United Foodbrands Q2 loss narrows as revenue grows 41%

United Foodbrands narrowed its consolidated Q2 FY27 loss after tax to Rs 6.4 crore from Rs 22.5 crore a year earlier as revenue from operations rose 40.9% to Rs 429.3 crore. Operating EBITDA increased 58.9% to Rs 60 crore, although finance cost and depreciation together exceeded operating EBITDA plus other income.

How did United Foodbrands perform in Q2 FY27?

United Foodbrands reported revenue from operations of Rs 429.3 crore in Q2 FY27, compared with Rs 304.8 crore in Q2 FY26 and Rs 425.9 crore in Q1 FY27. The 40.9% year-on-year increase contrasted with sequential growth of 0.8%, meaning the quarter’s revenue gain was principally against the prior-year base.

Operating EBITDA rose to Rs 60 crore from Rs 37.7 crore in Q2 FY26, exceeding the rate of revenue growth, and the operating EBITDA margin rose to 14.0% from 12.4%. However, operating EBITDA was lower than Rs 69.9 crore in Q1 FY27, when the margin was 16.4%, while Q2 FY27 moved to a Rs 6.4 crore loss after tax from a Rs 2.3 crore profit in Q1 FY27.

What drove United Foodbrands' operating EBITDA improvement?

United Foodbrands’ employee-related expenses rose 24.0% year on year to Rs 94.4 crore, below the 40.9% revenue increase. Operating EBITDA consequently increased by Rs 22.3 crore from Q2 FY26 to Q2 FY27, and the operating EBITDA margin expanded by 1.6 percentage points to 14.0%.

Food and beverage costs rose 44.0% to Rs 148.1 crore, while occupancy and other expenses increased 44.1% to Rs 126.8 crore. Both expense categories grew faster than revenue, but their effect was offset in part by employee-cost growth that was slower than sales growth.

Sequentially, costs rose faster than revenue in Q2 FY27. Food and beverage costs increased 1.7% from Q1 FY27, employee-related expenses rose 8.5%, and occupancy and other expenses rose 2.8%, compared with revenue growth of 0.8%; operating EBITDA therefore fell 14.2% from Rs 69.9 crore.

Why did United Foodbrands report a Q2 FY27 loss?

United Foodbrands reported a loss because Q2 FY27 finance cost was Rs 23.6 crore and depreciation and amortisation was Rs 49 crore, together amounting to Rs 72.6 crore. Other income was Rs 4.5 crore, down from Rs 8.1 crore in Q2 FY26, leaving a loss before tax of Rs 8.1 crore.

The presentation recorded a tax credit of Rs 1.7 crore in Q2 FY27, compared with a Rs 0.7 crore tax credit a year earlier. This reduced the loss after tax to Rs 6.4 crore, and the loss-after-tax margin improved to negative 1.6% from negative 7.4% in Q2 FY26.

What does United Foodbrands' adjusted profitability show?

United Foodbrands reported adjusted operating EBITDA of Rs 26.2 crore in Q2 FY27, compared with Rs 3.3 crore in Q2 FY26, while adjusted operating EBITDA margin increased to 6.1% from 1.1%. Adjusted profit after tax was Rs 1.6 crore, versus an adjusted loss after tax of Rs 21.2 crore a year earlier.

United Foodbrands defines adjusted profitability as excluding the impact of IND AS 116 and non-cash ESOP provisions. Adjusted operating EBITDA also excludes interest income, so the Rs 26.2 crore adjusted operating EBITDA is distinct from the reported Rs 60 crore operating EBITDA.

How did first-half results and Premium CDR compare?

United Foodbrands generated H1 FY27 revenue from operations of Rs 855.2 crore, up 42.1% from Rs 601.7 crore in H1 FY26. H1 operating EBITDA increased 55.0% to Rs 129.8 crore and the margin rose to 15.2% from 13.9%, while loss after tax narrowed to Rs 4.1 crore from Rs 39.2 crore.

Premium CDR reported Q2 FY27 revenue from operations of Rs 60.8 crore, up 28.5% from Rs 47.3 crore in Q2 FY26. Its network increased to 42 outlets from 34, and same-store sales growth was 7.8%, following 5.3% in Q2 FY26.

Premium CDR’s gross margin was 72.8% in Q2 FY27, compared with 72.9% a year earlier, while its pre-IND AS restaurant operating margin declined to 10.6% from 13.0%. Annualised revenue per outlet was Rs 5.9 crore versus Rs 6 crore in Q2 FY26; United Foodbrands said matured restaurants continued to deliver a pre-IND AS restaurant operating margin of about 18%.

Conclusion

United Foodbrands’ Q2 FY27 results show that revenue growth and a higher operating EBITDA margin materially narrowed the reported loss versus Q2 FY26. The move from a Rs 22.5 crore loss to a Rs 6.4 crore loss occurred despite higher food, occupancy and other expenses, while finance cost and depreciation continued to affect earnings after operating EBITDA.

United Foodbrands plans to expand to more than 300 restaurants by FY27 and to 425 to 450 restaurants by FY30, alongside a volume-led dine-in strategy and expansion of scalable brands. Progress against those network targets, and the relationship between revenue growth, operating margins and costs below EBITDA, are the disclosed items to watch next.