Pizza Express - Comments

Q3 results have been very encouragingly strong for the UK QSR Chain. Having gone through a CVA and bond restructuring last year, the company has been producing EBITDA margins of above 20% on +6% LfL revenues. Segments including London, Ireland and Hong Kong have been dragging on performance and so CF for the quarter was zero, but the aim at the moment is to bring covers back to the chain, rather than drive margin this year. Q4 should be seasonally weaker, but the company has upheld its case guidance for year-end. With another wave of Covid restrictions looming, management are pointing to the low £20m quarterly cash burn achieved last year as well as to the company’s over £50m cash reserve and £30m undrawn RCF. We’ll repeat: If PE needed further cash, its shareholders would certainly find it before losing their stakes.