Tortilla Mexican Grill lowers guidance as shoppers steer clear of high street

Tortilla bought rival Mexican restaurant group Chilango.

Tortilla Mexican Grill said it is trading below market expectations as sales have been hit by slow footfall on the high street and consumers spending less.

During the full year, the board said that  UK like-for-like growth was up slightly to 3.7 per cent, as the firm added it was helped by new store openings around the UK.

Revenues for the full year also grew by over £5m to £65.7m.

But Tortilla warned that performance is “slightly behind” the board’s previous expectations due to “subdued consumer confidence impacting demand across the eating out market”.

Outside of London, its most popular market, the firm has struggled, blaming low footfall and brand awareness.

Tortilla Mexican Grill has had a torrid year on the London Stock Exchange, down nearly almost forty per cent in the last six months alone.

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As a result of these factors, the board currently anticipates Adjusted EBITDA for FY23 will be in the range of £4.5m – £4.6m, down from previous expectations of £5m. 

Richard Morris, chief of the firm, commented: “As a management team we are taking proactive actions to adapt to the changing market environment.

“We know that in buoyant eating out markets where the Tortilla brand is well known, we outperform. We have a strong portfolio of new sites in high quality locations as well as additional franchise growth opportunities.”

He added: “In addition, we intend to increase marketing investment to improve broader consumer awareness of our brand and fresh, value for money proposition whilst also taking action to optimise the profitability and long-term potential of our delivery channel.”