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Thursday 25 July 2024

Guzman y Gomez (ASX: GYG): Lists on ASX

Guzman y Gomez, one of Australia’s fastest-growing QSR businesses, delivering clean, fresh, made-to-order, Mexican-inspired food to guests at high speeds, has now satisfied the conditions of admission and was admitted to the Official List of ASX on Thursday, 20 June 2024.  A fully underwritten Initial Public Offering of 11.1 million Shares at a price of $22.00 per share (“Offer Price”) to raise approximately A$242.5 million, including approximately A$200 million in primary proceeds and A$42.5 million of secondary selldown on behalf of select existing security holders.

Primary proceeds of the Offer will be used to fund GYG’s growth strategy over the coming years, primarily focused on the significant expansion of its corporate restaurant network in Australia. The proceeds of the Offer will also provide substantial flexibility to accelerate this strategy if appropriate opportunities arise.

Market opportunity:

GYG believes there is a significant network opportunity, both in Australia and globally, to support a long duration of growth. In Australia, GYG expects to open 30 new restaurants in FY25 and believes it has substantially built the team, restaurant pipeline and infrastructure to increase this to 40 restaurants per annum within 5 years. The focus will be on drive thru restaurants due to their potential to deliver superior restaurant economics.

GYG believes there is an opportunity to grow its Australian network to more than 1,000 restaurants over the next 20+ years. GYG also has an emerging presence in Singapore, Japan (both operated under a master franchise arrangement) and the US (operated via a corporate ownership model). GYG’s operations in the US is currently limited to 4 restaurants in the suburbs of Chicago, with a further 3 restaurants to be opened in the same area in FY25. While the Company believes there is a large growth opportunity in the US QSR market, it will continually assess and adjust the pace of restaurant expansion to ensure it is underpinned by robust restaurant economics.

Highlights:

  • Guzman y Gomez has now satisfied the conditions of admission and was admitted to the Official List of ASX on Thursday, 20 June 2024.
  • GYG raised $335,075,508 pursuant to the offer under its replacement prospectus dated 14 June 2024 by the issue and transfer of 15,003,432 shares at an issue price of $22.00 per share, and a franchisee offer of 277,778 shares at an issue price of $18.00 per share.
  • Quotation of GYG’s securities commenced at 12:00 PM AEST on Thursday, 20 June 2024

Commentary:

Steven Marks, Founder and Co-CEO said: “Over the last 18 years, the team at GYG has been obsessed with providing our guests with the freshest, cleanest, and fastest made-to-order Mexican-inspired food. I am incredibly proud to say that we now do this across more than 200 restaurants in Australia, Singapore, Japan, and the US. And the most exciting part is that we are just getting started. As we commence the next chapter as an ASX-listed company, our vision to reinvent fast food and change the way the masses eat will remain central to what we do. We truly believe that fast food doesn’t have to be bad food and we look forward to sharing our food with more guests across Australia and overseas as we look to realize the opportunity we have to grow our network to more than 1,000 restaurants over the next 20+ years.”

Hilton Brett, Co-CEO said: “GYG has a strong operational and financial track record, with global network sales increasing from $101 million in FY15 to $759 million in FY23, a CAGR of 29%. In addition to our delicious food, that growth has been underpinned by compelling restaurant economics which has allowed us to invest in our restaurant network, our teams, and our systems.

ASX announcement:

Official Statement from Guzman y Gomez:

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