The Irish arm of fast-food chain Nando’s has reported sales in excess of pre-pandemic levels at many of its restaurants, with the business swinging back into profit for its most recent financial year.
Nando’s Chickenland Ireland Ltd, which has filed accounts for the year ended February 27th, 2022, saw revenue for the period surge by 92 per cent to €17.2 million from €8.9 million the year before.
Profit before tax was €2.5 million, which was up from a loss of €2.4 million the year before. The company had net assets of €19.2 million, which were up from €17.3 million. The directors did not recommend the payment of a dividend.
The company said it was looking for potential sites for more restaurants in the Republic as part of a strategy to continue to grow profitability and market share.
It said the impact of the pandemic remained significant in the year. Levels of infection “remained high” as the State unwound containment measures designed to curb the spread of the virus.
This “significantly increased employee absences not just in our own restaurants but also in our supply chain operations”, the group said. As a result, shorter, often localised, restaurant closures continued during the financial year.
Furthermore, as the global economy reopened, the price of many commodities “increased considerably”, and a number of the company’s key products were affected towards the end of the year.
In February, Russia’s invasion of Ukraine sent many already heightened commodity prices “even higher”, just as the group’s financial year was drawing to a close.
“Whilst we continued to navigate to significant external factors of Covid-19 and the Ukraine conflict, we have been extremely encouraged by the strength of the customer demand for Peri-Peri chicken,” Nando’s said.
“In the first quarter of the financial year ending February 2023, many restaurants across the company have seen sales in excess of pre-pandemic levels.
“Nevertheless, we are seeing significantly higher levels of cost inflation due to external factors, including higher energy prices due to the war in Ukraine, additional wage inflation across our markets and increases in the cost of goods.”
The company said it has strategies in place to address these costs, but that it expects them to serve as a “significant drag” on its performance in the current financial year.
It said it was continuing to invest in digital technology for customers, including through “at-table ordering” via apps.
“As we continue to be encouraged by the strength of our sales, we are continuing the cautious return to opening new restaurants,” it said.
The average number of people employed by the company last year was 414, which was down from 426 the year before. The group spent €8.5 million on staff costs, which was up from €7.5 million the year before.