Portillo's (PTLO) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue rose 6.4% year-over-year to $176.4 million, driven by new restaurant openings and a 1.8% increase in same-restaurant sales.

• Net income for Q1 was $4.0 million, down 25% year-over-year due to higher income tax expense.

• Restaurant-Level Adjusted EBITDA was $36.7 million (20.8% margin); Adjusted EBITDA was $21.2 million (12.0% margin), both down year-over-year.

• No new restaurants opened in Q1 2025; 12 new units are planned for fiscal 2025, focusing on Sunbelt expansion and new formats.

• Brand initiatives such as loyalty program launches and targeted advertising supported performance.

Financial highlights

• Same-restaurant sales grew 1.8%, with a 4.9% increase in average check offset by a 3.1% decline in transactions.

• Food, beverage, and packaging costs rose to 34.6% of revenue due to 3.4% commodity inflation, mainly beef.

• Labor costs increased to 26.6% of revenue, reflecting wage investments and lower transactions.

• General and administrative expenses rose 2.0% to $18.9 million, mainly due to higher software and advertising costs.

• Net cash provided by operating activities was $9.5 million; capital expenditures totaled $19.0 million.

Outlook and guidance

• Fiscal 2025 targets: 12 new units, same-restaurant sales growth of 1–3%, revenue growth of 10–12%, and Adjusted EBITDA growth of 5–8%.

• Restaurant-level adjusted EBITDA margin expected at 22.5–23%; capital expenditures projected at $97–$100 million.

• G&A expense guidance lowered to $80–82 million.

• Commodity inflation forecasted at 3–5% for 2025, with beef as the main pressure.

• Effective tax rate expected at 25–27% for the year.