A & W Food Services of Canada (AW) Q4 2025 earnings summary

Executive summary

• Achieved both top and bottom line growth in 2025 despite challenging economic and competitive conditions in the Canadian QSR market.

• Positive same-store sales growth in all four quarters of 2025 and opened 26 new restaurants, focusing on Ontario and Quebec and partnerships with Suncor.

• Value-based promotions and a dedicated value menu drove growth and maintained affordability for customers.

• Strategic combination with A&W Revenue Royalties Income Fund in October 2024 simplified the corporate structure and eliminated royalty expenses.

• Operates 1,094 franchised and 10 corporate restaurants, serving over 125 million guests annually as of December 28, 2025.

Financial highlights

• Fiscal 2025 system sales reached $1.92 billion, up 2.8% year-over-year; total revenue was $294.1 million, up 1%.

• Q4 2025 revenue was $93 million, flat year-over-year; Q4 same-store sales grew 0.9%.

• Fiscal 2025 Adjusted EBITDA was $100 million, up 7%, with margin improving to 34.0%.

• Income before taxes for 2025 grew 53% to $76.7 million; net income was $56.8 million.

• Free cash flow was $54.6 million in 2025.

Outlook and guidance

• Fiscal 2026 guidance: Adjusted EBITDA of $103–$105 million, system sales growth of 2.5%–5%, same-store sales growth of 0.5%–3%.

• Restaurant count expected to end 2026 between 1,112 and 1,120 units.

• Guidance reflects ongoing economic uncertainty, severe weather impacts, trade friction, and demographic shifts, especially in Ontario.

• Committed to maintaining current quarterly dividend level.