A & W Food Services of Canada (AW) Q2 2025 earnings summary

Executive summary

• Achieved 3.4% system sales growth and 1.6% same-store sales growth in Q2 2025, with revenue up 7% to $68.8M, driven by new restaurant openings, marketing campaigns, and the launch of the A&W Rewards loyalty program.

• Adjusted EBITDA rose 18% to $25.5M, with margin improving to 37.1% from 33.4% in Q2 2024.

• Opened 11 new restaurants year-to-date, with expansion focused on Ontario and Quebec, and a robust pipeline supported by partnerships.

• Strategic focus on franchisee profitability, digital guest experience, and expanding partnerships, including Pret a Manger and Petro-Canada.

• Recognized as Canada's strongest QSR brand, maintaining #2 position among Canadian burger QSRs.

Financial highlights

• Q2 2025 system sales reached $452.3M, up $15M year-over-year; same-store sales grew 1.6%.

• Adjusted EBITDA was $25.5M (37.1% margin), up from $21.5M (33.4%) in Q2 2024.

• Year-to-date 2025 system sales totaled $849.2M, up 2.7% year-over-year; total revenue increased 6% to $129.9M.

• Net income increased to $12.5M in Q2 2025 from $8.8M in Q2 2024; net income per diluted share was $0.50, impacted by a higher share count.

• Cash dividends of $0.96 per share declared year-to-date, with $0.480 per share paid in June 2025.

Outlook and guidance

• 2025 guidance maintained: Adjusted EBITDA expected between $96M–$101M, system sales growth of 1.5%–4.5%, and same-store sales growth of 0.0%–3.0%.

• Total restaurants projected to reach 1,085–1,100 by year-end 2025.

• Continued focus on value offerings, menu innovation, and digital initiatives to drive growth.