Retail Food Group (ASX:RFG): Is a Turnaround or Growth Re-Rating Starting to Take Shape?

Sonal Goyal

01 September 2026 10:49 AM AEST

Retail Food Group (ASX:RFG): Is a Turnaround or Growth Re-Rating Starting to Take Shape?

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Retail Food Group Limited (ASX:RFG) is a franchise-food operator whose brands include Donut King, Gloria Jean's, Brumby's Bakery and Crust, alongside a coffee-roasting and wholesale business. After a turbulent period of restructuring and balance-sheet repair, the company has been rebuilding around cost discipline and new growth avenues, including the Australian rollout of the United States sandwich chain Firehouse Subs.

A narrowed Earnings outlook and accelerating cost savings have raised the question of whether a turnaround or growth re-rating is taking shape.

Latest Development

Retail Food Group reported underlying EBITDA of AUD 20.3 million for FY26, representing a 31.4% decline year-on-year, although the result remained within the company’s guidance range of AUD 20.0 million to AUD 21.0 million. Despite the weaker full-year performance, earnings showed signs of recovery in the second half, with 2H26 EBITDA increasing 20.9% compared with 1H26, indicating improving momentum towards the end of the financial year.

What Could Drive the Shares Next?

Catalysts include delivery of the FY26 EBITDA guidance, the pace of Firehouse Subs rollout and its contribution, continued cost savings, and stabilisation or growth in same-store sales across the core brands. Evidence that the transformation is translating into sustainable earnings growth would support a re-rating.

A clear shift from cost-driven stability to network-led growth would be the clearest positive signal.

Risks Investors Should Watch

Franchise food is exposed to discretionary spending and cost-of-living pressure, which affects both customer traffic and Franchisee viability. Executing the Firehouse Subs rollout and sustaining the cost savings carry risk, and the company operates in competitive quick-service categories.

The health of the franchisee base and same-store sales are the key operational variables.

Investor Takeaway

Retail Food Group narrowed FY26 underlying EBITDA guidance to A$20–24 million as cost savings accelerated, while pushing the Firehouse Subs growth story. Whether a turnaround or re-rating is taking shape depends on delivering that guidance and the new Brand gaining traction. EBITDA delivery, Firehouse Subs rollout and same-store sales are the things to watch.

FAQs

Q: Why did Retail Food Group (ASX:RFG) narrow its FY26 guidance?

A: Retail Food Group narrowed its FY26 guidance to underlying EBITDA of A$20–24 million as transformation savings accelerated, reflecting both tighter cost control and the ongoing rollout of Firehouse Subs.

Q: What is Firehouse Subs' role in Retail Food Group's strategy?

A: Firehouse Subs, a United States sandwich chain, is being rolled out in Australia as a key growth engine layered on top of the company's cost reset, though it remains at an early stage.

Q: What is the key risk to Retail Food Group's turnaround?

A: Franchise food is exposed to discretionary spending and cost-of-living pressure, which affects customer traffic and franchisee viability, alongside execution risk in the Firehouse Subs rollout.

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