Key Highlights

  • Underlying EBITDA of $20.3 million was down 31.4% on the prior corresponding period but landed within the FY26 guidance range of $20.0 to $21.0 million, with 2H26 EBITDA up 20.9% on 1H26.
  • Domestic Network Sales fell 3.1% to $489.5 million, reflecting challenging trading conditions and ongoing network optimisation, while Total Domestic Trading Outlets declined by 29 compared with December 2025.
  • Debt refinancing was completed in February 2026 via a new $41.2 million Facility with major Shareholder Washington H Soul Pattinson, providing Balance Sheet support for strategic priorities.
  • RFG's first Firehouse Subs store opened in Mt Gravatt, Queensland, setting an opening-day sales record for any international Firehouse Subs store, with the company targeting four stores by December 2026 and 15 by December 2027.

Retail Food Group Limited (ASX:RFG) has released its FY26 Annual Report, Appendix 4E and Results Presentation. Underlying Revenue for the year came in at $99.6 million, down 3.0% on the prior corresponding period, reflecting challenging consumer conditions and the impact of outlet rationalisation, partly offset by wholesale coffee price increases implemented from March 2026, improved procurement, and an initial contribution from the company's Türkiye Supply hub.

Underlying EBITDA of $20.3 million was down 31.4% on the prior corresponding period, though it landed within the company's FY26 guidance range of $20.0 to $21.0 million. The company attributed the decline to softer trading conditions, outlet closures across lower-performing and non-core outlets, the cycling of prior-period insurance proceeds and lease-provision releases, and lower coffee margins prior to the March 2026 wholesale price increases, partly offset by $2.3 million of transformation program savings. Second-half EBITDA improved 20.9% compared with the first half.

Underlying NPAT was $7.8 million, down 41.8% on the prior corresponding period, primarily reflecting the lower Underlying EBITDA result. Statutory NPAT for the year was $1.1 million.

Network Performance

Total Domestic Network Sales of $489.5 million were down 3.1% on the prior corresponding period, reflecting difficult trading conditions and network rationalisation. Core Brand Network Sales declined 1.7% to $476.0 million. Total Domestic Same Store Sales were 0.7% lower, as continued growth from Crust, up 0.3%, was offset by weakness across CCB brands, down 1.3%.

Total Domestic Trading Outlets were down 29 compared with December 2025, with the opening of six new outlets, all Core Brands, offset by 35 closures, mostly low-performing and non-core stores.

Balance Sheet and Cash Flow

As at 26 June 2026, the Group held total unrestricted cash of $14.4 million, up from $13.9 million in the prior corresponding period, with total cash reserves of $24.2 million, down from $26.0 million in the prior corresponding period. Operating Cash Flow of $9.3 million declined from $18.4 million in the prior corresponding period, largely due to first-half headwinds, transformation costs and Investment in new growth initiatives.

Operating Cash Flow strengthened materially to $7.4 million in the second half of FY26, compared with $1.9 million in the first half and $6.6 million in the second half of FY25, driven by improved operating performance including transformation program savings and Working Capital improvements. RFG refinanced its senior Debt facility in February 2026 with a new $41.2 million facility with major shareholder Washington H Soul Pattinson Ltd, including a further $7.5 million drawdown and the Capitalisation of establishment costs, maturing on 31 August 2027.

Transformation Program and Leadership

RFG's Transformation Program key initiatives are now complete, with cost rationalisation delivered, brand-aligned Leadership implemented, and operational improvements well progressed. The company expects its simplified operating model to improve Franchise partner support through more effective field operations, procurement, supply-chain management and targeted marketing.

With the transformation program's key initiatives now complete, the Board has decided to recommence its global search for a new Chief Executive Officer. Executive Chairman Peter George will continue in his existing role, including the CEO functions currently undertaken by him, while the Board progresses the recruitment process and succession planning.

Firehouse Subs and FY27 Outlook

RFG's first Firehouse Subs store opened in Mt Gravatt, Queensland, setting an opening-day sales record for any international Firehouse Subs store. The company is targeting four stores by December 2026 and 15 stores by December 2027 under its exclusive licence to grow the brand in Australia.

For the first eight weeks of FY27, core brand Network Sales were down 2.6% against the prior corresponding period, primarily reflecting network rationalisation and outlet closures, while Same Store Sales were down 0.4%. The company has targeted $5 to $7 million in cost-out savings for FY27, alongside expected benefits to Franchise Partner unit economics, gross profit margins and cash flow as the transformation initiatives fully take hold.

Conclusion

Retail Food Group's FY26 result reflects a year of declining Underlying EBITDA and Revenue against the prior corresponding period, brought about by challenging trading conditions and ongoing network rationalisation, though the result landed within the company's guidance range and showed a marked improvement in the second half. Completion of the debt refinancing and the transformation program, together with the early performance of the Firehouse Subs rollout, form the basis of the company's stated confidence in building on second-half momentum through FY27.