffee margin pressure, lower franchise-related income, and company store costs, but that expense control and transformation savings were starting to show through. He noted gross profit of $64.3 million, underlying EBITDA of $20.3 million, underlying NPAT of $7.8 million, and statutory NPAT of $1.1 million, while also pointing to $9.3 million of operating cash flow and $24.2 million of total cash at year-end. He said the new $41.2 million debt facility runs to August 2027, the group remained compliant with all covenants, and capital allocation stays disciplined around core brand improvement, Firehouse rollout funding, and balance sheet strength.

Analysts focused on Firehouse Subs spending, the timing and magnitude of P&L investment, and whether the business is ready to support the rollout; management said FY'27 rollout costs will not be included in underlying earnings, but FY'26 had $1.8 million of Firehouse setup costs and the first store's trading had been encouraging. Questions also probed why transformation actions were only happening now; Peter George answered that the company had shifted too much toward growth in 2023 and took its eye off the core franchise business, so the recent changes were aimed at repairing that. Other questions covered the Turkiye Hub, with management saying the FY'26 international sales decline was largely due to the changeover from Dubai and direct shipments while the new hub was being installed, and Brumby's/CIBO strategy, with management saying Brumby's is not for sale and CIBO likely should be divested.