Itsu, a British chain of Asian-inspired fast food shops and restaurants, has made a notable drop in EBITDA and overall losses, despite securing high revenues.
In the company’s annual report for the period 29 Dec 2016, it is reported revenues saw a healthy boost of +17% to £95.9m, while the sushi chain’s EBITDA was down 70% year-on-year.
Itsu reports ‘loss after tax was £8.9m’. It says it was impacted by a number of one-off factors including investments in the US and investment in a new head office building.
Itsu claims that the 70% slump to £2m was ultimately ‘due to continued investment in a new store expansion programme outside of London, losses in the in-house delivery business and significant head office investment behind the future UK and international expansion of the business’.
The company, which set the goal of opening 15 new stores in 2016, injected financing into expanding the brand outside of London throughout the year.
The report noted: “[Growth was] underpinned by retail LfL store growth in the period of 0.8%.” A further nine new stores were opened in the period, including a new flagship site at Heathrow Terminal five and regional openings in Manchester, Leeds and Bristol.
The report on Companies House also addressed high running costs as an issue. The predominantly London-based foodservice operator, which uses fresh produce in its dishes, identified wages, utilities, raw materials and overheads as mitigating factors.
FEJ previously reported that the cost of running each store also brings major overheads. In Oxford, where Itsu has been open for approximately three years, the combined bill for rent and business rates totals around £500,000 a year – almost £10,000 a week, according to the Daily Telegraph.