Holy guacamole! Guzman y Gomez shares smashed despite $1b in sales, maiden dividend

Guzman y Gomez investors have deserted the Mexican-themed restaurant chain even after it declared a maiden dividend and cracked $1 billion in sales for its nachos, burritos and tacos for the first time.

Global network sales rose a staggering 23 per cent to $1.18b in the 2025 financial year, delivering a maiden profit of $14.5 million — an improvement from the $13.8m loss in 2024.

But Friday’s results and the payout of 12.6¢ a share were not enough to please some analysts and investors.

RBC Capital Markets analyst Michael Toner said Guzman’s underlying earnings before interest, tax, depreciation and amortisation of $52.8m missed consensus expectations by 3 per cent.

The stock had its worst day since listing last year, with shares tanking 18.2 per cent, or $5.27, to $23.70 by the close.

Guzman listed on the Australian Securities Exchange to much fanfare in June 2024, with shares hitting $45 earlier this year — more than doubling its IPO price of $22.

The full-year result was led by its restaurants in Australia, Singapore and Japan, which achieved a 9.6 per cent same-store sales growth to $1.17b.

Guzman said this was driven by growth in its breakfast range — including the popular breakfast burrito — and late-night trading segments.

It said it was also accelerating its 24/7 trading, with 18 outlets now operating around the clock.

Guzman founder and co-chief executive Steven Marks said it was another “exceptional year” for the company.

It opened 32 new stores in Australia, four in Singapore, one in Japan and two in the US during the year, taking the total to 256 restaurants across the globe.

Operations in the US — where Guzman’s six stores face stiff competition from Chipotle and other independent Mexican restaurants — remain challenging.

The US segment posted a $13.2m loss in earnings — more than double than last year’s $6.5m loss.

These losses are expected to widen this financial year with the opening of two new stores in Chicago, where it intends to have 15 stores over time.

“We’ve made progress in the US, particularly in the second half,” Mr Marks told analysts and investors on a call, adding its strategy was to “demonstrate proof of concept”.

Mr Marks said the store located at Northwestern University in Illinois was trading well and there were “lines around the corner” as student customers embraced other offerings besides Chipotle.

Trading in the first seven weeks for the Australian segment saw growth of 3.7 per cent, well below consensus of 7.6 per cent.

But Guzman said the company it expected to deliver stronger sales growth in the current financial year through menu innovation, expansion into less traditional meal times, operational excellence, marketing and digital initiatives.

Guzman — set up in 2006 in Sydney by Mr Marks, a former hedge fund manager, and Robert Hazan — has ambitious plans to have 1000 stores in Australia over the next two decades.