Going out to dinner, a luxury available only to the first world, became impossible with the arrival of the pandemic. The forced confinements, first, and the fear of infection, later, led the restoration to a critical situation that they are close to overcoming in the US and Asia. In Europe, on the other hand, there is still a year to do so.
Analysts maintain that the large American and Asian restaurant chains will already be able to beat the profit they obtained in 2019 in 2021 . It is quite a feat considering that, for example, 71% of Americans say they feel more comfortable eating on terraces -and not indoors-, according to a recent report published by the American consulting firm Morning Call; or that in many European countries there are still limitations on capacity.
The restoration of the NAFTA region (US, Mexico and Canada) will achieve this year a profit 16% higher, on average, than that obtained in 2019, according to the consensus of analysts. It is the largest of the large regions analyzed, ahead of Asia, where it will increase by 12%. In Europe, on the other hand, losses are expected for chains that are mainly British, with the exception of the Polish (based in Spain) AmRest or the Italian Autogrill (owner of more than 300 brands, between its own and collaborations) .
Growth for 2022 will come from Asia, as has become customary. Its large restaurant chains will increase their profits by up to 36% compared to those forecast for 2021. It is almost triple that expected for the United States, while Europe will manage to emerge, meanwhile, from the hole of the pandemic.
But one factor that gives the US a certain advantage in its recovery should not be overlooked, which is that practically all listed restaurant firms are large fast food chains: McDonald’s, Starbucks, Chipotle, Yum Brands (KFC, among other brands) , or Domino’s Pizza. What does this mean? Their target clientele is much larger than covered double-digit restaurants and, furthermore, home delivery worked during lockdown in many countries.
” McDonalds suggested that its margins would be higher after the pandemic, even if there is some contraction in sales in the coming quarters,” they argue from Deutsche Bank, a firm that clearly bets on the American hamburger chain like so many others.
McDonald’s is among the best recommendations in the entire restaurant industry globally and has the highest margins. On the ebit [profit before interest and taxes] will reach 43.6%, according to the experts, at the end of the year. The closest competitor, in this case Canadian Restaurant Brands International , is almost 10 points behind.
Firms such as McDonald’s or Starbucks are trading in the area of record highs, accompanying Wall Street. This is not the case in Europe, where Autogrill is the closest to recovering pre-pandemic levels and is still trading at 20%.
AmRest is next, close to 22%. The coffee giant says it is seeing “positioned itself as a brand for new consumers” and its main market – the United States, with 72% of revenues – would have already recovered “90% of the pre-Covid traffic,” they point out from Barclays. But this situation is not replicating in Europe.
Britain’s Compass is the largest continental restoration firm. It is dedicated to catering and, therefore, it is expected that “little by little it will gain market share of small firms” that lagged behind, say Deutsche Bank, with margins of 7%. Its profit, at 570 million, will still be half that of the pre-Covid this year, but it is expected to exceed it in 2022.
About the Italian Autogrill, Bloomberg analysts acknowledge that “it has not wasted the crisis” to cut costs and that “it is reopening its most profitable stores”, although it still lacks tourism to be able to overcome. Estimates foresee that it will continue in losses for the next two years.
AmRest, the only one listed in Spain, will be played in December. After presenting some good numbers (see support), the consensus still points to losses of 14 million this year.
And what about Asia? Culture helps, considering that its population is much more used to eating on the streets. The problem is that in recent weeks they have taken a step back from new Covid outbreaks. Even so, its large chains such as Hong Kong’s Haidilao, India’s Jubilant FoodWorks (which manages franchises like Popeyes or Dunkin Donuts) or Japan’s Food & Life will increase their profits by 36% on average in 2022, tripling the US and light years from Europe.
AmRest soars 12%
The owner of ‘La Tagliatella’ or ‘Sushi Shop’ has cleared some doubts about its liquidity after presenting results. At the end of June, it left its losses behind for the first time – by earning 1.9 million – and increased revenues by 23% and managed to reduce net debt by 11.5%. Yesterday the stock closed at 7.02 euros after soaring 11.9%.